[Sitting date: 29 May 2012. Volume:680;Page:2567. Text is incorporated into the Bound Volume.]
Tuesday, 29 May 2012
Mr Speaker took the Chair at 2 p.m.
Chamber, Lobbies, and Galleries
Miss Universe New Zealand—Contestants
Hon MAURICE WILLIAMSON (Minister for Building and Construction)
: I raise a point of order, Mr Speaker. I have been fortunate in the last hour to have been in my office with the Miss Universe New Zealand contestants. They are in the gallery, and I think this House would like to acknowledge them being here today. [Interruption]
Mr SPEAKER: Order! The House will come to order. I am not sure how that is a point of order, but either way it seems a very pleasant visitation for the House to have. I think I recognise the Wellington representative among them—a good surf lifesaver.
Questions to Ministers
Budget 2012—Wider Economic Programme
Hon Dr NICK SMITH (National—Nelson) to the
Minister of Finance: How did Budget 2002 contribute to the Government’s long-term programme to build a more competitive economy?
Mr SPEAKER: I think it is 2012.
Hon David Parker: I raise a point of order, Mr Speaker. Yes, I think the question could be re-read.
Mr SPEAKER: As long as the Minister of Finance understands that it is Budget 2012.
Hon BILL ENGLISH (Minister of Finance)
: The 2012 Budget sets out the next steps in the Government’s programme to build a long-term, sustainable, growing economy based on more exports, higher savings, and more effective investment. In particular, the Budget continues an extensive programme of investment in infrastructure; further development and refinement of, and accessibility to, our skills system; and significant investment in science and innovation, as well as significant progress in improving our public services.
Hon Dr Nick Smith: Why is it important for the Government to continue responsibly managing the Government’s finances?
Hon BILL ENGLISH: Good financial management of the Government’s books is important because it helps the Government pursue its other economic priorities. For instance, if we stop running deficits, we can then stop New Zealand’s debt to overseas lenders from increasing. That can allow us to have lower interest rates for longer, which makes it easier for businesses then to build a productive and competitive economy, with more jobs and higher incomes.
Hon Dr Nick Smith: What are some of the measures in the Budget that will help achieve the Government’s priority of building a more productive and more competitive New Zealand economy?
Hon BILL ENGLISH: There are a number of particular measures that are focused on assisting businesses to make the decisions that grow the economy, and they are the decisions to invest more, to employ another person, and to pay a higher wage. That is why the Government continues to invest in infrastructure, but in particular in the roll-out of ultra-fast broadband, which will support businesses; extensive investment in
further innovation and research focused on the manufacturing and high tech industries; and further refinement of our skills system so that it is providing younger people with the skills that will make them competent citizens and enable them to take part in the kind of further training that enables them to get jobs in new industries.
Hon David Parker: Did he say in his Budget speech in 2011 that that Budget built “a platform for faster growth, more jobs and higher incomes”; and do his forecasts in Budget 2012 in fact show lower growth, fewer jobs, and lower incomes than he projected in 2011?
Hon BILL ENGLISH: In the first place, as I pointed out to the member, under New Zealand statute law Treasury makes the forecasts, and those forecasts represented its best professional judgment at the time, when there was great uncertainty around the world. It is our contention that New Zealand is doing pretty well, actually, when we look at how difficult conditions are across the developed world. We will have more jobs, we will have higher growth, and we will have more investment, and in today’s developed world that is somewhat exceptional.
Hon David Parker: I raise a point of order, Mr Speaker. I think the Minister is at liberty to go on to elucidate an answer when he does not like the primary answer that he has to give in response to a pretty direct question, but he did not actually address my question.
Mr SPEAKER: The member makes a reasonably valid point. One assumes the answer was yes. If the Minister was not saying yes to the question, he should correct me. The Minister appears not to be wishing to correct me.
Hon Dr Nick Smith: How will the Budget help deliver on the Government’s other main priority of delivering better public services within tight financial constraints?
Hon BILL ENGLISH: The Government has focused on getting results, because if we can get better results with our public services, in the long run we will save more money. Two months ago the Prime Minister set out 10 challenging and specific results for the public services to achieve over the next 3-5 years, including reducing crime, reducing long-term welfare dependency, and reducing educational underachievement. In the Budget delivered last week, the Government has found a lot of money for new initiatives by moving cash from programmes and initiatives that do not work to programmes that will achieve results.
Hon Dr Nick Smith: What reports has he seen in reaction to last week’s Budget?
Hon BILL ENGLISH: There has been a range of reports and opinion. Some of them, particularly from ratings agencies, are quite positive, but the verdict that I thought was appropriate was the so-called average family published in the Auckland media, who thought it was a sensible Budget for difficult times.
Public Service—Cuts to Front-line Services
DAVID SHEARER (Leader of the Opposition) to the
Prime Minister: Does he stand by his statement on the public sector staffing cap “Our revised cap won’t include those at the frontline such as teachers, police, hospital staff, and prison officers”?
Rt Hon JOHN KEY (Prime Minister)
: There is no public sector staffing cap. In fact, the number of teachers, doctors, nurses, and police has grown since we have been in Government. We have a cap on core Government administration, which does not include the groups the member mentioned.
David Shearer: Does he still believe that teaching is a front-line service; and if so, why did he support the Budget cuts to teacher numbers?
Rt Hon JOHN KEY: Yes, teaching is a front-line service, and that is why the Government invested $512 million extra in education. The important philosophical
debate here is one to understand. The Labour Party thinks the only way to solve a problem is to throw more resources at it. The National Party believes—
David Shearer: I raise a point of order, Mr Speaker. That was a pretty direct question about staffing cuts.
Mr SPEAKER: The Prime Minister did answer it, and I accept that maybe he was going on to add more than was necessary. Does the member have a further supplementary question?
David Shearer: As part of the approval process for the changes, did his Minister of Education make him aware of the impact of scrapping the technology staffing component?
Rt Hon JOHN KEY: That is not correct. The technology staffing component is not being scrapped. There is a change to the overall formula. As the Government has announced today, for 90 percent of New Zealand schools, they will either gain a full-time teacher equivalent or lose a fulltime-equivalent. For all other schools, it will be no greater than two fulltime-equivalents.
David Shearer: Given his statement that, as he said just now, across the country for 90 percent of New Zealand schools, the change will be either plus or minus one teacher, can he tell the House what proportion will be lost? How many schools will lose a teacher?
Rt Hon JOHN KEY: I do not have that to hand.
David Shearer: Is he aware that increasing ratios for years 2 to 3 means that some schools may have to cut Reading Recovery programmes for 6 and 7-year-olds?
Rt Hon JOHN KEY: No, I do not accept that proposition at all.
David Shearer: When he said this morning that he would prefer his child in a class of 16 with a quality teacher, rather than 15, was he aware that the median class size in State schools is in fact 28?
Rt Hon JOHN KEY: The important point here is that schools are funded off a ratio, and the funding ratio for a year 1 class is 15. The member actually makes a very good point. A parent I was talking to today has 22 in their year 1 class because that principal and board of trustees decided to do that. The facts of life are that the Government funds that school at 1:15.
Economic Programme—Productivity and Investment in Education
Dr RUSSEL NORMAN (Co-Leader—Green) to the
Prime Minister: Does he stand by his statement that “building a more productive economy” is a priority for his Government, given that productivity has declined in 2 out of 3 years since he came to office and the Budget forecasts no improvement this year?
Rt Hon JOHN KEY (Prime Minister)
: Yes. Building a more productive and competitive economy is one of the Government’s four priorities, and I would point out to the member that the Budget forecasts labour productivity growth of plus 0.6 percent in the year to June 2012, plus 2 percent in the year to 2013, plus 1.9 percent in the year to 2014, and plus 1.6 percent in the year to 2015. That represents a solid pick-up in productivity.
Dr Russel Norman: Does the Prime Minister agree that investment in education is crucial to building a more productive economy?
Rt Hon JOHN KEY: Yes, and that is why the Government is investing $512 million extra over the next 4 years. But what I also believe very strongly is that having had a country that has employed 12.5 percent more teachers over the last decade at a time when the roll growth has been only 2.5 percent, and when the education outcomes have plateaued, it is time for this country to start focusing on teacher quality and the quality of teaching, not just the sheer number of teachers.
Dr Russel Norman: How does his decision to eliminate dedicated funding for technology teachers at intermediate level help to build a more productive economy?
Rt Hon JOHN KEY: We do not, and if the member wants to check his BlackBerry before he comes to the House, he will see press releases.
Dr Russel Norman: When he made the decision to change schools’ staffing ratios, as part of the Budget, was he aware at that point of the effect on technology teaching at intermediate level?
Rt Hon JOHN KEY: Yes, and that is why the ministry took the liberty of writing to all schools in New Zealand. To the 90 percent that gained or lost one full-time teacher equivalent, that was pointed out to them. To the 10 percent that did not, the ministry not only wrote to them but made it clear to them we would be working on the transition plans. We are working on those transition plans with a working group, but to allay any fears that may be whipped up by those who simply want to use this for political reasons, we have indicated that the maximum reduction could be two full-time teacher equivalents over a 3-year period. It is also worth pointing out that there are significant changes in roll numbers in many New Zealand schools, and that in any one given year 5,000 teachers come or go from schools. There is a major change, so in that regard two full-time teacher equivalents over 3 years will not be a significant number.
Dr Russel Norman: Does he agree with John Key, then Leader of the Opposition, who on 28 September 2008 said: “Let me make this absolutely clear. Under National the number of … teachers … will grow.”; if so, how does his Budget cap on the number of teachers fit with this commitment?
Rt Hon JOHN KEY: It has grown in the 3½ years that I have been Prime Minister, and I am thrilled that the member reads everything that I say.
David Shearer: Having looked at my BlackBerry on the way to Parliament, will he now admit that the changes they announced in the Budget were wrong, and he now needs to claw back money in order to cover the technology teachers?
Rt Hon JOHN KEY: No, they are not wrong. [Interruption] It may not be convenient, but they are not wrong. The ministry has a contingency and will be making sure that the professional development that we want is funded, but there will be changes to the ratios, with limited impact on New Zealand schools.
Dr Russel Norman: How does his Government’s decision to discourage people from becoming teachers by requiring them to get postgraduate qualifications while simultaneously removing student allowances for postgraduate study help to build a more productive economy?
Rt Hon JOHN KEY: I reject the proposition from the member. We are not discouraging people from doing postgraduate studies. What we are saying is that we think the appropriate mechanism is a student loan at zero percent interest, not an allowance. Actually, the economic implication of somebody getting a postgraduate degree, either a master’s degree or a PhD, is heavily supported by the fact that they will get significantly higher levels of income than others and therefore funding that through a zero percent student loan, where the Government still writes off 40c in the dollar, in my book is still quite generous.
Grant Robertson: Given that last answer from the Prime Minister, can he tell the House what the difference is between the maximum amount that a student can borrow for living costs under the student loan each week, and the actual student allowance that people can get—what is the difference between those two amounts?
Rt Hon JOHN KEY: I am advised that it is very similar.
Dr Russel Norman: Given that 2,700 teachers emigrated from New Zealand last year, how does driving away ambitious educators help build a more productive
economy, or was the more productive economy he promised to build actually the Australian economy?
Rt Hon JOHN KEY: I cannot confirm that 2,700 teachers emigrated; they may or may not have. But the member will be absolutely thrilled and relieved to note that we welcome people from all parts of the world, including Australia.
Grant Robertson: I raise a point of order, Mr Speaker. [Interruption]
Mr SPEAKER: Order! A point of order has been called. [Interruption] Order! Order!
Grant Robertson: I seek leave of the House to table a document from StudyLink that outlines the various rates that can be obtained from a student loan weekly—
Hon Gerry Brownlee: Where did it come from?
Grant Robertson: From StudyLink.
Hon Gerry Brownlee: Where did it come from?
Grant Robertson: Is this a point of order or not?
Mr SPEAKER: It is a point of order, and there will not be interjection.
Grant Robertson: It says that the maximum amount of money that a student can borrow per week for living costs from the student loan scheme is $171.50, and that the maximum amount that they can get from student allowances is over $350 a week.
Mr SPEAKER: Leave is sought to table that document—[Interruption] Order! We will not have that rush of blood to the head. [Interruption] Order! Leave is sought to table that document. Is there any objection? There is objection.
Hon David Parker: Why did he say 2 days before the Budget that “under a National Government, exports are rising.” and in his Budget speech last Thursday that “We have got the export sector starting to grow.” when Statistics New Zealand earlier that day reported a 17 percent—$800 million—drop in goods exported from New Zealand in the year to April 2012?
Rt Hon JOHN KEY: Because the member is quoting a 1-month number, and I am looking over a 3 or 4-year period.
Hon David Parker: How can he pretend our export story is a good one when imports are projected to increase at twice the rate of exports, and before he blames Christchurch, is he aware that of the 6.8 percent current account deficit projected for 2016, Treasury has advised that only 1 percent relates to Christchurch?
Rt Hon JOHN KEY: I am advised that it is Christchurch that is a major part of it.
Hon David Parker: Does he agree with commentator Fran O’Sullivan in the
New Zealand Herald that the major problem is that there is no clear economic growth agenda?
Rt Hon JOHN KEY: No.
David Shearer: Can the Prime Minister reassure the intermediate schools Fergusson Intermediate School, Balmoral Intermediate School, Papatoetoe Intermediate School, and Manurewa Intermediate School that those schools will not be losing between 3.5 and seven teachers each as a result of the Budget announcement?
Mr SPEAKER: This is a very detailed question about teachers, which relates more to question No. 2 than question No. 3. I accept there has been some discussion. If the right honourable Prime Minister has the information, he is certainly welcome to answer the question, but I think the House should understand if he does not have that particular information.
David Shearer: I raise a point of order, Mr Speaker. This question was referring to what the Prime Minister said about reading our BlackBerry smartphones on the way to the Chamber today, which was that the ratios at intermediate schools had actually changed.
Mr SPEAKER: Order! A point of order is—
Hon Gerry Brownlee: It’s not to do with this.
Mr SPEAKER: The Leader of the House, above all others, should know that a point of order should be heard in silence—silence. I believe that comment did relate to the previous primary question, question No. 2, and that is why I—
Hon Members: No.
Mr SPEAKER: Well, I accept that and I will stand corrected if I am wrong there. I will invite the member, because so much time has gone by, to repeat his question, but I accept that the Prime Minister may not have information necessary to answer that question, because it is a long way from this primary question.
Rt Hon Winston Peters: I raise a point of order, Mr Speaker. If the Prime Minister cannot answer the question or does not have the information, then it should be left to him to tell us that, not to run tackle defending him before he gets to his feet.
Mr SPEAKER: Order! That is very simple, then. If that is the way the House wants it, I will simply rule the question out. But I am going to give the member the chance to—
Rt Hon Winston Peters: That’s not question time.
Mr SPEAKER: Order! It is my opinion as Speaker, and I am prepared to rule, that the question does not relate sufficiently to the primary question. I am not going to waste more time on it, but I am prepared to allow the member to repeat his question. But there does need to be some understanding that the Prime Minister may not have the necessary information to answer it.
David Shearer: Referring to the comment that the Prime Minister made about reading our BlackBerry smartphones on the way to the House, can he reassure the intermediate schools across New Zealand that they will not be losing up to seven teachers in the technology area?
Rt Hon JOHN KEY: I can assure them that over a 3-year period they will not lose more than a maximum of two fulltime-equivalents.
Budget 2012—Funding for Science, Innovation, and Research
NIKKI KAYE (National—Auckland Central) to the
Minister of Science and Innovation: What actions has the Government taken to boost funding for science and innovation research?
Hon STEVEN JOYCE (Minister of Science and Innovation)
: Last Thursday’s Budget delivered further on this party’s 2000 election commitment to help build a more competitive and productive economy, including $250 million of new operating funding and over $75 million in capital funding over 4 years for science, innovation, and research. We have continued to increase funding despite tight fiscal constraints, because science and technological innovation are important drivers of New Zealand’s growth and international competitiveness. In fact, total direct cross-portfolio science, innovation, and research funding has risen by 17 percent over the past 4 years to $1.24 billion in 2012-13.
Nikki Kaye: What initiatives is the Government progressing as a result of these funding increases?
Hon STEVEN JOYCE: We have allocated $90 million over 4 years in operating funding and $76 million in capital funding for the establishment of an Advanced Technology Institute, to better link businesses with research and help create new high tech products and services. We have funded a further $60 million over 4 years for National Science Challenges, to find innovative solutions to some of the most fundamental issues New Zealand faces. And in the tertiary education area we are increasing the size of the Performance-based Research Fund to $300 million by 2016. All this adds up to a very substantial commitment by the Government to the research
and science sector in this country—far above anything a research and development tax credit would deliver.
Budget 2011 and Budget 2012—Comparison of Spending on Superannuation and Education
Hon DAVID PARKER (Labour) to the
Minister of Finance: What is the increase in government spending on New Zealand Superannuation from Budget 2011 to Budget 2012 and is this greater than the increase to Vote Education?
Hon BILL ENGLISH (Minister of Finance)
: Spending on New Zealand superannuation will increase from $8.83 billion in 2011 to $9.59 billion in 2012, an increase of $757 million. Government spending on Vote Education will increase from $9.02 billion in 2011 to a forecast $9.28 billion in 2012, an increase of $256 million. So the increase in New Zealand superannuation is larger. About half of the increase in New Zealand superannuation over the next 5 years is due to increases in the rate of New Zealand superannuation, and the other half is due to the increase in the number of superannuitants.
Hon David Parker: Does the projected monthly cost of superannuation increase to more than the total monthly cost of education, including preschool, primary, secondary, and tertiary education, by the end of the 2016 financial year?
Hon BILL ENGLISH: I simply do not have the information to confirm that.
Hon David Parker: Is the Minister telling the House that he does not know whether by the end of the 2016-17 year—within the projection period of his Budget he delivered last week—superannuation costs will exceed education costs every month?
Hon BILL ENGLISH: I am telling the member I simply do not have the information to give an accurate answer to that question.
Whānau Ora, Minister—Confidence
Rt Hon WINSTON PETERS (Leader—NZ First) to the
Prime Minister: Does he retain confidence in the Minister responsible for Whānau Ora; if so, why?
Rt Hon JOHN KEY (Prime Minister)
: Yes; she is a hard-working, competent Minister, who is working for a brighter future for all New Zealanders.
Rt Hon Winston Peters: How can he possibly retain confidence in the Minister for Whānau Ora when, during these economic times, she gave $60,000 to a rugby and sports club to “undertake whānau development research to develop a range of outcomes, which include resilience, whānau connectedness, and community role models and leadership”?
Rt Hon JOHN KEY: I cannot comment on an individual case, but what I can say is the last time the member made accusations about Whānau Ora, he was wrong.
Rt Hon Winston Peters: Well, that is a lie for a start.
Mr SPEAKER: Order! No—
Rt Hon Winston Peters: I tabled the evidence—
Mr SPEAKER: Order! Now if I heard the member correctly, he will get to his feet, withdraw, and apologise for that statement.
Rt Hon Winston Peters: I withdraw and apologise. I raise a point of order, Mr Speaker. The Prime Minister made a statement that was not part of his answer, surely—
Mr SPEAKER: Order! The member cannot refute an answer by way of point of order. The member has further supplementary questions and he can pursue the matter through further supplementary questions, but not by way of point of order.
Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think you might want to add on to your ruling that there has been a change in the Standing Orders for this
Parliament, which means that there is a route that the member can take to have that matter referred.
Mr SPEAKER: The member is quite correct.
Rt Hon Winston Peters: How can he possibly, as Prime Minister, retain confidence in the Minister for Whānau Ora when she is granting sums like $60,000 to an established sports club when there are poor Māori children in the far north scrounging for food in pig scrap heaps and buckets, as reported in the
New Zealand Herald
on 12 May this year?
Rt Hon JOHN KEY: I do not have individual information on the particular programme the member is talking about. He will have to take that up with the Minister directly. In terms of the claims in the
New Zealand Herald,
I have no reasonable way of ensuring that that is accurate or not. In terms of the wider overall issues about Whānau Ora, that is aimed very much at families who need significant support and who are using a multitude of different agencies, and the Government is looking at ways to improve the outcomes. Given the successful track record we have had in the past of being totally unsuccessful with those families, I would have thought that trying new ways was not a bad idea.
Rt Hon Winston Peters: Does he think it fair that his Government is taxing paper boys and leaving rest home workers to battle and scrimp on the minimum wage while he and she dish out $60,000 in sums like that, and millions of dollars at that, for a rugby club to research “whānau connectedness”, whatever that is?
Rt Hon JOHN KEY: I think the Budget is fair, if that is the question that the member is asking. At the end of the day, yes, there have been some minor changes to the tax code. There have also been provisions for people who earn income at a younger age not to pay tax up to $2,340 for what would otherwise be, technically, a taxable event. Overall, the Government in difficult times is trying to make sure it is fair to all taxpayers.
Rt Hon Winston Peters: Given that the Prime Minister and Minister concerned are giving out $60,000, for example, to a sports club, a rugby club, can he explain to Parliament and the country as to what he thinks “whānau” is or are?
Rt Hon JOHN KEY: I think it is te reo word for “family”.
Better Public Services Targets—2011 Conviction and Sentencing Statistics
TIM MACINDOE (National—Hamilton West) to the
Minister of Justice: What reports has she received on 2011 conviction and sentencing rates?
Hon JUDITH COLLINS (Minister of Justice)
: Conviction and sentencing statistics published today by the Ministry of Justice confirm that this Government’s approach to reducing crime is working. The conviction and sentencing statistics show fewer criminal charges being laid in court, fewer people appearing in court, more charges resulting in convictions, and a decrease overall in serious and violent offences in the last 5 years. Since 2009 the total number of charges laid in court has dropped by 18 percent. That is over 60,000 charges.
Tim Macindoe: How does the reduction in the total number of charges being laid in courts deliver better public services in the justice sector?
Hon JUDITH COLLINS: Fewer people facing criminal charges means fewer cases clogging up our courts, fewer people unnecessarily going to prison, and fewer families disrupted. The new justice sector leadership enables the police, corrections, and justice departments to work together for the first time. Better public service targets are reducing total crime. Reducing youth crime and reducing reoffending are clearly in our sights. With less crime and fewer people entering the justice system, agencies can focus on
crime prevention, modernising our court system, and rehabilitating prisoners in order to reduce reoffending.
Te Ururoa Flavell: Talofa lava, Mr Speaker. Kia ora tātou. How will the Minister respond to the issue of huge sentencing inconsistencies as demonstrated by the excessive sentence handed down last week to Tame Iti and Te Rangikaiwhiria Kēmara, while 3 years ago a man found guilty of seven of eight charges of being in unlawful possession of two military-style semi-automatic rifles, thunderflash explosives, power gel explosives, two military flares, a smoke grenade, a grenade launcher, and an anti-personnel mine ended up being asked to pay $5,000 to St John Ambulance?
Hon JUDITH COLLINS: It would be quite inappropriate for me to comment on the sentencing in a particular matter. That is a matter for the courts.
Schools, Class Sizes—Teacher to Pupil Ratios
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) to the
Minister of Education: What is the estimated reduction in teaching positions at intermediate and middle schools in each of the next 4 years as a result of the new teacher to student funding ratios in Budget 2012?
Hon HEKIA PARATA (Minister of Education)
: Talofa lava, Mr Speaker. Kia ora tātou. The Government funds full-time teacher equivalents, not positions—that is a matter for each board. What we have always said is that about 90 percent of schools will have a net loss or gain of up to one full-time teacher equivalent. We have examined the effect on the other 10 percent of schools, and some would be affected more than we are prepared to accept. Schools will therefore be given a guarantee that their staffing entitlement will not be reduced by more than two full-time teacher equivalents over the next 3 years as a result of the policy changes.
Hon Nanaia Mahuta: Given her recent announcement at 1.41 p.m. today that “no school will lose more than two full-time teachers … as a result of the policy changes in Budget 2012.”, the Minister must know the budgetary impact of this about-face, so what is it?
Hon HEKIA PARATA: As the Prime Minister has already indicated, the Secretary for Education wrote on Budget day to every school to advise it whether it was in the 90 percent or the 10 percent. In that letter the schools were advised that the transition—
Hon Nanaia Mahuta: I raise a point of order, Mr Speaker. The question was very specific. I asked what the budgetary impact of the recent announcement this afternoon was, and she has not answered that question.
Mr SPEAKER: That is correct. That is what the member asked. I ask the Minister to come to the question.
Hon HEKIA PARATA: Yes, Mr Speaker. We have a contingency for transition, and it will support the provision of two full-time equivalents.
Hon Nanaia Mahuta: I raise a point of order, Mr Speaker. The question was very specific, it was asking for a specific value, and the Minister has failed yet again to answer that question. What is the budget?
Mr SPEAKER: Order! Before I call the Minister, I want to ensure the terminology is understood. The member has asked what the budgetary effect is. That may or may not elicit exactly the answer the member wants, but it is up to the Minister to answer as she sees fit.
Hon HEKIA PARATA: I do not have the exact figure to hand.
Scott Simpson: What support has she offered the most affected schools?
Hon HEKIA PARATA: Schools have been given a guarantee that their staffing entitlements will not be reduced by more than two full-time teacher equivalents over the next 3 years as a result of the policy changes.
Dr Megan Woods: Given that schools could still lose up to two full-time positions, can she give an assurance to Branston Intermediate School and Christchurch South Intermediate School that they will not lose their dedicated science and technology teachers as a result of her new ad hoc plan; and if not, is she concerned that this breaks John Key’s promise that National is committed to working with industry to make it easier for schools to find, pay, and employ people to take their trade and technology classes?
Hon HEKIA PARATA: We will continue to work with the Christchurch schools, as we have done on a case by case basis every since the impact of the earthquakes.
Dr Megan Woods: I seek leave to table three documents. The first is a letter from Christchurch South Intermediate School to parents, saying that the staffing cuts are a big mistake and setting out what the impact of these cuts on that school will be. The second document is an email from Branston Intermediate School to me, setting out the effect on its ability to deliver quality technology and specialist programmes within the school. The third is a transcript of a speech from John Key to the—
Mr SPEAKER: Order! If the House is to make sensible decisions, let us deal first with the letter from the school. Is there any objection to that letter being tabled? There is none.
- Document, by leave, laid on the Table of the House.
Mr SPEAKER: The second is the email from a school to the member. Is there any objection to that document being tabled? There is none.
- Document, by leave, laid on the Table of the House.
Mr SPEAKER: And the third?
Dr Megan Woods: The third document is a transcript of a speech from John Key in 2007 to the Employers and Manufacturers Association (Northern).
Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection. [Interruption] Order! I say to the Labour front bench that it appears they have a backbench colleague seeking the call.
Louisa Wall: Talofa lava, Mr Speaker. Tēnā tātou. Can she explain to the parents of years 7 and 8 students from Greenmeadows Intermediate School, Manurewa Intermediate School, and Weymouth Intermediate School why she is making it harder for their deciles 1 and 3 schools to support their learning and achievement, as her policy means those students will lose, on average, two teachers per school—and I note that before 1.41 p.m. it was, on average, six teachers per school—plus some targeted programmes that Iain Taylor, the Principal of Manurewa Intermediate School, says motivate and keep particularly Māori and Pacific students engaged in education?
Hon HEKIA PARATA: It is exactly because we are interested in raising the quality of teaching practice in order to raise student achievement that we are making a trade-off of having one or two extra students in a classroom in order that we can have raised achievement.
Iain Lees-Galloway: How is it fair for small intermediate schools to lose the same number of teachers as large intermediate schools, which is what her new, ad hoc plan that she made up on the way to the House will implement?
Hon HEKIA PARATA: We wrote on Budget day to all schools, telling them that a transition plan would be put into place and that we would work with each of them. In the interests of providing certainty now, we have provided the guarantee that no school will lose more than two full-time teacher equivalents, and 90 percent will not lose any more than one full-time teacher equivalent. This is good news. [Interruption]
Mr SPEAKER: Order! Forgive me, I did not hear that, but I need to be able to hear this next supplementary question.
Hon Nanaia Mahuta: Given that response, how will schools be given a guarantee that their individual staffing entitlements will not be reduced by more than two full-time teacher equivalents over 3 years—which may equate to six people—and that no further cap on roll growth will occur?
Hon HEKIA PARATA: We have announced to schools that they have a protection guarantee that they will not lose more than two full-time teacher equivalents. The way it is done every year, I say to that member, is that in September provisional rolls are set with schools, and their full-time teacher equivalents are allocated on that basis.
Budget 2012—Canterbury Social Services
MELISSA LEE (National) to the
Minister for Social Development: How does Budget 2012 assist Canterbury social services to support the rebuild of the city?
Hon PAULA BENNETT (Minister for Social Development)
: Recognising the ongoing impact of the Canterbury earthquakes, in Budget 2012 the Government is investing an additional $13 million over the next 2 years in social services for the Canterbury region. This is in addition to the $20 million already provided to non-government social service organisations since the first earthquake. The funding will continue to provide psychosocial support to those affected by the earthquakes and assist non-government social service organisations to coordinate these services and meet increased quake-related demand.
Melissa Lee: How has the Government’s social investment supported Cantabrians to date?
Hon PAULA BENNETT: Since the earthquakes, Canterbury social service providers have done an outstanding job in very difficult circumstances meeting the needs of the community. In the last 6 months this support has enabled over 6,800 counselling sessions, and the 0800 support and counselling line has received more than 14,000 calls. The Government has helped with funding, but these remarkable organisations on the ground are fundamentally making the difference.
Budget 2012—Aged Residential Care
KRIS FAAFOI (Labour—Mana) to the
Associate Minister of Health: Does she stand by her statement that the measures in the Budget to change the asset threshold for aged residential care were “a reasonable approach to the way forward”?
Hon JO GOODHEW (Associate Minister of Health)
: Talofa lava, Mr Speaker. Yes, I do within this context. The Government has slowed the rate of increase of the rest home asset threshold in recognition of tight financial times and an ageing population. On 1 July the threshold will increase from $210,000 to $213,300.
Kris Faafoi: Which non-government individuals or groups—if any—were consulted as part of the process leading to the asset threshold change?
Hon JO GOODHEW: The decision was announced in the Minister of Health’s main press release prior to the Budget being read in the House. [Interruption]
Mr SPEAKER: Order! I want to be able to hear.
Hon JO GOODHEW: Prior to the Budget being read in the House I phoned and spoke to both Grey Power and Age Concern to talk with them about this change, and to also talk with them about the investments that we are making in this sector, which are $40 million for residential care, $40 million more for dementia care, $40 million more for home support, and a total of $1.5 billion more for health over 4 years.
Kris Faafoi: Does she concede that the change made last week does not address serious issues raised by the Human Rights Commission report, such as pay parity, staff training, and quality of care standards?
Hon JO GOODHEW: The Human Rights Commission report last week contained 10 recommendations. The Government will carefully consider those recommendations. Amongst those recommendations are a number of issues that the Government is currently working on, and I talk, in this case, about quality of care, about rural funding for care, and about training for caregivers. Therefore I would say to the member that in fact we are addressing many of the issues raised in that report.
Kris Faafoi: Does she agree with the Prime Minister’s plan to address pay parity in workforce supply, given that he said to media yesterday: “You know, New Zealand might take a different view on migration, and, you know, there might be a converge of, you know, Filipino nurses that want to come and live in New Zealand, or whatever it might be.”?
Hon JO GOODHEW: The best thing that this Government can do, and has decided to do, to actually address any need for further funding into aged care, is to get our books back into surplus by 2014-15. That is the main focus for this Government, in order to then look at the priorities, which will include looking at the possibility of more funding into aged care.
Rt Hon Winston Peters: Could I ask the Minister—[Interruption]
Mr SPEAKER: Order! I apologise to the right honourable member, but I do want to be able to hear this supplementary question.
Rt Hon Winston Peters: Given that New Zealand First secured an additional $580 million in aged care support to address the PricewaterhouseCoopers report of 3 years before that, why is it a reasonable approach to the way forward, as she says, on the threshold for aged residential care, to inflation-index that, yet provide from her Government no inflation-indexing whatsoever of residential care allowances since it came to power?
Hon JO GOODHEW: In fact the member is incorrect, because cost-price increases are passed on from the district health board. But I want to also add that in fact the PricewaterhouseCoopers report has been superseded by the Grant Thornton report in 2010. That report identified that the most need in the aged residential care sector for additional funding was dementia care. In Budget 2011 we put an extra $40 million towards aged residential dementia care. There is a further $30 million in this Budget to aged residential dementia care, and $10 million towards dementia care pathways in the community.
Mr SPEAKER: Question No. 11, Eugenie Sage. [Interruption] Order! I ask members, please, on both sides of the House, to show some courtesy to a member at the back. I want to hear her question.
Freshwater Management—New Zealand’s Earth Summit Commitments
EUGENIE SAGE (Green) to the
Minister for the Environment: Does she agree with the statement by Dr Morgan Williams in the WWF New Zealand report released yesterday that “successive governments have failed to put in place the policies and mechanisms required by our Earth Summit commitments”; if not, why not?
Hon AMY ADAMS (Minister for the Environment)
: No, because New Zealand has in fact taken significant steps to deliver on those commitments.
Eugenie Sage: Given that the World Wide Fund for Nature
Beyond Rio report notes that almost all measured water-quality parameters have declined over the last 20 years, will the Minister give urgency to implementing the Land and Water Forum’s
recommendation that the Government use a national instrument to set limits on how much pollution our waterways can cope with; if not, why not?
Hon AMY ADAMS: I would, first of all, note that most of the data in that report is significantly aged and does not relate to this term of Government. It has been taken selectively and out of context. But, none the less, I will agree that our water quality is a significant issue, which this Government is prioritising and taking real action on, like instituting the Land and Water Forum. Actually, this Government is interested in making progress in water-quality issues, which is more than we can say for the Labour-Green Government of the 9 years that we had under them.
Eugenie Sage: I raise a point of order, Mr Speaker. I do not—[Interruption]
Mr SPEAKER: Order! There will be silence for me to hear the point of order. The member wishes to raise a point of order.
Eugenie Sage: I believe that the Minister was incorrect in referring to a Labour-Green Government.
Mr SPEAKER: Order! The member cannot use a point of order to disagree with an answer. That is not within our Standing Orders.
Eugenie Sage: Is the Minister aware of Dr Young, a freshwater ecologist with the Cawthron Institute, and his comment on the
Beyond Rio report by the World Wide Fund for Nature that “The water quality chapter convincingly portrays a sad picture of the current state and trends in New Zealand’s freshwater ecosystem integrity.”; if she is, will she do as the former Minister for the Environment did with the Land and Water Forum’s recommendations on the National Policy Statement for Freshwater Management and dismiss them, or will she take real action—urgent action—on water quality so that we can enjoy our lakes and rivers and so that present and future generations can enjoy them?
Hon AMY ADAMS: I am aware of a number of comments in respect of the report that was released yesterday. I do wonder whether some of those commentators are aware of some of the glaring errors in the report, like attributing commitments to New Zealand that do not apply to us, but I can assure the member that the Land and Water Forum is a process that this Government instituted and that we take very seriously, and we will be giving its recommendations full process and consideration.
Eugenie Sage: Does she agree with the statement of the Parliamentary Commissioner for the Environment yesterday that “We are dropping the ball on the environment, this is a failure of successive governments and bodes badly not just for the future of our environment but for the future of our economy.”?
Hon AMY ADAMS: In respect of the National-led Government, no.
Question No. 6 to Minister
Rt Hon WINSTON PETERS (Leader—NZ First)
: I seek leave to table a document to rebut the Prime Minister’s statement on evidence here.
Mr SPEAKER: Order! We need to know the source of the document.
Rt Hon WINSTON PETERS: This document is under the Official Information Act and has been received by my office—
Mr SPEAKER: From where, though?
Rt Hon WINSTON PETERS: —on Whānau Ora funding, and one page alone says $694,000.
Mr SPEAKER: Order! We need to know the source of the document.
Rt Hon WINSTON PETERS: The source is Te Puni Kōkiri, which I sought—
Mr SPEAKER: Leave is sought to table that document. [Interruption] Order! Leave is sought to table that document. Is there any objection? There is objection.
Health Targets—Shorter Stays in Emergency Departments
Dr JIAN YANG (National) to the
Minister of Health: What progress was made in the latest quarter towards achieving the Government’s target for shorter stays in emergency departments?
Hon TONY RYALL (Minister of Health)
: Great progress. In fact, district health boards have achieved record success in the last quarter and are reporting that, on average, emergency departments admitted, discharged, or transferred 93 percent of patients within 6 hours. In fact, 11 district health boards across the nation have now achieved or surpassed the Government’s 95 percent target. I would particularly like to congratulate the Wellington Regional Hospital, which was at 67 percent in 2009 and is now at 87 percent, a 5 percent improvement in the last quarter. This is a great result for a district health board that is buckling down and achieving better for patients.
Dr Jian Yang: How do faster emergency departments help support the entire hospital?
Hon TONY RYALL: An emergency department is a barometer for how well a whole hospital is working. When a patient is treated faster, it means there is better access to important X-rays, scans, and beds. That is why this Government is supporting it further in Budget 2012, where we are investing an extra $16 million into new systems to ensure faster access to magnetic resonance imaging scans and CT scans, and $4 million into a national register for patients treated for heart conditions, to improve the quality of their care. In Budget 2012 this National Government is spending a record level on health—$14.12 billion—to protect and grow our public health services.
- Debate resumed from 24 May on the
Appropriation (2012/13 Estimates) Bill.
Hon GERRY BROWNLEE (Minister for Canterbury Earthquake Recovery)
: I rise to speak in favour of the Budget delivered by the Hon Bill English last Thursday, and, as a consequence, to speak against the amendment to that motion moved by Grant Robertson from the Labour Party. We have budgeted $360 million for teacher professional development, and Labour says no—$360 million to help teachers raise their professional standards so they can do a better job in the classroom, and Labour says no. The story that we have heard from the Opposition since last week, whether it is the Green Party, the New Zealand First Party, or the Labour Party, has consistently been “no” to the growth Budget that National put in front of the country last week. It is extraordinary, and quite unique in New Zealand’s history, that a Government can put up a Budget that frees up $4.4 billion of funding for new initiatives that will support front-line services throughout New Zealand, and that comes from savings through various activities of the Government, in areas that were, to say the least, questionable in the first place. I think the fact that there has been very little comment about where that money came from indicates how bad it had become over a long period of years: successive Budgets loading up different sorts of initiatives, with no particular result for the taxpayer or for individual New Zealanders.
So in a year where the Government has delivered effectively a zero Budget, it still has $4.4 billion worth of new spending initiatives in it. The record so far from that approach previously has been 27,000 more elective operations being performed in New Zealand, year on year and growing, because of our new approach of getting better value from Government services. We have 2,000 more nurses, 800 more doctors, and 1,000 fewer back-office positions in the health ministry. Those are good numbers, and they do represent progress in society. We have 600 more police on the beat. No wonder the incidence of offending is starting to fall and we are seeing some of the benefits from an
intensive programme the police have had in crime reduction. National standards in reading, writing, and mathematics to raise achievements in schools will see great dividends for this country in the future. The support of those policies underlines the need that the Minister Hekia Parata has identified so well: to get quality into teaching, and therefore the need to support teachers in their work. So, as I say again, $360 million in this Budget for professional development, and our opponents say no.
There are 3,500 more early childhood places as a result of this Budget, and 48,000 rundown State houses will be upgraded as a result of this Budget. We get from the other side, constantly, all sorts of stories about the conditions that people have to live in, in various parts of the country, and all sorts of stories about living in squalor, living in poverty, etc., etc. We are going to fix 48,000 State houses this year, which is just a continuation of what has been going on, year after year under this Government, and Labour says: “No, that’s not a good idea.”
We have 12,000 more tertiary education places. That is equivalent to a whole new university full of students developed over the last 3 years and funded into the next 4 years by the current Government. That is a commitment to raising the educational profile of the entire New Zealand population.
Then we come to the Labour Party’s complete denial of the huge difficulty that the Christchurch earthquake places in front of not only people in that city but throughout this country, because of the type of nation we are, where we all like to support one another. It is a big commitment to take $5.5 billion, put it aside, and say we will be spending that over the next X number of years, plus all sorts of other expenditures that are likely to grow over that time, and to make that absolute commitment that we are there right to the end. And what did Labour do? Well, Labour came out, firstly, with a question last week suggesting that we had not actually spent that. Utter rubbish! Those people who have received their red zone settlements and those people who can see the Stronger Christchurch Infrastructure Rebuild Team—or SCIRT—working know that that money is being spent. And throughout the city in the Greater Christchurch area there is massive evidence of the activity that will lead to recovery.
What does Labour say? We have the wrong structure in place—we should have had a State-owned enterprise running it, according to their spokesman. Well, a State-owned enterprise generally has the capacity to earn its own revenue. There is no capacity for the Government to earn revenue out of this particular exercise. Then there is the suggestion that it should be a Crown entity of some sort. Well, that would require a committee of the great and good, appointed by the Labour Party, to somehow superintend activities between the people who need the attention and the Minister who is responsible for the money. That would lead to a degree of tension and controversy that people in Christchurch at the moment simply do not need.
The Government stands alongside people in Christchurch, and on 27 July another milestone will be achieved, when the Government is able to finally approve the redevelopment programme for the central business district. That will be a day when we will see a lot of people make big commitments, or begin to make big commitments, to that rebuild of Christchurch.
The other thing that is surprising in this Budget is the apparent lack of worry from the other side of the House about New Zealand’s financial situation, and absolutely no recognition that there is throughout the world a crisis going on. New Zealand’s economy is 1 percent of the world’s economy. We are like a little leaf on a large, tumultuous ocean that is being battered by a hurricane. We are keeping our head up as a nation—no question about that—in quite a remarkable way. But for there to be a denial that the turmoil in the rest of the world’s economic activity is somehow not going to
affect New Zealand is, I think, an abdication of any chance of ever leading this country to any sort of economic better position.
We, on the other hand, have recognised that there was a necessity to nurse New Zealand through those worst years. From the end of 2007 right through 2008 we were in recession. No question about that. The previous Government did not recognise that in the 2008 Budget. We have kept the worst effects of what could have been a very disastrous economic downturn for New Zealand at bay by responsibly engaging in Government activity that has maintained our economic activity. But there is a time when, simply, there is a necessity to recognise how costly that is, to get a track back to some sort of surplus position, and to start reducing debt. And that is what Mr English has done in this Budget, and he should be congratulated on that. To suggest as, Mr Robertson did, when he moved the amendment to the motion, that—
Hon Steven Joyce: Shearer.
Hon GERRY BROWNLEE: Sorry?
Hon Steven Joyce: It was Shearer, I think.
Hon GERRY BROWNLEE: I was sure it was Mr Robertson, but I could be wrong on that. It really does not matter. What the Labour Party members have said is that they do not support that concept. They do not support the idea of having a balanced Budget. They do not support the idea of making sure that you do create an opportunity for new initiatives to occur in your economy by shifting around the money the Government currently spends, to ensure it is in places where it matters, and they have no concept of the need to reduce debt as a nation. Those things indicate that this is an Opposition that has no intention of being a Government and is quite contented to sit around criticising everything that everyone else does. It has a single answer in response to any initiative that a Government puts up. That single answer, that single response, is always no. I predict that that will be the answer that voters give this crowd next time they get the opportunity—no.
Hon DAVID PARKER (Labour)
: John Key and the National Party always blame Christchurch or Greece for New Zealand’s problems. Greece and Europe have had problems. Outside of Greece and Europe, average growth in the world has been 1.5 percent per annum for the period since National has been in Government. Over that same period New Zealand has grown under 1 percent—not 1 percent per annum, but 1 percent in 3 years. The 53,000 people who last year went to Australia did not go to Australia because of Greece’s problems; they went to Australia because of New Zealand’s problems. It is time that the Government fronted up and addressed some of the difficult issues and some of the hard choices that have to be made. All Governments have choices. This Government has choices. This Government will not make the choices that we need in New Zealand, and that workers in New Zealand and businesses in New Zealand need for the Government to grow the economy, to grow our exports, and to grow our wages.
Indeed, Fran O’Sullivan said after this Budget that the “problem is that there is no clear economic growth agenda.” About 10 other commentators said the same thing. I am sure they have been speaking to each other, but I am also sure that they had independently come to that same conclusion, because this Budget does not have any economic growth agenda. That is why we continue to fall behind the rest of the world, outside of Europe, and that is why this Government ought not to be able to use Greece as an excuse any longer.
National members say this Budget is not their fault, but I think this Budget has exposed them. It has exposed them for their own negligence. Can anyone believe that this Government got it so wrong in respect of intermediates? Is that just not incompetence? Is that not just negligence? Did no one around that Cabinet table ask a
question? Did the Minister of Finance, who previously said that dropping class sizes made educational outcomes worse, not ask a question? Did the Prime Minister not ask a question? The star of National’s front bench, the up and rising Hekia Parata—future leader of the National Party until last week—obviously did not ask the question. The negligence of the National Party, its incompetence, is further exposed by that debacle that it is now backtracking on.
The Budget exposed them as having a lack of vision—a lack of vision. Is there anything in that that would give New Zealanders hope as to why they would want to put their forces behind the New Zealand economy rather than leave for Australia?
Hon Phil Goff: No.
Hon DAVID PARKER: No. A complete lack of vision—a drab Budget is how some people have described it, and they are right. I return to the point that has been made by so many. They are exposed as having an inadequate plan to grow our economy.
Even their handling of the public relations around this has been a debacle. They started skiting about the fact that it was a zero Budget. Just weeks ago they were saying that a zero Budget is a good thing. Then when everyone in New Zealand turned round and said that a zero Budget is a sign of failure, in the week before the Budget they changed their own rhetoric and they denied it was a zero Budget. They said: “We are spending more money. It is not a zero Budget.” They had been saying until then that it was a zero Budget. They changed their mind last week and it is not a zero Budget. The problem is that it is a zero Budget when it comes to ideas to grow our economy.
In the face of 53,000 people leaving for Australia in the last year, you would expect that they would be doing something, showing some vision, and tackling some of the problems that needed to be tackled. But do you know what? National members put off limits virtually any big step they could take. We have proposed quite a few, and I am going to address them later. But they have put them all off the agenda. Their canvas is so flat and devoid of colour; it is a white-out over there. They cannot see anything for the clouds, and John Key keeps hopping from cloud to cloud. Our very glib Prime Minister performed like a circus master in the House last week—
Hon Members: More like a clown.
Hon DAVID PARKER: More like a clown, my colleagues say. He was entertaining his trained seals around the back, and he chucked them another sardine and they clapped their flaps together and had a round of applause. The very glib contributions of the Prime Minister had no substance. He even had the audacity to say that New Zealand’s exports are growing. He had said it a few days earlier. His problem was that on the very day of his Budget speech, Statistics New Zealand said that export goods had dropped by $800 million, an incredible 17 percent drop year on year. It was not, as he said in question time today, a monthly figure. That was the annual figure for the year to April. Export goods were down by $800 million, compared with the year before. He pretends our export sector is recovering, when his own Budget shows in the forecast that from here to the end of the projection period exports increase at only half the rate of imports. We have already got a current account deficit. We already do not cover the cost of our imports and interest by our exports, and his own Budget shows that for every year under his projection period, out to 2016, it gets worse and the rate of growth of imports is twice as high as it is of exports.
He then pretends that it is all Christchurch. The Labour Party checked with Treasury officials when we were in the lock-up. There was another glib statement in the Budget document, saying that a significant part of the current account deficit relates to Christchurch. So we checked. At no year is Christchurch more than about 1 percent per annum of the current account deficit. You go out those 3 years and you get a current
account deficit of up to 6.8 percent per annum of GDP. It is less than 1 percent, so if it was not for Christchurch, we would still have a current account deficit growing to 5.8 percent. Our current account deficit is becoming out of control again. We are returning to old patterns. We have got residential-led growth, rather than export-led growth. The Government has no plan to address that problem.
Let us reflect on what is the central plan of this Government’s agenda for these 3 years in Government. It is to sell our assets. It is to sell our power companies. Not only does that make the Government deficit worse, to the tune of about $100 million per annum, but it does not change the economy; it does not grow our economy. Changing who owns what already exists does not grow our economy. We do not get extra exports. Over time it will actually increase our current account deficits, with those profits flowing to overseas people. It does not grow the output of our economy.
Why is this? Why is National wedded to following this same course, which is not cutting the mustard? It is because it is a conservative party. Conservative parties around the world trim expenditure, they fiddle with the fiscals, but they never address the fundamental changes that are needed. It is always progressive parties that change things. That is the fundamental difference in New Zealand and overseas between conservative parties and progressive parties. Conservative parties are basically happy with the status quo. They actually want to protect the status quo, because the people who support them have assets that are held up in value by the status quo, at least in the short term. They are not willing to make the progressive changes that progressive parties are willing to make. History shows this time and again in New Zealand. It is the Labour Party that makes the substantial economic changes. The National Party is conservative, and it just fiddles. I say to National that if you change nothing, nothing changes. It is a truism—if you change nothing, nothing changes. That is why National has not rebalanced the economy.
New Zealand needs pro-growth tax reform. We need a capital gains tax for a neutral investment signal. We also need it to address some of the inequities in New Zealand and the widening gap between the rich and the poor. We need a research and development tax credit. We need pro-growth savings reform, expanding KiwiSaver to a universal scheme. All of those are off the agenda from National. Not only that, National pretends that superannuation is not a problem. Today the Minister of Finance did not even know that by the end of his projection period, superannuation every month will cost more than total education will cost. This is another example of negligence on the Government’s part. All Governments have choices. This Government has them too. The reason that we do not have export growth and wage growth coming at us down the track is that this Government will not make the right choices, and if it changes nothing, nothing will change. Just let us not let the Government blame Greece.
Hon Dr JONATHAN COLEMAN (Minister of Defence)
: If that was the intellectual engine room of the Labour Party, all I can tell you is that that party is in deep trouble. All that was, was a 10-minute personal attack on the Prime Minister. I was really waiting to hear something of substance at the end. Do you know, the one idea that came out of that was the capital gains tax. So Labour’s idea about how to get growth into this economy is to slap another tax on hard-working New Zealanders. The problem for them is they actually took that to the last election and it was roundly rejected. It was completely rejected. David Parker is driving their thinktank approach and that is all he can come up with. He said if you do not change anything, nothing changes. Well, what they need is a change of front bench, because unless they get some people there with some ideas and some drive—some people who appeal to the average New Zealander—we are not going to hear much more from them. We are going to see more and more
editorials from the co-leader of the Greens, the real Leader of the Opposition, Russel Norman.
This is a great Budget. It is a great Budget for the times, and it has been well received by the people of New Zealand. To produce a Budget like this in a time of international economic turmoil is a great achievement on the part of the Minister of Finance, Bill English, and the Prime Minister. I think it shows that the country’s finances are in very sound hands. What has been delivered here is over $4 billion of new expenditure over 4 years, which is going to pay for the vital services and infrastructure that New Zealanders need and want. I defy Labour to tell us what it would have done. What it would have done is borrow more money.
Phil Twyford: Rubbish.
Hon Dr JONATHAN COLEMAN: Phil Twyford says “Rubbish.”—it would not have borrowed more money. But at the same time it would not have gone for a mixed-ownership model. Well, you cannot do both. You cannot fund the new infrastructure that New Zealand needs if you do not either do what we are doing, which is go for that mixed-ownership model and free up $5 billion to $7 billion of new money, or borrow money. We know what Labour would do. It would borrow. Where would that lead us? It would lead us down the track of Greece, Spain, Portugal, and Ireland. That is true. Mr Parker denied that the Christchurch earthquake had any effect on Government finance. He said to stop using it as an excuse. Well, I can tell you that it is a miracle that the Government’s finances are in such good shape, considering what we have had to deal with over the past few years. And to think that there is new money going into health! There is $1.5 billion over 4 years—$1.5 billion. There is $33 million of new funding going into cancer treatment, and there are 500 more operations a week under this Government. You can see that those members have fallen silent because they have no answer to that.
Today Tony Ryall, the Minister of Health, announced the new emergency department statistics: 93 percent of patients being seen within 6 hours in emergency departments. It was very, very bad under the Labour Government. We took action and now it is much, much better. I mean, look at the economy: 3 percent growth for the next 4 years, 60,000 jobs created over the last 2 years, and 154,000 new jobs to be created over the next 4 years—major achievements there. One of the key things, though, is a $197 million surplus for 2014-15. That is a huge turn-round in the face of a very difficult fiscal environment.
There is new money for education: $512 million over 4 years. It is interesting to see that those members will not agree with the $59.8 million investment into teacher quality. They are happy for things to just continue as they have. If you look at it, teacher numbers have gone up 12.5 percent over the past few years, and school rolls have gone up 2.5 percent. But attainment and intellectual achievement—the way our kids are going—have actually plateaued. And they over there have no answer. They were very happy for things to just continue on as they always had. So under this Government there are 27,000 more elective operations, 2,000 more nurses, 800 more doctors, and 1,000 fewer back-office positions. The health situation has been majorly turned round. There are 600 more police on the beat on the streets of New Zealand. There are 3,500 more early childhood education places. Forty-eight thousand State houses have been upgraded, and there are 12,000 more tertiary education places under this Government. So you can see there is major progress, major achievement going on. There are 41,000 more homes that are warmer and drier through the Warm Up New Zealand: Heat Smart programme. In terms of welfare reform, we are actually focusing on dealing with that huge iceberg—
Hon Member: Yawn!
Hon Dr JONATHAN COLEMAN: Look, Labour members laugh about this. They yawn about it. They do not care. They were happy for things to continue as they ever did. But the fact is we are identifying the tough issues and we are tackling them.
I just want to speak briefly about defence. We are very proud, I think—right across the House, actually—of the New Zealand Defence Force and the work that our men and women do overseas. There is a very concerted programme going on to achieve savings of $350 million to $400 million over the next few years, which is going to be reinvested back into the capabilities that the New Zealand Defence Force needs. I can say it is very pleasing that that vote has been retained. But the fact is we are going to be able to fund more and more of the capabilities that our men and women need to succeed at the front line over the coming years. Of course, our men and women are coming to the end of their time in Afghanistan; the SAS has done an excellent job over the time it has been representing us there. New Zealand was also represented very well overseas in East Timor and in the Regional Assistance Mission to the Solomon Islands. Our men and women in the New Zealand Defence Force deserve excellent support, and this Government is determined that they get that. You can see that in the capabilities that we are going to be funding over the next few years. It is quite an achievement in a tight fiscal environment to be able to maintain that vote, and to achieve the savings and reinvest those savings back into the capabilities that are required.
It was very interesting, though, listening to David Shearer’s reply to the Prime Minister’s Budget speech a couple of days ago. I was looking at David Shearer during the Prime Minister’s speech, and it was quite evident that he was taking no notes, which I thought was interesting. I have never seen that from a Leader of the Opposition before. But what was quite evident is that he had not listened to the speech at all. He had a pre-prepared message. He was not going to think on his feet. He was not going to rebut the arguments. The fact is that this is a party, the Labour Party, that is not interested in rebutting the arguments, because, frankly, it knows it has lost them. It lost them long ago. It lost them at the ballot box in 2011, and it is continuing to lose the arguments here in this Chamber and in the public domain.
So really it is quite irrefutable. This Budget is the right one for the times. But not only that, we have managed to get that $4 billion of savings, $4 billion pulled together from areas where wasteful and ineffective spending was going on, to actually fund the things New Zealanders want: the health, the education, the policing, the growth in the economy, the investment in ultra-fast broadband, the investment in science—major investment in science going on—research and development, and innovation. Steven Joyce is doing a great job in pulling that all together. So for Labour to try to make out that there is no path to the future, well, I can tell you, that just does not stack up when you look at the facts. I can tell you if Labour had given this Budget you would have seen more buying of votes, more borrowing, but at the same time a decline in our international credit reputation, a decline in our international reputation, and Labour knows that—those members know that.
I want to hear the next Labour speaker get up and actually tell us their plan for balancing the books, because they say they could balance the books, but, frankly, I do not believe it. Frankly, the public of New Zealand does not believe it. What the public of New Zealand does believe is that John Key is the right man to be running the economy of New Zealand. He is the person with the record. His sound stewardship is getting this country going in the right direction, and that is the actual fact. We are on track for surplus in 2014-15. We have got a whole lot of new spending, $4.4 billion over 4 years. It is all working well. It is getting us going in the right direction, and, most important, the public of New Zealand are confident that we are going in the right direction. This is a Budget that has their support, and I fully support it. Kia ora.
Hon CLAYTON COSGROVE (Labour)
: The member who has just resumed his seat, the Hon Dr Jonathan Coleman, talked about the fact that he did not want to tax “hard-working New Zealanders”. Well, I know we are not supposed to refer to the gallery, but I suspect there are a few hard-working New Zealanders who are just leaving the gallery now. They are the age of cleaners—you know, cleaning out the butcher shop—paper boys, and paper girls. They are doing those after-school jobs, earning 45 bucks or less per week, and I would consider those young people are hard-working New Zealanders. I would consider, like most of their parents would, that that is the ethos they actually want to instil in their kids: to get a job not just for the pocket money but to get those work ethics, such as turning up on time, contributing, etc, etc. Actually, was that not the sort of entrepreneurship that the “brighter future” of these guys over here in the Government promised? Was it not supposed to be encouraging entrepreneurship, encouraging people into getting off their backsides and getting a job?
That member, the Minister of Defence, is the man who is responsible for sacking Defence Force staff. I am told, and it has been reported in the media, that the cost of sacking them is more than their salaries. He stood up and said: “I do not want to tax hard-working New Zealanders.” Well, in this tinkering, spin, little Budget, which deals with none of the big issues, the first piece of legislation that we addressed of course last week was to tax every dollar that those hard-working young New Zealanders will earn doing their paper rounds, doing the cleaning, and those sorts of things. But he does not consider them hard-working New Zealanders.
As I said last week in a speech, for many of those young kids it used to be a bit of pocket money. It used to be 45 bucks a week to maybe go to the movies or go out with the mates, or whatever. Now, for many of those hard-working young New Zealanders, the 45 bucks a week that he is going to cream the tax off is not pocket money any more, not in South Auckland, parts of Christchurch, parts of New Zealand. Actually, what the 45 bucks a week is, is a contribution to the family budget, forced on them because the family have to make ends meet. He talks about the great plan that National has. Well, let us go through it. We have already dealt with the sort of mean-spirited, pickpocket-like measure in the Budget taxing the paper boys. That is the first thing, and that is going to generate a massive 14 million bucks over 4 years. What a huge amount of money that is in the scheme of things! That is the big issue that that member, the Minister of Defence, said his Government is dealing with.
Then, on the other side of the generational divide, we had the sort of mean-spirited, scrimp away, have-a-crack-at-elderly rest home care, and the asset testing around that. We know the record of the National Government, yea, unto the Middle Ages, in respect of its conduct with elderly New Zealanders, who are some of the most vulnerable, going back to the Muldoon days, coming forward to the Bolger days, and now this Government does it again. So we carve a little bit off the paper boys, we nip a bit out of the old folks, and then the other big, great part of the plan or mosaic is, of course, flogging off assets—State-owned assets that give an 18.5 percent return, as opposed to a debt-servicing cost, of around 4 percent. If you are in business, you would label the great “Maestro” and his ilk as nuts.
And they talk about borrowing. They talk about borrowing $300 million a week, or has that member forgotten what he passed in his own previous Budget? It is $300 million a week in the middle of the global financial crisis, not to fund capital, or hospitals, or schools, or the things that are critical to growing a nation, but of course to provide an across-the-board tax cut where his mates and his ilk—the top few percent—get the vast majority. So that is the great plan: kick the paper boys in the guts, kneecap the old folks, give your mates a big tax cut, borrow and hope, and then, because you have got no money and no plan to grow the economy, borrow $300 million a week.
That is the grand plan. Then you bundle in increasing class sizes. Does anybody in this Chamber believe that parents will believe that their kids are going to get a better education if class sizes increase? If you can find a parent in this country who believes their kids are going to get a better start in life as the class sizes increase, then put up the ante, I say to that side.
Then the next step in the Budget, of course, we know, is cutting teachers. Hekia Parata—I agree with Trevor Mallard—had a damned good shot at becoming the next leader of the National Party. Now there is hope for Mr Coleman, of course, after she blew apart in the last 24 hours because of—
Phil Twyford: He looks good.
Hon CLAYTON COSGROVE: He looks good? Yeah, well, I would not say that. Her promise, of course, in the Budget—
Hon Trevor Mallard: Leave the cigar out of it.
Hon CLAYTON COSGROVE: Well, he is blowing smoke up all sorts of places, is he not? Hekia Parata, of course, in her own budget said that schools could lose around six to eight teachers. Then suddenly she comes back into the Chamber and says: “Oh no, intermediate schools, I guarantee, will lose only up to two teachers over 3 years.” A big backdown, and the Budget is only a week old. So we have got increasing class sizes, we have got cutting teachers, and we know that exports are down, even though Mr Key thinks they are up because he cannot read the latest Statistics New Zealand information.
Then we have Paula Bennett’s legacy: 50,000 more on the scrap heap of unemployment, and nothing done about that, and 53,000 Kiwis leaving our shores every year, over 1,000 a week, when Mr Key promised he would get that down. That is the report card of the National Government, and their grand plan talks about asset sales, kneecapping kids and old folks, and tinkering around the edges. Like David Shearer, I will concede that the money provided around the science and innovation area is good stuff. But it is not good enough; they should never have reversed the research and development tax credit, which our Government, in Government, put in place. But I have to say, to be fair, let us call it as it is: it is good stuff. But the problem National members have is that they try to scrutinise us. The great “Maestro” forgets that he is in Government, he gets a quarter of a million bucks a year and a BMW, he has a warrant, and he is responsible for this Budget. It is incumbent upon that member and his Cabinet and his caucus to convince New Zealanders that this is the right course of action.
Actually, if you read the papers, people are bored with this. They know there is no plan. The Government is under fire from the business community in Auckland, who know there is no business strategy to grow our entrepreneurial sector, to grow jobs, and to grow exports. There is nothing in this Budget at all to do that, and the great diversion is to ask what other people would do. Well, here is the problem, Mr Coleman, I say through you, Mr Assistant Speaker. In Government, the problem is that if you want the warrant, the BMW, the big, fat salary, and the cigar, you have actually got to be accountable for your Government and your Budget. They have a plan that flicks a few dollars—a lot of dollars—off the old folks, a few dollars off the youngest and most vulnerable, and flogs off our assets needlessly. And with their own logic they have not been able to sell that one to the public; 80 percent of New Zealanders say “We do not want our assets sold.” So as the old “Smokeball” over there grins away, his head sort of nodding, that is the problem he has got when 80 percent of his own constituency do not agree with asset sales because, first, they know it is illogical, and, second, the Government has not even been able to make the case for it. In fact its advice to the community has been contradictory.
So that is the grand plan for New Zealand. That is the grand plan: a bit of spin, a bit of smoke, and a bit of tinkering around the edges. That is the grand plan for New
Zealand and that is where it ends with this Government. That is where it ends with this Government. The brighter future, the innovation, and encouraging our entrepreneurship—I thought we wanted to do that for the really young. I thought we wanted to embed those in the mind-set of our youngest kids at school so they had the work habits as they grew up. But oh, no, not with “Uncle Scrooge” over there, old “Goldfinger”, and the rest of his people. That is not innovation; that is not the brighter future. They have sold out New Zealand. This is not a Budget of hope; this is a Budget of despair and surrender from the National Government.
Hon KATE WILKINSON (Minister of Labour)
: Can I say that it is a great pleasure for me to stand and support Budget 2012. I do not have a lot of notes, because I was hoping that I would have something sensible to rebut from the former member of Parliament for Waimakariri, but all we got was nasty, negative name-calling.
This Budget is a good Budget, this Budget is a sensible Budget, this Budget is a pragmatic Budget, and this Budget is a sensible, realistic Budget. Families in New Zealand know that times are tough. The Labour Party does not know that times are tough. We know that times are tough. We know that we need a Budget that will stimulate jobs. Mr Cosgrove actually said there was nothing in this Budget to grow jobs, so I will come back to jobs in a minute, but we do need a Budget to stimulate jobs, we need a Budget to deliver better services for our families, and we need a Budget that is on track for a surplus in 2014-15. And that is what we have got, because National is aspirational, and we have a plan to actually build a brighter future for all New Zealanders.
We have said time and time again what the priorities are, and I will repeat them because the other side has a slight lack of memory. The first is to responsibly manage our Government finances, and we are doing that through the able work of both our Prime Minister and the Minister of Finance. Next is to build a more competitive and productive economy. That actually means more jobs. That does not mean to say that growth in government is growth in the economy. Growth in the economy is different from just growth in government, and we are concentrating on more jobs. Then there is delivering public services, and, finally, rebuilding Christchurch and Canterbury, which have gone through some horrific shocks and shakes.
I want to talk a bit about jobs, because although Mr Cosgrove says there is nothing to grow jobs in this Budget, I say that in the past 2 years we have created 60,000 jobs. That is not bad in difficult economic times—60,000 jobs. I ask what the Labour Government would have done had it been in Government. Well, I can tell you. It would have opposed the 90-day job trial. That trial period has been really successful: 80 percent of employers would not have taken somebody on if it was not for that 90-day trial. It has been credited with creating 13,000 new jobs—13,000 new jobs. Labour would repeal it, costing 13,000 new jobs. That policy is designed to give businesses confidence, not to take away confidence, which is what the Labour Opposition would do. It is to give businesses confidence to take on people that they might not otherwise take on, to take on those at the edges of the market, whether they are young, whether they are old, or whether they are new to this country. And it is working, because it is credited with creating 13,000 jobs. The Labour Party if it was in power would repeal it, and that would be the cost.
The Labour Party opposed the Hobbit law. The Hobbit
law created 3,000 jobs. Every time we have an incentive or a project or a plan to create jobs, Labour members oppose it. They are
Hobbit haters, as our Prime Minister likes to say. They are
Hobbit haters. That law created 3,000 jobs. Each one of those jobs is a person. Each one of those jobs involves a worker, and those workers have families. Labour is not the party of workers,
because it would have jeopardised 3,000 jobs, just like that—3,000 jobs plus the 13,000 jobs from the 90-day trial. It is adding up.
Labour members are opposing the convention centre. That is another 900 jobs—900 jobs on top of the 3,000 jobs, on top of the 13,000 jobs, which they would jeopardise. On top of that, they would arbitrarily and unsustainably raise the minimum wage to $15 an hour. That is 5,000 jobs that they would put in jeopardy. They oppose the convention centre. When it is up and running it will create another 800 jobs.
I could go on and on. That party is not the party of workers. When we add it up—13,000 jobs, plus 3,000 jobs, plus 5,000 jobs, plus 900 jobs, plus 800 jobs—that is a lot of jobs. In times of economic recession, in challenging times, each of those jobs is precious, and we want to make sure that our New Zealanders get those jobs, have those jobs, and do not have them stolen from them by the Labour Party.
Its employment relations legislation in itself would take us back 30 years. It would cost even more jobs. We are now in a climate of fair and flexible employment, and it is working, but every piece of employment legislation and every employment improvement that we suggest, those members oppose. They even opposed a piece of legislation that actually had the same wording about secret ballots for strikes as in their Labour Party union mates’ constitution. They even opposed that.
But, talking about jobs, I want to talk about workplace safety, because it is important that we actually link—and we all have a duty to link—productivity with workplace safety. The two go hand in hand, and it is really important that one is not deemed to be a trade-off for the other. I am very proud to have shepherded through a huge investment in workplace safety: $37 million over the next 4 years, and that is on top of the $1.5 million for the High Hazards Unit—
Hon Trevor Mallard: That is the Minister who stopped the work on mining inspections.
Hon KATE WILKINSON: And they scoff. Mr Mallard is scoffing. Well, can I tell you what Labour’s record was? Labour cut funding for health and safety in four of its nine Budgets. It cut health and safety funding in four of its nine Budgets. Our Budget, on the other hand, has a 20 percent increase in funding for health and safety. Under National, health and safety spending has gone up by more than 40 percent—more than 40 percent. What did Labour do? Labour cut it in four of its nine Budgets.
When Labour came to power, the inspectorate was 163. It had 163 health and safety inspectors. Labour ran it down to 141. With National’s extra investment in health and safety, because we realise and appreciate and acknowledge that it is such a priority, that inspectorate will be increased to 180. Whereas Labour reduced it and ran it down from 163 down to 141, we will increase it to 180. That shows our commitment to workplace safety. Actually, the other side does not really know where it is coming from in terms of this issue. I have got two comments about our improvements to workplace safety. One of them says: “The least the government could have done was to wait until the Royal Commission on Pike River Mine reports back in September,”. That was from Darien Fenton. The other comment was: “We don’t need to wait for the Royal Commission’s decision.” That was from Andrew Little. I would suggest that they really should put their politics aside and work with us on workplace safety.
Can I say that I actually congratulate the Council of Trade Unions on being active on the Workplace Health and Safety Council, and also on being part of the forum, the task force, that I have announced, which is going to have a look at the workplace health and safety in employment legislation.
In all Labour’s 9 years of office, it tinkered with the legislation three times. In 2002 Labour had the chance to reform it; it tinkered. In 2004 it had the chance to reform it; it tinkered. In 2006 it again had the chance to reform it, and it tinkered. National is going
to reform the health and safety legislation. We have invested another $37 million over the next 4 years, in these tough economic times, because we place a priority on workplace safety. We are looking at the health and safety legislation that has been in force for 20 years now. We think it is a timely review, with the Pike River commission of inquiry due to report back in September, and with the events of the Canterbury earthquake. It is timely that we have a comprehensive review to make sure that our health and safety regime is fit for purpose, and where it is not, we can make improvements. But what does Labour do? It opposes it.
I just remind the House that our official rate for workplace incidents is appalling. It is 4.1 fatalities per 100,000 workers. That is twice the rate of Australia or the UK. We lose nearly a person a week. The Labour Party can scoff at that, but it is serious. When we know that every worker who goes to work in the morning comes home safely at night, without injury, we will know we have made a difference, and $37 million over 4 years will make a huge difference.
GARETH HUGHES (Green)
: Kia ora, Mr Speaker. Ngā mihi nui ki a koutou. It is a privilege to take a call on the Budget debate. This is a Budget that has been called so many names in the last week—the “paper boy Budget”, the “paper girl Budget”, the “nickel-and-dime Budget”, and the “black” Budget. It has been called a zero Budget, not just because of the zero new spending and the $8 billion deficit but because of that zero hope and zero compassion for those 200,000 Kiwi kids growing up in poverty, and zero plans for how we are going to boost our economy.
We heard it from the Prime Minister, we heard it from the Minister of Finance, and now we have heard it again from the Minister of Conservation—the absence of the recognition that our economy depends on our environment. I cannot believe that we had the conservation Minister not use the word “conservation” or “environment” once in her speech. Our economy depends on the environment. This is why our valuable “clean, green” brand has been costed as worth over $20 billion to our gross domestic product. This recognition is what is lacking.
The Budget could also be called the “drill it, mine it, frack it, cut it, sell it Budget”, because these are the only planks this Government has for economic development—to drill it, to mine it, to frack it, to cut it, and to sell it. I would like to touch on three of its planks, to dig more holes and dig more wells across New Zealand, as the only plans they have got. I would like to look at the costs associated with these policies and the economic impacts, and to say that it is just not worth it. It is not worth it for New Zealand.
We are exporting a bit of oil at the moment. We exported just over $2 billion worth in the last financial year. Obviously, it is important: we need to be exporting, and we need to be earning foreign exchange. We are doing so well because the price of oil is so high, but let us look at the flip side. We are importing more than $8.3 billion of oil in return. We are not even getting a third of the way to self-sufficiency. Looking forward, this is a major strategic risk. That $8 billion fuel bill is already 16 percent of our imports, and is our single biggest import. Every US$1 price rise in the price of a barrel of oil wipes $40 million to $60 million off New Zealand’s gross domestic product.
Facing those big strategic risks, governments, councils, and militaries all around the world are getting together and developing oil reduction plans. But our Government has got no plan to even start planning to reduce our dependency on oil. Instead, what it does have is a plan to increase our dependency on oil and look at production. We are addicted to oil. This Government somehow found in an austerity zero Budget $14 billion to borrow to throw at these uneconomic roads of national significance. All this is going to do is increase our dependency on oil.
The second leg of its plan is to drill it, mine it, and frack it. This brings huge risks to New Zealand. The only way we could be a net oil exporter, as the energy and resources Minister grandly proclaimed in the briefing to the incoming energy and resources Minister, is to drill deep—very, very deep. We are talking as much as 3 kilometres down. As we have seen recently, for the permits being given off the coast of Wellington, Christchurch, and Otago, this Government did not even bother to consult with the people or the councils in those regions. The drilling could be between 1 kilometre and 3 kilometres deep, and this brings a huge risk. What we are talking about are exploratory wells this summer, and when you look at America with the Deepwater Horizon oil spill, which was another exploratory well, we see that it came with a massive environmental cost and a $40 billion clean-up.
New Zealand has nowhere near the level of capability to deal with a spill. This Government could not even deal with the
oil spill, a spill of a couple of hundred tonnes on the coast of the Bay of Plenty. This is why New Zealanders are so concerned about this Government’s risky deep-sea oil drilling plan; it is because oil on our beaches is not academic any more. Kiwis can see it, they can touch it, they can smell it, and they do not want it on our beaches. They do not want to risk it, especially when the economics do not stack up.
What we know from the Government’s deep-sea oil plans is that there will be hardly any jobs, hardly any taxes, and hardly any royalties, and we know that the profits are going to go offshore. So Kiwis could be facing 100 percent of the environmental risks for 5 percent of the value of the oil. We have been rated as having the fourth-lowest Government take—that is, royalties plus taxes—of any oil-producing nation in the world. This Government is selling us far too cheap. When you add on the pages of tax exemptions foreign oil companies can access in New Zealand, when you look at the tens of millions of dollars this Government is throwing at them, picking winners in an absolutely unsustainable field, you can see that there are going to be hardly any royalties and hardly any taxes, and there will be hardly any jobs.
We know that in Taranaki it has the lowest employment rate per percentage of GDP of any sector of the Taranaki economy. We know that last year the oil industry successfully lobbied the National Government to get foreign oil workers put on the immigration skills shortage list, so that they can expedite foreign workers to work on foreign-owned, foreign-controlled oil rigs, yet we are the ones facing the cost. We are the ones facing the environmental risks. We are going to see hardly any jobs, hardly any taxes, and hardly any royalties, and we know that the profits—100 percent—will go offshore.
So a spill would bring such considerable risk to our economy that it does not stack up. A spill would destroy that valuable “clean, green” brand. A spill would be catastrophic for our fisheries and aquaculture industries. A spill would also mean that it is the taxpayer coming to pick up the tab. This is what we have seen happen with the
Rena. Last week the Government appropriated $35 million, and previous Minister for the Environment Nick Smith reckons we could be looking at a $130 million bill. Because this Government sat on its hands and refused to sign up to the 1996 bunker convention, and refused to update the Resource Management Act, and is still carrying over the woefully inadequate penalties to the new Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill, it is still sitting on its hands and is quite happy for the taxpayer to pick up the tab.
This is the big problem in the Budget: it gives $14 billion for new motorways, tens of millions of dollars to clean up oil off our beaches, $1.7 billion to throw at and subsidise polluters over the next 3 years through the emissions trading scheme, and $2 billion for
tax cuts for the wealthiest Kiwis. But the maths are mad, and are not in New Zealand’s interests. There is no hope, no vision, no compassion, and no plan going forward.
That is why the Green Party is proposing concrete, realistic solutions that are going to benefit our environment and benefit our economy. Probably the best example of a benefit—and, to give the Government credit, it is good to be working with it on this scheme—is the Warm Up New Zealand: Heat Smart home insulation scheme. Our economic experts have calculated that we have seen $1.2 billion in direct benefits from that scheme, since it has been running. So there are some win-win opportunities out there. We wish the Government would grab the rest of them. Instead of selling State assets, we should be driving these companies to export.
The global renewable energy market could be a $100 billion global market place in the next few years. If we got just 1 percent of that in exporting our renewable, exporting our geothermal, and exporting our hydro experienced expertise and technologies, we could be providing tens of thousands of jobs that would deliver hundreds of millions of dollars of economic benefits, to the advantage of New Zealand. It would provide good, Kiwi jobs and provide high-waged jobs. We would not need to see all those numbers of Kiwis—who could fill Eden Park—fleeing over the Ditch every year.
So there are solutions out there. We are going to keep proposing them until the Government gets the right idea. We are not holding our breath, because the Government’s only plan for the economy is to drill it, mine it, frack it, cut it, or sell it, and that is no plan for New Zealand. Kia ora.
TODD McCLAY (National—Rotorua)
: It is a pleasure to rise so early in this debate and speak on what was an excellent Budget. Can I congratulate our Minister of Finance, Bill English, on delivering another Budget for New Zealanders—a Budget for the times. It is a Budget for New Zealand and a Budget for New Zealanders. It is not for Greece—before the members opposite start talking about the policies they would bring to this country. It is not a Budget for the eurozone, and, of course, the challenges they are facing. It is not for the USA or other parts of the world. It is a Budget that invests in New Zealanders; a Budget for the future. This is, of course, a Government for the future and of the future.
I say that not just because of the way members opposite talk about their policies, as if those 9 years in Government, all that long time ago, were the best of times, but because New Zealanders woke up and said they were not the best of times. The spin came from members opposite—but it was not the best of times. This Budget is a Budget for the times, as I said, and I commend Bill English. Can I say to our Prime Minister, John Key, the New Zealand public not only trusts him but they voted for him in record numbers to continue to lead this country towards a brighter future.
The problem we have—and I say to my colleagues on this side of the House that we must be extremely cautious—is that we must ensure that when we have had a number of terms in Government we do not end up like members opposite, who still, after 3 years, are not listening to the public. They think the public will wake up and realise that they got it wrong, and that those years—all that time ago—were a good time for them here in New Zealand and that they made a mistake and should change their vote.
Well, it was not a mistake. They made a clear and conscious choice as to who they wanted to govern this country. They had an opportunity to reflect upon that at the election last year, and they moved forward with that in giving Prime Minister John Key the biggest vote any party has ever had under MMP—second time in a row. That is quite some accomplishment.
What is the Budget going to do? Well, it focuses on four key areas that I believe are extremely important to New Zealanders. The first is responsibly managing Government finances. Can I say to the members opposite, who last week voted against legislation
that will save $347 million over 4 years—money to reinvest in our economy, to grow productivity, to put more money into schools, and to back New Zealanders—that, actually, the point they were making when they decided to vote against that legislation was that we should instead borrow that money.
Members opposite should just look at the newspapers and cast their minds all the way across the sea to Greece and other parts of Europe. They will see the great problems they have over there because they have not fronted up to their responsibility on their issues. They have not fronted up to the changes they made. If you keep borrowing, sooner or later you have to pay it back. Well, if members opposite want to keep borrowing, it is the New Zealand public that will have to pay it back.
Secondly, this Budget is about building a more competitive and productive economy. That means taking taxpayers’ resources and spending them better for a better return on behalf of taxpayers. I think that the New Zealand taxpayer, after 9 years of a Labour Government, has a lot to look forward to over the next 2 or 3 years of this Government, including responsible spending of taxpayers’ money in building a more competitive and productive economy, and delivering better public services.
I am going to talk about a couple of these areas in a moment, but can I recognise the unbelievably committed and focused job that our Minister of Health, Tony Ryall, has done. This is not just about those 9 years under Labour where it increased the spending significantly. I recognise that members opposite when in Government increased the health spend significantly.
Somebody told me the other day they thought that Labour had almost doubled the health spend. That is commendable—it almost doubled it. But productivity in health—productivity is not mums and dads receiving letters saying that they cannot see their doctor this week or that they are not going to get their operations—did not increase by the same amount. Productivity—people being treated by the health system by our hard-working and excellent doctors and nurses—did not increase by the same amount. It did not almost double; at best it probably went up 10 percent over that period of time.
Every single week our newspapers in Rotorua are full of praise of the Lakes District Health Board. The papers are focusing on the great work that the board is doing, because last year there were more operations in the Rotorua Hospital than in any year before. Under Labour we were just told they needed more money; that is what they needed to do these operations. We found if you backed doctors and backed nurses, and you get more doctors and nurses, then more people are treated and more people get better.
Who would have thought that it is not just about money; it is about doctors and nurses in the health service. Tony Ryall has done a fantastic job. He has delivered more money to health so that we can do more, and has backed doctors and nurses so that they can get on with the task and do the job that New Zealanders want them to do.
The next point of this four-point plan is the rebuilding of Christchurch. Just over the weekend there were more earthquakes in Christchurch. Can I say that it is hard for us in the rest of the country to know what the people of Christchurch have gone through, but I say to the people of Christchurch that this Government is supporting them and this Government is continuing to make sure that the rebuilding of the city and of their region is a priority. That is very much what this Government focused on during the past 3 years and will be focusing on in the coming 3 years. We will be lifting economic achievement and doing more for New Zealanders.
Christchurch was New Zealand’s second-largest city. A year or two ago it passed the size of Wellington. It was New Zealand’s fastest-growing city, and it was not growth based upon wasteful Government spending, which New Zealanders got used to over 9 years, but growth based on productivity. It was productive growth—people producing
things and getting on in manufacturing or selling them and taking that money back into their businesses, reinvesting it, and growing employment.
Had it not been for the earthquakes, can I say to New Zealanders I think that our country would be in a very different position, and the books may look quite different. But it is a commitment that the Government has made and a commitment that New Zealanders in my electorate tell me they want us to honour—that is, to support the people of Christchurch, to rebuild their city, and, at the same time, to help rebuild our economy.
The next area is finance. We want to get the Government’s books back to surplus by 2014-15. I have heard almost every member opposite—at least from the Labour Party—say that that is not important. Labour has its own plans and would borrow a bit more and would get back to surplus in a few years in the future. Well, one need only look back a couple of years ago at countries like Greece, and they were saying similar things.
The members opposite are not fit to run this country. We cannot forever borrow and spend more than we earn. That is what they are happy to do on the opposite side of this Chamber. So this Budget, which was delivered by the able Bill English, gets us back to surplus by 2014-15. Members opposite will say that that is a modest surplus and only an odd hundred million dollars here or there. But can I say that when you are borrowing money, as this Government has had to in order to take the sharper edges off the recession, a few hundred million dollars here or there becomes very important. When we add up all of the promises that the Labour Party has made over the years of the recession—a few hundred million dollars here, $20 million over there—all the promises and commitments, well, it is not just a few hundred million dollars.
This economy and the Government’s books will be back to surplus, which is projected by Treasury to be by 2014-15. That means we can stop borrowing, we can start investing more in New Zealanders, and we can start lowering our debt levels. Of course, our debt levels will peak around 30 percent of GDP. When we came to office they were spiralling. They were forecast to spiral out of sight for the next 20 or 30 years; we have turned that round.
I want to finish, if I may, in a moment, by talking about education. A $511.9 million investment has been made in children in this country—an admirable investment. Our hard-working Minister of Education, Hekia Parata, has done a very good job to make sure that as a Government we are doing the right things. We will invest in children and we will invest in teachers. Our teachers do a very good job on our behalf. I entrust four of my children to teachers to help educate them every day. We will take some of this money—almost $60 million—and invest it in these teachers so that they can continue to do a good job, and that together we can raise educational standards.
Members opposite are right when they say that this is all about the children, and we must make sure we do everything we can for those children. But the last 9 years of a Labour Government, when it spent money on education that did not raise achievement, was a good trial, but that is all it was—a trial. It did not succeed, and if we want to raise achievement, we must do things differently, and I commend Hekia Parata for her hard work and focus in this area.
To members opposite I say that if you keep doing what you have always done, then do not be surprised by the same outcome. Can I ask only one thing of you, and I do this genuinely: please keep doing what you have always done, and in the next 3 years we will work hard in the third term of the National Government. Thank you.
Mr DEPUTY SPEAKER: Before I call Tracey Martin, this is to be a split call, and New Zealand First can determine what proportion of the call goes each way.
TRACEY MARTIN (NZ First)
: Excuse me, Mr Speaker. Are you able to ring the bell at 5 minutes?
Mr DEPUTY SPEAKER: If that is what you would like: 5 minutes or 4 minutes?
TRACEY MARTIN: Four minutes, with a minute to go. Kia ora. Thank you, Mr Speaker. New Zealand First believes that education is a critical social and economic investment. If you listened to the spin put out by the National Government, you could be forgiven for believing that it actually thought the same thing.
But just before I get into addressing just a few—just a few, because I have only 5 minutes to address these things—of the areas of concern that this seemingly innocuous but, quite frankly, dangerously sly Budget has within it, I want to send out a message of support to Dr The Rt Hon Lockwood Smith. I can only imagine the distress that Dr Smith is feeling right now as he watches his own party apply a wraparound death grip to the teaching of technologies in New Zealand schools. Some of you will not know what this document is that I am holding up. This is
The New Zealand Curriculum. It is supported by this other document I am holding up, which is on the teaching of te reo inside mainstream English-medium schools.
Dr Smith was a very hands-on Minister of Education back in the 1990s, and it was in 1993 that he demanded—demanded—that the technologies be included as a compulsory learning area in our curriculum. This document was reviewed with wide consultation in 2006. It was scheduled for full implementation in February 2010. Part of the consultation, particularly around the technologies inside this document, was with the Royal Society of New Zealand and the Institution of Professional Engineers. This is a highly regarded—both nationally and internationally—and recognised document. Other countries come to study this document. But since 2008 and the re-election of a National Government, this document and our schools have been under attack. First, we had national standards, a flawed system of markers given precedence over this curriculum by a Minister of Education who on every level refused to consult, communicate, or interact with those on the front line of educational delivery. From the last two Budgets $14.75 million has been spent on the marketing and spinning of national standards to the New Zealand public, in an attempt to convince the New Zealand public that this Government actually cares about their children and their children’s education. In this Budget, the 2012 Budget, there is a further $13.9 million, taking the spend on national standards to over $28 million by the end of the 2014 financial year.
Here we have a Government and a Minister of Education that talk the talk but have not got the faintest idea how to walk the walk. This Minister says on the one hand the Government is going to invest in 21st century learning environments, and in the next breath argues for 1970s class sizes. Here we have a Minister who talks about the one in five, speaks about our most vulnerable, and then allows her ministry to spend over $28 million on paperwork that never needed to be done. Not a single dollar of that $28 million will touch a child, and yet this same amount of money could have provided close to 9,000 identified 6-year-olds with reading recovery, or the same amount could have provided 1,690,000 teacher-aide hours in the classroom, supporting those children.
But let us just skip now to this increase of $511 million that is apparently inside this Budget. How much of that money is going to be spent on designing a league tables website? How much of that money is going to be paid to Catherine Isaac and her team while they work on an internationally suspect charter schools programme for New Zealand? How much of that $511 million will never touch a single decile 1, decile 2, or decile 3 child in this country? We do not know yet, because the Minister actually does not even know. The Minister does not know, she does not understand the teacher ratios, she has not received good advice, and our rural schools are dying because of this Budget, yet this Government will say, much like National did in the 1990s: “A little pain now, for some more gain later. Wait, New Zealand. Trust us—we know what we’re doing.” You do not, and that was obvious from today’s question time.
The Minister has no idea and the Prime Minister has no idea how teacher to student ratios work. But even if she did, why do they not apply to Māori-medium schools? Why are Māori-medium schools keeping the ratios across the board, and yet mainstream English-medium schools are being affected in this way? What about all the Māori and Pasifika students who are inside our mainstream schools now? Are they just going to have their technologies set aside—the very people whom the Minister said she is overly concerned about? The Minister needs to gain further advice. She needs to send her Secretary for Education out into the New Zealand schools, and out into the rural schools, not just the brand new, flashy ones where they can cut a ribbon. They need to go and talk to the staff, so that the Minister and her Secretary for Education can actually find out what Treasury’s suggested cuts will do for those students. Thank you.
Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First)
: Talofa lava, malo le soifua ma le lagi e mama, Mr Speaker. Fa’afetai mo le avanoa. Thank you for the opportunity to speak, and to acknowledge Samoan Language Week. [Interruption] I hope that the member David Bennett is learning some Samoan this week.
National’s Budget reforms should be given a theme of money-shuffling. That is what this is all about, and that is what this Budget is all about. It is called money-shuffling. The Government’s Budget is simply money-shuffling. Last Thursday we heard how it was taxing the young boys and young girls doing paper deliveries, and then on Friday we heard how it was collecting from the senior citizens in their residential care. Sometimes I wonder whether those are what you call “senior moments”—a Government having senior moments.
As New Zealand First’s spokesperson on social policy and welfare, what better area can I begin with than to look at what National has done to enable the welfare reform of Minister for Social Development, Paula Bennett. One of the steps National has taken is to cut $155 million from youth services. These services were established with the aim of getting youth and the unemployed into work. Instead, what has the Government done? It has gone and cut from there and channelled the money into the new package of welfare reform. Part of this new reform includes $55 million over 4 years, fundamentally for Work and Income staff to assist people into jobs. Fancy that! I have trouble understanding how this will be implemented, when this reform will not necessarily create new jobs. Does the National Government propose that we get jobs from the air? How will this, and how will they, assist people in finding jobs, when many of these unemployed people need training?
It is no myth that finding a job in New Zealand is hard. But New Zealanders have a right to know what this reform will do, when we are investing $55 million into it. Simply saying that it invests in Work and Income staff and establishing a board to oversee the changes is not enough. New Zealand First has been asking the same question for quite some time: where are the jobs? Where are the jobs? National proposes to create 3,000 placements for school-leavers, but how long will this last? How long? What we have is a cycle of training up or giving short-term placements to youth in order to ship them off to Australia. We are simply supporting a mass exodus. No doubt our increasing export from New Zealand is qualified students who simply cannot find work here in New Zealand.
Bill English estimates that unemployment will decrease by 2015 due to an injection of funding into Christchurch and other sectors to create jobs. Yes, there is nothing wrong with injecting funding, but there is something very wrong in relying too much on the hope that Christchurch will be able to boom back from heavy destruction and resolve our unemployment rates. Maybe Bill English is suggesting that school-leavers will become fund managers for KiwiSaver or auditors for the Inland Revenue Department. I believe that that is what he is looking for. Or does he expect them—
Mr DEPUTY SPEAKER: Order! The member’s time has expired.
PHIL TWYFORD (Labour—Te Atatū)
: Labour opposes this Appropriation (2012/13 Estimates) Bill.
Chris Auchinvole: No, Phil!
PHIL TWYFORD: Yes, it is true. Yes, it is true: we are opposing this bloody hopeless, nit-picking, penny-pinching Budget. The poor members on the other side of the House have been subject to all sorts of criticism over the last few days. They have upset the paper boys, they have upset aspiring postgraduate students, they have upset elderly people looking at going into residential care, and, worse than that, they have been criticised and lambasted by every respectable financial and economic commentator in this country.
But there is one group that the pundits forgot. There is one set of organisations that are the beneficiaries of this Budget, and they have not been given the recognition they deserve. That group is Western Australian mining companies. They are thrilled by this Budget. They have never seen a better Budget from a New Zealand Government. The Western Australian mining companies are over here recruiting as we speak, holding public meetings in places like Kaitāia and Kaikohe. Their public meetings are overflowing with skilled New Zealand workers looking to go and work in the Western Australian desert in goldmines and so on. This Budget is the best thing that has ever happened to them, because the flow of skilled workers across the Tasman to Western Australian mines will be speeded up by this National Budget.
It is, as we have been saying, a zero ideas Budget, and what is amazing about it is that for four Budgets in a row now Bill English has stepped up on Budget day and made the most remarkable promises about economic growth and about job growth, and he has consistently failed to deliver. Year after year he has made claims that Treasury has put into his hands of so many jobs being created and so much economic growth, and every year he has failed to deliver. Last year he promised 4 percent growth, and in this Budget he has scaled that down to 2.6 percent. Last week he said that exports were rising, whereas the House now knows that statistics show that exports fell by almost 17 percent last year. Last year he promised growth in real wages, and this year we have seen growth peak at just 1.6 percent and then decline.
In this House I represent the people of Te Atatū. We want jobs and we want growth in west Auckland. This Government has offered absolutely nothing to the people of my electorate in terms of hope that this economy will get back into growth, and nothing to make them believe that there is any realistic prospect of more jobs being created. West Auckland is the happy home of a boatbuilding industry that has been very successful in recent years, and yet under this Government’s economic stewardship we have seen one of the major superyacht builders internationally lose a major contract, which led to 50 workers being made redundant—50 workers. Since then we have seen another boatbuilder go into receivership. The owners and managers of that business have gone off to Australia. Why? Because under this Government the exchange rate punishes exporters, and members on that side of the House refused to do anything about it.
Well, Labour has produced a very clear and credible alternative budget over the last few days. We have heard my colleague David Parker laying out what Labour would do. We would introduce pro-growth tax reform that would not only make everyone pay their fair share in tax but also encourage more productive investment. I am talking about the capital gains tax. We would increase savings through a universal KiwiSaver scheme. We would re-establish the research and development tax credit scheme that National has decimated over the last few years, and, perhaps most important, we would adjust monetary policy so that it actually takes into account the need for jobs, exports, and overall economic development. But, no, National does not want to hear any of that.
What has it given the nation in the last few days? A penny-pinching, pathetic, beige Budget that does nothing to address the big structural challenges facing our economy.
I want to talk about school class sizes, because this is one of the most interesting aspects of this Budget. John Key, when asked on Friday how many schools would be affected by the Government’s change to class sizes, said that one or two schools would be affected. Well, what do we know? Now we know that every intermediate school in the country is going to be affected by job cuts, and that class sizes are going to go up dramatically. In my electorate of Te Atatū there are three intermediate schools: one of them was set to lose eight teachers, and the other two were set to lose six teachers each. They have been distraught over the weekend. They have been absolutely distraught. The Minister of Education comes to the House today and says that no more than two teachers will be lost by an intermediate school—two teachers—and she makes that claim for just the next 3 years. Well, I have got news for the Minister. One of the intermediate schools just down the road from where I live has 20 teachers. If it is going to lose two teachers, as the Minister seems to be saying, that is a 10 percent reduction in its staffing—a 10 percent reduction in its staffing. That is an outrage. After the next 3 years, what is going to happen? Will the rest of the job cuts come through? That is my question, and I ask members on that side of the House to get up and explain that policy.
There is a deep, dark secret in this Budget. While the Government has been nickel-and-diming postgraduate students, the elderly, and the paper boys, the big, deep, dark secret is that National’s spending on its roads of national significance is bloated and out of control. Billions of dollars under this Budget continue to be misspent. That is low-value spending, by the Government’s own data. These motorway projects were hand-picked by Steven Joyce when he was the Minister of Transport, most of them even before any kind of cost-benefit analysis had been done about the economic value of those projects. It is a huge amount of money—$14 billion over the next 10 years—poured down a rat-hole in many cases. It is poor-value expenditure, and when this Minister of Finance was asked in the House recently about that, the best he could say was: “Well, we campaigned on it, and we won the election, and that’s why we are going to continue doing it.” That is an extraordinary thing for a Minister of Finance to say to justify billions of dollars of expenditure on poor-value, gold-plated motorway projects. And when he is asked to explain it in the House, the best he can come up with is: “We campaigned on it, and we won an election.”
At a time of austerity, when everybody else in the country is being asked to pull their belts in a notch, Gerry Brownlee’s bloated roads of national significance are out there stealing the lunch of every other category of transport spending. From the far north to Southland, every local council is screaming that they do not have enough money to maintain their roads. Local roads are being squeezed of the resources that they need to be properly repaired. Milk tankers and logging trucks are tearing up those roads. National members opposite who represent rural electorates will be very aware that their councils simply do not have the money, because National’s roads of national significance have been gobbling up all of the budget. If it is not a road of national significance, there is a moratorium on new State highway projects around the country. It is virtually impossible to get a new State highway project done unless it is a road of national significance—unless Steven Joyce has personally hand-picked it.
I want to finish on what is the crowning glory of National’s economic plan under this Budget. I am talking, of course, about asset sales. I want to note one particular thing that I think was one of the most depressing aspects of National’s Budget last week, and that is the so-called Future Investment Fund. National is selling off assets that the mums and dads of New Zealand already own and that deliver a damn good dividend to the New Zealand taxpayer every year. It is selling them off. And what is it going to do with the
proceeds? It is going to put them into a fund—a Future Investment Fund—that Bill English conceded last week is a notional fund. So National is selling real assets, which we and our forebears sweated blood to build, and it is going to put the proceeds into a notional fund. KPMG, the accountancy firm, criticised the Future Investment Fund for using the cash merely to fund existing commitments. It said that the fund was for things the Government had already committed to. That is a sham, and that is why we oppose this Government’s Budget.
DAVID BENNETT (National—Hamilton East)
: It is a great pleasure to speak in regard to the Budget, and a great Budget it is. It is a Budget that is going to be good for New Zealand, and good for our voters and our constituents as they realise that we are building a more competitive and productive economy, which is quite different from the Opposition on the other side of the House.
I would like to start by congratulating Phil Twyford, as that was probably his best ever speech. Everybody has left the Chamber, and there is nobody left now. It is great to see Phil on form again here today. Phil did mention a few things that I think we should draw attention to: the deep, dark secret of the Budget that is the roads of national significance. I would like to see Phil and his mates come to Hamilton and tell the people of the Waikato that the deep, dark secret of this Budget is the roads of national significance, and that Labour will not fund them. Will Phil come to Hamilton and say that he will not fund the Waikato Expressway? Will you do that, Phil?
Phil Twyford: Any time, Mr Bennett, any time.
DAVID BENNETT: Any time. Well, that is the best news Tim Macindoe and David Bennett could hear, because that guarantees us the next election if Phil Twyford comes to Hamilton and says what he said in this House, that he will not fund the Waikato Expressway. The Labour Party will not fund the Waikato Expressway. Thank you, Phil Twyford. I knew you were here for a reason. I knew we could count on you to give us that advice. And Phil—are you the spokesperson on transport for the Labour Party? Are you? Are you the transport spokesperson? Yes, he is. We have got a winner. Phil Twyford is the winner. He is the Labour Party spokesperson on transport, and he has said in this House today that Labour will not fund the Waikato Expressway. I look forward to ringing the
when I leave this room and telling them that the great vision of the Labour Party transport spokesperson, Phil Twyford, for the people of Hamilton is that they will not get that investment. Thank you, Phil. Thank you, Phil. Tim, I think you are going to have to thank Phil after I have finished here, as well.
It is good to see Labour members making policy on the hoof, which is really unusual for them. They are making good, sound policy on the hoof as well, which is very unusual for them. And they are making policy where they have thought through the implications, because the implications are what this Budget is about. The implications for when you invest in infrastructure are that you build a stronger economy. When you have that infrastructure there, cities like Hamilton can take advantage of their links to Auckland and Tauranga. They can grow, and they can become more successful. Phil Twyford shakes his head in this House. Well, Phil, come to Hamilton, talk to our Regional Land Transport Committee, and ask it what its priority has been for the last generation. For a generation, what has been the priority? The committee has wanted one thing: the completion of the Waikato Expressway. Phil Twyford today has denied the people of the Waikato the one thing they have wanted for 30 years—30 years of waiting, and we have finally got it. Then today the Labour Party tried to dash that hope, and that is very sad for you, Phil, your party, and any potential candidates you have in the Waikato at the next election. I think you need to take stock of your party and what it is about.
The other thing that was interesting is that Phil went on and attacked the Future Investment Fund. That was great, was it not? One of the things that the Future Investment Fund is investing in is an organisation called KiwiRail. KiwiRail is the dear favourite of the Labour Party. The Green Party prays to KiwiRail every night, and the Mana Party is loving KiwiRail, as well. The Opposition sees KiwiRail as the great saviour of the New Zealand economy.
Hone Harawira: Sell it! Sell it!
DAVID BENNETT: Now the Mana Party wants to sell it. Well, if you make a bid for it, then you are quite entitled to it. The Green Party and the Labour Party will come into this House day after day and say that we need to invest in public transport, and that we need to have all these rail connections throughout New Zealand for public transport. They will have no limit on what they ask for, and they will never look at it objectively; they look at it believing that public transport rail is the answer. And when we invest in KiwiRail, when we put money into KiwiRail, like we are in this Budget, what do we get? We get criticism. The Opposition does not want to invest in KiwiRail, and yet it wants KiwiRail to be the answer for all our public transport issues. That just does not make sense. You cannot have a solution without investing in that solution. I implore Opposition members to look at what they say when they talk about things like KiwiRail, and work out that you need to put some money in there. We are doing that. We are actually doing what is required to build that company into the beast that they all want in order to achieve the goals that they talk about.
The Labour Party forgets that we have had a major recession—a recession that this country was in before the rest of the world, due to the policies of the previous Labour Government. Labour members forget that—
Chris Hipkins: That’s not what Bill English said.
DAVID BENNETT: What did you say?
Chris Hipkins: That’s not what Bill English said.
DAVID BENNETT: So you disagree? Labour members now disagree that they put New Zealand into recession before the rest of the world. Well, they should have a look at the growth figures.
Hon Phil Goff: The Government accounts were in the black.
DAVID BENNETT: There is Mr Phil Goff saying that they did not do that. They did do that. They put New Zealand into recession before the rest of the world. The Labour Government was a world leader. It was a world leader at putting a country into recession before the rest of the world. It put this country into recession before the rest of the world, and we have had to pick up the pieces. We have had to pick up the pieces of a recessionary economy. We have had to pick up the pieces of Budget deficits going into the future, which my good colleague from Rotorua Todd McClay talked about. He talked about how the New Zealand economy was facing years of large deficits as a result of the previous Labour Government’s policies of buying elections. The previous Labour Government put this country into recession. We had to come and take it out of recession. We have had to rebuild Christchurch, we have had to invest in the future of New Zealand infrastructure, and we have had to invest, more important, in the future of the New Zealand people.
We have done that in our education and health spending. I want to see Phil Twyford come to Hamilton and have a look at that great new beautiful hospital that is in the electorate of my good friend Tim Macindoe. That investment of $400 million in rebuilding that hospital, which will serve the purposes of the Waikato, Bay of Plenty, and other regions, is important for the future of our people. We are giving them that solid health care that they require and demand from a Government. We are giving them the standards in education that people require and demand. We are giving them the
investment in other areas, such as law and order, that people want to see as the result of a good Government.
Broadband is another example. When Mr Twyford comes to Hamilton to talk to the ratepayers and citizens of Hamilton to defend his action of not progressing with the Waikato Expressway, I want to see him walk down the streets, where you see these orange corner stands where they are putting in the broadband in Hamilton. Hamilton was the first city to get broadband in New Zealand. It is being put in there now under the good work of the constituent MPs, and it is in the best interests of this country to make that investment.
Kris Faafoi: Shameless!
DAVID BENNETT: “Shameless!” you may say, but we deliver for our constituencies, Mr Faafoi—something that I am sure you will seek to do at some stage of your political career. That is happening on the ground. Our residents see that. Hamilton has even decided to change its vision as a city. It is looking at a technologically fast forward vision, you could say—
Hon Craig Foss:
Tron. The city of the future will be the most linked city of the future, and we will be head of the pack.
Jacinda Ardern: With not a train in sight.
DAVID BENNETT: What was that, Miss Ardern?
Jacinda Ardern: With not a train in sight.
DAVID BENNETT: Miss Ardern wants a train to Auckland. See, look at this: on the one hand, Mr Twyford does not want to invest in KiwiRail, yet Miss Jacinda Ardern comes in here and wants the train to Auckland. Maybe, Jacinda, you need to take this back to Phil, your spokesperson on transport. Remember, you have campaigned two elections in a row on having a train from Hamilton to Auckland, which is worth about $2 million, and we have campaigned two elections in a row on having an expressway to Auckland, which is worth about $2 billion, and guess what the people of Hamilton want.
Chris Auchinvole: What do they want?
DAVID BENNETT: They want the expressway.
TIM MACINDOE (National—Hamilton West)
: I am delighted to stand and follow my good friend and colleague the member for Hamilton East. I am going to pick up on one of his themes, which is a vitally important one, and that is the shameful record of the previous Government, which pushed this country into recession. I want to reiterate the point that he has just made, because he is absolutely right that the people of Hamilton have demanded the completion of the Waikato Expressway for a very long time, and the Labour Party transport spokesperson being on record saying that Labour is not committed to it will be devastating for the people of the Waikato.
Perhaps even more than the three that preceded it, the fourth Budget delivered by the current Government highlighted both the gravity of the fiscal environment in which we are operating and the importance of our sound and careful strategy to manage the New Zealand economy back into surplus. In recent times one other point has become abundantly clear to my constituents and to the more responsible media and economic commentators, and that is the growing understanding of how appalling the previous Government’s record of economic mismanagement was during the 9 years of the Clark-Cullen-Parker-Cunliffe regime. That is not just a political point, and nor is it trite or cheap, because, reflecting now on the previous Government’s shameful record of huge and reckless increases in Government spending while it made little or no provision for paying for it, it is clear that all the Ministers in that former Clark Government—including the leader of New Zealand First, I should add, who now feigns concern about
debt and the need to boost our country’s exports—have shackled our economy and imperilled our children’s future. For 5 years under their stewardship, if one could call it that, Labour Ministers allowed Government spending to rise at twice the rate of revenue. At any time such a policy would be foolhardy and unsustainable, but to continue on that path as economic storm clouds were brewing at home and throughout the global economy—
Todd McClay: I saw those storm clouds brewing.
TIM MACINDOE: —you did indeed, Mr McClay—as was clearly the case in the final term of the last Government, the Clark Government, was reckless and utterly shameful. So when former Ministers from “Planet Labour” stood in this House last week to attack the Budget and to speak of the Government’s supposed meanness and lack of imagination, as several attempted to do, I saw red in more ways than one. No one is fooled—none but the most one-eyed, dyed-in-the-wool Labour Party activist could continue to defend the indefensible. Labour caused the lion’s share of New Zealand’s current economic difficulties, yet not one member of the party opposite has had the integrity, yet, to admit it or the humility to stand and apologise for it. Not one of them.
Again, today, we have heard more unadulterated claptrap from this week’s Labour finance spokesman, David Parker, deflecting the blame and ignoring the triple challenges posed by the global financial crisis, the magnitude of the Canterbury earthquakes, and the continuing impact of Labour’s reckless and unfunded escalation of public spending. Yet today Mr Parker opined that “if you change nothing, nothing changes”. The same party that derides National’s attempts to rein in Government spending and mistakes a zero Budget for a recipe for zero growth and that attacks significant programmes to deliver better public services, to fund the reconstruction of Christchurch, to improve our tax system, and to promote the creation of new and sustainable jobs hopes it can spin the line that nothing is changing. The evidence that things are changing is overwhelming and all around us.
Andrew Little: They are on the benches opposite.
TIM MACINDOE: We have had growth, Mr Little, in every quarter since Bill English delivered a Budget. In fact, the last period of no growth was the last quarter bequeathed to us by the outgoing Labour Government.
We have constantly reprioritised spending, as a Government, towards the things that work, and we also have a firm focus on results, not just inputs. It is the Labour Party’s view that you just throw money at things, you have no accountability, and you make no attempt to measure whether things work. You just say: “Throw more money at the problem.” and you borrow it from overseas. The members opposite say: “Let’s tax and tax and tax, and spend and spend and spend, and somehow we will fix everything.” Well, what we are doing is making a difference, despite the fact that we are not increasing overall Government spending.
Notwithstanding Mr Twyford’s bizarre assertions a few minutes ago, the facts show that the number of people on benefits fell by more than 21,000 in February this year alone. That included 5,651 fewer people on unemployment benefits, which is a 9 percent drop in that month alone—a fantastic effort. Then the following month, to show it was not a fluke, we saw a further 8,000 people cancel their benefits, because they had found work. I congratulate each and every one of those 8,000 people, and I wish them well. I know that finding work is the best thing for them and for their families, and I trust that it will see a significant increase in their living standards.
I stand 100 percent behind the priorities that our Government has outlined for this term. Let us be reminded of those four priorities. We have committed ourselves to responsible management of the Government’s finances in order to return the
Government’s books to surplus by 2014-15. Nobody underestimates how challenging that is. Each time—as we saw again, tragically, last week—there is another earthquake in Christchurch, it becomes harder, but we remain on track. Well done, Bill English. Well done, everybody who is managing a ministerial portfolio in these tight times.
Our second priority is to continue building a more competitive and productive economy—not one where you just throw money at low-quality areas, but one where investment is made in sustainable jobs and in growing a productive economy.
Our third priority, which I am going to come back to in a few minutes, is delivering better public services. I am passionate about that goal, which is why I will talk about it a bit more in a few minutes.
But of course the final one, as I have just mentioned, is that commitment, which remains ongoing, to the rebuild of Christchurch. Nobody should underestimate how challenging that is. I am sure our hearts go out to everybody in that city at the moment, as they continue to be shaken. It is a traumatic and devastating time for all of them, and we stand 100 percent behind them. They need that commitment, and I am glad that we have made it to them.
Earlier this year the Prime Minister announced 10 new results-driven goals for the Public Service, and they are hugely important. It is a pity that they did not get more coverage through the media, but I guess that tells you a little bit about media priorities. But those 10 commitments are very important. They are challenging and they are things that we are prepared to put on the record and be judged on over the next 3 to 5 years.
The first, of course, is the reduction in long-term welfare dependency. It is hugely important for generations of future New Zealanders.
The second is to see more young children, particularly Māori and Pasifika children, in early childhood education. We have made great strides in the last 3 years in this area. We are committed to achieving more, and I am delighted to see it happening.
The third is an important health objective, and that is continuing to see an increase in the rates of immunisation for young children. That is happening again. The records are out. In fact, I saw in the papers today further results from the district health boards around the country, and I congratulate them. They are all making major strides in that direction.
The fourth is to see a significant reduction in the number of assaults on our nation’s children. I am sure every member of this House welcomes that objective. I am sure we are all determined to see it happen. I thank those who contributed to the green paper and who have put forward ideas. I thank those who are working in this crucially important area, and I am going to do everything I can as an MP to support their efforts.
The fifth is to see more young people coming through our education system with significant levels of achievement. We know that pretty much the benchmark now is National Certificate of Educational Achievement level 2. It is a huge jump from even a generation ago. Therefore, what we are doing is putting a major investment into the programmes available, seeing them go through school and into tertiary education. We are determined to achieve that outcome, and we know that it is the quality of teaching that makes a huge difference. We are funding that. We are backing our teachers. We believe in them. I back them. I am a former teacher myself, and I thank them for what they are doing.
The sixth is to see a more skilled workforce, with an increase in the number of people coming through with advanced trade qualifications because they need them in order to secure employment.
The next is a reduction in the crime rate. It is not just total crime. It is youth crime that is such a major problem in our country, and it is violent crime. As we reduce crime,
and we are seeing that happen, we know that that is going to make a huge difference to the lives of all New Zealanders.
The final one that I am going to mention today is a reduction in the rate of reoffending, which is something I am passionately committed to.
Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman)
: After that speech, I am going to have a talk to my colleague Phil Twyford and say that we do need the Hamilton expressway, because that member clearly needs to get out of Hamilton more often and into the real world. He is kidding himself with most of the facts or most of the claims he made in that speech.
The Budget was next to useless. It was a failed and failing Budget from a Government that is doing the same, failing. In fact, there will be many comments made on the Budget, but perhaps one of the best I have seen is one that said it was so bad that even the Queensland fruit fly would want to go back home. I think that is true. The 50,000 people who are now going to Australia every year are helping this Government. They are certainly reducing the unemployment figures; no doubt about that. But the sad fact is they are leaving because they have no hope for the future in this country, and that is a sad indictment on 4 years of a National Government, on four Budgets that have failed to deliver any vision whatsoever for this country.
What it has done is costed everything and valued nothing—costed every single thing, nickel and dime everything, even to the point of squeezing paper boys. Look back at the people we are talking about. These are young boys and girls up and down this country who often get up early in the morning, come rain, hail, or shine, get on their bikes and go out and deliver papers to people who get out of bed, and there is the paper at the front door. Their work ethic, their commitment to the job, is one that inspires every New Zealander who appreciates getting their paper in the morning. What has Bill English done? The mean-spirited, failing Minister of Finance has said: “We will take tax off them.”, because probably once a year they would look forward to a tax refund of about 200 bucks.
I lived out in the country, so I could not do it, but I can remember talking to friends who would get that money and that was a huge bonus—the inspiration for a year’s commitment. Bill English has scuttled them. And why? Well, because in 2009 the Government gave billions of dollars in tax cuts to the most wealthy in this country. The Government cut $13 million from Adult and Community Education at a time when it knew there were going to be people put on the unemployment scrap heap. The Government knew there were going to be people who needed to upskill and find some inspiration. No, the Government chopped it, for $13 million, and gave billions of dollars to people who probably, for the most part, did not even notice the increase in their income.
Andrew Little: Didn’t need it.
Hon DAMIEN O’CONNOR: They did not need it. They did not need it, and then of course, to top it off, National increased GST, which is the most regressive tax, arguably, that we have. The more people have to spend to live, the more GST they pay.
Hon Maurice Williamson: Who brought it in, in the first place? Who then increased it?
Hon DAMIEN O’CONNOR: Bill English and Mr Williamson there, because he is one of them—that member over there had to bring in a whole swag of Miss New Zealand entrants to try to find some inspiration, because he got nothing from the Budget. I hope it perked you up a little bit, Mr Williamson.
Can I say that there are a couple of areas that I would like to focus on. They are quite weighty documents, I have to say. Thanks to the help of my colleagues, and we all worked through our own parts, I ended up, having read through the primary industries
one—and I will go back to that—being notified about the economic development and infrastructure section, which is an oxymoron from the National Government, I have to say. I went through the area of energy and found a line item that has decreased that epitomises this Government and everything it stands for—that is, a whole lot of promises and no delivery. John Key promised that money would not be an issue and that everything that could be done would be done to get the 29 miners out of Pike River.
Chris Auchinvole: And he did.
Hon DAMIEN O’CONNOR: No, he did not. Mr Auchinvole might—that is an absolute lie. Can I say, to back up what the Government has done, it has cut the $5 million—
Chris Auchinvole: I raise a point of order, Mr Speaker. I am surprised, and I do not wish to engage in the indelicate nature of the way that the member is speaking, but I do not take being called a liar.
Mr DEPUTY SPEAKER: I did listen very, very carefully. The member who was speaking, Mr O’Connor, said that that is a lie. He did not accuse the member of being a liar. It is a fine point. I just advise the member not to take those liberties because it does bring disorder. I am not upholding it, but I am not commending the member for the way he spoke, either.
Hon DAMIEN O’CONNOR: I do appreciate the Standing Orders and the fine line. But some things are untrue, and I have to say them in that way. I am not accusing anyone. I am saying that if anyone claims that everything was done, then that is a lie because it has not been. The $5 million that has been allocated for the recovery of the Pike River miners has been chopped from the energy budget, and that now is left to Solid Energy, perhaps—or who else, we do not know, perhaps a trust that the Government is trying to set up—to try to fund the recovery. Where is John Key’s commitment? Where is National’s commitment? They made a song and dance about it at the time. I have to say a lot of people hung their hopes on that. I welcomed that commitment. But like so many other things, promises of jobs, promises of economic growth, and promises of growth and innovation, the National Government has simply not delivered.
Well, the previous member got up and said there was growth in every quarter. It is more likely there was a quarter of the growth in every quarter, because, of every single figure that John Key or Bill English have put up in terms of job numbers and job creation, none of those targets have been met. I suggest that none of the targets in this Budget will be met either. It is a zero Budget—a zero Budget—because National did not want to make any promises. It wanted to have estimates and forecasts, but no promises, because it has not delivered—it has not delivered—on any promises to this.
The four objectives could be summarised in one word: sell, sell, sell, sell. Four State-owned enterprises—sell them. Why? Because John Key and this Government have promised their mates on the New Zealand Exchange that they will deliver them a bundle of toys so they can go and play with them. The Government will give its mates some shares to trade—blue-chip shares, so they will hang around for a wee while. But we know that ultimately every one of those State-owned enterprises and all of those mums and dads’ shares—in fact, the promise to have mums and dads at the front of the queue is also a lie. It is a lie because it cannot be delivered, and the Government has stated so very quietly—very quietly. It cannot deliver on the promise that mums and dads will be at the front of the queue. That is a lie, and it should be stated in this House because we have an obligation as the Opposition to identify the untruths, the failed promises, and the failed commitments of this Government. We have got a plan going forward, and it needs growth in the primary sectors.
We have seen in the next lot of documents in the primary sector cutbacks to biosecurity funding. In a number of areas we have seen cutbacks. Can I say that I am horrified at $6.8 million in so-called cost savings in biosecurity policy. We then have a $5 million reduction in domestic biosecurity surveillance. The very system that picked up the Queensland fruit fly is going to be cut. And this is the Government that claims it has a vision. Actually, I do not know whether it has claimed that. Perhaps that is a lie. I do not want to say that. I do not think it has ever claimed to have a vision. I do not think it has ever done that. It says it has a plan. Well, the plan is about selling State-owned enterprises, it is about squeezing teachers at schools, it is about trying to break unions and dumb down labour policy, and it is about robbing kids who deliver papers. I am sure that every MP when they are at home over the holidays, whether it is raining or sunny—and they are going to take the tax back from them.
There are no words too strong to describe the injustices and the unfairness that this Budget as a continuation of current Government policies has delivered. There is no hope; there is no vision. The Labour Party will develop policies that will offer at the next election—
Chris Auchinvole: When?
Nikki Kaye: When?
Hon DAMIEN O’CONNOR: We have plenty of time, because at the moment—
Mr DEPUTY SPEAKER: Order! The time has expired. [Interruption] Order! I have cautioned the member.
CHRIS AUCHINVOLE (National)
: Normally I say what a pleasure it is to follow on from a previous speaker, but I am afraid on this occasion I do not intend to say that, because I was very disappointed in the depths to which that member, Damien O’Connor, went in seeking to make some sort of a snide personal point. I am very disappointed. I had thought better of him; I am sure his family did too. However, we get disappointed in life.
But I rise to speak in favour of the Appropriation (2012/13 Estimates) Bill—the Budget delivered by this Government for the brighter future that this Budget and the Government seeks to protect, particularly from the sort of criticism that we have been hearing from the other side of the House. Let us not be misled: we do have to protect the future from that sort of needless, senseless, groundless criticism. It needs to be protected from an Opposition party whose scant regard for our future prosperity was manifest in its own period in Government—and its scant regard for the future prosperity of our children and grandchildren. Our need to protect them from that party is confused and of concern, because we do not know why it is adopting the approach it is taking.
Those members sit on the cross benches, on the Opposition benches, as sirens singing for our nation to shipwreck, but this is a tune we are glad to change. And goodness me, the singing sirens—what an astonishing performance we have had—
Hon Maurice Williamson: You think they look like sirens?
CHRIS AUCHINVOLE: Well, some of them—it requires, the Hon Maurice Williamson, a little bit of imagination, I would agree. I would agree, especially when you hear the Hon Clayton Cosgrove singing. Goodness me. And then from New Zealand First—oh, such hand-wringing, such an end of the world, such accusations. One only has to look back a little bit over the years in Parliament to wonder at such sounds coming from New Zealand First, of all parties.
Andrew Little: Tell us about the Budget.
CHRIS AUCHINVOLE: You want to talk about the Budget? I am very happy to do that, and I will do it for Mr Little because I know he is keen to see New Zealand’s future develop. This Budget, Andrew, promotes economic growth. It forecasts growth at about 3 percent over the next 4 years. That is higher than Europe, at 0.5 percent; higher than
the UK, at just over 1 percent; higher than Japan, at 1.5 percent; and higher than the US and Canada, at 2 percent. We are expected to have around the same growth rate as Australia—about 3 percent.
The Green Party, represented by Gareth Hughes’ speech, spoke of the Budget as not promoting growth. He could not be “wronger”! Responsibly managing Government finances in testing times and keeping the Government on track for surplus in 2014-15 is the task of this Budget. Our move towards surplus safeguards our international credibility and helps, for instance, to keep our interest rates lower for longer. Did Labour do that? No. It takes the pressure off the exchange rate. I will say that again: it takes the pressure off the exchange rate. Did Labour do that? Oh no. It reduces future finance costs. I will say that bit again: it reduces future finance costs. Did Labour do that? Oh no. Labour members have gone wonderfully quiet.
This Budget has been received positively by Standard and Poor’s, Fitch Ratings, and Moody’s. It is not just National who says it is a good idea; the people who measure these things say it is. This represents a huge turn-round, given the impacts of the 2008 recession, the global financial crisis, and—wait for it—the thing that in Labour-land never happened, the Canterbury earthquakes. The growth is based on strong fundamentals and our sound economic and financial institutions, rather than the money-burning fiscal irrationality of Labour—and we all had to endure that.
The Labour Opposition proposes a capital gains tax on all businesses, the reason—the only reason I have heard from it—being that other people do it, as if that makes it perfect in every way. It proposes the cancellation of a successful 90-day trial period, which would put 60,000 jobs created in the past 2 years at serious risk. Do you want to talk about that a little bit longer? Do you want to talk about that? Where do we hear criticism of that 90-day trial period? Thank you, Mr Speaker, I am sure you want to talk about it, but does the Labour Opposition want to talk about it?
Andrew Little: Yes.
CHRIS AUCHINVOLE: Oh, I am sure you do—except that it has worked. It gets into work people who would not get to work otherwise. Oh yes!
The Labour Opposition proposed extra transport charges and lifting interest rates by borrowing billions more, which would have put at risk the positive economic growth this nation has enjoyed in nine of the past 10 quarters under this Government. Do you want me to say that bit again? Nine of the past 10 quarters under this Government. The Labour Opposition proposes minimum wage increases that would cost thousands of jobs. The Labour Opposition has shown that it has the wrong recipe for building a more competitive international economy.
Why is that? Why is it? I am sure those members are well-meaning people, except for the previous speaker; I do not think he meant well at all. But normally Labour speakers mean well, so why is it that they get it horribly wrong? It is because they are trying to answer their trade union masters rather than the economic reality. We all know about self-seeking trade unionists, and how they lurk in the Opposition benches, lurking there.
This Budget maintains our commitment to rebuilding Christchurch. Almost $1.6 billion of the $5.5 billion Canterbury Earthquake Recovery Fund was spent in 2010-11. Most of the remaining funding is expected to be spent by 2015. But Cantabrians are not the only ones who will be supported through hard times. We will keep protecting vulnerable New Zealanders through Working for Families, New Zealand superannuation, and welfare benefits. I was remarkably proud of the Prime Minister when we realised that we had gone into recession during Labour’s last term and he said: “We must support the vulnerable. We must support those who are on benefits and entitlements.” And he has done that—he has done that. We will continue to support
people to help themselves, investing $287.5 million on education and training. This is an investment in the people and the future of New Zealand.
Another vital role of this Budget is to ensure that the great work that has been done in the health field is continued. Let us remember that the Hon Tony Ryall was a spokesperson on health, an attack politician on that side of the House. He did a wonderful job in speaking about the frailties, the infirmities, and the need for change in health. He then made that transformation of becoming a very effective Minister of Health—let us be honest about it, all party politics aside; he is an outstanding Minister—and then he got a second term as health Minister. So it is amazing. Over 4 years we will commit almost $1.5 billion extra to our public health service. This will develop far more operations. This will continue to support the growth in health services.
Just to finalise, this Budget allows the Government to reprioritise $65 million in operating expenditure over the next 4 years, as well as—what is it—$73 billion in Government expenditure overall, contributing to 33,100 offenders accessing drug and alcohol treatment in prisons, 7,855 more rehabilitation places, 2,950 more prisoners in education and training, 7,500 prisoners in community offender support to find real jobs, 41,100 more rehabilitation places for community offenders, and 6,000 more integration support programme places. This Budget allows the Government to take the vital steps in addressing prisoner reoffending.
These steps in health, in law and order, in the rebuilding of Christchurch, and in every other field of government will build the brighter future that we campaigned on, that we have protected, and that we on this side of the House are so proud of. This Budget invests in New Zealand’s future. It will stimulate new jobs and deliver better services for families, while keeping the Government on track to surplus in 2014-15. I encourage those on the cross benches and those on the Opposition benches to join us and say: “Well done, Mr English, and well done, Mr John Key’s National-led Government.” Thank you.
CATHERINE DELAHUNTY (Green)
: Talofa lava, Mr Speaker. I would like to acknowledge Samoan Language Week. I cannot say well done. We are living in an Orwellian universe now where bad news is good news, especially in education. The title of my education budget speech is “The labyrinth descends into ruin”, on an education budget labyrinth that is now disintegrating by the hour like a train wreck. Who knows? Maybe by 6 o’clock tonight staff cuts will be only one teacher per school. And the working party? Who knows? Just so long as the working party is not going to be led by Catherine Isaac or Paula Rebstock, because we have seen what that means.
Enough wasting of money on national standards moderation tools for the non-national standards, and enough wasting of money on the bizarre experiment of charter schools, which has failed overseas. We need to think really seriously about what is going on in education, and, unfortunately, the changes in this Budget are a maze in which many are wandering and finding strange things in dark corners. It takes a while, but it comes out in the end.
One positive area I am going to mention in the maze, which has shown some light, is Enviroschools, Te Aho Tū Roa. It is a wonderful initiative established by the Green Party in 2002 and then cut by the National Government, and now restored by the advocacy of the Māori Party to the tune of $7 million. I say good on the Māori Party, because we need Enviroschools more than ever as the planet faces the worst crisis it has ever known. It is a small beam of hope in the darkness that is the maze of educational confusion from this Budget.
But what about the grimmer and bigger picture in education? What about early childhood education? The freeze on the 20 free hours subsidy is an attack on families and whānau—nothing less. The centres and the families are contacting us and telling us
in words of one syllable that people cannot afford to pay more on their fees for early childhood education. The rate of inflation makes this an effective cut to the subsidy and it is not fair. It is going to cost everyone in the long term. Early childhood is supposed to be the most important time in our children’s lives. The advisory groups on early childhood education have come up with some good ideas to improve early childhood education, but the whole process is getting undermined because people simply cannot pay the fee increases built into this Budget. I ask the Government to please not do this to families just because you can; it is too important. The Government will respond by saying that extra money is going into targeting Pasifika and tangata whenua children. That would be great if it was on top of universalism, because what really makes a difference is when you acknowledge that the poverty and inequity that is absolutely endemic in this country is across the board. It is not geographically or sectorally tidied up into some particular places; it is right across this country. That struggle is across many, many areas and it needs to be recognised through universalism, with additional targeting of funding. The Government has failed to understand that, because it does not grasp the concept of universalism, and also because it does not want to spend the money.
So let us talk about another disaster in the Budget, which is the compulsory sector. In schools the essence of the Government’s rhetoric has been the long tail of underachievement in addressing disadvantage. So what has the Budget done? It has delivered bad news, and even today has backed down, calling it good news because of the public relations disaster. I personally spent all weekend replying to emails and calls from families and from teachers saying: “What on earth are we going to do without these teachers? What is going to happen to our children?”. In primary and intermediate schools this is a disaster, and the labyrinth that I referred to is collapsing further into ruin.
The new funding formula for schools will do a number of extremely destructive things. Increasing class sizes in years 2 to 8—whose terrible idea was that to save money? I bet it was Treasury’s. I bet it was Treasury officials, those experts on education, persuading the Ministry of Education and the Minister that it would save the country when, even in its narrow monetarist terms, it will end up costing us. That is what happens when you let Treasury officials call the shots on something that they clearly do not understand, at all. Primary and intermediate schools are fighting hard now to keep class sizes at around 23, because it works. We all know it works. That is why the rich send their kids to private schools. Because they have small classes. Why does the Government not just admit that? Why does it not admit that it does not think everyone deserves it? But the diversity of children and the need for one-to-one attention to engage students with learning is a core plank for every decent school, unless, of course, you believe in rote learning, or unless you think that lecturing is education for our children.
The other day I visited a school that is fighting to keep class sizes down by bringing in extra funding from international students, and the principal had just come back from overseas doing this. It was not because he wanted to, but because without that money, it cannot meet its target of 23 per class. I went into a classroom of 6-year-olds who are now looking at an increase in their class size. The 6-year-olds in that classroom are so diverse that there are six different reading groups amongst what is now 23 students. The teacher said to me: “Please don’t give us one more child, because the diversity of need means I cannot do justice to those six different reading groups of needs within a class of 23.” That is the reality of a community where children experience dyslexia, special needs, and a whole range of learning needs where English is a second language. If you understand what is actually going on in the demographics of schools, you would never
do this to our children. You would never consider it. However, what we are going to look at is a decline in quality. Small classes are quality classes unless you are a charismatic lecturer at a university—and any student can tell you that not many of them actually exist.
Technology teachers are the front line for the axe. We might lose up to 1,350. It is confusing, as the Prime Minister said in the paper this morning, and well he might. He is confused, we are confused, the Minister is confused—everyone is confused because the formula was not thought through. I want to quote from a woman, who gave me permission to quote her, called Sally French. She said today: “My daughter, a highly qualified art teacher with a fine arts degree with distinction and postgraduate diploma and 12 years’ teaching experience finds herself redundant with 1,100 others, and, yes, this is personal for me.” This family is extremely shocked and undermined, but the Government and Treasury just think these are numbers. What is technology actually teaching? It is a broad field including practical skills and the arts, including te reo Māori, which is an obligation under Te Tiriti. It is about hands-on learning and it is about specialist teaching. Specialist teaching as well includes remedial reading, which the Government, if it cared about literacy, would be doing nothing to undermine. So there are many contradictions in what is happening.
Another one is the bizarre outcome of bad planning and lack of coherence in the education section of the Budget around cutting postgraduate allowances whilst stating that teachers will now need a postgraduate qualification. How bizarre is that? On the one hand, postgraduates must find a way to study for a master’s qualification with no money, and, on the other hand, if they do not achieve this qualification, they will not be able to teach. Can they not even talk to each other before they write the Budget? The maximum amount that can be borrowed now is $172.51 a week.
However, there has been good news in the Budget—good news for Wanganui Collegiate School. It has received $2.9 million over the last 3 years and a new commitment to this private school, which is failing. Private sector education, of course, deserves the cash—apparently! So let us bail out failing private schools and cut quality public education. That is what is hidden in the rhetoric maze, and, people, this is bad news. It is bad news for students, teachers, and the country, but it is good news for Treasury and its little numbers, and good for Wanganui Collegiate School.
However, the Green Party is inspired about education and educational leaders in Aotearoa, as well as others such as Pasi Sahlberg, Finland’s director of education, who has shown the world that great results come from a commitment to equity, leading to achievement. Does the National Government know what equity means in education? It is the reason that Finland is at the top of the Programme for International Student Assessment poll. Equity—that is what leads to good achievement for all our children, and it is highly successful, despite the uninformed doubts expressed by Gerry Brownlee about Finland. The tragedy is that without equity in our communities we will never achieve equity in our schools. But to undermine that by cutting teacher numbers and increasing class sizes at this time in our history and at this time in our crisis around employment is a downright disgrace. The tragedy of the failed Budget appropriation on education is that someone will have to then turn round to get teachers back into the profession and to reduce class sizes again and fix the damage—and what a waste of time and lives that is. At a time when education must be the basis for liberation for all, we are now talking about narrowing privilege. We are now talking about increasing the privilege of the few, and protecting the few, despite the many.
The cuts to adult community education, lifelong learning, and many other things need to be talked about. The maze is unfolding, but I just want to say thank you very much, Mr Speaker. The Budget has failed us and our children.
NIKKI KAYE (National—Auckland Central)
: I am very pleased to speak in this Budget debate. The first thing I want to talk about is courage, in relation to the Budget. Last night I heard a speech about courage. When we think about courage we think about accepting reality, and accepting the situations in New Zealand that may not be things we are proud of, but also about making the hard calls for New Zealand. And what I can tell you about this Budget is that we are not only accepting the reality about our place in the world and some of the issues that we have had in the past but also implementing policy that means that many young people in New Zealand will actually have a future. We are making the hard calls for New Zealand that we need to make. I want to talk about some of those today.
I also want to say that there is a clear contrast in this House. There is a clear contrast in this House between us and Opposition members, whose strategy around this Budget is to deny, oppose, and hope, compared with us making hard decisions. They have denied the situation that they left us in with regard to our economic situation, and we are addressing this within the Budget. They have opposed many economic issues that we are proposing within this Budget, and they are hoping that everything will be OK.
I want to address just some of the issues and some of the initiatives that we have in this Budget that mean we have a real economic plan for this country. The first thing I want to talk about, as chair of the Education and Science Committee, is our tertiary education system and the changes that we are making. We acknowledge that we have one of the most generous tertiary support systems in the world, and if we want many of our young people to have a future and to have high-paying jobs, we have to shift expenditure into research funds in areas like science and technology. We have announced a $326 million initiative in this Budget around research and technology. We have also announced a number of changes to the student loan system. What that is about is freeing up funds so that we can invest more in research in our tertiary system. What that means is that rather than people coming out of university with high debts that they will never be able to pay off because they will never be able to get the high-paying jobs in research and innovation, we are saying that we need to spend that money on research within our tertiary institutions. We also need to make sure that we are spending that money in those areas like agriculture—and some of those other areas might be digital media—so that we actually can create industries that have high-paying jobs.
Compare that with the Opposition members, who, firstly, have opposed everything from labour law changes to tax reform changes, to mixed ownership changes, and to investment in infrastructure. When you look at the rest of our economic plan, which, again, is highlighted in initiatives in this Budget, you see that we also focus on massive investment in infrastructure. We acknowledge that if we want our country to be better, then we not only have to shift funds within our tertiary education system but also have to invest in infrastructure. You will see that that is reflected in this Budget, whether it is in our $1.5 billion Broadband Investment Fund, whether it is in our roads of national significance, which are about ensuring that goods get to market quicker, or whether it is in the tax reform changes that we are making.
In this Budget there is $1.36 billion that is coming out of revenue around closing up tax loopholes, and what that is saying to New Zealanders is that we believe in fairness, and we believe that if we really want to have a future for our young people we need not only to reform our tax system but also to invest in infrastructure, to ensure we reprioritise in areas like science and innovation, and to make changes within our education system. It comes back to the point that I made before, which is that if we want to have a country that has a future, we need to make sure that we do not allow one in five kids to leave our education system not being able to read and write properly. That is actually appalling.
Now I want to cover just a few initiatives within this Budget with regard to education. What we are saying is that we acknowledge that there is a very difficult financial situation not only in New Zealand but also around the world. If we want to be secure, we have to have zero Budgets, we have to make sure we reduce debt, and we have to pay our own way in the world. The way we do that is that we have to reprioritise expenditure. So what we are saying is that we know that New Zealanders in their own homes understand the situation and that they have to make choices. Some of the choices we are making in education are to say that we know that if we invest more in teacher training and professional development, then we can actually raise the level of achievement more.
I want to give you an example of a place that I visited recently—the Best Pacific Institute of Education. In the Budget there were 3,000 additional places in the Youth Guarantee scheme, and I am incredibly proud of that. I want to tell you about these kids. A number of these children—and some of them came through our education system in the last 12 years, if members opposite want to crow about hearing about people who are poor—came out of our education system not being able to read and write. No one in this House should be proud of that. I am proud that through our Youth Guarantee system we are giving them a future. We are giving 3,000 more places within our Youth Guarantee system, to say to those kids that the Government will ensure that they get some basic National Certificate of Educational Achievement qualifications, because, actually, we did not do our job in our education system before that. That is the kind of initiative in this Budget that is about creating a future where young people leave our education system actually being able to read and write, and being able to go into professions that have high-paying jobs.
I want to touch on that again. Again, you are seeing a very clear contrast between this side of the House and the other, whether it is in National’s investment in infrastructure, whether it is in the reshuffling of funds in our tertiary education system, or whether it is in the huge package for science and innovation. I want to show you a graph here on science and innovation. This graph I am holding shows what we are spending on science and innovation. You can see it going up, regardless of the tax credit that the Labour Party talks about so much. We are clearly prioritising, in very difficult financial times, as a result of this Budget, and saying that, actually, if our country wants to earn more money, then we know that that is going to be in areas that are high tech. We know that we need to spend $160 million.
I want to address one of the initiatives that we have announced—the Advanced Technology Institute. That is a massive initiative to spend over $100 million on investing in good science and research that is going to enable our industries to sell high-value products to the rest of the world. Again, it is about priorities. On this side of the House we understand that with the incredible situation that has been happening around the world, with the fact that we went into recession before the rest of the world and were staring down the barrel of a decade of deficits, it is actually not OK to have a strategy to just deny that everything is happening, oppose everything, and hope everything will be OK. This Budget is about choices, whether they are in the education area, whether they are in the economic area, or whether they are in the health area. New Zealanders know that this Budget is about choices. There are hard calls to make, and it comes back to what I said before—it is about courage. It is about being able to stand up to New Zealanders and say that we do not have any blank cheques to write, and we have to get the money from somewhere.
What I can say is that I am confident—I am actually very confident—that when you look at where we have put the money, in various parts of the Budget, you see that we have prioritised areas like our most vulnerable, like the kids in the Youth Guarantee
scheme, where there will be 3,000 more places as a result of the Budget. We have found $326 million for science innovation. This Budget is about creating a future for our young people. It is about ensuring that we earn our way in the world, ensuring that our young people have higher-paying jobs, and ensuring that they leave our schools actually being able to read and write. It also ensures that for those young people who came through the system under the last Labour Government and who cannot read or write, we will help them get back on their feet, and we will ensure that they can get into work. We know that not only their futures but also the futures of their children are dependent on our waking up and realising that the world has changed, that we have to make choices, and that some of those choices are hard, but they are about reprioritising expenditure. Every single line that you see within our Budget is about understanding that the world has changed, and making those choices. You can compare that with the Opposition approach of deny, oppose, and hope.
I came back to New Zealand to stand for Parliament. I was in London, working, and I came back to stand because I truly do believe that we have a great leader, and that we have principles within our party that actually recognise the economic situation that the world faces. We have prioritised to ensure that young people in New Zealand are going to have a future.
KRIS FAAFOI (Labour—Mana)
: Thank you, Mr Speaker, very much for this chance to speak in the Budget debate. It is a pleasure, actually, to follow the previous speaker, Nikki Kaye. And talofa lava. I should acknowledge Samoan Language Week along with other members of this House. The previous speaker talked about courage and making the hard decisions in this Budget. I would like to congratulate the Government on making the hard decisions and having the courage to do so in the 2012 Budget. I would like to thank them and commend them for their courage in taking money off paper boys and paper girls to raise a miserly $14 million. This will affect 68,000 young people around the country. Congratulations to the National Party on its courage in doing that.
Tim Macindoe: I raise a point of order, Mr Speaker. By implication, the member is impugning the courage of the members on this side of the House. He cannot do that. That is outside the Standing Orders.
The ASSISTANT SPEAKER (Lindsay Tisch): The member needs to be careful. When one talks about the party, as the member did, that does imply members. So we will not do that again.
KRIS FAAFOI: Thank you, Mr Assistant Speaker. I do note your ruling, and I thank Mr Macindoe for making that point. I would also like to thank the Budget, I guess, for the courage that it took to crack down on some of our most vulnerable citizens by changing the way the asset threshold for residential care is calculated. I commend the Budget for that courageous move.
I also commend the Budget for its courageous move—and I hope the Government sticks to it—in its announcement to change the funding formula for teachers, which, in essence, means that hundreds of intermediate school teachers right around the country now face losing their jobs, and that tens or hundreds of thousands of children around our country will probably now find themselves in classrooms with lots more children. I commend the courage in the Budget for making these hard decisions, because these decisions are our ticket to prosperity. These Budget measures will mean that we are going to be on the road to prosperity.
I am reliably informed that at about 1 o’clock last Thursday a search and rescue team was convened. It had to be the best, because of the type of mission. The mission was going to be difficult. It was going to be a hard slog. It could have been a long mission, and it could have been a mission that may have finished with an unhappy ending. That
search and rescue team was tasked with finding positive ideas within this Budget to address the fact that New Zealand has had the worst growth in 50 years. That search and rescue team was tasked with needing to turn round the fact that every year 52,000 Kiwis head to Australia because they think they are better off there. Every week 1,000 Kiwis think it is better for them to head to the Gold Coast than it is to stay here in New Zealand.
That search and rescue team was also tasked with finding a solution to the fact that 33,500 more children are living in benefit-dependent homes since the National Government took office. That search and rescue team was tasked with finding out why, and with finding a solution to the fact that unemployment has gone up by 52 percent since John Key became Prime Minister. Through a crackly transmission through a radio we heard: “I’m sorry, guys. We’ve come up with zero.” We were given a Budget with zero hope and zero ideas to face and tackle the serious problems that this country faces.
It is ironic that the previous speaker talked about courage in this Budget, because the measures in it do not contain any courage whatsoever. In this Budget there are none of the hard decisions that need to be made—none whatsoever. We asked that search and rescue team whether there was any sign of job creation and helping our exporters increase their exports and earn more. We were told: “No, sorry; there is zero sign of that.” We asked that search and rescue team whether there was any sign of helping Kiwis get the education they need and the opportunities they need to succeed in the 21st century. The message back was: “No, sorry; there is zero sign of that.” We asked that search and rescue team whether there were any policies in this Budget to grow incomes by investing in science, research, and development. The response was that there was some science but that it is much smaller than anticipated. So there is some sign of research and development hope in this Budget. We asked whether there was any sign of it becoming easier for Kiwis to save for their first home or save for their retirement. “No.” was the response back, “This is a zero Budget.” There is zero in that department in this Budget.
This weary and tired search and rescue team was then asked another question: “What did you see in this Budget? Tell us.” Well, like all search and rescue teams that go away on a long mission and find nothing, they suffer from a little bit of trauma and a little bit of stress. They might need counselling, because what they saw was horrific, harrowing, and, essentially, not very pretty. They saw 52,000 Kiwis heading to Australia every year—52,000 Kiwis heading to Australia every year. That is not good enough. There is no hope in this Budget for that to change—no hope. This is a Government that was worried when 35,000 were heading to Australia. This is a Government that was worried when 35,000 Kiwis were heading to Australia every year, and there is nothing in this Budget to turn that round—nothing in this Budget to turn that round.
What else did the search and rescue team see? They saw a Minister of Finance reaching into the pay packets of young children who deliver papers and pamphlets around our country, to get $14 million out of them—$14 million. That is one of the big ideas in this Budget. What else did the search and rescue team see? I mention again that the Budget is attacking the elderly in our community—170 people in the first year. The Government said this would save $14 million in the first year, or $16 million; I might stand corrected on that. This Government wants to change the calculation of the asset threshold for residential care. That is one of the big ideas in this Budget.
What else did the search and rescue team see? That tired old idea of asset sales—that is still there. As others have mentioned in this debate, the Government is still spouting off that line that mum and dad Kiwis will be at the front of the line. We have seen the legislation.
Andrew Little: It’s not in there.
KRIS FAAFOI: It is not in there. So any guarantee that this Government may give that the assets that Kiwis have paid for and built up over many generations, like our power companies and our airline, will stay in Kiwi hands is not worth the paper it is written on, or members’ breath when they speak about it. That promise is not mentioned anywhere in the Budget. The promise that these assets will stay here in New Zealand hands is one that the Government will not be able to keep.
Then we move on to our schools, because not even our children are safe. I challenge the Government to stick to its word, because today we have had a bit of a back-pedal in this area. If this move is so courageous and is such a hard decision, then the Government should undo its back-pedalling. Let us see how the parents react when their kids go to school and there are three, four, or maybe five more children in their classrooms. Let us see how the parents respond to that. Let us see how the teachers respond to that as well. One principal in my area of Mana is not very happy that he is potentially going to lose six staff from his school.
Tracey Martin: How many?
KRIS FAAFOI: Six staff from his school. I believe I heard the Prime Minister say that some schools might lose one or two teachers. So the homework was not done on this one. It does not look like the Prime Minister even read the papers. He said he had not seen that, and that he might do something about it. It is Tuesday today—4 or 5 days since the Budget was delivered—and there is some serious back-pedalling going on on the ninth floor of the Beehive. I can imagine that the pollsters and the focus groups were going mad from 2 o’clock on Thursday, and they came back with bad news for the Government: this is going down like a cup of cold sick. So here we go; the back-pedalling has started.
This is a Budget with zero hope for growth, and zero hope to turn round the dismal record that this Government has on unemployment, which has gone up 52 percent. This Budget has zero hope for the Kiwis who see the Gold Coast as a better option than New Zealand—52,000 Kiwis. This country is not a viable option for them any more. This is a zero Budget with zero hope.
MARK MITCHELL (National—Rodney)
: I have not heard anything new from my colleague Mr Faafoi. They are still talking about paper boys. I knew this was a good Budget when all I could hear coming from the Labour benches was “paper boys” and “search and rescue”. Mr Shearer needs the number for search and rescue. It is about the mixed-ownership model. Mr Faafoi, we have limited capital in this country. We are a small country. The best thing we can do is take that capital and use it wisely—use it and invest it in other assets. We should grow other assets for the country, and grow other assets for our children. It is about the best use of that capital—a mixed-ownership model.
I tell Mr Faafoi that I am a parent as well. I have four kids. Three of them are in the public system and one of them is at an integrated school. I welcome the measures announced today by the Minister of Education, because I want to see quality teaching. I want to see an increase in the quality of teaching in our schools.
I hear a common theme emerging from the Opposition benches. They want the Prime Minister to deny the fact that our country has been impacted by the global financial crisis, the world recession, and the earthquake damage in Christchurch. This is exactly why Labour has been labelled “Planet Labour”. You would have to be living on another planet to say that none of these things has had a major impact or effect on our economy. I am proud of this National Government and that it has steered us, and will continue to steer us, through all these difficult times. I am thankful that we as a country are not being governed by a party that lives on another planet. Long-distance relationships are
hard to manage at the best of times, but it must be proving difficult for Labour to connect with the people of this country from that sort of distance.
This Budget invests in New Zealand’s future. It will stimulate growth in new jobs, while still keeping us on track for a surplus in 2014-15. Getting back to surplus is a very important goal for us as a country. When we see other countries buckling and failing under huge debt, the last thing we should be thinking about is laying down more debt, which ultimately will have to be paid for by our children. We are one of the few developed countries that will not be increasing debt over these testing times.
I am pleased to report that for the people of Rodney our front-line health services have improved over the last 4 years. We are seeing more operations and shorter waiting-times. To continue with these great results, a further $1.5 billion is being committed over the next 4 years as a part of this Budget.
The Prime Minister spoke in the House last week and he talked about the Opposition and what it has been supporting in terms of our economic growth. He talked about the plan that we have for economic growth. I would like to just run through that list again, just to remind everyone. Let us look at some of the initiatives that Opposition members have said no to. Do they support the future intensification and development of our agricultural sector? No, they do not. They wanted to put the sector out of business, last time. Do they want more mining, or more oil and gas exploration? The answer is no. They get up and they complain about the amount of Kiwis heading to Australia. A lot of those people are going to work in the oil and gas sector in Australia—the mining sector. Australia has the will to develop that sector. When we develop the will to do it we will have a ready-made workforce of Kiwis wanting to come back and get involved in our own mining sector.
Do those members even want Australian companies moving jobs to New Zealand? No, they do not. Do they want welfare reform? No. Did they support the 90-day probation period for new employees?
Andrew Little: No.
MARK MITCHELL: No, you did not—you did not. They do not want to support businesses and employers and put them in a position to hire more employees. Do they support any of our labour market reforms?
Andrew Little: No.
MARK MITCHELL: No, you are right. Again, you do not want to support the private sector and businesses—the people who create jobs and employment. Do they support the $1.5 billion we put into ultra-fast broadband?
Hon Members: No.
MARK MITCHELL: No. All our entrepreneurs and our small businesses that are working remotely need ultra-fast broadband. Do they support foreign investment in New Zealand? No, they do not. Did they support the 3,000 jobs that came of making the two
Hobbit movies? Why would Labour pick on hobbits?Why would it pick on hobbits?
Does it want a less onerous emissions trading scheme?
Andrew Little: No.
MARK MITCHELL: No, it wants to increase it. It wants to put our farmers under more pressure. It wants to attack our primary industries. Do those members want the irrigation of the South Island or parts of the North Island? Do they support roads of national significance? I heard an invitation being extended by my colleagues Tim Macindoe and David Bennett for Mr Phil Twyford to come and speak about roads of national significance. I would like to extend that same invitation, because we have a road, the Pūhoi to Wellsford road, that is actually pretty significant for the people in Rodney and the people in Northland. I would welcome Mr Twyford coming up there,
and we can arrange some meetings and he can tell everyone that this road is not important to the Labour Party.
Darien Fenton: Yes, that would be good.
MARK MITCHELL: I hear the Labour benches saying that that is good. Well, it is not good, actually. I will tell you what the Pūhoi to Wellsford road of national significance is all about. It is to enhance inter-regional and national economic growth and productivity. It is to improve movement of freight and people between Auckland and Northland. Northland has been under-serviced for ever, in terms of having a main State highway. It is to improve the connectivity between the medium to long-term growth areas in the northern Rodney area and to improve the reliability of the transport network through a more robust and safer route between Auckland and Northland.
For us to continue to grow as a country and continue to be competitive with our competitors overseas, we need to keep investing in our infrastructure. That is a no-brainer. The great thing about this Budget, and the great thing about this Government, is that we have kept that investment in infrastructure going even when we have been faced with very tough times. What this Government is doing is actually setting us up for competitive advantage with those markets that have not had the capital and have not had the money to invest in infrastructure.
The other thing in relation to the Pūhoi to Wellsford road is the fact that we have one of the highest fatality and serious injury accident rates in the country on that piece of road, and it comes down to a straight safety issue. So you would understand that the reception for Mr Twyford in Rodney and Northland would probably not be that welcoming when he arrives and refers to it as a “Holiday Highway”, and says that it is not important to the region.
Scott Simpson: Shameful.
MARK MITCHELL: It is. I am running business forums in Rodney, and they are proving to be very popular. We have got a lot of our local businesses—big, small, and medium-sized businesses; exporters and local businesses—coming there, and what we are talking about is what this Government has done, and what we are doing, to help promote economic growth, not just in Rodney but in the whole country. Let me go through some of these things. Let me go through some of the things that this Government has done in relation to assisting growth for our businesses. Sorry, let me first cover what Labour proposes to do in terms of helping our businesses. It wants to implement a capital gains tax on all businesses. It wants a more than doubling of employer KiwiSaver costs—which is ridiculous—irrigation taxes, a minimum wage increase that would cost thousands of jobs, an acceleration of the 90-day trial period, and a return to 1970s industrial relations policies. It wants a wind-back of National’s ACC changes, meaning higher ACC levies, extra transport charges, and a lifting of interest rates caused by going out and borrowing billions of dollars. All that this would be is an anchor round the necks of our local businesses, whereas the National Government is looking at ways of reforming the labour laws, investing in infrastructure, and continuing to help and promote our business overseas. I take great pride in standing in support of this Budget. Thank you very much.
DARIEN FENTON (Labour)
: Talofa lava, Mr Speaker. Thank you very much for the opportunity to have a call on Budget 2012. I think there is one thing we do agree with the Government on, which is that Governments are about choices and priorities. This side of the House just thinks National has got its choices and priorities all wrong. Labour’s view is that the Budget is about people, rather than people being about the Budget. You know, that side of the House thinks that the people serve the economy, not the other way round.
Budgets are where the rubber hits the road, and this Government has got it so wrong. Its priorities are wrong, and it shows: the worst growth in 50 years, more than 50,000 New Zealanders leaving our shores, a 52 percent increase in unemployment, and nearly more than 50,000 people on benefits under this Government. It has been in power for only 3 years and a bit, and what a track record. John Key has consistently overpromised and under-delivered. This year is no exception. Last year he promised 170,000 jobs. Where are they? Where are the jobs? This year the estimate has gone down. It has been cut by 16,000, and we are still waiting to see the jobs from last year. Last year he promised 4 percent growth. What has happened to that? That is now a 2.6 percent projection. He said that exports were rising. The latest statistics show that exports fell almost $800 million, or 17 percent in the last year. Last year he promised real growth in wages. This year we see it peak at just 1.6 percent and declining.
One of the most disappointing things about this Budget is the lack of focus on jobs and wages. The Government’s recipe is to tinker and hope, and it is all going to come right in the end. It reminds me of Mr Micawber. Remember him? Mr Micawber from
David Copperfield, who was famous for saying: “Something will turn up.” Let us remember that Mr Micawber spent quite a lot of time in the debtors’ prison, actually, and perhaps the Government should think about that too.
Let us talk about jobs, because the Government has been talking about jobs—or the last speaker, Mark Mitchell, certainly did. Jobs from Australia: let us be honest about why those jobs are coming from Australia. They are coming from Australia because we have got a low-wage economy. They are coming from Australia because Mr English thinks low wages are a competitive advantage. Let us talk about
The Hobbit jobs: 400 jobs at Weta Digital are coming from overseas. How is that helping New Zealand? Four hundred jobs—high-skilled, high-tech jobs. Of course, we will not have the teachers in the intermediate schools to even give those kids a hope. Even the Royal New Zealand Ballet is now looking to bring in people from overseas. For goodness sake! What about jobs?
This is the truth about this Government’s job recipe. The truth is, as we all know, that people are just giving up, because this is a no hope Budget, and they are heading overseas. Turning paper boys and paper girls upside down to get the money out of their pockets and robbing the pockets of older people for small change are the best ideas that the Government has been able to come up with, and this zero Budget will do nothing for low and middle income earners and their families. On the things that matter, that will really make a difference to those people, things like growth in the economy, jobs, incomes, and exports, this Budget offers nothing. The only idea this Government has is asset sales, and we all know how that is going down in the community: a big, fat bleurgh.
You know, the tragedy about this, though—and it is playing out in almost every family in New Zealand—is that people are realising that there is no hope under this National Government. Over the weekend there was a new baby born in my family—he was born to my nephew—which is something to celebrate, but this is a child whom I will probably never see. He was born in Vienna; he will be an Austrian citizen. The next generation of my family now live in Australia, in Geneva, and in San Francisco, and I cannot tell you how sad that makes me as a proud New Zealander, knowing that there are some of our family who will just not come home while we have this kind of Budget and this kind of no hope Budget.
The Government has made choices that make things worse. Let us talk about the tax cuts it gave to the rich. It has not apologised for that. It has put the country in a bind, and it should apologise for that, because following that, it hit lower-income families with a rise in GST—
Hon Maryan Street: And the paper boys.
DARIEN FENTON: —and the paper boys—and it has increased the minimum wage by paltry amounts. It keeps going back to failed ideas. We have heard some of the Government members today say that Labour had the cheek to oppose the 90-day trial period. I heard the Minister of Labour sort of shrieking her way through her speech, making outrageous claims that nobody can substantiate about how the 90-day trial period has created all these jobs. Is that the best the Government can do? No, actually, it is not, because National does not understand how you get better wages and productivity and decent work in this country. It is a narrow vision, and what we are going to see is more of it. That is what we are going to see: more employment law changes ahead, particularly around collective bargaining, and that is the one thing standing between raw managerial power and respect and fair treatment for workers. It will undermine collective bargaining. It is another thing that helps lift wages across the board, protect job conditions for all workers, and reduce inequality.
I would like the Minister of Labour, Kate Wilkinson, to front up to those rest home workers whom our very brave human rights commissioner talked about on the weekend. I would really like her to do that, and to tell the commissioner why they should be worse off because she is going to make changes to the labour law. Tell it to the cleaners who gathered last week to launch the Living Wage campaign along with 50 community organisations, including faith-based organisations that reminded us that we have a moral duty in this country to love thy neighbour, to look out for one another. But this Government does not do that. It does not do that. What did John Key say? He does not understand what a living wage is.
I am really looking forward to hearing what happens to the Minister of Labour when she goes off to the International Labour Organization conference next week, where they are actually going to be talking about fundamental principles and rights at work, like collective bargaining and like freedom of association. I think she can expect a pasting, and she deserves it. In fact, all of the ideas, all of the things that she has put forward in the paper that Cabinet has signed off, have been criticised by the Department of Labour, and they have been criticised by the International Labour Organization. We will be a pariah in the international community, after 10 years of being a leader and being able to hold our heads high about the way we treat workers.
The one thing I will support in this Budget is the increase in health and safety, even though we know it has been reprioritised from other areas. It is not new money. But I would also add to that and say that it is not going to solve the problem, because the Government does not believe in worker involvement in health and safety. It does not believe that workers are intelligent or trustworthy enough to be able to contribute their ideas about their own health and safety and how improvements can be made.
Kate Wilkinson puts all of her confidence and money into a chief executive officer forum—again, you know, where the bosses are essentially deciding what is good for workers. She has let the Pike River families down—in fact, John Key has let them down—with the cut in the Budget on that. She has cut the role of workers in health and safety. The Government has made workplaces more unsafe with the 90-day trial period, and if those members do not believe me, go and talk to a young worker at a workplace on a 90-day trial and ask them how safe they feel raising a health and safety issue. The Government can cry crocodile tears about health and safety, but it has no idea—no idea—about what this means. Bit by bit, this Government plans to gut our employment relations framework so the protections that workers in New Zealand have will be gone. This is a “zero ideas Budget”. It is short-sighted, it is petty, it is nasty, and, worst of all, it is going to mean we see more of our children crossing the Ditch and heading overseas.
PAUL GOLDSMITH (National)
: This Budget is a sensible one. It takes a firm line on spending and invests in our future during difficult times. Like households all around New Zealand, this Government knows that it has to live within its means. That means paying down debt. It means going over all the spending and making sure that it makes good sense. It means looking for ways to get what we want for less, and also figuring out how to improve our income. That is what households are doing, and that is what this Government is doing, and no wonder this Budget has resonated so well.
I want to respond to a couple of canards that were heard from the other side. The first is that this is some sort of “do nothing” Budget. What a load of rubbish. This Government has stuck to a consistent line for the past few years of setting a path back to surplus. Consistency and stability are precious commodities in this world. True, it does not represent a radical departure. That is quite right, because a sensible direction was set out in 2010 in terms of the tax settings, and subsequently the focus on rebuilding Christchurch and delivering better public services has continued. It makes sense to continue such a line. This represents an evolution of that strategy, the wisdom of which is becoming more and more apparent with each passing month as we look around the world and see the situations that other countries have got themselves into.
We should also consider for a moment some of the other proposals from the other side. Labour’s solution to every problem seems to be a capital gains tax. It still is beyond me how taking more tax from small businesses, from farmers, and from other businesses can be some way of growing the economy. That is no way to grow the economy, as far as I can see. The Greens talk in a dreamlike manner about green industries, as if somehow they will magically arise and lift our living standards.
Well, the National Party is much more realistic about what it takes to grow an economy. It is about, at the end of the day, the additional jobs and economic growth that come from companies being successful. Companies are successful only if they beat the competition, and you beat international competition only if you deliver products that are either better or cheaper than the rivals. Ideally, they will be even better; they will be cheaper and better.
I can think of six drivers for business growth that we do not hear about much from the Opposition. It is about innovative ideas, it is about capital, it is about raw materials, and it is about skills, customers, and infrastructure. I want to go through each of these six in turn. If we start off with ideas—
Dr Megan Woods: Where are the technology teachers to teach the skills?
PAUL GOLDSMITH: Well, we will get there. We will start off with ideas. The innovation ideas reflect the genius of the people—young folk coming up with new apps or new products. The Government can help.
One area where the Government is making a significant investment is in research and innovation. It is going to be spending, over the next 4 years, $166 million on the Advanced Technology Institute, helping high-tech firms boost productivity, $60 million for the National Science Challenges, $100 million increasing the Performance-based Research Fund that is available to universities, and $59 million more for science and engineering tertiary courses. The Government cannot come up with all the ideas, but it can create an environment in the research and development area where this country will be producing more ideas that companies can draw on to be successful.
If we turn to capital, well, you know, we do have amongst the lowest interest rates that we have had for decades. It is helpful if you are trying to get access to capital, is it not, if you are not having to pay unreasonable amounts for that capital? Those low interest rates that companies have available to them are the direct result of consistent, stable, sensible economic policies that this Government has been driving over these last 4 years. Another area that is important in terms of capital is the mixed-ownership
model, which will give a fillip to New Zealand’s capital markets, which have been thin and weak over the last past few decades. The Greens, of course, are protesting about this as usual. I see they are advertising on Student Job Search to pay people to go out and fill petitions.
Todd McClay: Using taxpayers’ money.
PAUL GOLDSMITH: I am not sure about that, but it would be interesting to know. Contrast the National Party’s approach to getting access to more capital with that of the other side, and what you will find is an inward-looking opposition to any foreign investment. Members opposite are opposed to that—especially if it is Chinese, if you are dealing with New Zealand First—and turning inwards. That, to me, is no recipe for growth. National understands that successful companies need access to capital.
What about raw materials? Well, this Government recognises that New Zealand has rich resources on its land and throughout its vast exclusive economic zone. Labour and the Greens do not want to do anything with it; they do not want to touch it. They prefer to export our next generation to Australia to help them make use of its natural resources. Well, that does not seem to make good sense to me. If we talk about primary industries as well, growing production through irrigation and intensification is the sort of thing we need to do to make a better living in this world, and that is what this National Government has been focusing on. So what have we got here? We have got successful businesses having greater access to ideas, to capital, and to raw materials.
Before we close at 6 o’clock I can talk about skills and education. We all want our kids to leave school with the knowledge and skills they need to reach their potential in the 21st century. In education our focus is on increasing student achievement, not just on pouring more and more teachers over the line without focusing on the result. Over the next 4 years we will be committing $511.9 million in the Budget towards new early childhood education and schooling initiatives, as well as another $59 million invested in teacher quality to support professional development for teachers and principals. We are ticking off that one.
Then if we move to customers, customers are all about market access and free trade, and, thankfully, the Labour Party—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that actually having access to international markets through free trade is an important thing. I have no confidence whatsoever that the Green Party would be at all interested in maintaining New Zealand’s open access to international markets. It seems to be against trade, but on that score—
The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.
- Sitting suspended from 6 p.m. to 7.30 p.m.
PAUL GOLDSMITH: I was talking about how this Budget is a sensible one, has taken a firm line on spending, and has invested in our future during difficult times. I talked about the National Party’s understanding of what really were the drivers of economic growth, and that came down to having companies that are successful internationally making money and beating the competition. I talked about what they needed for success, which is access to good ideas, access to good, strong capital flows, and access to raw materials, primary industry, skills, and customers. We talked about market access and the fact that, thankfully, Labour—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that market access is an important thing, and that there has been a measure of bipartisanship in the House on that subject. I was not so sure about the Greens.
The final area that I think is obviously clearly important for economic growth is good, sensible investment in infrastructure. Here we are talking about electricity
transmission, the ultra-fast broadband building and construction, and transport—roads for a start. In Auckland, where I come from, lives have been transformed by the second Manukau Harbour crossing by the Victoria Park Tunnel, relieving pinch points in Auckland’s arterial road network. The Greens and the Labour Party tend to oppose everything that we do on the roads. They are in the thrall of public transport at the expense of everything else, even when there is a very poor return. We saw in the
New Zealand Herald this morning yet another story of only a handful of commuters using the $81 million rail line to Manukau. That is how the State can spend your money if it is in the wrong hands. This Budget, it seems to me, is continuing a sensible line, which the Government has outlined since it came to office in 2008, showing stability and sensible management at a time of difficulties.
The other thing I just wanted to mention was the canard that we hear time and time again that the National Party has simply given tax cuts to the rich. This has been a line that the Greens have used time and again, when it is factually incorrect when you look at the numbers. That is what happens when you look at only two out of the 13 components of the 2010 tax package. Mr Norman tends to pick out personal tax cuts and GST and ignore all the other parts, such as changes to depreciation, loss attributing qualifying companies, and thin capitalisation rules. I suppose it is because they are not quite sure how they work, but depreciation changes alone raised $1 billion in extra revenue each year, mostly affecting high-income earners. When you look at the 2010 tax changes, overall the burden of that has been borne very evenly across all income groups. This is a very sensible Budget that we have brought here, and I fully support it. Thank you very much.
Dr KENNEDY GRAHAM (Green)
: This 2012 Budget is the miser’s Budget. It picks up the kids, hangs them upside down, then empties the coins out of their pockets, with a view to pretending we are on-target for a wafer-thin surplus in the year promised. Not only is this small-minded, it is a distraction. It is a distraction because it deceives us into focusing on the near irrelevant, forgetting the essentials and ignoring what is critical. What has not been recognised amidst all the rhetoric and hyperbole in this debate is what this Budget will not be known for—what it has omitted. What the Minister should be doing with his Budget Policy Statement in these difficult times is this: first, explain the global ecological economic context to the New Zealand public; second, analyse what the international community is doing about the global problems that beset us all, all 200 national economies; and, third, offer a prescriptive macroeconomic policy in the Budget Policy Statement, supported by the estimates, which reflects the mix of national prudence with which the Minister is instinctively well endowed with some creativity on what policy prescription New Zealand can offer to help ameliorate the global problem, something of which the entire Cabinet seems to be devoid.
The first requirement is to recognise the ecological overshoot of the current global population. With a footprint of 2.7 hectares per person and an earth share of 1.8 hectares, we record an overshoot of just on 50 percent. That means we need one and a half planets to sustain our current global population on the basis of contemporary technology. That is the first sobering global fact the Budget needs to address, but this Budget is silent on that.
The second sobering global fact is that the human population is increasing, barring tipping points, by an additional 29 percent, from 7 billion to 9 billion, by 2050. The global population will have grown from 2 billion at my birth to 9 billion at the death of my children, from 2 billion to 9 billion within two human lifetimes. That unprecedented event has enormous implications for New Zealand’s economy, yet this currency trader Budget completely disregards it—not a word.
The third global fact—not so much sobering as alarming—is the onset of serious climate change. Let us put things in context. The international community has now had 20 years since adopting the framework convention to ensure that global emissions peak and commence the downward emissions path to a low-carbon economy. In 1992 global carbon equivalent emissions were 44 gigatonnes; today they are 56, an increase of 28 percent. During those 20 years, the only instrument to reduce emissions was the Kyoto Protocol, with a commitment period of 16 to 20 years later. That protocol covered only 17 percent of global emissions and aspired to shave only 5 percent off them. Even if it had succeeded, it would have shaved perhaps 0.2 degrees Celsius off the average global temperature increase. It was intended as a precursor to a comprehensive, binding global agreement. That is now to be negotiated by 2015, to come into force in 2020, so the global agreement designed to commence the task identified in 1992 of containing the global emissions increase will come into force 28 years later. It is likely, in the best of all worlds, to take a decade before emissions would peak after that. That would be 13 years after emissions need to peak to avoid serious climate change.
In 2010 the international community agreed on a threshold of 2 degrees Celsius rise on average global temperature. One year later, the scientific community revised the expected temperature increase to between 3 to 4 degrees Celsius. So no sooner did the Governments identify a global warming target, than that target was rendered unlikely if not impossible. This is humanity at work, addressing for the first time ever an issue pertaining to its survival. Scientific concern is now being expressed over the indeterminable risk of non-linear climate change occurring from ice melt, thermal ocean expansion, and methane release from the tundra and subterranean vents. These are the tipping points that could cause catastrophic disturbance to the biospherical balance of the planet on which we dwell for our survival. These three global facts depict a planet in decline. They forecast severe strain, perhaps intolerable strain, for the global economy. The New Zealand economy accounts for a tiny portion of the global economy—only 0.2 percent—but it is not negligible.
The fate of New Zealanders rests on the fate of the global economy, yet the Budget says nothing of this. The Budget Policy Statement advanced last week by the currency trader Government contains not one word on population, not one word on ecological overshoot, not one word on biodiversity lost, and not one word even on climate change. Rather, its highlights are tax credit reductions for paper deliveries, and adjustments to livestock valuations. It plans to cut policy advice on climate change by 30 percent, compared with 2 years ago. Because of this, the 2012 Budget has an air of unrealism to it, reminiscent of the
What does the Budget do about climate change, even though it does not mention the words? The Budget seeks to hide the line items pertaining to climate change, splitting the emissions trading scheme into various line items that would challenge any corporate investigator. The New Zealand emissions trading scheme is a complex creature. It was born of proud parentage but slipped into a wayward life, early on. Its original objective under the Labour Government was to meet the Kyoto Protocol obligation of the same emissions level in 2008-12 as that in 1990. It was to achieve that by setting a carbon price and then let the market work. It was based on the assumption that other countries would do the same around the same time so there would be little carbon leakage, and an integrated international carbon trading market would emerge. But this was beset with flaws. First, no emission reduction obligations were required under the framework convention or the protocol for developing countries. Second, the United States stayed away. So some 83 percent of global emissions have faced no such constraints, so the risk of carbon leakage is ever-present—something the corporate world exploits to the full for self-interested commercial reasons.
Third, the emissions trading scheme itself was designed to be soft on the New Zealand economy, setting no cap for the emissions permit trade. It sets a ridiculously low carbon price and it gives free allocations to carbon-intensive, trade-exposed companies like medieval indulgences, comprising 76 percent of the environment ministry’s budget. So there has been zero incentive for any New Zealand firm to actually cut emissions. So rather than staying level, our emissions have soared from 60 million to 72 million tonnes by 2010.
The independent review panel recommends further deferrals in the name of doing our fair share. The Government’s proposals reflect the panel’s recommendations. The submissions and hearings will run their course and the Government will enact those deferrals. The 2012 Budget contains the multiple concealed line items in anticipation of that. Meanwhile, New Zealand fights its corner at the international conferences, determined to gain some short-term maximum advantage in the game of global carbon negotiations, wilfully heedless of the repercussions in the medium term that will harm itself. Each time the climate Minister returns from yet another Olympian mission overseas we are assured that New Zealand has once again punched above its weight. By definition, that is a recipe for disaster. If 194 States’ parties punch above their weight, the global carbon emissions and ecological footprint will shoot higher, yet this is what we are all doing. We need to avoid such hubristic pursuit of competitive national interest on climate change. We need to engage in a collaborative national interest in pursuit of the global interest. One day, a New Zealand annual Budget will reflect that underlying truth. The question is: will it be too late?
TE URUROA FLAVELL (Māori Party—Waiariki)
Kia ora tātau katoa te Whare e hui nei i tēnei pō ki te wetewete, ki te wānanga i te kōpaki pūtea o te Kāwanatanga. Ko te wā o te tahua pūtea e korerohia ake nei, ehara i te mea he wā ki te titiro ki ngā mea hē anake. Me titiro anō hoki tātau ki ngā mea hei whakapakari ake, hei whakatika ake, hei whakakaha ake, hei whakanui ake rānei i te motu. Koinā te tikanga o te kōpaki pūtea. Mō te Pāti Māori, koirā te wā pai hei whakatinana i te kaupapa o te Pāti Māori i tuhia i roto i tō mātau whāinga matua, arā, kia manaaki tētahi ki tētahi, ko te whanaungatanga tētahi ki tētahi, ko te tiaki a tētahi, ki tētahi kia taea e au te kī, he peka kai, he peka whakaruruhau, he peka herenga. Hei tīmatanga kōrero anei tētahi kōrero o Kahurangi Iritana Tāwhiwhirangi, i a ia e kōrero ana mō te Whānau Ora. E ai ki tāna: “Every person being nurtured and enhanced and given hope, given purpose, given dignity, given responsibility”. Koinei tā Iritana Tāwhiwhirangi. Nā, koinei tā mātau o te Pāti Māori i kōkiri nei i roto i ngā kōrero i waenganui i ahau, a Pāti Māori me te Rōpū Nāhinara i roto i ngā wetewete mō te kōpaki pūtea.
E ai ki tā ētahi, he pūtea korekore nei, arā, i roto i te reo Pākehā, ko te zero Budget.
Ahakoa kai reira tonu tērā taiapa, kai te harikoa te Pāti Māori i te mea, kei te anga whakamua tērā whakaaro o whaea Iritana. Kua mauheretia, me kī, te 164 miriona taara ki te Whānau Ora. Nō reira, ki a mātau he mea pai tērā. Ko te huarahi ki te whai ao, me kī, e ai ki tā mātau o te Pāti Māori, kei roto i ō tātau ake ringaringa. Kua aro nui mātau ki ngā take kimi mahi, ngā take whare, take mātauranga, take hauora i roto i ngā kōrero katoa, ā, kai te whakatinanatia ērā kaupapa katoa i raro i te Whānau Ora, i roto i tēnei o ngā kōrero mō te kōpaki pūtea. Koinei mātau e kī nei kia aro tahi Te Puni Kōkiri ki ngā kaupapa whai mahi, ngā kaupapa whai mātauranga, ngā kaupapa ā-whare nei, me kī. Ki a mātau, kai roto i te whānau ngā whakautu, ngā whakahoki ki ngā uauatanga o te wā. Nō reira, me hāngai tonu te titiro ki wā tātau tāmariki, ā, mokopuna.
I ngā 10 tau mai i te 2000, arā, ko te tau 2000 ki te 2009, i te wā i piki te whakapaunga o te pūtea o te kāwanatanga mai i te 35 piriona taara, arā, billion,
tērā hai āwhina i a koe, ki te 64 piriona taara, i warewaretia katoatia wā tātau tamariki. Nā, kai
te harikoa mātau mō te 24 miriona taara ki tēnei māuiui nui nei e pā nei ki ngā tamariki Māori me ngā tamariki o Te Moana-nui-a-Kiwa, arā, ko te rheumatic fever. He pūtea nui tērā hei āwhina i tērā kaupapa, hei karo i tērā māuiui. Kāre mātau i te rata ki te pikinga o te utu mō te rongoā, he uauatanga tērā ka pā, kāore e kore ki ētahi ā-rawa kore, ā-kore moni nei. Kia noho ora ngā tamariki. Me noho rātau i roto i te mahanatanga o te whare. Koinei mātau i tohe nei kia whakaroa ake i te kaupapa e kī ana ko te Warm Up New Zealand programme mō ngā whare 20,000 ā ngā tau kai mua i te aroaro.
Nā, e ai ki tā ētahi o tēnei Whare, ko te tikanga o te zero Budget, ko te kore moni ki ngā kōhanga reo, ki ngā kura kaupapa Māori mō tēnei mea, mō tērā mea, ēngari anō mō tērā. 4.4 piriona taara he moni hōu. He moni nei kua tangohia i ngā wāhi ngoikore, me te penapena moni anō hoki o tēnā tari, o tēnā tari. Kai te titiro mātau ki te pae rangi, arā, ki tawhiti, ki ngā rā kai mua i te aroaro. Koinei tā mātau e aro nei te Pāti Māori. 19 miriona taara hei whakatuwhera i te kuaha ki ngā kura kōhungahunga, ngā taitamariki pakupaku nei. Me pērā te titiro i te mea, kua puta te pūrongo a te Tari Arotake Mātauranga, arā, ko te Education Review Office me tana whakatau, arā, 10 paihēneti noa iho o ngā kura kua aro mai ki te whakawhanaungatanga ki ngā whānau Māori. He uauatanga, he momo mate tērā ki a mātau. Ki te rongo ngā tamariki ki tō rātou ao ā-wairua, ā-ngākau, ā-kupu ka tau pai rātau i roto i te āhuatanga o te ao mātauranga, nō reira, he whiwhinga nui tērā mōni, me kī, mō ngā tamariki nohinohi. 19 miriona taara i tēnei wā, ā, ka kitea mai ai te puāwaitanga ā te wā.
Nā mō te wā poto, ka huri ki te reo Pākehā mō ngā taringa areare i te mea, kai te pīrangi au ki te hama atu i tētahi take ki a koe mō te wā poto kātahi ka huri ki te reo Māori.
[Greetings everyone here in the House this evening to analyse and discuss the Government’s Budget. Budget time is not just about fixing up what is wrong; it is about strengthening what is right. That is the purpose of the Budget. For the Māori Party, it is a good time to implement the rules written in our constitution, to care for each other, to build positive relationships, and to protect one another, so that it can be said that there is sustenance, support, protection, and a connection for our people. I would like to begin my speech with a quote from Dame Iritana Tāwhiwhirangi about Whānau Ora. She said: “Every person being nurtured and enhanced and given hope, given purpose, given dignity, given responsibility.” And that is according to Iritana Tāwhiwhirangi. This is what the Māori Party has pushed for in Budget talks with National.
Some have called this a zero Budget. Despite that obstacle, the Māori Party is delighted because the aspirations of Aunty Iritana are being enacted. We have protected the $164 million in funding invested in Whānau Ora, which is a positive. The pathway to transformation lies in our own hands. We have focused strongly in all talks pertaining to employment, housing, educational achievement, and health, and all these matters are being enacted under Whānau Ora in the Budget package. At the same time, we are refocusing Te Puni Kōkiri to give urgent priority to improving Māori employment, training, and housing outcomes. We believe the answers to our current problems lie with whānau, so we must concentrate on our children and grandchildren.
In the decade from 2000 to 2009, when Government spending increased from $35 billion to $64 billion, our children were forgotten. We are thrilled that we secured $24 million to reduce rheumatic fever, which impacts on Māori and Pacific Island children. It is a significant amount of funding to assist in efforts to combat that disease. We oppose the rise in prescription charges, which will affect the poor.
For our children to be well, their homes must be warm. And that is why the Māori Party also argued to extend the Warm Up New Zealand programme to 20,000 more homes in coming years.
Some members in the House have made simplistic assumptions that a zero Budget means zero for kōhanga reo and Māori immersion schools—zero for this, zero for that—but $4.4 billion worth of new money is coming about by reprioritising existing spending, and achieving savings across Government departments. We are looking towards the future. This is our focus of the Māori Party. We sought $19 million to improve access to Māori-medium early childhood services for these small children. If there is any doubt about why we need this, one should turn to a report from the Education Review Office, which found that only 10 percent of early childhood centres had built effective and culturally responsive partnerships with Māori whānau. That is a major problem to us. To engage Māori children, learning must be relevant and allow these children to see, hear, and feel their culture around them, so that is an incredible investment in our future.
I will speak briefly in English for those listening because I want to hammer out an issue with you for a short while and then turn back to speak in Māori again
For the member of this Parliament who did zero research to conclude that there was zero for kōhanga reo, and, indeed, for the media who reported these statements and who also did zero research to even check the facts, the $19 million I have just talked about is reserved entirely for Māori-medium service, which is a service that currently uses the Māori language at least 80 percent of the time. Currently, this includes all kōhanga reo services, plus 10 education and care services.
But wait, there is more. We also have secured an increase of $15 million in equity funding, with an emphasis on te reo Māori and tikanga Māori. In addition to the access funding, each kōhanga reo will receive an estimated average increase of around $9,000 per year—
Hon Tau Henare: How much?
TE URUROA FLAVELL: —$9,000 per year—through new equity funding.
But wait, there is still more. We achieved another $8.5 million for strong resources to support learners in Māori medium education. This is fundamental to both protecting and revitalising te reo Māori, and for achieving good educational outcomes for our learners. So I thought,
Ka kōrerohia ērā kupu i Te Reo Pākehā kia mōhio mai ai te ao kua whiwhi i te Pāti Māori i ētahi painga i roto i tēnei budget.
Nō reira, waiho tērā ki reira. Kāre mātau i te titiro ki ngā mea, me kī, tere whakatika i ngā uauatanga o te wā, kai te aro kē ki tētahi huarahi hei whakatikatika, e kī ana te Pākehā, ko te transformational agenda.
Kua tīmata te Māori economic strategy, kua tīmata te constitutional review, te spectrum, te Māori Language Review ēngari, ā ngā rā tata kai mua i te aroaro, ka puta ētahi kōrero anō hoki mō ngā mea kua whiwhi i a mātau i roto i te kōpaki o te kāwanatanga. Ehara i te mea mō nāia tonu nei ngā painga anake, koinei te pai o te kaupapa pēnei i te 7.6 miriona taara mō ngā kura-taiao, arā, mo ngā Enviroschools.
Hei whakamutu atu, kāore he huringa atu, kāore he huringa mai mō te Pāti Māori ki tō mātau tirohanga. Ko Whānau Ora te huarahi ki te whai ao. I kite tātau i te painga o te mahitahi i tērā wiki i te wā i eke atu te Iwi Leaders Forumki roto i te tohetohe nei o Talley’s me ngā uniana. Nā, he aha te painga o tērā? I mahitahi rāua kia eke te kaupapa rā ki tōna taumata. Koinei te huarahi e hiahiatia nei e mātau o te Pāti Māori hai whāinga ā ngā rā kai mua i te aroaro. Kai te harikoa tōnu atu ki te āhuatanga o ngā mea kua kitea nei e mātau i roto i te Pāti Māori nō reira, koinei te mihi tēnā koutou, kia ora tātau.
[I spoke in English so that the world will know that the Māori Party has secured some benefits from this Budget. I will leave that there. We are not about quick band-aid solutions. We have a transformational agenda, and that work is under way with the priority on the Māori economic strategy, the constitutional review, the spectrum, and the Māori Language Review. We have other announcements coming out soon about the
things we have secured in the governmental package. And we must ensure our gaze is not just on today; we must protect tomorrow. That is why we received $7.6 million for Enviroschools.
In conclusion, the Māori Party is even more determined than ever to keep the momentum of Whānau Ora in everyone’s sight. The power of the collective was ably demonstrated last week when the Iwi Leaders Forum came together to broker a solution in the employment dispute between Talley’s and the unions. They worked together to achieve a successful outcome. This is the pathway the Māori Party wants to pursue in the future. We are delighted with what we have found in the Māori Party, so I thank you collectively, and us all.
ALFRED NGARO (National)
: Manuia le fa’amanatuina o le vaiaso o le gagana Samoa. Manuia le fa’amanatuina o le lima sefulu tausaga o le tuto’atasi o Samoa. Blessings for the celebration of Samoan Language Week, and blessings for the celebration of Samoa’s 50 years of independence.
I stand in support of this Budget of 2012. But I want to read from the words of Sir Apirana Ngata, who in the early 20th century told his people that they could not expect support from the culture and Government that had deprived them from their land. Instead, they would have to use their own resources to make a living within the dominant culture of New Zealand in order to create prosperity for themselves. These are wise words from our tupuna, who told us that we need to ensure that when we plan, we plan responsibly. That is the Budget that we have been given by the Hon Bill English. It is responsible for managing the Government’s finances as one of our priorities in very difficult fiscal times. Sir Apirana Ngata gave us this wisdom, and so it tells us this. How do we show a nation that we truly do care? Often members on this side of the House have been labelled as the Tories who do not care, who do not have a concern for the ordinary, everyday people of our communities.
Well, this is how we care. In our Budget of 2012 we have freed up $4.4 million to reinvest in better results from front-line services. We are lengthening educational achievement, and increasing participation in early childhood education with better quality teaching. We are balancing our investment at tertiary level between student support and greater investment in teaching and research. We want all our kids to leave school with the knowledge and skills that they need to reach their potential in the 21st century. This is what concerns me, having been involved on a board of trustees for 20 years and having been involved in schooling improvement over 25 years, and this is the thing I want to tell the people on the other side of the House. I have seen many times when education is talked about, and we support our educational system, but we also know that there are some who are in there who need a wake-up call. I have seen people take the funding for Māori and Pasifika students, but they are not willing to do the work. They are not willing to be held accountable. We have seen the Minister of Education stand up and say: “Why is it that we have increased teacher numbers, but we’ve not increased the performance and achievement of our children?”.
Our children—they are what this Budget is about. They are what this Budget is about. Four out of five kids are getting the qualifications they need, but under National’s plan we want to lift that standard. National’s plan is about getting five out of five. We want all our kids to leave school with the skills they need to reach their potential in the modern economy. You can talk all you like, but here are the results that are coming through. We are firmly focused on raising student achievement and to do this we must invest in the biggest effect possible. The quality of teaching and practice and professional leadership are what truly make the difference. We have set two ambitious targets in education. One is increasing early childhood education participation by 98 percent, within 5 years. We know that early childhood education is a way of
increasing literacy and numeracy in our schools for our children. [Interruption] That is right, Ms Moroney—our children.
The other target is having 85 percent of all 18-year-olds achieving the minimum of a level 2 qualification for the National Certificate of Educational Achievement. We have heard members on the other side say: “Oh, but that’s too high a standard.” How can members on the other side say that it is too high a standard for our children? It is not too high a standard. This is what happens. It is members on the other side who keep our children, Māori and Pacific, in poverty. This is the thing. I stand here as a person who has come from this community, and who has worked in community development. You find it hard to speak to me because I am the same person who has been there. I know the results and I know what we need. I stand here proud of this Budget because it truly does make the difference.
But what about welfare reforms? Too many of our New Zealanders have become dependent. As Sir Apirana Ngata said, this State is not where our dreams and our moemoeā are, and our vision is; no, it is not. It is trapping our families in poverty, and it is costing too much. We believe that those who can, should have the opportunity. Work is not a means to it. Work, in itself, is an ability to get us to a vision and a dream of where we want to go to. We will hear the rhetoric, though. Where are the jobs? It does not matter how many times you keep pulling out the statistics, you will keep hearing the same thing. There is an old saying: “Do not throw your pearls before the swine.”—do not throw your pearls before the swine. No matter how much of the statistics and the results we give them, it will not make a difference. But we will keep telling them why, because it is not the people on the other side whom we want to hear what we are saying. It is the people at home.
Sue Moroney: Out of touch with New Zealanders. You’re out of touch with their problems.
ALFRED NGARO: It is the people at home who need to hear this message, so we will keep preaching it, Ms Moroney. We will keep telling them this is what we are doing. So it is about a better life and better opportunities. Twelve percent of our working-age population is on a benefit, and 220,000 children are in a benefit-dependent home. That is an indictment on any nation, and this is what we are doing. We are taking responsibility under the honourable Minister that we have, the Minister for Social Development, who has a vision. Twelve thousand people have now cancelled their unemployment benefit, 13,000 people went off the DPB and into work, and there are $17 million of savings overall that we can reinvest into our youth and our young people.
We will undertake further reforms during the term of this Government. Our changes are significant. They will introduce two stages, and one includes supporting sole parents with children 5 years and older into part-time work. This is not just rhetoric. When I have gone into my communities of Glen Innes and Panmure, this is what they have said to me. They have said: “Alfred, this is what we need. We need opportunities. We have heard the one-trick pony over and over again.” But this is the thing they have forgotten about. I am a first-generation-born Pacific Islander, and this is what you have forgotten about. We are now first, second, and third-generation. We have become more educated, more mobile, and more articulate, but your message is this: you still want to keep us in poverty. This is not a message for poverty. This is a message for hope. This is the message—that I stand as a Pasifika person, first generation, and say that this is what we are doing to make a difference for our people and for our communities. You can keep talking, but after 9 years you had not made a difference—you had not made a difference. So this is what we are doing—this is what we are doing. We are helping those who can work to find a job. We are removing barriers to work through childcare
assistance. We are targeting resources to those most at risk of long-term dependency and helping young people make better choices.
But what about health? What about health? I really do want to take my hat off and acknowledge the support of the Māori Party as our coalition partner. We have $6 million in a Pacific Innovation Fund—$6 million. Let me tell you this. I have researched what happened under Labour, and you did not give any innovation fund to our Pasifika for health—not once. Your funding was all in the mainstream vote for health. But this is what we have done. This is what we have done under the honourable Minister Tariana Turia, Associate Minister of Health. She has allowed for $6 million to be invested in innovation. What is that for? So that our own people can be self-determining—our own people can make the choices about what we need to do to improve our health. It is not State-dependent, but dependent on our own people. And we will see more innovations that will come out of that.
I am proud of this Budget. I am proud that what this Budget does is put the resources in the hands of our people to be self-determining. This Budget not only does that but it says this to us: there is a hope and there is an opportunity for us to be self-determining so we can make the choices for our children. I stand proud to be here today so that my children will look at me, speaking in this House and knowing this: that we are not dependent on anyone else but ourselves. Sir Apirana Ngata, who was in this House at one time, said this: “We are not dependent on the State. We are not dependent on anyone but ourselves. We will find the answers for ourselves.” What this Government is about is allowing our own community to be self-determining, to make the choices for itself, and to be caring for the concerns that we believe are very important. This Budget is such a good Budget that it allows for great opportunity in health, education, and welfare reforms.
And I want to say this; this is the last thing I want to say. As the honourable member from the Māori Party Te Ururoa Flavell said, research is important. It concerns me that members of the New Zealand First Party talk about Whānau Ora and condemn the work of Whānau Ora. They say things about the work that it is doing, and all those members are doing is grandstanding. But what is it about? They have not seen the impact that Whānau Ora has had on many of our whānau and family. What is it doing? It is allowing Māori to be self-determining. Instead, what do we have? We have the nitpicking. We are accused of being penny-pinchers. We are accused of taking from the paper boys. There is a lot of nitpicking that comes from over there on something that truly is making a difference. If they really felt that they supported something that was indigenous for Māori, then they would give it an opportunity to do its best, and that is what it is doing. It is doing the best that it can. We hear all these inflammatory remarks, but there is no truth in them. I am proud to be here today. This is a great Budget for our country, for our nation, and for our community.
Hon DAVID CUNLIFFE (Labour—New Lynn)
: Talofa lava, Mr Speaker. I also would like to recognise Samoan Language Week, and to acknowledge the 50-year anniversary of Samoa’s independence from New Zealand administration, the record of which was not proud.
The member who has just resumed his seat, Alfred Ngaro, opened his speech by saying that some people say National members are Tories who do not care. I would never say that about that member. I would say that his record of service before he entered this House proves that he does care. In fact, I nearly appointed him to the Auckland District Health Board because of that service. Perhaps, given where he sits now, I should have. But I would not say he does not care. What I would say is that the policies his party is advancing are not going to achieve the hopes and dreams that he says he stands for.
He said that he wants all our kids to leave school able to reach their potential. Then do not increase their class sizes! Do not turn intermediate school class sizes from 30 to 40 children. And do not continue to spend $35 million a year subsidising private schools, which do not need it, while cutting funding to low-decile public schools. While you are at it, do not waste millions on league tables, which all the evidence shows are a complete waste of money and achieve nothing for our students. Or, on the wider agenda, do not cut taxes for the wealthy—for the very wealthy—by putting up GST on every loaf of bread that is bought by needy families in his own South Auckland. That is what we do not do if we hope our people will be better off.
I have a little pointer for the member, the Rev. Ngaro, who has just resumed his seat—a little humility lesson. In the 9 years of the last Labour Government life expectancy itself increased by 3 years—1 year longer for every 3 years we were in office. Debt was cut to zero, we ran surpluses every year, and every region of New Zealand grew. So a little humility around the historical record would be in order. [Interruption] I see the members opposite have had an emotional dinner break, and they are back in fine form. Liquidity was flowing tonight, quite obviously.
In this Budget debate it is rather easy for us to talk in big numbers or big words. We talk about billions of dollars of trade deficit or hundreds of thousands of people unemployed, and it is easy to forget that every one of those people is a New Zealander, a hard-working Kiwi who wants to do the right thing for themselves and their family, who wants a fair day’s work for a fair day’s pay—remember that—and to get ahead. Now the reality for too many is no work at all, or if they can get work, they are working two or three jobs to pay the rent and make ends meet, all the time worried to death that their children are not seeing enough of their parents. That is the reality for so many in our society. There also are the thousand a week who are making their way to the departure gates as they move permanently to Australia. That is twice, roughly, the number of members of this whole House. Every working day two Houses of Parliament leave for Australia permanently. We can see the hope dying in their eyes. They have lasted for 4 years under this Government being promised that growth and more jobs were just round the corner, but it is a corner that never comes.
There also are the small-business people or the medium-business people who are working every hour that God sends to make a success. They have put their homes on the line. They want their businesses to succeed. They are not lazy. They are trying their hardest. But there just are not enough customers, or they have not got enough money to spend.
Hon Tau Henare: If he’s Sonny Crockett, who’s Tubbs?
Hon DAVID CUNLIFFE: It is called, in the jargon of economics, which that member does not know, an output gap, and Treasury says we have got one still. There is not enough demand in the economy. That is why this zero Budget makes zero difference.
These real people are the real casualties of this Budget: our friends, our neighbours, our constituents, and our family members. They have been told to expect the best, and what they got was a zero Budget. And it is not enough—it is not enough. Tinkering is not enough. A zero Budget is not enough. Balancing the books is not enough. It is not enough to get people back to work. It is not enough to get businesses back afloat. It is not enough to stem the tide of people going to Australia. We want a future we can believe in. We want an economy that can sustainably grow and provide for our beautiful children. That is what we want, not a zero Budget, not a zero vision, and not zero hope. That is what we want.
So how should a Budget deliver on those things? Before I turn to that, I just need to say that the press has cottoned on to what is going on here. Here are some quotes on this
issue of economic development and sustainable growth. Fran O’Sullivan—no lefty—says “the major problem is that there is no clear economic growth agenda.” The
Press editorial—again, no left-wing rag—says “The Budget delivered yesterday by the Minister of Finance, Bill English, had a distinctly underwhelming feel.” Fairfax says “It was billed as a Zero Budget, and that’s what we got.” Or there is Brian Fallow, who says the Budget is definitely “contractionary. Fiscal policy will subtract from demand and from growth not just next year but for the next four years.” Or John Armstrong in the
New Zealand Herald says “a fiscal surplus is not a growth strategy.” And so it goes on.
But of course it is easy to criticise; it is hard to build. And what the public wants is hope for a better future. Here is what Labour would do. Labour is going to provide leadership that is willing to take the tough decisions and try new ideas to grow jobs and incomes. As my colleague David Parker has rightly said, if you change nothing, nothing changes. Over there is the party of conservatism, the party of steady as she goes, the party of Keith Jacka Holyoake. That may have been appropriate when we were all collectively on the sheep’s back, but we are not on the cow’s back now. We have got all our cows in one basket, and the basket is leaking. Change nothing, nothing changes. Change nothing, Rev. Ngaro, and your people will not find change.
There are some things we can do individually and we should. We do not abdicate individual responsibility, but we believe in co-responsibility: the responsibility of the individual to society and society to the individual. We cannot all individually solve the problems of this economy; we must do it collectively. That is why our constitution vests in the Treasury benches the responsibility to guide our country through—not to balance their own books at the expense of the people’s books, not to pull a zero Budget at the cost of zero hope. The mandate is deeper, broader, richer, and more sacred than that.
Labour will create jobs by supporting our exporters to expand and earn more. We will help Kiwis get the education and skills they need. We will grow incomes by investing in science and innovation. And we will make it easier for New Zealanders to save for their first home and for their retirement. We will do it with the following. I am going to mention just six tools: firstly, pro-growth tax reform like a capital gains tax that gets money flowing where it can do more good, and research and development tax incentives that get our innovators going; increasing savings through universal KiwiSaver; the research and development tax credits; monetary policy; fiscal policy that seeks to balance demand and supply across the cycle and across the economy; and an economic development policy that works with every sector and every region in the country so that every New Zealander can be the best that they can be.
What has this Government done to the Budget for economic development? Well, it has cut it. It has cut by two-thirds the Seed Co-investment Fund, which helps struggling businesses get up to the next level. It has cut, would you believe, the in-market assistance to help people export to China and India. It has cut regional development by 90 percent around the country—and it says it wants growth. It has cut industry assistance. It has cut development in our regions. It has cut assistance for exporters. It is cutting our future.
Big words, big numbers, big problems, but at the end of the day real people who deserve real hope and real policy. Thank you.
Mr DEPUTY SPEAKER: I call Andrew Williams. Is this a split call? Do you want a bell at 4 minutes?
ANDREW WILLIAMS (NZ First)
: Yes, please. I would like to table sources that the Parliamentary Library prepared today. It is a spreadsheet that details the Government’s operating balances for the years 2002-12, the last decade of surpluses and deficits, prepared today by the Parliamentary Library. I would like to table that.
Mr DEPUTY SPEAKER: Is there anyone opposed to that course of action? Leave is not granted.
ANDREW WILLIAMS: Well, as I suspected. I suspected that that leave would not be granted, because these are the facts. These are facts from our own Parliamentary Library sources. The National members on the other side like to live in fantasyland, but these are the facts. They are the same facts that were printed in the
Dominion Post last week, laying out the last 10 years of deficits and surpluses.
Earlier tonight we heard one of the members, Mr Tim Macindoe, saying that we have shackled our economy and imperilled our children’s future as a result of the former Labour - New Zealand First coalition Government. He tried to make out that all the problems now were a result of the former Labour - New Zealand First Government. Well, I would like to point out—and it was printed in the
Dominion Post and other papers in New Zealand—that during the period 2002 through to 2007 the surpluses were running in the order of $2.4 billion, $4.3 billion, $5.5 billion, $7 billion, $7 billion, $5.86 billion, and then $5.6 billion. There were surpluses of billions and billions of dollars right through until the following year after the National Government took office, and suddenly we are into $3.8 billion deficit; the following year after that, $6.3 billion deficit; the following year, this latest year, $18.4 billion deficit; and this year the Budget is an $8.4 billion deficit. The following year after that it is a $7.8 billion deficit. The year after that it is a $2 billion deficit. Finally, in about 3 years’ time, this shows that we come into a surplus of $197 million. It is so close to the margin of error it is not funny.
After 7 years of huge surpluses we now have 6 years of huge deficits. So do not give us any of this business about how we have imperilled our children and about how we have left it in such a shocking situation. Basically, for the next 2½ years we are seeing another $20 billion in deficits from this supposedly brilliant Government with its brilliant strategist, the ex - Merrill Lynch world banker and world financier. We are seeing this economy continuing to go down the drain. This is what a lot of red looks like, I say to the National members on the other side. Again, this chart is out of the
the other day. The black lines came through here as the surpluses. All the big reds, funnily enough, are from that side of the House—from the National Government side of the House.
Further to that, let us have a look at the record over the years. Have a look at this chart, which shows average unemployment. This is the average unemployment by Government, with Governments going right back to 1957—unemployment. It is very interesting, because where there is red, that is Labour Governments, and sometimes New Zealand First - Labour Governments. Where there is blue, that is National, Tory Governments. Is it not interesting that the unemployment figures are always incredibly high when there is a National Government around? They are incredibly high—always high.
Then, when you look at the GDP growth by Government on this chart, going right back to 1957, is it not interesting that, again, in the Labour Government periods and, again, when New Zealand First is with Labour we have very high GDP growth. But look at the low points—the blue low points—down here, and look at the latest low point under the National Government. It is almost down to zero. Is it not incredible? With the two charts combined, the unemployment under National goes right off the top of the chart, while the GDP growth goes right off the bottom of the chart. These are the facts, not the rhetoric—not the fantasy world on that side of the House. These are the facts, and the sooner New Zealanders wake up to the fact that we are being led down a garden path by this Government, the better.
RICHARD PROSSER (NZ First)
: I am pleased to rise on behalf of New Zealand First to take a short call on this quite dreadful Budget as it has been delivered by this
quite terrible Government. It has been called a zero Budget, and that is what it has delivered for the New Zealand Defence Force—zero, nothing, zip, nada. I have to refer to my notes here, because zero can be spelt in a number of different ways.
I listened to the Minister of Defence earlier in the evening. I listened to Dr Coleman attempting to defend the indefensible. He made a valiant attempt. He is a good man, of that I am sure. I am sure that Dr Coleman is genuinely committed to the New Zealand Defence Force. I am sure he genuinely wants to see it perform to the best of its ability, and for our forces, when they go out into the world, to go with the best of equipment and the best of support. It is a testament to his loyalty to the Government of which he is a part that he was able to stand and defend the fact—or attempt to defend the fact—that the Defence Force is not being given enough resourcing for it to be able to defend New Zealand.
It is also loyalty that drives the men and women of the New Zealand Defence Force to carry on their duties in the face of ever-dwindling resourcing. They do not do it for the money—God knows they do not do it for that. Even in this secular Parliament it is important that God knows it, because under this Government’s ongoing defence cuts, it really will be God who is tasked with defending New Zealand. But despite Dr Coleman’s best efforts to justify the illogical, irrational, and downright dangerous penny-pinching of this Government’s meagre and, some might say, feeble—indeed, embarrassing—allocation to defence, it remains a fact that New Zealand’s military is disadvantaged by it.
I had the honour to accompany the Minister and a number of other members to Exercise Alam Halfa in Waiōuru last month. I have to say I was seriously impressed with the commitment, the dedication, and the professionalism that I saw from our boys and girls in the military forces, who were small in number and young in age, I have to say, to my eyes in a comparative sense now. I was impressed by their continuing commitment.
I do not see that level of commitment continuing from this House to those people. We continually over the decades and over the years continue to downgrade defence. We continue to cut costs. We continue to cut corners. We continue to believe that we live in some kind of imaginary benign strategic environment—a term that was crafted more than a decade ago by people on this side of the House, but by people who, in my estimation and in the view of New Zealand First, were not grasped of the realities of the military world, and did not have a world view that took history into account.
We do not live in a special bubble of human existence. The world is not different now. The world has not changed. People have not changed; the behaviour of humans and the behaviour of nations have not changed. Conflict will come again, because conflict is the natural state for humanity. We live in a break between conflicts. That is all. The Pax Americana has been imposed through the threat of force on the Western World these past three generations. Conflict will come again and we are not prepared for it. The Budget allocation for defence this year by this Government has not assisted in that process.
The world is an uncertain and unstable place, and it is becoming more so by the day. Only this morning on CNN American defence analysts were warning of renewed instability in the Middle East. Tensions are growing between Israel and Iran. The former is already armed with nuclear weapons and the latter is quite possibly seeking to become so. Iran is certainly armed with weapons capable of reaching southern Europe. And there are southern European nations that have been exercising with the Israelis that Iran might take to be enemies. Iran has missiles capable of reaching Italy and Greece. In the South China Sea, a half-dozen nations including China lay claim to the Spratly Islands, rich in oil, and to fishing grounds that are ever more contested and ever more
congested. Several nations—Viet Nam, the Philippines, and China among them—have taken to sending naval vessels out with their fishing fleets in order to protect their national interests.
Against this backdrop, New Zealand is cutting funding to our defence forces. We are civilianising back-office jobs and looking for savings from operational budgets. This is folly. It is misguided and short-sighted. There are people in Christchurch suffering because they failed to make proper account for their insurance and then the earthquakes happened upon them. New Zealand today is not making proper account for our national insurance for our defence. The defence of the nation is the first responsibility of Government, not the last. It is the very last thing that should be cut in this nothing Budget. It is a mediocre, lacklustre Budget from a mediocre, lacklustre Minister of Finance. The National Party should be ashamed of him and of his Budget. Thank you.
Hon STEVEN JOYCE (Minister for Economic Development)
: I move,
That this debate be now adjourned.
A party vote was called for on the question,
That the motion be agreed to.
||New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.
||New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.
|Motion agreed to.
Crown Entities Reform Bill
- Debate resumed from 23 May.
A party vote was called for on the question,
That the Committee divide the bill into the New Zealand Public Health and Disability Amendment Bill, the Mental Health Commission Amendment Bill, and the Charities Amendment Bill, pursuant to Supplementary Order Paper 30.
||New Zealand National 59; New Zealand First 7; Māori Party 3; ACT New Zealand 1; United Future 1.
||New Zealand Labour 34; Green Party 14; Mana 1.
|Motion agreed to.
- Bill to be reported with amendment presently.
Commerce Commission (International Co-operation, and Fees) Bill
Part 1Co-operation with overseas regulators
CHRIS HIPKINS (Labour—Rimutaka)
: I am happy to take a brief call on this part of the Commerce Commission (International Cooperation, and Fees) Bill while the other Labour speakers, who, hopefully, are watching this in their offices—that is, Cunliffe, Cosgrove, Huo, and various others who may be watching—are, I am sure, on their way to the Chamber. Of course, they were not expecting to be here until 9 o’clock, because the agreement of the Business Committee was that the Budget debate would
continue until 9 o’clock. So I will put on record now that the Opposition members are very unhappy, and after an agreement that was reached unanimously by the Business Committee has been breached, our further co-operation with the Government will be much, much more restricted from this point onwards in proceedings. The Business Committee does operate on a unanimous basis, and when the Leader of the House gives an undertaking to the Business Committee, we expect that it will be adhered to. The agreement was that the Budget debate would continue until 9 o’clock, so we are somewhat disturbed that that agreement has been breached, and that the debate was adjourned before the time that was agreed with the Leader of the House was reached.
I am sure my colleagues who have more knowledge of the particular clauses in this bill that we are going to be debating, who are watching this and listening to this, will be on their way to the Chamber at the moment. I can see that Mr Cunliffe has just arrived, and I am sure he will be happy to pick up the debate after a few minutes. I will give him a few minutes to collect his thoughts, and then I am sure he will pick up the debate.
But I do want to say that I am incredibly disappointed at this breach of good faith by the Government—
Hon Dr Jonathan Coleman: I raise a point of order, Mr Chairperson. These remarks do not seem to relate at all to the topic in hand.
The CHAIRPERSON (Lindsay Tisch): I know that the member will come to Part 1 in a moment, but there is a procedural matter that he is referring to, and I am happy to accept that. I know that the member will come to Part 1.
CHRIS HIPKINS: Thank you very much, Mr Chair. I will come briefly to Part 1 while my colleagues sort themselves out. This bill basically has two parts. The main provisions of Part 1 set out the cooperation provisions with overseas regulators with regard to restrictions on providing information, the arrangements regarding Government to Government cooperation, and what the cooperation agreement must contain. Those are contained in new sections 99C through to 99O, inserted by clause 6. Other new sections include procedural arrangements with regard to reporting on the use of cooperation arrangements, conditions on providing information and the sharing of information, and the maintenance of privilege.
Those are the main provisions that are in this particular part of the bill. I am sure my colleague David Cunliffe, who I am sure is about to speak on this bill—and possibly Raymond Huo, who is also here—will be willing to elaborate on those provisions further.
Hon DAVID CUNLIFFE (Labour—New Lynn)
: Labour supports the Commerce Commission (International Co-operation, and Fees) Bill. It is a bill that was originally introduced by the Hon Lianne Dalziel. It was then adopted by the Hon Simon Power—who, it might be said, was a great loss to the National Cabinet—and it has now been taken over by Craig Foss, my former colleague on the Finance and Expenditure Committee. But since 2010 it has, unfortunately, been languishing on the Order Paper.
The proposals in this bill are part of the work programme supporting the memorandum of understanding with Australia on business law cooperation, and on that I would like to make a couple of introductory comments. The bill aligns us with Australia, which passed similar legislation in 2007. It is not a matter of enormous pride for this House that it has taken us until 2012 to return the favour.
There are a couple of general comments that might be made about the progress of business law and competition policy in the two countries. The first comment is that Australia, because it has a larger, more complex, and perhaps more nuanced political system than our own, did not embrace what we call Rogernomics with quite the same fervour or gusto. If I recall correctly, in about 1987, when I was offered a job at Treasury, I turned it down because I did not want to enter a monastic institution where
the religion of the land was something called neo-liberalism or, as we called it, Rogernomics. I am very glad that I made the right decision in turning that job offer down. I went to work in the Ministry of Foreign Affairs and Trade, before Murray McCully was the Minister. I guess those were the golden days.
Since those days, the way that New Zealand approaches the closer economic relations arrangements—which, of course, were the brainchild of Tim Groser in his own mind, but that is another story—has changed. Back in the 2000s CER was designed to pursue the interests of Australia and to pursue the interests of New Zealand, and to do so where those two interests mutually overlapped. What has changed under this Government is very, very significant. It has changed the purpose clause so that the memorandum of understanding supports the joint—the joint—increase in business well-being across both economies. One might very well suggest that that change is, in the language of economic geography, usually going to be in the nature of the interests of the stronger, larger partner. We all know that if we were perfectly open to a single labour and capital market, more of the smart money, the research and development, and the big-end capital would migrate towards Australia. So it is important that we do at least incorporate into New Zealand law the sometimes greater protections that have been developed in Australia’s larger and more complex system.
For example, in the area of telecommunications, a portfolio that I used to hold, we learnt a great deal from the ACCC—that is, the Australian Competition and Consumer Commission—and its approach in relation to the regulation of telecommunications in Australia. That was one of the things that became instructive in the way we approached the then virtual monopoly, the vertically integrated monopoly, of Telecom New Zealand. It was also one of the reasons why we were able to benchmark the changes of 2006 that led to the unbundling of the local loop, the strengthening of the Commerce Commission, and, interestingly, the resulting doubling of investment in that sector, along with lower broadband prices and higher uptake. That was partly because we were able to benefit from the experience of our Australian cousins.
Much has been made of the international nature of transactions and the territorial limits of regulators being a reason why it is very desirable for regulators to be able to cooperate to manage competition and consumer effects of transactions across various domestic markets. It is important for the Committee to recognise that the Commerce Commission is currently constrained from providing the investigative assistance and compulsorily acquired information that it holds to overseas regulators. If it is the case, as is too often the case, that the head office of a New Zealand company that has been bought up by an Australian, or maybe another, parent moves across the Ditch and the big strategic decisions are made there—and there might be a bit of transfer pricing going on so that it does not pay too much tax in the New Zealand market, hypothetically speaking—it is very, very important that when that company is caught out by the New Zealand regulator, it can share that information with the Australian regulator. [Bell rung] Mr Chairman, I probably will not take the whole of the next five minutes, but I do want to touch on several of the important—
Chris Hipkins: Yes, you will.
Hon DAVID CUNLIFFE: Oh well, my whips are saying that I will. Normally I am one of those who are quite challenged to find the words to fill a whole speech, but I will force myself, because the whips have asked for that. Such is the life of a parliamentarian these days, I guess. As they say, the whips own my body, so I am here to do their bidding. There we go.
So let us just dig down, in all seriousness, for a moment and look at some circumstances where that information-sharing power might be important. For example, the New Zealand Commerce Commission’s statutory powers of compulsion can be used
only in relation to enforcement and adjudication within New Zealand. Well, that is not very useful if it is a trans-Tasman business and if the naughtiness happens to be going on at the head office across the Ditch, and it gets the evidence here. It needs to send the evidence to Sydney so we can catch the bad guys. There is no point in having the sheriff with the posse stop at the gate of the neighbouring ranch. Well, that is what we have got until we pass this law.
There are also legal constraints on the provision to overseas regulators of confidential, compulsorily acquired information that is already held by the commission. This in turn limits the willingness of overseas regulators to provide assistance to the commission, such as cross-jurisdictional assistance, that might be mutual. Another example, in a different sphere, is the way our officials and Australian officials have developed protocols on an immigration policy in order to swap sensitive information on cases that cross the Tasman. There is no such similar power until we pass this bill in the area of commercial and competition regulation.
I will say just a couple of words on the main provisions of the bill. There are two parts. Part 1 amends three Acts. Part 1 includes Subpart 1, which amends the Commerce Act, and which is the substantial part of the bill. It sets out the cooperation provisions with overseas regulators and provides for Government to Government cooperation, and there are also new sections on procedural arrangements with regard to reporting on the use of cooperation arrangements, conditions on providing information, and the sharing and maintenance of privilege, which is also very important in the legal world. Subpart 2 amends the Credit Contracts and Consumer Finance Act, ensuring that the changes to the Commerce Act apply to the Credit Contracts and Consumer Finance Act where references are made to consumer credit law and the Minister of Consumer Affairs. Subpart 3 amends the Fair Trading Act to ensure that changes to the Commerce Act apply to the Fair Trading Act.
Part 2 covers the fees that will be charged, and we have two SOPs. For the benefit of the public out there, these are Supplementary Order Papers. These are the last-minute changes the Government brings to the Committee to keep the Opposition guessing, or because officials did not do their homework in time. We have two of them today. Supplementary Order Paper 274 introduces a new subpart, because the original bill did not amend the Telecommunications Act to bring it into line with the legislation. This Supplementary Order Paper is in breach of Standing Order 299(1). No? No, it is not now. That is good; the super-Minister, the Hon Craig Foss, has sorted it out. That is very good. We are very pleased about that. Perhaps he is the next budding super-Minister.
Hon David Parker: Maybe he’ll get education.
Hon DAVID CUNLIFFE: Maybe he will, because apparently it is going to be vacant soon, I hear. Or he may get one of those uniforms, like Steven Joyce has, with the underpants on the outside and the long flowing cape. I am always confused: if he is Superman, why have they given him a department called “MoBIE”? That’s a different fairytale.
Hon Member: Because he’s a dick.
Hon DAVID CUNLIFFE: “MoBIE Dick”—perhaps that might be what the underpants are about, but, anyway, that is another matter.
Supplementary Order Paper 26 divides this bill into four bills, and there, pretty much, we have it. It is a sensible bill—a sensible bill. I do not think anyone in this Chamber would argue that this is not a sensible bill. It is, one might say, a trifle more sensible than the recent Budget. Thank you.
Hon CRAIG FOSS (Minister of Commerce)
: I intend to move Supplementary Order Paper 274 during the Committee of the whole House. I note that because of
changes to the Standing Orders the amendments set out on the Supplementary Order Paper, which was tabled before the last election, can now be considered without leave of the Committee of the whole House.
That Supplementary Order Paper proposes to add new Subpart 4 to Part 1 of the Commerce Commission (International Co-operation, and Fees) Bill to amend the Telecommunications Act 2001 to authorise the Commerce Commission to provide investigative assistance and compulsorily acquired information, under the Telecommunications Act, to assist overseas telecommunications regulators. Incorporating the Telecommunications Act is consistent with the overall intent of the bill to allow the Commerce Commission to assist equivalent overseas regulators in the enforcement of competition and consumer laws. The Supplementary Order Paper will also align the New Zealand and Australian approaches, as the Australian Competition and Consumer Commission is already able to provide such assistance to the New Zealand Commerce Commission.
I too acknowledge the rapid way in which we have come to this bill, but we are here now. In respect of what a previous speaker said, I do acknowledge the general cooperation and collaborative nature around this particular bill. I hope that that continues to facilitate its progress.
Hon Lianne Dalziel: There is no facilitation—not after breaking deals.
Hon CRAIG FOSS: Fine. I am just saying my piece. On that point I acknowledge, as I did in my second reading speech, that the bill originated with the former Minister of Commerce, the Hon Lianne Dalziel, under the previous Labour Government. Many of these commerce bills are across Parliament, and we fully respect that. I do always make a point of acknowledging that point.
Did I hear right that the Hon David Cunliffe was off to a monastery or something? I note he has a beard, ready to go a monastery or something. But he did raise a very good point about the Supplementary Order Paper and the Telecommunications Act. I respect that we are on Part 1 at the moment, but this is just an introductory speech here. It is just an acknowledgment of how things have changed over recent years, and in hindsight that probably should have been thought of in the initial stages of the bill. But again there is a collaborative nature across the House with regard to its merits, and an acceptance of why that should be included.
As the previous speaker, David Cunliffe, noted, the bill is relatively small. There is a Supplementary Order Paper that breaks it into four bills later on in respect of the Acts that it amends or impacts upon. Importantly, it is a very important part of our single economic market agenda with Australia, and it is one of the 28 key points that the Government has signed up to with Australia. We are making good progress on those. As I noted at the start of my speech, Australia can already share information with New Zealand. This bill will empower the New Zealand Commerce Commission to share such information with its counterpart over there. We already have cross-sittings of the chairs or representatives of both the Australian equivalent and the New Zealand Commerce Commission. That keeps them aware of what is going on in the two economies. As other members have noted, so much of our economy crosses the Tasman in one way, shape, or form.
Most of the detail is in Part 1, which we are addressing now. I am looking forward to hearing views and points from members around the Chamber. I do acknowledge the work of the Commerce Committee, and the improvements and value that it gave to this bill, particularly the sections about what was originally drafted as Government to Government permissions, and for Government regulators to also be able to talk to each other.
I note that although this bill concentrates on New Zealand and Australia, in fact it could be empowered to go beyond that, subject to some upfront agreements for protections of privacy and protection, as members will see, of self-incriminating statements, etc. They would not be shared. There are strong rules upfront about how information could be shared, and members may also note that a lot of the information around Part 4 of the Commerce Act is actually not to be shared. Most of those are domestic energy - type situations in New Zealand. I look forward to hearing members’ views and opinions on this part of the bill.
Hon DAVID PARKER (Labour)
: When I came down to the House today, I looked at the Order Paper and we had 12 hours and 2 minutes remaining of the Budget debate. And here we are just a couple of hours later having switched not to the next bill on the Order Paper but the one after it. The Government seems to be in a state of disarray today—
Hon Craig Foss: No, they’ve done the others.
Hon DAVID PARKER: What’s that?
Hon Craig Foss: They did the Crown Entities Reform Bill.
Hon DAVID PARKER: It did the Crown Entities Reform Bill? The Committee stage went through very fast, did it? Well, I might be mistaken, but I did not think—
Hon Lianne Dalziel: We did that.
Hon DAVID PARKER: We did it very quickly. Well, the first mistake that we had from Gerry Brownlee today was when he came down here to speak in the Budget debate, and despite his being responsible for the Order Paper, which said the amendment was in the name of David Shearer, he said it was in the name of Grant Robertson about three or four times, until Mr Joyce sort of, with some embarrassment, whispered into his ear that he had that one wrong. Then, of course—
Hon Member: Touch of the “Banksies”.
Hon DAVID PARKER: A touch of the “Banksies”. That is right—a touch of the “Banksies”. Then we had some debate around the Budget, and when it was obvious that the debate was about to turn to Vote Education and the terrible debacle that there has been for the Government around intermediate schools, lo and behold, all of a sudden we had an adjournment motion on the Budget debate. Even with many, many hours remaining in that Budget debate, it was not convenient for the Government to continue. It had to come to these other “urgent” pieces of legislation, which have been languishing—
Hon Lianne Dalziel: How long has this one been sitting there?
Hon DAVID PARKER: Well, that is right. This Commerce Commission (International Co-operation, and Fees) Bill was introduced originally by the Hon Lianne Dalziel in the last Labour Government. It then languished at the Commerce Committee for some time, because there was more—
Hon Lianne Dalziel: Under the chair of Lianne Dalziel.
Hon DAVID PARKER: —under the chairpersonship of Lianne Dalziel, because there was some more pressing and important business before the committee for it to attend to first. Then, the bill having been back here since November 2010, the Government let it languish on the Order Paper until today, because—
Hon David Cunliffe: They must be hurting.
Hon DAVID PARKER: I have heard that the Government has been hurting so much that the Prime Minister’s emissaries have been around the press gallery today blaming Hekia Parata. Collective responsibility is not really—
The CHAIRPERSON (Lindsay Tisch): Order! Part 1.
Hon DAVID PARKER: I am being told that we should be addressing Part—
Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. [Interruption] Are we interjecting on points of order now?
The CHAIRPERSON (Lindsay Tisch): A point of order, the Hon Clayton Cosgrove.
Hon Clayton Cosgrove: With respect, and not challenging your ruling, the Minister in the chair, the Minister of Commerce, in his address did actually say that he was going to—and fair enough too; he was wandering slightly wide of Part 1—address some other issues, which, in fairness to the Minister, I think were valid. But if that leniency is going to be extended to Ministers, it should be extended to those on this side of the Chamber.
The CHAIRPERSON (Lindsay Tisch): I have given the speaker 2½ minutes of talking about things other than Part 1. I have asked him to come back to Part 1, and I know he is going to.
Hon DAVID PARKER: Thank you, Mr Chairman. That is a fair point, and I will come back to the bill. This bill would allow the Commerce Commission to share information if there was an inquiry being conducted in one country or another into, for example, the efficiency of provision of education and there was said to be some anti-competitive practice at large. It could be whether charter schools were cooperating amongst themselves in a way that was anti-competitive, and it would be interesting to know from the Minister whether, if the Crown was engaged in some anti-competitive procedure that was affecting school conduct—for example, if it was to try to tell all of the intermediate schools in the whole of the country that they should close down their technology—
The CHAIRPERSON (Lindsay Tisch): Order!
Hon DAVID PARKER: Mr Chairman, this is within order. I am asking whether, if the Crown was to give a direction to all of the intermediate schools, it would be caught by the inquiry functions of the Commerce Commission that are being extended in this legislation. I am not sure from my reading of this legislation whether it applies only to private enterprise actions, like charter schools, or whether it would apply to Crown actions were a Minister or a Government silly enough to tell schools that they had to change student-teacher ratios in a way that effectively required—I want the Minister to take a call as to whether that sort of conduct on the part of the Crown would be caught by these investigative functions that could now cooperate, and whether it could get lessons from Australia as to whether that country has ever been silly enough to give a direction to its intermediate schools in a way that would close down all of their technology classes. I am interested in the Minister taking a call and answering that question.
I am also interested in another matter. At times we have regulated monopolies in New Zealand, including in respect of electricity lines. There is an unclear point in New Zealand as to whether the input methodologies that are relied upon to set the prices for lines are right in New Zealand.
Hon David Cunliffe: It’s a hot debate.
Hon DAVID PARKER: It is a hot debate. It is going to appeal at the moment, and Vector would say that the Commerce Commission in New Zealand is allowing it a lower cost of capital than is allowed in Australia.
Hon David Cunliffe: What does the Minister think?
Hon DAVID PARKER: I would be interested to know what the Minister thinks of that, and I would also be interested to know what the Minister thinks as to what the consequences of that are for the regulated monopoly. I will tell you why I am interested: because I have been told that the consequences of that for Vector are worth between $400 million and $700 million. We could benefit from cooperation with the Australian authorities as to what they think is the right answer to that.
Hon David Cunliffe: It’s like two Skycity Casino deals.
Hon DAVID PARKER: Well, that is the exact point I was going to make, Mr Cunliffe. It is strange that you should mention that, because if, rather than pinging Vector on its return on capital, the Government was to say to Vector “Why don’t we give you the same rate of return as they have in Australia, and you build us a convention centre?”, we might get a convention centre for cheaper than the Skycity group is willing to do it, without the adverse effects of the pokie machines. So it would be interesting if the Minister could respond as to whether this sharing of information between regulators on both sides of the Tasman, in this case, could actually turn up some information to show whether that decision by the Government in respect of the Skycity Casino is not really as silly as it appears from the outside.
Hon David Cunliffe: Dotcom.
Hon DAVID PARKER: Dotcom. That is right. Well, look, the police seem willing to share his computers, so maybe this is just another example of sharing of information.
There is one other serious question I would like to raise, and that is what controls there are going to be against the inappropriate sharing of information. I would not want to see information being shared—for example, in relation to telecommunications companies—with some countries that do not have proper checks and balances in the protection of the civil liberties of their people in their countries. I think we have to be a bit careful—[Interruption] What is that?
Hon David Cunliffe: Not naming any of them.
Hon DAVID PARKER: Not naming any, other than Fiji, perhaps, which I would name as a close neighbour with whom we should not be sharing information on some of these matters.
I have raised a number of questions. I am particularly interested in the point as to whether there could be a sharing of information on, and whether this bill would apply to, decisions of the Crown as, effectively, a monopoly purchaser of education services, if it made some ridiculous decision that would effectively cut technology classes out of all schools—whether that sort of thing could be the subject of an inquiry by the Commerce Commission, for the purposes of which it could gather information or share information with the Australian regulator. That seems to be the most practical instance that we have had recently of some monopoly or monopsonist practice that has terribly adverse effects and that there needs to be an inquiry about.
ANDREW WILLIAMS (NZ First)
: I take a call on behalf of New Zealand First on the Commerce Commission (International Co-operation, and Fees) Bill. I would concur with the honourable member Chris Hipkins in terms of what was an agreed arrangement at the Business Committee to go this evening until 9 p.m. on the Budget debate. But it was very interesting that, obviously, the Government members were finding the heat a bit too hot. They did not like the information that was being put on the table, and it was very interesting that the “Superman” super-Minister had to leave the House with a great deal of urgency because it was getting a bit too hot for him.
But getting back to the Commerce Commission (International Co-operation, and Fees) Bill, I do apologise; I was going to go back to my office, as many other members were, to get some of my speech notes for later in the evening, but as we were not given the courtesy to do that and this bill was brought forward, then we will have to explore things on the hoof. It is on the hoof—
Hon Clayton Cosgrove: A bit like their policy—on the hoof.
ANDREW WILLIAMS: And it is a little bit like the National Government—you are dead right. It is a bit like the National Government, and how most of its policy is on the hoof. Most of it, as a result, is of that ilk.
I would like to raise a few points out of the bill, particularly new section 99H, in clause 6. It says, in new section 99H(1): “Following a request by a recognised overseas regulator made in accordance with a co-operation arrangement, the Commission”—as in the New Zealand Commerce Commission—“may do either or both of the following: (a) provide compulsorily acquired information to the recognised overseas regulator: (b) provide investigative assistance to the recognised overseas regulator.”
This is of great assistance in terms of dealing with, particularly, our sister nation across the Tasman, Australia, which already has this in place, and has had this in place for a few years. It will help with inquiries in terms of what is happening on both sides of the Tasman, in particular, but also with many of our other international trading partners.
But when I get down to new section 99H(2A), it says: “If the Commission considers, after consultation with the Ministry of Foreign Affairs and Trade, that a request for compulsorily acquired information or investigative assistance may have significant trade consequences for New Zealand, the Commission must refer the matter to the Minister of Trade.” This is a very interesting provision, because it basically means that the Ministry of Foreign Affairs and Trade is brought into the whole picture in terms of any matters that are occurring within New Zealand or, indeed, could be occurring in an overseas market, where a jurisdiction commission in an offshore market where we operate is similarly inquiring into the activities perhaps of a New Zealand company, or a company operating there that has interests in New Zealand as well.
So that is very interesting, and they, perhaps, would be very interested in making sure that New Zealand does play by the rules—that we do operate by the rules and are certainly above board. It might, for instance, be such that they would come to the Ministry of Foreign Affairs and Trade and ask for its opinion on these sorts of things. It is interesting that today, the same day, we read in the
New Zealand Herald that the Ministry of Foreign Affairs and Trade was stripped of $6 million by the Minister of Foreign Affairs, who happened to be the Minister for the Rugby World Cup. He stripped $6 million out of the Ministry of Foreign Affairs and Trade to pay for party central for the National Party on Queens Wharf, to expand it into Captain Cook Wharf.
I think it is interesting that the very body that could be providing assistance to the Commerce Commission to provide international information across to our Australian counterparts might actually be the same body that had $6 million stripped out of it for other commercial activities to basically promote the Rugby World Cup. If you were an organisation in Australia and you were involved with bidding for the Rugby World Cup, were running part of the Rugby World Cup, were a tenderer for the Rugby World Cup, or were trying to be a big player in the Rugby World Cup, you would start to question whether it is fair play that the New Zealand side of things stripped $6 million out of its Ministry of Foreign Affairs and Trade, just pulled it out of a hat, and sent it across to party central to pay for the upgrade of a wharf. So it starts to move into the area of “How does New Zealand operate here?”.
More and more, under this National Government, we are starting to see some very shonky things happening, and I think that before we start being the regulator, with the Government saying “This is how you will play by the rules.”, perhaps this Government needs to reflect on itself and say “Well, we will also abide by the rules and play by the rules.” We cannot be judge and jury, and we cannot provide international information to our sister commerce commissions and our sister governmental organisations around the world if we ourselves are not squeaky clean, and if we ourselves are not providing something that is upfront, very clear, and very transparent.
When I as a New Zealander see things such as the Ministry of Foreign Affairs and Trade having something like $24 million stripped from it—removing our embassies in Sweden, downgrading many of our posts, greatly reducing our presence in Europe, and
greatly reducing the efficiency of the ministry in terms of our top international people around the world—it is concerning to read, on the very same day, in the biggest paper in New Zealand, that $6 million was pulled out of our Ministry of Foreign Affairs and Trade in order to pay for Rugby World Cup party central for the National Party.
So I say to the Minister in the chair, the Minister of Commerce, let us get in behind this Commerce Commission cooperation, let us be a genuine player on the world stage, and let us be fair and equal to all. But let us also make sure that back at home in our own backyard we play by the rules.
Hon CLAYTON COSGROVE (Labour)
: I want to raise a couple of issues, but before I do I just note for the record that the reason we are here tonight not debating the estimates is what I would call the usual reason—I see Mr Sam Lotu-Iiga nodding and grinning in agreement. This is a Gerry Brownlee special. This is a Gerry Brownlee special, in that the deal was reached to debate the estimates to 9 o’clock, and Gerry stuffed it up, either deliberately or otherwise. So here we are, deal broken, debating this piece of legislation, the Commerce Commission (International Co-operation, and Fees) Bill, which somehow tonight, after a robust estimates debate, has taken on such urgency that Mr Brownlee comes down to the House on bended knee, breaks the deal, and here we are.
The question you have got to ask is why. Well, I suspect that—and I will make this very relevant to the bill, Mr Chair, because I am anticipating your thought in respect of my speech—after Hekia Parata came down and had to effectively reverse and back down from the policy over teacher numbers, the feet were put to the fire. Then down came Gerry on the draught horse, on the silver charger, to break the deal—to break the deal—and here we are debating this legislation tonight.
I have got a couple of questions for the Minister in the chair, the Minister of Commerce, on that—for instance, if we look at some of the interesting things in the Budget that are very germane to this bill, like rest home care. I have a question for the Minister. So if one had, for instance, a—
Michael Woodhouse: Very germane to the bill!
Hon CLAYTON COSGROVE: It is. Oh, it is germane to the bill, and I will tell you why before you leap to your feet. Taihoa, help is on the way. It is germane because what if one, for instance, and this is a question for the Minister, had an Australian-owned rest home provider with Kiwi interests, and one of the two companies, say the New Zealand company, was attempting to claw back and increase the numbers of fees from its residents—say, for instance, colleagues, to make up for the fact that the Government has now slashed the asset-testing subsidies—what if they were trying to claw some of that back? Would those two entities, Minister, be subject to this bill in respect of monopolistic behaviour or collusion, and, therefore, subject to the investigative procedures if they shared that information? That would be interesting, given—
Darien Fenton: That’s a good question.
Hon CLAYTON COSGROVE: —that is a good question, I think—that, of course, the third National Government in its generation—Muldoon, Bolger, and now the Key Government—has kneecapped the oldies in respect of, in this case, asset testing; in its history, the pension; or in Muldoon’s history, of course, bribing people with their own money.
The question is this: if a New Zealand - owned rest home operator decided to, in a monopolistic way, claw back moneys, could that information be shared with an Australian provider, and would that then be collusion and subject to the provisions of this Act? I know that this is an issue that Mr Lotu-Iiga, who is an eminent lawyer, I am told—an eminent lawyer; more so than Mr Finlayson—is exploring and is deeply concerned about for his constituents, of course, in South Auckland—
Peseta Sam Lotu-Iiga: It’s not South Auckland.
Maungakiekie’s not South Auckland.
Hon CLAYTON COSGROVE: —or Maungakiekie, I should say, who are subject, and may be subject, of course, to rest home provisions.
The second point I would make is Mr Parker’s. It will be very interesting to note—and it may be that the Minister has not anticipated this question as this bill has gone through—given that the Crown is effectively a monopoly provider of services within the State sector and it is stripping resources from that education sector, particularly pertaining to technology, whether it is the case that the Australian regulator could require an investigation and require information to be shared to bring that provider, namely the Crown, to account if it was engaging in monopolistic behaviour. I think that is a very important question, given, I suspect, that the Minister—though he is a Minister, and therefore part of the whole Budget process—presumably, in bringing in these Supplementary Order Papers 274 and 26, was aware of the provisions in the Budget and was aware of what his own Cabinet and what his Government was doing. Presumably, that is addressed within these Supplementary Order Papers. Or, if the point is not valid, I think the people of New Zealand would like some assurance as to how those issues will be dealt with, because they are important issues.
We support the tenor of this bill because, of course, it is about aligning with Australia, and it is about bringing our regulatory relationship and our commercial relationships together. It is about attempting and doing that to make business easier—easier and more transparent for the entities on both sides of the Tasman. That is something that has occurred for a great period of time, going back beyond CER.
I think there are some lessons coming out of the Budget that need to be addressed. There are some actions the Government has taken that could directly impinge upon the legality and processes within this piece of legislation, so I invite the Minister to address those issues. There will be elderly folk who have now, of course, been shocked in recent days by the announcements of this Government having gone back on its word, and who will now be listening to this debate tonight and wondering, for instance—especially rest home providers—whether this legislation will impinge upon them in respect of the relationship with their counterparts in Australia or, indeed, in other places.
I also raise the other point that Mr Parker did, in terms of what controls there are in respect of information sharing. I would note that I would assume that there are some jurisdictions internationally that we would not want to share information with, perhaps. What are the controls or vetting procedures for receiving information and verifying it from some of those jurisdictions? Of course, we would not like to see the Crown’s name slurred internationally, even though it is in danger of that, at least domestically, with some of the provisions in this Budget.
The other point I would make is this: in terms of monopolistic behaviour, we know in Australia there are also great young entrepreneurs called paper boys and paper girls, and they are indeed paid for their service. I am not sure, but I think their tax provisions are far more generous in Australia—
Michael Woodhouse: I raise a point of order, Mr Chairperson. Saying that comments are germane to the bill does not necessarily make them so, and I fear that the member speaking has drifted far too far outside the boundaries of this legislation.
The CHAIRPERSON (Lindsay Tisch): I am the judge of relevance in this matter, and I will ask the member to speak on Part 1 from now on.
Hon CLAYTON COSGROVE: Thank you, Mr Chair. I completely note—as does the House—the quality of your rulings. I know that the inexperienced souls—some of them on that side—will be learning from your learned judgments—
Maggie Barry: We certainly don’t learn from you, except what not to do.
Hon CLAYTON COSGROVE: —in respect of this bill. Hang on! That was a bit of a dandelion at the back of the garden, I think, over there, who decided to wake up. You know, the eyes have opened, the blood is now pumping, and the air is being pumped through. Well done! As I said the other night, Miss Barry, go on gardening leave. You will be far more qualified for that than you are in this House with your contributions. The best contribution that member made was to try to intimidate submitters at a select committee, but moving back to Part 1—
Maggie Barry: Go and get a hairdo.
Hon CLAYTON COSGROVE: I may be light in the hair, that is true, but it is all real and it ain’t dyed.
Let me say this: in Australia we have young entrepreneurs, as we do in New Zealand, called paper boys and paper girls. We also have young entrepreneurs who do after-school work, of course. In Australia or in New Zealand, one could argue that it would be hard for monopolistic behaviour to occur between those entities across the Tasman, but it is an interesting question to ask, given that the tax arrangements are far more generous in Australia, and given that Australia does not have a Government that has decided to tax every dollar, every cent, that young entrepreneurs decide to make, whether it be $1 or $45 or whatever.
So, again, I make the same point to the Minister in respect of the rest homes. If, say, a paper boy or paper girl was a part of a company delivering the local newspaper, and that company was perhaps to engage in monopolistic activity and those employed by, say, Independent Newspapers or Fairfax in New Zealand were to engage in similar activity, what would be the provisions that would be invoked? And could the Commerce Commission and the Australian regulator then investigate those entities, poor though they will be, of course, given the Draconian legislation this Government has put forward in respect of taxing them? Would the provisions of this bill apply? I think it is a fair enough question to ask, because the poor old young people have been kicked in the guts once in the last 2 weeks. They used to be able to earn 45 bucks a week without tax. Now these scrooges have come along and pulled the rug out from under them, and pulled the pin. So I think we would not want to scare those fine young entrepreneurs.
The Government said once, many, many years ago, that it wanted to encourage entrepreneurship and a brighter future—many, many years ago. It does not mention those words now, of course, and it has a harder job mentioning them when it is actually discouraging entrepreneurship, as it did in the Budget. But I think that is a fair question to ask. We are giving these regulators substantial powers in this legislation. Will they apply to those rest home companies or to those companies employing paper boys and paper girls? Will those provisions apply, and to what extent? And regarding the quality of information, which jurisdictions will we not be prepared to share information with? My colleague Mr Parker mentioned Fiji.
These are germane questions, and I invite the Minister to look at them very carefully, respond, and give some assurance to the Committee—in terms of both the young folks and those in their retiring years—as we go through it.
Peseta SAM LOTU-IIGA (National—Maungakiekie)
: I take this opportunity to first say talofa lava, which is Samoan. It is Samoan Language Week, and it is an especially significant week this week because it is also the 50th jubilee celebrations of Samoan independence. So talofa lava to you and to our listeners at home and all the viewers around the country.
I am honoured to speak on the Commerce Commission (International Co-operation, and Fees) Bill, and I want to bring the discussion back to the bill. It is an important bill because this bill is consistent with the Budget that we have heard being debated tonight.
It is consistent with the goals of a Government that is looking to put this country back on track to recovery. After 9 long years of the Labour Government, where the last 5 years of that Government saw exports contract, this bill directly impacts the ability of our firms, companies, and organisations in this country to operate effectively in its trading markets and, in particular, the Australian market.
The proposals in this bill are part of the single economic market reforms. It started with the John Key Government in 2009 when he led a mission to Australia, alongside other Ministers in commerce portfolios, where they got around the table and looked at how they could make our countries prosperous, and how they could work together to develop a single economic market to allow both countries to prosper. The bill enables greater cooperation between our regulatory bodies.
I acknowledge the Minister in the chair, the Hon Craig Foss, who is the Minister responsible for the Commerce Commission, and the fine work that he does as our Minister of Commerce, following on, of course, from the Hon Simon Power, who was the Minister in charge of bringing this bill together, along with the Hon Lianne Dalziel. It is part of improving our export markets. We know that this Government’s plan to open access to export markets is part of the recovery process. It is about building a more productive and competitive economy. So what do we do? It is about our firms operating overseas. It will allow the Commerce Commission to work effectively with the Australian Competition and Consumer Commission and other regulators to look at unfair trading practices, as well as other anti-competitive behaviours.
The cooperation between the regulators will involve some degree of information sharing. This Government is actually focused on information sharing to provide efficiencies in Government. We saw that with the welfare reform bill, which allows for information sharing between the Ministry of Education and the Ministry of Social Development. We saw it with the information-sharing bill, which I understand is being worked on by the Justice and Electoral Committee. By sharing information, the regulators are able to more effectively monitor those companies that exhibit anti-competitive behaviour—monopolistic behaviour—as well as unfair trading practices.
What is it about? Well, yesterday I visited one of my businesses in my electorate.
Hon Clayton Cosgrove: Did they recognise you?
Peseta SAM LOTU-IIGA: For the member opposite, who continues to say that Maungakiekie is in South Auckland, I say it is not. It is the heart of Auckland. It is the centre of Auckland. It is the heart of manufacturing, not just in Auckland but in this country, with companies like Rakon, Coca-Cola, and BSL Buckley Systems. They are big companies that actually provide jobs and opportunities for not just my local people but also people across Auckland. Maungakiekie is not in South Auckland; it is in the isthmus of Auckland, between Onehunga and Panmure.
What is our ambition? Our ambition is to remove the barriers to trade. Removing anti-competitive practices allows those firms that want to operate in foreign markets to have an equal footing. When we heard the seven submissions that came before the Commerce Committee we were concerned as a committee that this information sharing would allow for quite confidential and privileged information to be shared not just across borders but also to non-governmental organisations. They may be regulators, but they are not Government organisations. We were concerned that that would be the case, but we were reassured by officials that in the regulator to regulator exchange of information there would also be provisions to work with the Foreign Affairs Ministries in both countries and to work with Government organisations in order to facilitate the effective and efficient exchange of that information. That enhanced cooperation is about detecting and successfully penalising overseas-based parties that contravene this Act and other provisions of our commerce legislation.
Why is it important? It is important because it promotes fair trade in domestic markets as well as in our foreign export markets. It is also about promoting competition in our local markets. As I said, when I visited this business yesterday, Baxter Healthcare, which operates in both markets, has plants and pharmacies in both countries, and has distribution networks in both countries, part of its concern was that it wants a regulatory framework that is consistent between the countries so that it understands that when it trades, and when it produces and manufactures its goods, it has a level playing field—a consistent playing field—not just between Australia and New Zealand but also with other foreign jurisdictions that this bill also affects.
We heard those concerns about the regulator to regulator exchange of information. We were reassured by the officials, and I am confident that this bill will actually promote effective and efficient markets. It is a bill that certainly had cross-party support during the select committee process. It is a bill that I believe continues to have that cross-party support. It is in the best interests of our international trading relationships, especially with our biggest trading partner, Australia, that we have these single economic markets and that we have consistent law between the two.
May I just add my own word of caution to this debate and the discussion we have had here tonight. It is certainly my view that we do not just adopt Australian legislation in toto and that we kowtow, I suppose, to Australian legislators. I think we are a Sovereign nation, and we need to continue to develop our own law independent to that of our trading partners. When I look at this bill, and when I considered this bill at length with my colleagues in the Commerce Committee, I believe that the bill is in the best interests of our country, and certainly in the best interests of my local manufacturers and those that trade with foreign countries. I certainly commend this bill to the House. Thank you.
Hon LIANNE DALZIEL (Labour—Christchurch East)
: Like many of my colleagues, I was not prepared for the debate on this bill, the Commerce Commission (International Co-operation, and Fees) Bill, to proceed at this particular time. I have all of the submissions that the Commerce Committee received sitting upstairs in my office, and I did not have time to go and get those. But, of course, I will be able to bring them down for my second call, after other colleagues have had their go on this particular matter.
I just want to comment on a point, though, that Peseta Sam Lotu-Iiga made in his contribution to the debate, which was to reflect on how this bill ties in with the Budget. I just want to remind the Committee that this bill was introduced actually when I was the Minister of Commerce, on 9 September 2008, and it did not get its first reading until 25 May 2010!
Hon Clayton Cosgrove: So why the rush now?
Hon LIANNE DALZIEL: So why the rush now? I think that starts to expose a little bit of what has really been going on here tonight. Why did the Government suddenly call an adjournment to the Budget debate and hold it over so that this “urgent” piece of business could be dealt with? We have had the Minister in the chair, the Minister of Commerce, take one very brief call and we have had the deputy chair of the select committee, as he was then, take another call. It does not seem to me like the Government is really getting in behind this legislation.
I do want to call to account, though, one of my own colleagues—not the spokesperson on commerce, of course, who is a very good spokesperson, indeed; much better than the last one. The person I want to pull up is the person who said that it sat at the select committee for a long time. It did not. It was referred to us, as I say, on 25 May 2010, and we reported it back on 22 November 2010. That was before the last election and now we are dealing with the Committee stage in May—and, actually, it is June at
the end of the week. It seems to me that if this was such an urgent piece of business for the Government it would have gotten on to it well before now.
Hon Clayton Cosgrove: Gerry sat on it.
Hon LIANNE DALZIEL: I do not think the thought of Gerry Brownlee sitting on anything is quite the appropriate mind’s eye that I want to bring to this particular piece of legislation.
The bill has an interesting history, though. It goes back even further. The original discussion document was put out in 2004, and, in fact, as a result of the discussion paper that went out, and a good deal more consultation with affected parties and those who had an interest in these matters—with feedback going back to Cabinet in 2005, and then, indeed, further decisions in 2007—it was decided that there would be this new legislation, which we introduced in 2008. But what is really interesting—flowing on from the comments that the member made about engagement with the Australians on this matter, and why this is suddenly so imperative—is this: do you know when Australia introduced its amendments to the Australian Competition and Consumer Commission so that the New Zealand Commerce Commission could have a cooperation agreement with the Australian Competition and Consumer Commission? Australia did it in 2007, which was when we made the decision to do precisely the same thing, and that was why we introduced the legislation in 2008.
But it is now 2012. We have had this slippage, and all we have had from the other side is a sort of attack from the previous speaker that did not seem to be very well directed, because I think there is a degree of looking in the mirror that is required when considering how we have progressed this bill since it has come to the House.
It has also been several months since it was at the select committee, so I have had to use my iPhone—new technology—to find the relevant submission I have been looking for. I think Russell McVeagh made a very interesting point. It talked about how the bill talks about only compulsorily acquired information. That is the area that I think the Minister should give a little bit of feedback on to the House so that we have got it on the record here. The concern was that the commission would in fact use section 98 notices at a time when it already knew that information could be disclosed under a section 98 notice. Of course, you can see from the legislation itself that, in fact, you can provide compulsorily acquired information and investigative assistance only in accordance with sections 99H to 99J. That means that you have to look at the definition of it being compulsorily acquired. Under the definition in section 99C in clause 6, “compulsorily acquired information” has to be information acquired under a section 98 notice or under one of the other provisions—yes, sections 98, 98A, or 98H. So the three provisions are included in the “compulsorily acquired information” definition.
But what Russell McVeagh were concerned about was that in a leniency process a company may, in fact, disclose that certain information was available, and what Russell McVeagh were highlighting was that the commission could then issue a section 98 notice and it would meet the requirements of the compulsorily acquired information as the basis for issuing that information to an overseas jurisdiction. So something that was made available in a voluntary sense could become compulsorily acquired information if, in fact, the Commerce Commission were to use section 98 in that way. I think it would be very useful—we were absolutely persuaded at the select committee that the commission would not do that, but we really would like to have the Minister on the floor of this Chamber actually put it on the record that the Commerce Commission would not do that.
When we switch to the provision—section 99H—that actually talks about providing compulsorily acquired information, apart from the protections around the Government to Government agreement and the regulator to regulator agreement, you have to look in
each case as to whether it is “likely to, assist the recognised overseas regulator in performing its functions or exercising its powers in relation to competition law; and (b) the provision of the information … will not be inconsistent with the cooperation arrangement.”, and then there is a prejudice provision around trade interest. But if we actually look at that, at that point the concern of the regulator in New Zealand becomes the concern of the regulator overseas. So if the regulator in New Zealand originally knew of the existence of the information because of the voluntary disclosure of it under a leniency process, there was concern that that would then become compulsorily acquired information.
There were not that many submissions that came before the select committee, but I thought that Russell McVeagh had put a lot of thought into its submission. It was actually arguing that this law was necessary. So it was not arguing against the law; it was just raising a particular concern about how the law could operate in practice, and that it could mean that an overseas regulator would really want our regulator to be doing its job for it in a way that was not necessarily going to enhance our position in terms of protecting the interests of New Zealand consumers in terms of any anti-competitive behaviour between different companies.
I really do think it is worthwhile raising this as a particular issue, and having the Minister place on the record of the House how he would see the Government responding to that particular concern, which was raised at the select committee. As I say, there were not that many particular submissions on the subject, but I felt that this one had some merit. They did appear in front of us, as I recall. If I had my notes in front of me I think I would have had—
Hon Clayton Cosgrove: Why do you not have them?
Hon LIANNE DALZIEL: I did not really have time to get my notes, Mr Cosgrove, because I was not expecting this bill to quite come up as soon as this. But when I come back to the Chamber for another couple of calls on this particular part, then I certainly will have the detailed notes with me and I will be able to be assisted—
Hon CRAIG FOSS (Minister of Commerce)
: I acknowledge that this bill, the Commerce Commission (International Co-operation, and Fees) Bill, has been in gestation for quite some time, and members have acknowledged that it was introduced by the previous Labour Government and the previous Minister of Commerce. In defence, I guess this new Minister of Commerce is making good progress, having had this bill for only 6 months. A few points have been raised by members, and the member Lianne Dalziel did well to find that on her iPhone.
There are safeguards in place for the use of information-gathering powers in the bill. Of course, there is a judicial review available in reference to this, and I will go through some of this in a bit more detail in a moment. There are existing incentives on the commission to protect the confidential information received and the leniency provisions, as this is standard practice around the future supply of information.
Let me explain it a bit further, because others have raised similar issues. The cooperation arrangements, which members have started asking questions on, are set out in sections 99D, etc., in Subpart 1, inserted by clause 6, for the various parts of the different Acts where this eventually, with the permission of the House, will get split out to. The commission can assist overseas regulators, in the first instance, with its statutory powers or through passing on compulsorily acquired information only if a Government to Government cooperation arrangement is already in place. This ensures reciprocity of the intent from the start. So, as I said in my earlier speech, the hard work here is done up front—the rules, the terms and conditions, of the pre-existing arrangement for Government to Government, or the regulator thereafter, to share information.
Before entering into a cooperation arrangement, the responsible Minister must take into consideration public interest matters such as the legal framework of the overseas jurisdiction and the potential consequences for New Zealand businesses and consumers of the proposed arrangement. The Minister must also consult with the Privacy Commission on any privacy issues. The content of the arrangement must be set out as to how any compulsorily acquired information may be used and kept secure. To provide transparency, cooperation arrangements must be gazetted and a copy should be posted on the commission’s website. So I hope that provides a little bit of information to those who were concerned about some of those issues.
A member, Mr Williams, earlier had concerns that sometimes requests may be deferred or asked of the Ministry of Foreign Affairs and Trade. He shared with us some of his thoughts about those issues. I would just like to point out that that came from a recommendation from the select committee process, but it is fair enough that he brought the issue up. I want to highlight that the Commerce Committee recommended changes to require the commission to be satisfied that the provision of assistance under the bill will not prejudice New Zealand’s international trade interests. If, after consultation with the Ministry of Foreign Affairs and Trade, the commission considers a request for assistance or information has significant trade consequences for New Zealand, then the commission must refer the matter to the Minister of Trade. The Minister of Trade then decides whether the request for assistance should be accepted. So hopefully that alleviates some of the concerns that the previous speaker, a few speeches ago, raised.
There have also been some questions asked about the protecting of privileged information. Just quickly, I say that to encourage sharing of privileged information, the bill strengthens its protection. It does this by providing that information that is privileged in the hands of the commission will continue to be privileged, even if the commission provides the information to an overseas regulator. Also, if privileged information is received from an overseas regulator, it remains privileged in New Zealand. To protect information provided in confidence to the commission, in relation to settlement negotiations, this will not be able to be provided to overseas regulators without the consent of the parties.
So I acknowledge the concerns and the issues that submitters obviously raised—and it is fair enough if the member cannot remember if they appeared or if they were written submissions; I do not know either—but, again, the intent about the sharing and the intent of this bill, and the good consideration that the committee and this House are giving to it, should ensure and alleviate those concerns around the House.
Dr DAVID CLARK (Labour—Dunedin North)
: Talofa lava. I recognise that it is Samoan Language Week, and it is a joy to be able to open with a greeting of that nature. I, like my colleagues, was expecting the Budget debate to continue for much longer this evening and I was expecting to speak in the Budget debate, so I am a little disappointed that Mr Brownlee saw fit to change the order of events from what had previously been agreed. One might speculate—although now is probably not the time to do it—that perhaps it was because the debate was not going in the direction that the Government wanted. I understand there was some discussion of school ratios, which is obviously a hot topic right now.
We have seen where the Budget debate has been so far, as we passed legislation that picked the pockets of paper boys and did asset-testing thresholds. We can see there are no big ideas in the Budget, no big ideas in the Budget debate, and we can perhaps conjecture that it is in order to get away from that painful, slow torture the Government backbenchers present are facing, as they realise that their Ministers and their people on the front bench have few ideas as to how to grow this country and how to grow this
economy. They do not seem to have the pro-growth policies that we might expect from a Government.
Before I get too far into the Budget debate, which is not in fact the matter before us right now, I want to refer to the regulatory impact statement on this bill, the Commerce Commission (International Co-operation, and Fees) Bill, which took some time to locate. There is not one on the Table in the centre of the floor of Parliament. So I went to the Bills Office and asked whether they had a copy of the regulatory impact statement. I am wondering what kinds of costs this legislation might carry for New Zealand as we put an extra burden on those responsible at the Commerce Commission for collecting further information. It was actually quite hard to find any kind of regulatory impact statement. The one that I did locate, in the end, on the internet was one prepared by the Ministry of Economic Development in 2010. It went through the range of options before the Commerce Committee and discussed their pros and cons. I am not sure whether there is a further regulatory impact statement.
I will come back to the matter of the bill.
The CHAIRPERSON (Lindsay Tisch): We are on Part 1.
Dr DAVID CLARK: In terms of Part 1, I would very much like to know what are the costs involved. I wonder whether the Minister in due course could point us in the right direction. This bill has as its objective to increase—
The CHAIRPERSON (Lindsay Tisch): Order! We are not on Part 2. We are on Part 1.
Dr DAVID CLARK: Part 1.
The CHAIRPERSON (Lindsay Tisch): You cannot talk about fees. We are on Part 1. Fees come into Part 2.
Dr DAVID CLARK: The fees.
Hon Clayton Cosgrove: What about that MFAT issue?
Dr DAVID CLARK: In terms of the Ministry of Foreign Affairs and Trade—I will come to the Ministry of Foreign Affairs and Trade issue because one of the things raised in the regulatory impact statement that I did find was around the recommendations that the commission consult with the Ministry of Foreign Affairs and Trade if it received a request for assistance that has significant international trade consequences for New Zealand.
Hon Lianne Dalziel: The select committee wrote it into 99H.
Dr DAVID CLARK: Sorry?
Hon Lianne Dalziel: 99H.
Dr DAVID CLARK: 99H?
Hon Lianne Dalziel: So if you look at 99H, you will see the select committee wrote all those provisions in.
Dr DAVID CLARK: Ah, the select committee did write in these provisions. But the question in my mind now is whether, in fact, we will have the specialist skills in the Ministry of Foreign Affairs and Trade to service these requests, because we know that there has been $120 million spent on a restructure that has been bungled—
Hon Clayton Cosgrove: Gutted.
Dr DAVID CLARK: —gutting the Ministry of Foreign Affairs and Trade, and certainly bringing morale there to an all-time low. This is an important issue because we are attempting here to make sure that our international trade practices and obligations are met, but also that our New Zealand exporters are in a position, and our competitive companies are in a position, to be competitive—both to comply but also to be in a competitive position.
If we take an example, if we looked at competing delivery companies in two different countries, some in New Zealand might rely on young people to deliver items.
They may be earning under $45 a week, these young people, and they may be facing an increased tax burden in New Zealand, the paper boys and paper girls of this country.
NIKKI KAYE (National—Auckland Central)
: I move,
That the question be now put.
RAYMOND HUO (Labour)
: Like some of my colleagues, my mind was full of the Budget debate because I was due to take a call on the Budget right after my colleague David Clark. But suddenly everything has been reprogrammed or rescheduled. It appears that we were ambushed in this manner, like the senior citizens in New Zealand were ambushed by way of the rest home legislation that was rammed through the House last Friday under urgency.
I would like to touch on two main issues, and the very first one is in relation to the explanation given by the Minister in the chair, the Minister of Commerce. Before I give the details, I would like to say that Labour does support this bill, the Commerce Commission (International Co-operation, and Fees) Bill, which was originally introduced by the Hon Lianne Dalziel, a wonderful Minister. It was later adopted by the Hon Simon Power, and now by the rising star Minister in the chair, Craig Foss.
Hon Clayton Cosgrove: A falling star.
RAYMOND HUO: No, a rising star. He is one of the very good Ministers. The first issue is in relation to confidentiality or the protection of confidentiality. I believe, in my submission, that the Minister in the chair’s explanation is not sufficient enough to address some concerns as expressed by submitters—for instance, Vodafone, Telecom, and also Russell McVeagh, as mentioned by the Hon Lianne Dalziel. In general, allowing the Commerce Commission to share information with overseas regulators would generate greater risk of disclosure to third parties. Russell McVeagh is of the view that the bill as currently drafted goes significantly further than the cooperation agreements that are currently in place.
The safeguards provided in this bill may not be sufficient to adequately protect sensitive information exchanged between a corporate or an individual and the Commerce Commission from disclosure to overseas regulators. Common sense would say that once information leaves its hands, our Commerce Commission may well lose its ability and power to control the end-user of that piece of information. Therefore a greater clarity is required in respect of the circumstances in which our Commerce Commission can make use of its statutory information-gathering powers.
Further, greater ex ante controls on the provision of information to foreign regulators are necessary. Why ex ante? Ex ante means before the event, because unless there are control mechanisms in place prior to the event, it will be too late. If it is too late—in other words, where a breach of confidentiality by an overseas regulator occurs—are there any remedies available to the victim or victims? Practically, there would be very few, if any, according to Vodafone.
I agree with Vodafone’s submission that once information is disclosed to overseas regulators, the New Zealand Commerce Commission itself has very little ability to ensure its continued protection. Also, there is no ability for a party to appeal against the commission’s decision to make disclosure to the overseas regulator in the first place.
In its current form, the bill provides that the Commerce Commission may impose conditions on the provision of information to overseas regulators. Vodafone, in its submission, requested that if information is given to the commission in confidence, the bill should require the commission to protect that confidentiality to the greatest extent possible.
That brings us to the next question, concerning the use of existing or historical information by the New Zealand Commerce Commission. It is not clear whether the information-sharing powers under this bill are intended to have retrospective effect. In
its current form, it is not clear, so that is why I wish the Minister in the chair would take a call to give us further explanation as to the retrospective effect of this particular bill.
The submitters’ view is that the bill needs to be amended to provide that information that has been compulsorily acquired by the New Zealand Commerce Commission prior to the date of enactment may not be shared with an overseas regulator. Without this clarity the bill poses a risk that the New Zealand Commerce Commission could apply the bill with retrospective effect. Russell McVeagh’s view is valid that, firstly, historical information should be defined in the bill and the New Zealand Commerce Commission prevented from making use of that piece of information; and, second, the bill should provide more clarity, although the issue can be resolved with reference to the Interpretation Act 1999, which requires that an Act is presumed to not have retrospective effect. Thank you.
MARK MITCHELL (National—Rodney)
: I move,
That the question be now put.
The CHAIRPERSON (Lindsay Tisch): The question is that the question be now put. Those of that opinion will say Aye—
Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. I know you are in the process of calling the vote, but I will just call your attention to my colleague who has been seeking a call and has not had a call on this at all.
The CHAIRPERSON (Lindsay Tisch): No. I am the judge of the number of calls and we have been going for well over an hour and a quarter—
Hon Damien O’Connor: Point of order, Mr Chairman.
The CHAIRPERSON (Lindsay Tisch): I am ruling. We have been going for well over an hour and a quarter and I am accepting the closure motion.
Hon Damien O’Connor: Point of order, Mr Chairman.
The CHAIRPERSON (Lindsay Tisch): No. I am accepting the closure motion. The question is that the question be now put. Those of that opinion will say Aye—
Hon Clayton Cosgrove: Point of order.
The CHAIRPERSON (Lindsay Tisch): You are trifling with the Chair. I have already ruled that I am accepting the closure motion.
Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. With respect, I am not challenging that. You have to accept a point of order, and you can rule it out once you have heard it. Can I say this to you. You are correct: we have had an hour, or whatever you specified. However, you will also be aware that an arrangement was put in place between the parties—
The CHAIRPERSON (Lindsay Tisch): That is not a point of order. Listen, there have been 14 calls for the Opposition and four for the Government. In terms of relevance, I have listened very closely. I have ruled accordingly well over the hour and a quarter as to relevance and it is time for the closure motion.
Hon Damien O’Connor: Point of order, Mr Chairperson.
The CHAIRPERSON (Lindsay Tisch): No, I am not accepting it again. The member will sit.
Hon Damien O’Connor: Point of order, Mr Chairperson.
The CHAIRPERSON (Lindsay Tisch): If you are trifling with the Chair, it will be the matter—I call the Hon Damien O’Connor.
Hon Damien O’Connor: I raise a point of order, Chairperson. I have not had a call on this and—
The CHAIRPERSON (Lindsay Tisch): I know you have not had—
Hon Damien O’Connor: —the point is that—
The CHAIRPERSON (Lindsay Tisch): Sit down. Sit down. You have not had a call; I know that. But then you have not been here the whole time, either, and there have
been plenty of opportunities to take a call. I have looked around at who has got up to take a call. That is the end of the matter.
Hon Members: Point of order, Mr Chairman.
The CHAIRPERSON (Lindsay Tisch): If you trifle with the Chair, I will ask you to leave the Chamber. One more.
Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. I am not trifling with the Chair, but there is a point that I ask you to reflect on. Mr O’Connor has been in the Chamber for a considerable period of time. All members have been enthusiastic on this side to take calls—
The CHAIRPERSON (Lindsay Tisch): I thank the member for those comments. I have ruled. I have given the Opposition 14 calls. We have been going for well over an hour and a quarter, and I am accepting the closure motion.
A party vote was called for on the question,
That the question be now put.
||New Zealand National 59; New Zealand First 8; Māori Party 3; ACT New Zealand 1; United Future 1.
||New Zealand Labour 34; Green Party 14; Mana 1.
|Motion agreed to.
- The question was put that the amendment set out on Supplementary Order Paper 274 in the name of the Hon Craig Foss to Part 1 be agreed to.
- Amendment agreed to.
- Part 1 as amended agreed to.
Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman)
: In the absence of being able to speak on the important Part 1, I will take a call on Subpart 2, “Amendment to Credit Contracts and Consumer Finance Act 2003”. All these amendments here in the application of the Commerce Act relate back, of course, to Subpart 1, where we have provisions relating to the acquisition of information from a foreign jurisdiction and our obligation through reciprocity to provide information to the relevant regime in that country.
The issue is—not only in relation to the Credit Contracts and Consumer Finance Act but, in fact, in relation to any piece of legislation—what we will be obliged to provide and what we will be trading off. It said in one of the provisions, new section 99H(2)(c) in clause 6, that “the provision of the information or assistance will not significantly prejudice New Zealand’s international trade interests.” We have to assume that the Commerce Commission is satisfied that New Zealand businesses are not compromised in any way.
It is all well and good to have such an arrangement and a reciprocal arrangement, but I have to say with some pride that there are not many countries around the world that have such sound, such ethical, and such consistent systems as we do here in New Zealand. I think that is something that each and every one of us can be proud of. The problem is that if we are dealing with other jurisdictions and we are obliged to provide information, be it on the Credit Contracts and Consumer Finance Act or any other, then we may in fact be compromising the trade obligations and objectives of this country. So I would ask the Minister in the chair, the Minister of Commerce, maybe to clarify whether in the event that we are asked for such information, be it under this particular
Act referred to in Subpart 2 or any other Act, the Government will make a call in the best interests of New Zealand. I have to say we can look around for examples of where the Government stood up, where it thinks it might want to protect New Zealanders. Take, for example—and it does relate to a situation that might arise through Subpart 2—the Government having to make a call—
The CHAIRPERSON (Lindsay Tisch): Part 2, not Subpart 2.
Hon DAMIEN O’CONNOR: Sorry?
The CHAIRPERSON (Lindsay Tisch): We are on Part 2, “Fees”—clauses 12 and 13—not Subpart 2.
Hon DAMIEN O’CONNOR: Thank you, Mr Chairman. I appreciate your guidance there. I would like to say that if the Government is prepared to make a call, then it probably would have done so on the issue of pork importation. I know it is a bit of a stretch, but the question is whether the National Government will make the calls that uphold and protect the rights of New Zealanders in arrangements of reciprocity with other jurisdictions. I think that most people in this House come to Parliament because they want to do the best thing for New Zealand, and although we have trade obligations, we need to ensure that we do the right thing. As you know, Part 2 relates to fees, and this Government has been—
Hon Clayton Cosgrove: Rabid.
Hon DAMIEN O’CONNOR: —rabid, I would say is the best word, on fees and costs, claiming that it is reducing them across the board. The reality is that it has pretty much pushed up fees and costs on every single part of central government jurisdiction.
- The Chairperson reported the Crown Entities Reform Bill with amendment, and that the Committee had divided it into three bills, and progress on the Commerce Commission (International Co-operation, and Fees) Bill.
- The House adjourned at 9.56 p.m.