Land Transport Management Amendment Bill — Instruction to Committee In Committee Instruction to Committee In Committee 
Text is incorporated into the Bound Volume 
Land Transport Management Amendment Bill — Instruction to Committee In Committee Instruction to Committee In Committee 
[Sitting date: 01 July 2008. Volume:648;Page:17034. Text is incorporated into the Bound Volume.] 
Land Transport Management Amendment Bill 
Instruction to Committee 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I seek leave for the Committee of the whole House on the Land Transport Management Amendment Bill to have the power to consider and if it thinks fit adopt the amendments set out on Supplementary Order Paper 211. 
Madam SPEAKER 
: Is there any objection to that course being followed? There is objection. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I move  
That it be an instruction to the Committee of the whole House on the Land Transport Management Amendment Bill that it have the power to consider and if it thinks fit adopt the amendments set out on Supplementary Order Paper 211 
. This amendment is outside the current scope of the bill although the current scope of it does refer in one instance to the Government Superannuation Fund. All that this amendment does is to provide that the rights in respect of Government superannuation of existing employees of Toll NZ who are within the Government Superannuation Fund are unaffected by the change in the ownership of that company. It does not of course open up the whole issue of the change in ownership; it is simply about preserving the rights of those existing members of the fund and follows previous legislation in this form. 
Hon BILL ENGLISH (Deputy Leader—National) 
: 
 Labour forgot about the workers. That is what has happened here. Labour bought back the railway and forgot about the workers. When New Zealand Rail was sold 15 years ago National did not forget about the workers. We made sure that the people who worked for New Zealand Rail at the time could remain as members of the Government superannuation scheme and keep their entitlements even though they were transiting into the employment of a purely private sector employer. It was quite straightforward. Workers who had their entitlements kept them because they had had them for a long time under New Zealand Rail. It was part of the deal. There was never any sense of insecurity for those workers. 
But Labour forgot about the workers. In fact it sounds as though Labour found that out only today after it had signed the deal. Labour goes around the country bleeding from its liberal heart about how fantastic rail is and about all the good things it will do for New Zealand but it forgot that the several thousand people who worked for Toll had entitlements under the Government superannuation scheme and that under the deal Labour has done the workers will lose their entitlements. As of now they have no entitlements; they are gone. Well does that not tell us just what Labour is up to? 
In fact it reminds the House about the original motives for the whole deal around rail. The workers certainly know it was nothing to do with the welfare of the employees of Toll because Labour has shown it was not interested in that. The original motivation for the deal with Toll was purely political. The House may remember Helen Clark at one stage some 6 months ago saying the biggest issue in election year was going to be State assets. Then Labour set out on a set of reckless and expensive political moves to try to make State assets an issue. It decided to intervene at the last minute in the Auckland airport sale. That destroyed hundreds of millions of dollars of value. It has made the shares in that blue-chip company virtually unsaleable to anyone except the New Zealand Superannuation Fund. Labour tried to turn that sale into a big political issue but that failed. It got headlines for a day or two but those went. So then Helen Clark rang up Michael Cullen said Labour needed to do something else and suggested that he buy back rail. On the urgings of the Prime Minister and the chief adviser in his office Dr Cullen then set out to buy back rail. The result of that is the expenditure of about $1 billion of taxpayers’ capital today—about $1 billion. 
From the way that the Government has gone about this particular purchase one would think that capital was endless. Well it is not. The New Zealand Labour Government cannot put enough classrooms on the site of schools in Queenstown near my electorate because it says it does not have enough money but it can find $1 billion at short notice when the economy is turning down to buy back New Zealand rail. 
Gerry Brownlee 
: Unbelievable. 
Hon BILL ENGLISH 
: It is unbelievable. The motivation was purely political. The Government is trying to dress it up now in terms such as sustainability and the enhancement of public transport. The fact is that the Government does not have any long-term plans for either of those things. The purchase of New Zealand rail or Toll does not change the fundamental fact that it will still need to be subsidised. As my leader pointed out today the trains are coloured red partly because Labour wants the advertising but also because that is the colour of the ink that will flow through the Government’s books as either Labour or National—whichever one is the next Government—struggles hard to recoup some of the taxpayers’ dollars that have been spent. 
When Dr Cullen was sitting down with his open cheque book with Mr Paul Little on the other side of the desk he forgot about the workers because he was so focused on giving Toll Rail everything it wanted for this particular asset—an asset that was not performing very well. The workers have every right to feel aggrieved because Dr Cullen instead of worrying about their entitlements and their security was sitting there with an open cheque book and what happened? Well he wrote out the cheque that Toll asked him to write out and it became bigger last night. Last night in the run-up to the deadline the Government decided to shell out another $18 million on top of the $840 million or so for the assets and the debt that it has already shelled out—another $18 million to actually buy out of a promise it had made in the original deal. In the original deal the Government told Toll that it could have rent-free access to particular warehouses around the rail system and that it could have cut prices on our rail system for the Toll-owned trucking company. Having made that undertaking earlier on Dr Cullen yesterday spent $18 million to $20 million on buying out of that promise. 
That adds up to a figure that is getting towards $900 million for the purchase of New Zealand rail. 
Sue Moroney 
: I raise a point of order Mr Speaker. The motion being debated here is specific and I believe that the speaker is going well wide of that motion. The motion is about a Supplementary Order Paper and I ask you Mr Deputy Speaker to direct the member to stick to the debating point. 
Gerry Brownlee 
: That is an interesting intervention from a Government that is clearly embarrassed by the fact that the Supplementary Order Paper is here at all. I read it earlier this morning and it is entirely consistent with the whole purchase as Mr English is pointing out. The member across the other side of the House does not seem to understand that if there had not been a purchase if there had not been neglect of the workers and if there had not been a failure in the negotiations around this particular purchase or initiative by the Government—not that it is a great initiative I have to say—then we would not be here having this debate. So it is perfectly reasonable that the House consider why this Supplementary Order Paper has to be here. 
After all the sale is a straight commercial sale—or so we thought. But now we find out that the entitlements those workers have had for literally 15 years have somehow been taken off the table. None of those workers right now have the cover they were guaranteed by a National Government 15 years ago. Michael Cullen has taken it away from them. This is about putting it back on the table—about making it legal for the scheme of arrangement that was put in place in 1993 to continue. To suggest somehow that there should be no recital of the history that there should be no consideration of the negotiation and that there should be no questioning of the initial decision by the Government to make the purchase is an utter nonsense. 
Mr DEPUTY SPEAKER 
: I thank Mr Brownlee and I thank Sue Moroney for raising the matter. I ask the Hon Bill English to continue. I tend to agree with Mr Brownlee. 
Hon BILL ENGLISH 
: The point is pretty obvious. If the Government is doing a transaction with Toll then the interests of the workers one would have thought would be something that the Labour Government would take into account. [ 
Interruption 
] That is the point I was coming to. What about all the protections Labour says it has put in place as it goes around the country—all the things it says it has done for workers? It has passed vulnerable worker legislation and flexible working hours legislation and it goes around telling everyone it has put up the minimum wage and has encouraged collective bargaining. It has had 9 years to put in place protections for workers yet here we have a large group of workers some of whom are well paid but many of whom are not very well paid who are suddenly vulnerable not to a transaction that someone else is doing but to one that the Government is intimately involved with. That tells us something does it not? 
Whenever the Government is talking about other businesses it is very keen to make sure that workers have widespread protection and businesses and other workers simply have to carry the costs that are imposed by more legislative entitlements. But when the Government is doing its own business transactions it forgets about the workers and overlooks their welfare and security then at the last minute—or after the last minute—expects Parliament to turn round and correct the fact that it has paid no attention to the people who are the heart of the Toll business. I invite the next Government speaker to get up and tell us why the protections that Labour says it has put in place over the last 9 years for workers’ entitlements around business sales did not apply in this case because that is the only reason we need this legislation. I would have thought if there are issues here about vulnerability and entitlements that the frameworks Labour has put in place would protect these people. 
The workers in Toll have learnt the hard way that Labour has long forgotten about their genuine interests. This Government spends more time on trying to talk about who does National’s polls than it does on the facts that the economy is turning down that people are being sacked every day because businesses are running out of money that the Government is the only part of the economy that is actually still growing and that oil prices are $140 a barrel. And in that sense we are with the Greens. This is something on which we do agree with the Greens. The Government’s allies got up today and said it was time that Ministers got out of their BMWs and found out what was going on in the real world. Well I bet the workers of Toll who have built up 25 and 30 years of superannuation entitlements that are now gone would also like Annette King the Minister of Transport to get out of her BMW and find out what is going on in the real world. [ 
Interruption 
] Well the Minister should get up and tell us. She is the person responsible as Minister of Justice for the Electoral Finance Act—an Act that will stop these workers campaigning for their rights unless they register as a third party because they would have to spend over $12000. Annette King should get up and tell us why she should be cruising around in a BMW and be so out of touch with what is going on in the real world that she has supported the Labour Government in buying back New Zealand’s rail company and leaving the workers stranded. 
The Government has said it encourages savings and looks after workers. It has deserted workers it has forgotten their interests and it has put their savings at risk. 
GERRY BROWNLEE (National—Ilam) 
: 
 I think the points raised by Mr English should be well understood by the wider public because here we have a Government that literally for months has been running around the country saying how wonderful it is that it is buying back New Zealand rail. It has neglected the fact that New Zealand rail was actually not going anywhere any time soon; New Zealand rail was always going to be in New Zealand. Nobody who was operating it could pack it up and take it away. The previous owners had no choice other than to continue operating it. The problem was that the Government in taking over the rail track decided to put a huge value on it. 
Today we heard Michael Cullen crowing about the fact that the railways were bought for a dollar and are now valued at over $10 billion. But that is the problem. You see poor old Toll was asked to pay a rental on the tracks that reflected that $10 billion value. [ 
Interruption 
] Those members laugh at me for saying “poor old Toll” but that is exactly what the Government did and I will come to that in a minute. Toll was encouraged or required to pay a track rental that reflected a return on that $10 billion. They said: “We can’t do it. We can’t make the rail system in New Zealand work if we have to pay rent on those tracks when you’ve put a value of $10 billion on them.” They sold them for a dollar the Government made them $10 billion in value and Toll said: “What are you doing? This is not going to work.” Negotiations went on and on and finally the Government said: “Poor old Toll. We have to help them out. We’ve put them in a dreadful position so we’ll make them an offer they can’t refuse.” They started talking about the numbers. We heard it would be $600 million then $700 million. Toll said it was worth a billion. These numbers get so big that we almost lose sight of what it is. Finally today we heard that $690 million - odd has been paid to Australian shareholders of Toll because the Government obviously felt sorry for them. There can be no other reason. There will not be one extra train one extra track or one extra freight load taken as a result of today’s change in ownership. 
All we are seeing today is a change in ownership a liability back on the New Zealand taxpayer and further a new set of colours for the trains and the rolling stock. Some people unkindly said today that it was the Labour Party colours painted on them. I think Mr Key was far more accurate when he said it was a graphic representation of the ink that will run across the Government’s books as a result of this particular purchase. In fact the red and the grey livery of the new KiwiRail are the old colours of the Progressive party which was once here in the House. You see I think the Government is trying to say that this is a progressive move. 
Dr Cullen also said to the House today that he thought that New Zealanders including Mr Key might have noticed that the oil price has gone up. Well we certainly have. But how is that helped by the purchase of this organisation today? The fact is that those trains and those ferries run on diesel so the one thing that everyone needs to be sure of and needs to know for certain is that as a result of the purchase today not only will New Zealanders using those services pay more because of the cost of operation but they will pay a lot more because of the cost of capital invested in those businesses—far in excess of what is reasonable and realistic. 
Then today the appalling situation arose whereby Dr Cullen said he has just discovered that the superannuation entitlements of many of the workers employed in Toll are suddenly lost. Those workers have had 15 years of protection since that rail company has been in the private sector. It returns to the Government today and those entitlements are lost. So we have this little Supplementary Order Paper being appended to the Land Transport Management Amendment Bill. It is quite out of the scope of that bill but nonetheless it is thrown in there so it can be got though. The question I have for Dr Cullen is this: what would have happened when he found out about it this morning if there had not been the happy coincidence of this bill being on the Order Paper this afternoon? The reality is that those people’s entitlements would have sat in abeyance until the Government found a bit of time to try to enact some retrospective legislation to put it right. What it really tells us is just how little the current Government cares about working New Zealanders. 
Hon Maurice Williamson 
: They could have done it in the organised crime bill—that’s next. 
GERRY BROWNLEE 
: My colleague says—if we consider how this process works and what we are talking about here today—the Government could in fact have come to the House with this Supplementary Order Paper and attached it to the Organised Crime (Penalties and Sentencing) Bill which is next but that would be too close to home because it is almost an organised crime for the Government to have gone out and spent the money it has on this particular organisation knowing that it will never be able to make a single penny out of it. 
We of course will not want to see workers who have served Toll and New Zealand Rail for all that time penalised. That is our record. [ 
Interruption 
] Darien Fenton over there one of the doyennes of the union movement in this country was one of those who in 1993 made the Government aware of the problem—and the National Government did not quibble. There was no quibbling at all. The entitlements that people had accumulated over all those years were simply transferred with them. They were able to stay in the Government Superannuation Fund as they worked for the successive private entities that owned that organisation. It is such an irony is it not I say to Ms Fenton that we are here in the House today having discovered that a Labour Government was the Government that took those entitlements away from those workers? 
There is another bill on the Order Paper that the Government could have attached this particular Supplementary Order Paper to and that is the Judicial Matters Bill but that also would have been somewhat of an irony given the extraordinary lack of judgment that the current Government has shown not only in making the purchase in the first place but in failing to recognise the need to protect workers. How many times have we seen Labour members stand up in this House and talk about vulnerable workers? How many times have we heard them talk about the economy not delivering to hard-working New Zealanders about the benefits of KiwiSaver and about the minimum wage that should be paid to New Zealanders—all those things that engender the idea that Labour cares deeply about workers in this country? Then Labour has one very clear symbolic opportunity and it forgets about workers. 
What really amuses me is that we know what would have happened here. As they were going through that negotiation Dr Cullen would have been going down to the Labour caucus room on a Tuesday and giving them a bit of an update on how it was all going and not one of them—not one of them—would have asked the question: “What about the workers?”. I would have thought Parekura Horomia would say: “Wassup Dr Cullen?” but no nothing—not a squeak not a murmur not a mention. So here we are in the House this afternoon having to approve a jacked-up process to try to protect the workers of New Zealand—in particular the workers who have transferred from New Zealand Rail to Tranz Rail to Toll Rail and now to— 
Hon Parekura Horomia 
: Boo hoo! 
GERRY BROWNLEE 
: There is old Parekura Horomia over there pretending he is crying. He does not care. He did not care through months and months of caucus meetings and Cabinet meetings and Cabinet committee meetings and then ultimately when sitting in the Cabinet room at the top of the Beehive making the decision. He did not care. Well we care. We think the workers are entitled to this but we want to make sure that all New Zealanders know that this is a day that Labour was exposed as being a party that could not give a tuppence about workers in this country. 
Hon MAURICE WILLIAMSON (National—Pakuranga) 
: 
 I think it is important to make clear to those who are listening to the House today just exactly what sort of a position this House has got itself into. When we look at the Government orders of the day the business before the House we see that order of the day No. 1 is the Land Transport Management Amendment Bill. So people who were expecting the House to move on to that straight after question time will be surprised to hear that we are having a debate that does not seem related to that legislation at all. That is because Dr Cullen tried to seek leave to stick a very shabby little Supplementary Order Paper a one-pager in as part of that bill. He thought he could just come down here get the leave of the House and stick in something that as my colleague Gerry Brownlee says is not even slightly related to the Land Transport Management Amendment Bill. Actually as Gerry Brownlee also said Dr Cullen was exceedingly lucky that that bill was on the Order Paper at all because the next one down was the Organised Crime (Penalties and Sentencing) Bill the next one was the Judicial Matters Bill and the one after that the Births Deaths Marriages and Relationships Registration Amendment Bill. It could have been that the Toll workers got their superannuation protected through the Births Deaths Marriages and Relationships Registration Amendment Bill with a Toll Supplementary Order Paper attached to it. 
I want to go back and check some of the history of this. I can tell the House that I was around then; I was a member of Cabinet at the time of the sale of New Zealand Rail back in 1993. I was part of the Cabinet that did it. But I want to ask some questions first of all. 
Sue Moroney 
: Disgraceful! 
Hon MAURICE WILLIAMSON 
: “Disgraceful!” says Sue Moroney. That is really interesting. Let me ask Labour a couple of questions. Did Labour vote for the bill that sold New Zealand Rail? There is a good question. 
Chris Auchinvole 
: Did they? 
Hon MAURICE WILLIAMSON 
: I know the answer. Let me just check this because Sue Moroney said that it was disgraceful. Did Labour vote for the bill that privatised New Zealand Rail? I cannot hear any answers. I will ask the question a third time. Sue Moroney must know. If what went on back in 1993 when we sold New Zealand Rail for $370 million was so disgraceful I assume that Labour voted against it. Is that right? I ask Sue Moroney whether Labour voted against the legislation. She has to help me with this one. You see Labour will not answer the first of the hard questions because it actually voted for the legislation; it voted for the sale of the railway line. 
Now we come to something more interesting. Rodney Hide made a great point and members should listen to how this works. The Government sold New Zealand Rail for $370 million and I remember the issue about the workers their superannuation and their entitlements. It was a major issue. What is the name of the railway workers’ union? I cannot remember what the acronym is. 
Gerry Brownlee 
: EPMU. 
Hon MAURICE WILLIAMSON 
: No it is not EPMU. It is the maritime and rail something. 
Hon Mark Gosche 
: The Rail and Maritime Transport Union. 
Hon MAURICE WILLIAMSON 
: The Rail and Maritime Transport Union. I can remember that the union that represented the workers was very very vociferous at the time. I am interested to note that it has not been heard on this issue. I have not heard the union saying anything on the issue this time. But at the time it said that this would be an outrage to its workers because they would be sold into private hands and would have all those long-service Government superannuation entitlements. We thought that the union was right and we thought that the point was exactly fair and stuff was put into the legislation to protect those workers—as it should have been. That was 15 years ago at the time of privatisation. 
Let me go through Rodney Hide’s reasoning today because I thought this was a cracker. We sold New Zealand Rail for $370 million—that is what the owners bought it for. Then we hear from Winston Peters and Labour that the private sector then took this asset and ran it into the ground. The private sector asset-stripped it and ran it into the ground. So the private sector bought it for $370 million then took everything out and ran this thing into being almost a shadow of its former self until it was almost of no value at all. Does that not beg the question of why one would then buy it back for close to $1 billion? It has been bought for $690 million plus there is $120 million of debt so that comes to $810 million plus there are some other payments to take account of. 
Gerry Brownlee 
: Commercial leases. 
Hon MAURICE WILLIAMSON 
: Yes the commercial leases and so on—it is the thick end. Let us go with $900 million. But let me go through the logic of New Zealand First again. We sold it for $370 million and the private sector then asset-stripped it tore it to shreds and made it worth nothing. And the Government is buying it back for $900 million! 
Gerry Brownlee 
: Without the trucking company. 
Hon MAURICE WILLIAMSON 
: That is right. Gerry Brownlee reminds me that the actual jewel in the crown of the business—in fact the only part of it that is really profitable and a great little bit—is the trucking operation. 
Chris Auchinvole 
: Who got that? 
Hon MAURICE WILLIAMSON 
: Well Toll has kept that. We have been done over a few times by the Aussies with the underarm bowling incident and the single aviation market. But we have never been done over by the Aussies like this—they must be back at the headquarters right now in fits of laughter. The question I would like to ask Labour is why this needed to happen at all. Would the railways have just gone away if the Government had not bought it? Would Toll have just said that that was it that it could not keep doing it and that it would give up? 
Gerry Brownlee 
: We’ll pack it up. 
Hon MAURICE WILLIAMSON 
: We will pack it up. Well it might have taken its train set but it would have been quite a good idea to let it do that. It could have bought some new trains in at a better price and not paid all the legacy costs surrounding it. So that question really needs to be asked. One could have started “Rail Two” or whatever one wants to call it almost straight away once the Aussies had walked off in a fit of pique. But no this Government decided to pay top dollar—actually when one takes the trucking operation out of it and everything else it is more than top dollar. The one thing that Labour keeps crowing about almost as a sort of mantra is that it is the party of the workers. If Labour were the party of the workers it would have been talking to the people from the Rail and Maritime Transport Union and telling them not to worry because it would look after their workers. Labour would have told them that when the deal was done it would make sure that all the entitlements privileges and all the stuff that they carry from history would be protected. 
Suddenly we get to the day after the deal is done—it was done yesterday 30 June and agreed to as of midnight last night. The big announcement occurs this morning and suddenly it is a case of “Oh dear!”. Labour voted for the sale to privatise the railways it openly admitted that an asset worth $370 million had been run into the ground and then it bought it back for $900 million. And that was without the trucking operation which was basically everything that was of value in the operation. Suddenly the people whom Labour supposedly represented the workers missed out altogether. 
I say to the House—and my colleagues Bill English and Gerry Brownlee have made this clear—that we will not stop this; we will not vote against Supplementary Order Paper 211 even though attaching it to a bill like the Land Transport Management Amendment Bill will have people in the future sitting and scratching their heads. People who are looking at legislation in the future will ask what on earth was going on on that day that somehow an instruction to the Committee in respect of a Supplementary Order Paper had to be moved because it was not accepted by leave it did not comply with any Standing Order in terms of being within the spirit of the original bill. People will ask how that happened. 
Hopefully historians will say that the reason was simple: Labour in spite of all of its massive dealings in the media and all of the coverage that Michael Cullen received about what a wonderful idea it was to be buying back the rail operation had not thought for one minute about the workers at Toll who would be coming into the State sector. It is really important that members of the public and members of the railway union understand that when the National Government privatised the railway back in 1993 it made sure that those privileges protections rights and historic coverage of all of the Government superannuation were covered and protected when it moved to the new entity. Not so the Labour Government: in its race to buy an asset that was not worth even half of what it paid for it it could have told Toll Holdings that it would give it $370 million which is basically what was originally paid for it—take it or leave it. I can tell members that Toll would have taken whatever price was going. 
The whole sale process is best summarised by one of the best cartoons I have ever seen in the  
New Zealand Herald.  
It is a split cartoon—on one side is the Phoenix Mars Lander and on the other side is a railway train off the tracks facing side on with its wheels fallen off. On the left-hand side we have what the National Aeronautics and Space Administration got for $430 million for the Mars Lander and over on the right-hand side we have what Dr Cullen got for $690 million. 
This is a very symptomatic shoddy little piece of legislation that shows that Labour thought nothing about workers; and I am surprised at the union: next time I see the Rail and Maritime Transport Union before our select committee I will be asking its members why they were so vocal at the time when National was looking to privatise but why we did not hear anything from them in the media about why the Government was not taking count of their privileges their rights and their protections. It is just a little too late a little too little and very disingenuous. 
PANSY WONG (National) 
: 
 I remind everybody that today is 1 July. Supplementary Order Paper 211 which was brought to the House by Michael Cullen states that it will affect—and only a Labour Government would do this—“any person who immediately before 30 June 2008 is employed by the company” which is Toll NZ. I will come back to that point. So Labour not only forgot about this matter but is doing something about something that happened yesterday. 
When Labour members put down patsy questions in the House today they did not seem to remember even at that stage the Toll NZ workers. The Labour member Darien Fenton asked the Minister of Labour what changes to help workers took effect today. Well National members could have told her that the changes that took effect today would have resulted if it were not for the cooperation of the House in the Government Superannuation Fund contributions of thousands and thousands of workers from Toll NZ not continuing. 
What sort of Labour Government is this? Its members stand up in this House day after day and claim that Labour is the only party to look after the workers. Well I have bad news for those members: they seem to look after the Australians better than they look after workers here. After all as my colleagues say the Government has happily handed over what we now know is $800 million—$600 million - odd in cash and $180 million of debt—to the Australians. The Australian shareholders are actually very happy that someone is prepared to pay an inflated price for their shareholding in Toll NZ. 
Supplementary Order Paper 211 is very interesting. It is supposed to become part of the Land Transport Management Amendment Bill which I am looking forward to debating. I thought the debate would be centred on the regional fuel tax all sorts of Government policy statements and national and regional roading transport project planning but suddenly we are landed with a Supplementary Order Paper that is quite strange. I will take the public through its provisions. It is to do with ensuring that the Government Superannuation Fund contributions of workers who until yesterday were employed by Toll NZ but today are employed by KiwiRail continue. 
It is interesting to note the way that the Government will have that happen. New clause 41(1) states that any person employed by the company is “deemed to be an employee in the Government service so long as that person continues to be an employee of the company.” Interesting things happen in Parliament; it is suddenly deemed that for the last 9 years those workers continued to be employees of the Government service rather than employees of a private company! New clause 41(4) states in relation to employees of the company who are contributors to the Government Superannuation Fund that the “controlling authority in relation to those employees means the company’s board.” Suddenly a Crown entity is set up and the Supplementary Order Paper tells us apparently that its board of directors should be treated in the same way as the board of a private company. So with this piece of paper people who are actually employees of a private company can be deemed to be employees of a Government service and a board of a private company can be deemed to be the same as a board of a Crown entity. I wonder who the top advisers are who can dream up changing people’s status with just a simple piece of paper. 
On the one hand Labour members try to blow their own trumpets by claiming that on 1 July all sorts of legislation comes into force—flexible working hours and whatever—and on the other hand they suddenly realise that a quite large number of workers were totally forgotten in all the intense burning-the-midnight-oil negotiations involving the Minister of Finance and Toll NZ. It is quite interesting to reflect on that because some commentators have said of Dr Michael Cullen’s role in the “Treelords” negotiations that he is the only member of the Labour team who not only is capable of seeing the overall picture but actually has the mana to pull together all the details and to make sure that the various parts of the machinery fit together. Well in the light of that compliment—that he is the only Government member who is capable of making sure that every little detail falls into place—one has to ask how he could overlook thousands of employees of Toll NZ. 
Another question needs to be raised—and National members will raise it. The Transport and Industrial Relations Committee constantly meets with union delegates who come in front of the select committee and make statements about their looking after the interests of their members. I wonder what happened to the union representatives from Toll NZ—the ones who looked after the railway workers. Did they remind Dr Michael Cullen? Did they ever raise the issue with the Labour Government? Were they ignored? I would be interested to see a Labour member take a call to enlighten us as to when the omission occurred and who discovered that the workers were the only ones to be forgotten by the Labour Government during those intense negotiations. Government members always proclaim that they are looking after the workers. I want to know when the omission was discovered who reminded the Minister of Finance of this huge omission and how the Labour Government managed to produce the Supplementary Order Paper. Usually when National members ask for a technical amendment etc. we are told that there is not enough time to put anything together. When the Labour Government wants something done in a hurry somehow the advisers and the technical draftspeople can always be counted on to put it through. 
I say that today is a day of shame for the Labour Government which claims it is the protector of the workers because the workers were the ones who were forgotten in this golden handshake deal. The Government is kind to the Australians only rather than the Toll NZ railway workers. But National will cooperate because we would not want to see the workers suffer just because the Labour Government forgot about them; we will support Supplementary Order Paper 211. 
SUE MORONEY (Junior Whip—Labour) 
: 
 I move  
That the question be now put 
. 
NATHAN GUY (Senior Whip—National) 
: 
 I raise a point of order Mr Speaker. We are here this afternoon debating the motion on the Land Transport Management Amendment Bill that under instruction the Deputy Prime Minister has moved. It is a serious matter that needs worthy attention of the House particularly when Labour members bestow upon us the view that they are the ones who look after workers’ rights. Well you have heard some contribution from this side of the House this afternoon but we would like to make further contribution on Supplementary Order Paper 211 because it is very important. If you could Mr Deputy Speaker please look at the Standing Order I think it is 137(3) to do with moving a closure motion which states it has to be reasonable to do so. 
SUE MORONEY (Junior Whip—Labour) 
: 
 We have had six calls now on this motion. The last five calls have all been from the National Party. There is no debate occurring on this motion. The National Party has said it supports it and I would like you to take that into account Mr Deputy Speaker. 
BRIAN CONNELL (National—Rakaia) 
: 
 Before you rule Mr Deputy Speaker I think there is a very serious principle at stake here and that principle is the right of the workers to be heard. I know it is a delicious irony that this comes from a National MP but members of the Government who thump the table time and time again in defence of workers are not prepared to stand up and debate this issue. I think we owe it to the workers of New Zealand to debate this issue fully. 
Mr DEPUTY SPEAKER 
: Thank you. Thank you for raising those matters. It is true that this debate is a restricted debate; it is as to whether the Committee should have the power to consider this matter. The debate should not wander too widely. It certainly does not extend to the principles the objects or the provisions of the bill that is before the Committee. It is not relevant that all of the speakers after the person who introduced the motion happened to come from one party; it might even show that that party is very interested in this matter. 
BRIAN CONNELL (National—Rakaia) 
: 
 Thank you for your very well-considered judgment. I initially was not going to take a call on this debate when I came to the House because like my colleague Maurice Williamson I thought I was coming to listen to a very reasoned debate on the Land Transport Management Amendment Bill. But I have sat through these proceedings and I have to say that I am absolutely appalled by what is transpiring here. As I said in the point of order that I raised it is a delicious irony that it is a National member of Parliament who is standing up to defend the rights of workers in this country. I pose this question to the House: what is the most often trumpeted core business of the Labour Party? 
David Bennett 
: What is it? 
BRIAN CONNELL 
: It is supposedly looking after the rights of workers. 
Chris Auchinvole 
: Does it do that? 
BRIAN CONNELL 
: Well it did not do that. Here we have a test of Labour’s integrity a test of whether it will actually put its money where its mouth is and protect the workers. At the last hour—in fact at the last moment—we have in this House a Supplementary Order Paper trying to protect the superannuation entitlements of Toll’s workers because the Government in its haste to buy this organisation forgot about a fundamental principle the protection and the rights of workers in this country. My colleague Pansy Wong not only stated that the Government had forgotten about the rights of New Zealand workers but also claimed—I think not quite rightly—that it had actually looked after the rights of Australian workers. I take issue with that because it did not even look after the rights of Australian workers—only of Australian shareholders. This money has gone straight into the pockets of Australian shareholders and the Government says to hell with New Zealand workers. That is what I am so appalled at and why I felt compelled to get on my feet and take a call. 
My colleague Gerry Brownlee also gave some background as to why this Supplementary Order Paper had been introduced to the House at the eleventh hour. Simply the Government had valued the rail network at something like $10 billion. The board of Toll must have looked at their business and asked what type of return on asset it was getting in New Zealand. The answer would have been with that asset backing a very poor return. So the decision at board level would have been to try to sell the business. But I can imagine the conversation then going along the lines that it was all very well to want to sell the business but they just would not find anyone silly enough to buy it. 
Mr DEPUTY SPEAKER 
: Mr Connell you have had almost 4 minutes of introductory remarks. I will say again that this is a procedural motion and it is a narrow debate. The only matter under debate is whether the Committee should have the power to examine and adopt this Supplementary Order Paper. It is not about the rights or wrongs of superannuation and it is not about the purchase of KiwiRail. Those matters can come into it in a small way but the thrust of your argument which is undermined a bit by the willingness of the Opposition to actually support this motion should be why the Committee should not have the power to examine this Supplementary Order Paper. 
BRIAN CONNELL 
: I thank you for your guidance Mr Deputy Speaker. In my defence I say that I wrote down points that were raised in the debate. I was really just expressing some opinion on those points which you have actually already ruled on. So I think without questioning your decision that I am within the Standing Orders in raising some of these issues. 
With your agreement Mr Deputy Speaker I will just finish the point I was making then address this issue in particular. My issue was whether the board could find an organisation that would buy Toll. I think the debate that must have gone on in the Toll boardroom was that they thought they knew a party that might be gullible enough to do so. When that proposition was put to the Government I think it was in such haste to sign up that it forgot about the fundamental rights of the workers in this country—that is the protection of their entitlements which for 15 years had been enshrined in legislation. I think that is fairly fundamental. 
I raise this issue because I think it goes to the heart of public confidence in the Government. I say that for this reason: if the Government purports to have as its main platform the protection of workers and workers’ rights and then falls at the first hurdle I ask what confidence the people of New Zealand can have in a Government that would do that. 
With those things said my contribution was simply to make those points. As I said earlier I was appalled at what I was hearing. I thank you for the opportunity to make those points because I think another member of the National Party had to get up and argue to protect the rights of workers because the Government has been found woefully lacking on this particular issue. 
Hon PAUL SWAIN (Labour—Rimutaka) 
: 
 I move  
That the question be now put 
. 
Mr DEPUTY SPEAKER 
: Not quite. I take it Mr Bennett that you will talk about why the Committee should have the power to consider the Supplementary Order Paper and if it thinks fit adopt it. All future contributions must relate to that or I will take the question. 
DAVID BENNETT (National—Hamilton East) 
: 
 We have been asked to consider a Supplementary Order Paper that has been put forward by the Minister of Finance at a very late hour in the transaction of the Land Transport Management Amendment Bill. 
Chris Auchinvole 
: Very sudden. 
DAVID BENNETT 
: Yes it is a very sudden Supplementary Order Paper coming before the House just today. Mr Deputy Speaker you are quite right to say we need to debate the relevance of that Supplementary Order Paper and whether it should be debated or should in fact be passed through the House today. The reason why it is so important to debate whether we accept Supplementary Order Paper 211 relates to the nature of what it represents. 
Chris Auchinvole 
: What is the nature? 
DAVID BENNETT 
: This Supplementary Order Paper represents a mistake made by the Minister of Finance. The Supplementary Order Paper tries to rectify a mistake made by the person whom the Labour Government entrusts with the financial management of this country. It deals with the mistakes of the Labour Government. 
There are many mistakes of the Labour Government with regard to the Toll purchase and we can go through them at length. But the mistake we are looking at today is a fundamental mistake. 
Chris Auchinvole 
: Who does it affect? 
DAVID BENNETT 
: It is fundamental in that it affects the workers of Toll. It affects all workers in New Zealand as well because it shows that the Minister of Finance does not consider their needs to be imperative in any deal that he does. He is not concerned about New Zealand’s workers. He has said on TV that he just wants to hold on to power. That is what he is about. So it is important that we debate Supplementary Order Paper 211 in this House and that we continue to debate it because it represents the real intention of the Minister of Finance. 
Chris Auchinvole 
: Or a lack of intention. 
DAVID BENNETT 
: Yes—or a lack of intention. The Minister’s intention is not to do what is best for New Zealand; his intention is to do what he thinks will win him another election. 
The Minister of Finance has made a big mistake because in trying to buy back an asset that did not need to be bought back he has made a few fundamental errors. He did not think about the debts that he would incur. He did not think about the fact that he was giving preferential rights to certain land to Toll’s trucking operation a decision that he has now had to reverse again. He did not think about the fact that he is leaving the workers out in the cold—which again he is trying to reverse with this Supplementary Order Paper. What does that tell us about our Minister of Finance? It tells us that he is not a very smart business person. It tells us that as soon as he walked in the door of Toll Holdings to negotiate with it that company was licking its lips. That is why we need to look at this Supplementary Order Paper. 
This Supplementary Order Paper shows the deficiencies of the Minister of Finance. It shows the deficiencies of the Labour Government as well because Labour is a party that is based on the notion that it knows better than anyone else. It thinks that it knows what is right for New Zealanders. The Labour Government does not give New Zealanders the ability to make their own decisions in life. Labour takes New Zealanders’ money and then distributes it. It redistributes that money under its guiding ambitions. 
Sue Moroney 
: Stick to the point of the debate. 
DAVID BENNETT 
: The point we are talking about is that Labour entrusted the Minister of Finance to undertake a major commercial deal which he stuffed up and this Supplementary Order Paper tries to deal with his stuff-ups. That is what we are doing here today. 
We need to debate this Supplementary Order Paper more in this House this afternoon because that is the only way that the public will understand what a failure we have for a Minister of Finance. He has put our country in the position of having some of the highest interest rates and the lowest growth rates in the world and of having an economy that is going down the tubes at a great rate of knots. That is what we have had from the Minister of Finance. The Minister of Finance does not know what to do. He is useless at these financial matters and this Supplementary Order Paper is a practical example of his ineffectiveness. So we need to debate it more. We should be debating it all day and night because it shows the lack of credibility of the financial management of the Labour Government. 
Labour has been going around for many years saying it is there for the workers and is there for the economy but the reality is that it has just been sitting on something that has been in terms of pressures in the international economic environment a reasonably good time. Now that we are going into tough times we see the deficiencies and Labour’s lack of economic management. Should we entrust the finances of the rail company into the hands of 60 ex-unionists? I ask whether we should we do that because this Supplementary Order Paper is what we get when we do that. We are having to do deal after deal day after day to try to rectify the mistakes that those members made when they were signing a commercial agreement. The reason they made those mistakes is that none of them have ever had to negotiate a commercial agreement in their lives. None of them have had to go out there and make money in business. They do not know what it is like they never will know what it is like and they cannot be entrusted to run a country when they do not know the reality of commercial management. 
Today we are seeing the result of that. What more do we need to show us that than to see the Minister of Finance have to come into this House put forward a Supplementary Order Paper and say that he forgot about the workers that he did not look after the people who voted him in and that he has made a mistake in the biggest commercial negotiation he has done this year. He made a mistake. He has had to come to this House to have it rectified. It is important that we debate it and that we debate it strongly because it shows the ability of the Minister of Finance. 
Chris Auchinvole 
: Or lack of ability. 
DAVID BENNETT 
: He has a lack of ability in commercial matters and the people of New Zealand have seen that. The people of New Zealand are voting against this Government in the polls because of the economic conditions they are now in. They know that the Minister of Finance has not managed this economy they know that tough economic conditions are coming their way for the next couple of years and they know that Labour has no idea about economic management. They know that Labour is at fault in relation to the conditions we have and they know that they cannot trust the Minister of Finance. 
What more do we need to show that our lack of trust is justified than for the Minister of Finance to have to come into this House and ask for his mistakes to be rectified? We could want nothing more from the Minister of Finance in order to show us how incompetent he is at his job than for him to have to come to this House and show that he has made a huge mistake on the biggest deal he has done this year. 
Hon PAREKURA HOROMIA (Minister of Maori Affairs) 
: 
 I move  
That the question be now put 
. 
Hon TAU HENARE (National) 
: 
 I raise a point of order Mr Speaker. The recent transaction by the Government is worth around $800 million. There has not been one speaker from the Government on whether— 
Hon Members 
: It’s not about that. 
Hon TAU HENARE 
: Actually I thought there was supposed to be quiet when we have a point of order for goodness’ sake! 
Mr DEPUTY SPEAKER 
: Yes that is true. 
Hon TAU HENARE 
: Supplementary Order Paper 211 is important and it is an important issue as to whether we should allow the Committee to deal with the matter or whether it should be dealt with in another forum. That is all that this debate is about and I think it is incumbent on the House to listen to as many people as possible; members opposite should not just sit here and push things through willy-nilly without any debate. It is called the House of Representatives and this side certainly is about representing those people whom maybe the Government does not want to represent. We should have our fair share and our fair say on an issue the cost of which is going up and up. 
Mr DEPUTY SPEAKER 
: I thank the member for raising that point. I have considered all of those issues as we have gone through the debate. We have had six speakers and throughout the debate there has been some encouragement for them to stick to the instruction that is before the House which is that the Committee should have the power to consider this matter adopt it etc. They were not warnings; they were just guidance to bring members back to discussing those issues. All of the members who have spoken have gone much wider. I think that three members now have asked that the question be now put and I think that the right place to discuss the issues that you and others have raised is in fact in the Committee. So I accept what Mr Parekura Horomia has asked for. The question is that the question be now put. 
Motion agreed to. 
In Committee 
Part 1 Amendments to Land Transport Management Act 2003 
Hon ANNETTE KING (Minister of Transport) 
: 
 This is a very important bill affecting land transport in New Zealand. A lot of effort and work has been put into this legislation by many people. I will begin by thanking members and staff of the Ministry of Transport for the work they have done in helping to prepare this bill and servicing the Transport and Industrial Relations Committee during its hearings. I also thank the members of the Transport and Industrial Relations Committee for the very good work they did on this bill during its time at that committee. In particular I acknowledge the chairmanship of Mark Gosche in steering this bill through the committee. 
The bill is important because it has a number of key aspects to it. The first is that it reserves fuel excise duty for land transport purposes. This is something many members of this House have wanted for a long time and in this respect I would like to acknowledge members like Peter Brown and Mark Gosche who have argued this for many years. This is called hypothecation—in other words dedication of all funds that are taken from road users either by a petrol excise duty road-user charges or motor vehicle licensing—and it is put into the National Land Transport Fund dedicated to transport. For many years Governments have dipped their hands into that money and spent it on other activities. No one is saying that they were not worthy activities but the money was certainly not being spent entirely on transport. This bill ensures that whatever revenue is collected is then dedicated to transport. 
It also introduces 3-year regional land transport programmes and a 3-year National Land Transport Programme. It puts in place a 3-year planning cycle which is something people have said we have needed for a long time. The first real long-term planning came in Budget 2006 when we set out funding over a 5-year period. What came through very strongly was the need to have longer-term planning for our transport system to ensure that those who are building the roads those who are providing the passenger transport and those who are involved in the transport sector have the ability to plan ahead and know what they are doing. 
It also provides for a 3-year Government policy statement. This is important. The Government policy statement will be set out for a 3-year period and it will be updated every 3 years so that we can ensure that people know the expectations of a Government and where its priorities are in transport. The bill also streamlines the membership of the land transport committees. As is known by many members in this House land transport committees in some areas have been large and cumbersome and have found it hard to make decisions. The bill reduces the number of members on those committees while retaining community representation. It also brings about the merger of two Crown entities—Transit and Land Transport New Zealand—into a single statutory Crown entity. It implements much of the Next Steps review that we undertook in terms of changes to the transport sector. The aim is to have an efficient safe well-integrated transport system for New Zealand with every mode working well. 
We know that transport is more than just roads. Roads are important but it is more than just roads. This bill allows for the introduction of a regional fuel tax. A region can decide that it would like to bring in a regional fuel tax for a particular project it wants to bring forward and see funded. I see it as a very fair mechanism. For example if Auckland wanted to bring in a regional fuel tax to electrify rail and ensure a better journey for those travelling on trains in Auckland it would then through a phased-in regional fuel tax pay for it out of the region. I see that as being very fair because people in Invercargill would say: “If everyone is getting their fair share of the National Land Transport Fund then why would we pay for a project that Auckland wants over and above that fund?”. The regional fuel tax is not compulsory. It is not imposed; it is a tool in the tool box of regional councils and regional authorities around New Zealand if they wish to use it. They have to ensure that they have consulted with their community and that they have agreement on their priorities and their projects. 
I will also talk briefly about the Supplementary Order Papers attached to this bill particularly the one about which we have just had a debate about in terms of its inclusion in the bill. Rather than the Government forgetting about the workers in less than 12 hours after the Toll sale being agreed to we have introduced through this Supplementary Order Paper the retention of the superannuation rights of Toll workers. It could not have been done faster than the way this Government has done it by adding a Supplementary Order Paper to this bill. [ 
Interruption 
] A bill could not be introduced when the rail had not been purchased. It would be stupid to bring in a bill to protect superannuation rights when the trains have not been purchased. That is the sort of thing we might have got from National but it certainly is not what one gets from this Government. Rather than forgetting the rights of workers within hours we have ensured that their rights are retained and those are the facts. 
I was a little disturbed by the talk about forgetting about the workers. We all know that the workers of New Zealand got a 68c increase in the minimum wage over 9 years of a National Government. That is how much National cared about the workers and New Zealanders should never forget that. Today National members are crying crocodile tears about the workers when we know that in 9 long years they increased the minimum wage by 68c. 
The debate today on the Supplementary Order Paper being part of this bill is important. It told us that National opposed the purchase back of rail by the Government. That is what the debate told us and I am glad New Zealanders were able to hear it. As I said this is a very important bill for Parliament. I welcome the debate; it is timely. I commend the bill to the House. 
Hon MAURICE WILLIAMSON (National—Pakuranga) 
: 
 I want to take the first of what I hope will be many calls that you will allow the Opposition Mr Chairperson. One of the things that this Government is getting very cute at is bringing legislation to this Parliament. If we look at the size of the Land Transport Management Bill we see it is a 247-page bill but it is being brought in in only two parts. There is a Part 1 then a fractional Part 2 that contains a little bit of miscellaneous provision. Because of the way in which the debates now occur at the Committee stage we deal with bills part by part. 
This is a massive Part 1 that is as I said in my second reading speech like the curate’s egg—it is good in parts. I will not even begin to say that this bill is bad across the board but if things are done reasonably and this Parliament works as it should members of the Opposition should be allowed to pick a 5-minute speech on each of about five or six of the main subjects the Minister has just covered. The Minister talked about Toll then she talked about hypothecation then she went on to talk about the Government policy statement the planning cycle and so on. I want to cover off a few of those things right now. I think the Minister is dead right about getting a more concentrated planning cycle that everyone can work around. I think it has been overdue for a long time and I congratulate her on legislation that sets up those structures. 
But there is a range of questions that we want answered. For example in relation to the regional petrol tax which I hope to be able to cover as well how come we now see an Supplementary Order Paper that instead of saying “You can introduce a regional petrol tax if you want.” now states that there will be a schedule associated with it? Supplementary Order Paper 209 proposes to substitute a new subsection (4) of section 65G in clause 31. Subsection 4(b) states: “the total rate of any regional fuel tax scheme may not exceed—(i) 2 cents per litre … in 2009; and (ii) 5 cents per litre … in 2010.” That is really interesting because later on I will refer to a quote by the Prime Minister who said that she had no intention of allowing the regional petrol tax to be put on to long-suffering motorists “next year”. She made that comment in June 2008 so I presume “next year” means 2009. However the Minister in the chair the Hon Annette King in almost flouting the wishes of her Prime Minister has shoved a schedule into the Supplementary Order Paper to allow a rate of 2c in 2009. 
There is more that National members would like to debate if you will give us those calls Mr Chair. The first is to do with the structure of the new agency because I think it is always worth while trying to look for gains in efficiency of Government departments not that that has happened under Labour when we look at the hugely bloated growth in bureaucracy and floor space in the 9 years since Labour came to power. If the Minister wants to debate that issue I am happy to give her the total number of bureaucrats and the total amount of floor space that has been rented since Labour came in. I am happy to look at some efficiency gains but we must always call into question those issues of conflict of interest. 
I tell the Minister and she probably remembers it well that in the mid-1990s the clarion call from local government was that Transit by being both the funder of roading and the provider of the State highway network had a complete conflict of interest. I have the documentation and the letters from councils up and down the country. I dug them out of the box at the time the select committee process was going on. They told me over and over again—indeed they kept beating me up—that I could not let Transit be the one who decides who gets what money and also be the operator of the State highway network because Transit would continue to favour itself. In the end I gave into that because I thought there was some real merit to the case that Local Government New Zealand and others were running—that there was that conflict. What is really interesting now is that we are putting them back together again. We are going to take the funding agency—that is Land Transport New Zealand—which decides which projects get which money in each year and then we are going to incorporate it back into that body and call it the New Zealand Transport Agency. That is the very body that is looking for State highway funding all the time in the form of Transit New Zealand. 
So again on one of the calls that I will take on Part 1 if we get them I will explore whether there is enough protection. We were told at the select committee that there was. Interestingly enough of those who should have been concerned about that conflict did not express it and in fact when asked about it said that no they thought there were enough protections. I would like the Minister if she can during one of her calls to give a detailed explanation to the Committee about how those protections will work to stop the agency being both the funder of roading and the owner and operator of the State highway network. If we talk about conflict of interest I would have thought that today we have seen one of the most classic conflicts of interest ever to occur in this country. We have seen the Government buy back the rail network today and today we have also seen the Government put an increase in road-user— 
Hon ANNETTE KING (Minister of Transport) 
: 
 I welcome the member’s support for the changes that have been made in planning and funding. Obviously the member as a former Minister of Transport understands those issues well. But I know that the issue of one agency was raised at the Transport and Industrial Relations Committee and that considerable debate took place at the committee about this issue. I know also that the chair of the establishment board Brian Roche appeared before the committee to talk about how the new board would manage the transparency between the operation of the old Transit agency and the responsibilities of Land Transport New Zealand. 
My understanding is that a very good briefing and a very good understanding was given to the committee as to how the new agency would operate. A lot of thought has been put into the operation of the new agency to ensure transparency. That was a matter of concern and I acknowledge we need to have transparency. My understanding is that a very good briefing was given to members and that they could see a serious issue was being taken seriously and addressed by the establishment board and by those who have some knowledge of how the sector works. It is important that we do not ever have one part of an agency dominating any other part of the agency. Therefore the way it operates and the transparency of the operation are very important issues. I think the previous speaker should have been reassured by the submissions made to the select committee and no doubt the chair of the committee will talk further on this issue shortly. 
The previous speaker is obviously interested in the regional fuel tax and I know that the National Party is very keen for this Parliament to pass that part of the bill. National members do not wish to vote for it and they do not want to dirty their hands but they do want it to be passed because they know it is another tool in the tool box. I am waiting to see whether Dr the Hon Lockwood Smith will cross the floor of the Chamber and vote with the Labour Party and other members who are supporting this bill to support the regional fuel tax. Dr the Hon Lockwood Smith has assured the people interested in Penlink the people who are interested in building a road in their area that he would cross the floor to support the regional fuel tax. This is the time for him to come to the Chamber and say he will do what he said he would do for the sake of the people of Whangaparaoa. One cannot make those sorts of promises to people and think they will forget them. They do not forget them; they remember them. They have them in their minds. Those people took note of that and they are waiting for Dr the Hon Lockwood Smith to come to the Chamber and vote when we get to the vote on this part of the bill to ensure that the regional fuel tax as a tool for regional government is able to be used. 
I move  
That the Committee report progress and sit again presently. 
Progress reported. 
Report adopted. 
House resumed. 
Instruction to Committee 
Mr DEPUTY SPEAKER 
: Thank you. I thank the Committee for enabling the House to sit again. When I was last in the Chair I neglected to put the question on the matter that we were debating. I do that now and the question is that it be an instruction to the Committee of the whole House on the Land Transport Management Amendment Bill that it have the power to consider and if it thinks fit adopt the amendments set out on Supplementary Order Paper 211. 
Motion agreed to. 
In Committee 
Debate resumed. 
Part 1 Amendments to Land Transport Management Act 2003 ( 
continued 
)  
Hon MARK GOSCHE (Labour—Maungakiekie) 
: 
 It was interesting to listen to the Hon Maurice Williamson. People would never have thought from the questions he was asking that he was on the Transport and Industrial Relations Committee that dealt with this bill. I am sure he was awake. I recall that he questioned people about the single agency having gone on about the fact that he had created seven or eight separate bureaucracies. He is a member of the National Party which has said it would get rid of bureaucracy. When we actually do that National members vote against it. That tells us so much about the National Party. It created seven or eight different sets of bureaucracy in transport; we have pulled that number back to three or four. 
We had very good information from the person who is putting in place the new agency—one Brian Roche. I know that the National Party trusts him because both Governments have used him in very important roles. He was the head of Housing New Zealand when I became the Minister of Housing and we have used him to chair the Auckland Regional Transport Authority. He is being used to put this agency together because he is a very competent gentleman—and so are the people who work with him. 
This is interesting legislation. I think it is one of the most important that I have worked on in the 12 years that I have been in Parliament because it finally addresses regional needs and gives regional government the power to fund regional needs. It gets us away from the issue of people in the South Island asking why they should pay for the creation of new infrastructure in Auckland or people in Waikato asking why they should pay extra for Wellington infrastructure and so on and so forth. It is interesting that National members will vote against it because people in the Bay of Plenty will want to know why National members are voting against their having the ability to finance the $200 million worth of projects that they desperately want done and that will not be done unless there is a regional fuel tax. People in the Wellington region will want to know why National members are voting against the $400 million worth—I think it was—of projects that will not be able to proceed if the regional fuel tax is not available to that region. 
Of course people in Auckland will want to know what the National Party would do to electrify its rail system. The other day I drove from Greenhithe to Mount Wellington. I was almost always on a motorway. I left Greenhithe at 4.30 p.m. and I got home just before 5 o’clock. I was driving on motorways that had been built by this Government; not one bit had been built in the 9 years of the National Government. I drove through “Spaghetti Junction” which was built by this Government. National members opposite who say they are serious about infrastructure development are a joke. They are saying to the people in Auckland that they do not support their having public transport. I was able to make that journey in less than half an hour because Aucklanders are getting on public transport in a way that they have never done before. They are able to do that because we have spent real money on it—significant money. But we know that to meet the ongoing demand—and it is growing by the day—we need to electrify the rail system. 
National members say they will do it by magic. They will not support this bill; they will have some other way of funding the electrification. Well we are waiting to hear what that way is. Maurice Williamson is supposed to be the National transport spokesperson and he has yet to say what its policy is to come up with $600 million to electrify the rail system—or whatever the sum might be. Aucklanders are waiting to hear. They want to put in an order for new electric trains and they know that unless this bill is passed they will not be able to do that. They want some certainty about the funding. Will they get it from the National Party? No way. 
Aucklanders and New Zealanders also want to know why the National Party is voting against hypothecation. For years those members have said that it is terrible to take money out of the petrol tax and road-user charges and use it for something else. National members will vote against that. They have to tell people why they will vote against it because it was their big policy at the 2005 election if I recall rightly. They were going to spend all the fuel tax on roads Maurice Williamson said. But now he is going to vote against it. His party is going to vote against it. Why is it going to do that? Is it just to spite somebody on the Government side of the House? Is it just to spite New Zealanders who believe that it is the correct thing to do? Why is the National Party going to vote against hypothecation? 
DAVID BENNETT (National—Hamilton East) 
: 
 That was a very interesting speech from Mark “Julius” Gosche—the man who built every road that exists in Auckland and believes he is the founder of New Zealand’s transport system in the sense that every road he travels on has been built by the Labour Party. That is absolute rubbish. The reality is that this Labour Government has not completed the roading network in Auckland. It is a complete fabrication for its members to say they are doing it now. The reality is that they have not done it and they will not do it because they will not introduce a regional petrol tax. Their Prime Minister has said they will not introduce one next year. They are passing legislation today to give them the ability to put in a regional petrol tax and then the Prime Minister says she is not going to introduce it! She will not go to the polls knowing she is telling the public of Auckland that they are going to have to pay another 10c on their fuel bills. She refuses to do it. 
Hon Annette King 
: That’s wrong. 
DAVID BENNETT 
: The Minister of Transport is saying that that is wrong—it cannot be right. She is going to go out there and introduce a little bit of the tax so she can potentially go back to the people of Auckland and say they will have some certainty about their electric trains. The very thing Mark Gosche was talking about having certainty about—for the purchase of electric trains—is up in the air because the Prime Minister will not actually allow them to impose a regional petrol tax next year. She does not want to do it because it is not politically expedient for her to go into an election campaign with a regional petrol tax for the communities of Auckland and other big cities around this country. 
The other thing Mr Gosche said that was quite interesting was that we need to give power to the regions so they can fund what they want to do. It was a very important point for him to emphasise—power to the regions. How come in this legislation he has not listened to what all the regions have said—apart from a few of the main cities that have a public transport issue? All the other regions wanted to have the ability to dictate where that 10c would go. The Waikato region the Bay of Plenty region and the Taranaki and King Country region wanted to have the ability to determine what that 10c was spent on. But in this legislation there is a mandatory apportionment. I say to Mark: “Give power to the regions if that is what you are going to do. If you are going to give them power listen to their submissions because their submissions said they wanted to have power to distribute that money. They did not want you to tell them they had to spend 5c on public transport. They wanted to have the ability to determine that for themselves.” 
By not doing that he is not giving power to the regions; he is doing what the Labour Party does and knows it does best—telling people how to live their own lives. It is a party based on redistribution and on the principle that it knows better. The regions went to you in this select committee process they came in front of you and they implored you to take— 
The CHAIRPERSON (H V Ross Robertson) 
: Order! 
DAVID BENNETT 
: —into account the wishes of the regions. The regions want to have the ability to distribute that money in the manner that fits their requirements. The Labour Party will not allow that. The Labour Party will not allow the regions to do what they wanted to do and its members ask why we vote against it. Why would we vote for something that all the regions apart from some of the main centres said they found was a problem? Why put through legislation that the regions are not happy with? It does not make any sense. The regions came to the select committee and they had a reasonable rational case for them to be able to distribute that 10c according to their needs and the Labour Government ignored them. It ignored them because it is paying back the Greens. 
That is what it is doing with this legislation. It is not about what is right for New Zealand it is not about what the regions want it is not what the regional land transport committees around the country have been advocating or seeking; it is what this Labour Government needs to do to stay in power. It needs to get the Greens onside and to do that it has compromised the select committee process it has compromised the submissions of all those regions—all those rural provincial regions that came out and said: “Just give us the ability to determine what we do with that money; just give us that power.” What was so hard about that? Why cannot the Government of the day give the regions of New Zealand the power to decide what happens with that money? No it will not do that. That is the fundamental problem with this legislation; it is the fundamental problem with this Government. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 I am happy to take a short call on Part 1 of the Land Transport Management Amendment Bill and particularly on the Minister’s Supplementary Order Paper 209. I realise that I left the House somewhat on tenterhooks on Thursday afternoon when I drew attention in my second reading speech to what I called then the Minister’s pork-barrel clause whereby the projects that the Ministers can decide should occur in Auckland—not in any other region but with the second 5c in Auckland—were not subject to any set of Auckland regional priorities. I was particularly concerned that in a bill that strengthens the role—quite rightly we in the Greens think—of the regional land transport strategy and adopts the principle that regions can determine their own destiny their own priorities for expenditure and whether to levy a regional fuel tax it was quite inappropriate for Ministers then to be able to impose projects on Auckland that were not in accordance with the priorities in the regional strategy. The Supplementary Order Paper fixes that and we are very happy that that has been fixed. 
The Supplementary Order Paper adds a short statement to new section 65N(1) inserted by clause 31 which states that the Ministers must be “satisfied that the projects are consistent with the Auckland regional land transport strategy”. That is a big improvement. It closes a big loophole that the Greens were very concerned about and we are now able to vote for the bill. Although we are not ecstatic about everything in the bill we are now able to vote for the bill on balance without further reservations. 
The Auckland regional land transport strategy was prepared under a very democratic process as provided for in the Land Transport Management Act. There was large-scale consultation. As I recall about five options were put out although it may have been six for the balance of expenditure between roads and rail and for different kinds of projects that were to be funded over the long term in the region. The public got involved and chose which option they wanted to go for. They chose well in my view. They said that they needed to get the rail system fixed and that it was a high priority and they chose option five which did that. It would be quite inappropriate to allow that decision to be overturned for projects that did not even make it on to Auckland’s priority list at all to be funded by the Minister’s 5c which let us remember is not money that comes from central government. The Government for that second 5c in Auckland raises the loan and puts it on the Crown’s balance sheet which does not require any immediate expenditure but it is Auckland that pays an extra 5c on its petrol to raise the money to service that loan. If Auckland is paying to service the loan then it is essential that Auckland gets to say what projects it is used for. 
I am very glad that has been fixed. I thank the Minister for recognising the danger going into the future that some future Minister might use it for totally pork-barrel reasons which would not be appropriate. 
It still however leaves the fundamental problem of transport funding and that is the financial assistance rate. We still have a problem that if Auckland and I use Auckland as an example but it is the same anywhere wants to build a State highway for Aucklanders to use to get from one side of Auckland to the other—let us say State Highway 20—then that is 100 percent funded out of the National Land Transport Fund paid into by motorists across the country. OK fine; it is like that in every region. But if Auckland wants to improve its rail system to carry millions more passengers from one side of Auckland to the other performing exactly the same function then Auckland has to find at least half of the money to do that. If we compare dollar for dollar rail is the better option. 
DARIEN FENTON (Labour) 
: 
 It is a pleasure to take a call in the Committee stage of the Land Transport Management Amendment Bill. As a member of the Transport and Industrial Relations Committee I took an Auckland-focused interest in this bill because that is where I live and have worked for many many years and it is where my family live. Over those years I have travelled up and down the pitiful motorways that we had in the 1990s and experienced the years of transport neglect that we saw under past administrations particularly National administrations. It is a great pleasure to see this bill come in on top of all the things that this Government has already done. 
I heard one of the members opposite calling out that Mark Gosche did not take public transport to his place at Greenhithe. He did not say that actually. He said that he drove. If he had wanted to take the bus he could have used the northern busway which is a fantastic investment in the area that I work in on the North Shore. I was present at the opening of the busway. I walked along the motorway with the Prime Minister. 
Dr Jonathan Coleman 
: I thought you worked in South Auckland. 
DARIEN FENTON 
: No I work on the North Shore. I tell Jonathan Coleman to catch up. It was a very proud moment to see the railway on wheels that we have on the North Shore. 
I live in the west of Auckland even though I work on the North Shore. I live in a part of the town that is serviced by the railways. My experience of them has been very interesting. Apart from the fact that my son worked as a ticket collector on the railways for years when he was at university I remember what a mess they were. The railways were single tracks so they were very very slow. The rolling stock that was bought had mud and grass hanging out of it the railway stations were run down—they were not a particularly nice place to be—and the trains ran on single lines. There were years and years of argument about that and about how we would pay for them to be fixed. I am really pleased that one of the provisions in this bill will enable the electrification of rail. The Government of course has already assisted with double tracking of the rail in Auckland. That is well under way and it is making a huge difference. 
The National Party needs to answer some questions about its opposition to this bill. People in Auckland are quite worried about National’s opposition and what it means. How will we pay for the electrification of railways if a future National administration decides it is not a good idea? 
Hon Member 
: It won’t happen. 
DARIEN FENTON 
: Well that is true. We do not have to worry I suppose but these are the questions that are being posed. The other day Brian Rudman in the  
New Zealand Herald 
 said that Mr Williamson should tell us what his party will do in Government if the regional fuel tax becomes law in a few weeks despite National’s opposition to it. 
Hon Mark Gosche 
: They don’t have any ideas and don’t have any policy. 
DARIEN FENTON 
: That is right. That is the problem. National members do not have any ideas and they are not telling anybody what their plans are. It is of great concern to the people who live in Auckland and it is of great concern to the workers of Auckland who are relying increasingly on public transport. We heard a ridiculous display from National members this afternoon. They were trying to pretend that they care about workers. It was just astonishing. It really was one for the books. 
This Government has expanded public transport funding. The Minister said in the House today that funding was frozen at $40 million during the 1990s and now it is 15 times as much as that. But we will have to continue with investment in public transport and that is what this bill enables people in Auckland to do through the contribution of the regional fuel tax. 
I am also interested as one who works on the North Shore in Penlink. 
Hon Member 
: When? 
DARIEN FENTON 
: Has the member not seen my office in Birkenhead? He should come and visit me. I would be happy to welcome him to my office at 88 Birkenhead Road. The Penlink people have come to see me as well. They are very very concerned and I am very very concerned about what might happen if this bill is not passed and the regional fuel tax does not go through. I wonder what Dr the Hon Lockwood Smith will be saying to those people when he has to explain to them next week that National voted against this bill. What will be his answer? What is going to happen next? People from Dr Smith’s electorate are very concerned. They came to our select committee and talked about Penlink and their support for this bill yet their local MP is voting against it. 
I am really pleased as an Aucklander and as someone who has worked there for years and years to see this bill come through and to see some answers for once—building on the years and years of work this Government has done—to our public transport issues. 
PITA PARAONE (NZ First) 
: 
 It is a pleasure on behalf of New Zealand First to make a contribution to the Committee stage of the Land Transport Management Amendment Bill. I want to talk specifically to new section 4 inserted by clause 5 which refers to the Treaty of Waitangi and to take this opportunity to express the disquiet New Zealand First has in terms of this provision. Section 4 as it stands now states: ”In order to recognise and respect the Crown’s responsibility to take appropriate account of the principles of the Treaty of Waitangi and to maintain and improve opportunities for Maori to contribute to land transport decision-making processes …”. I have submitted on behalf of New Zealand First an amendment to omit the words “principles of the” but to still retain reference to the Treaty of Waitangi. 
New Zealand First’s position in respect of that wording should not come as any surprise to this Committee. Our amendment shows that New Zealand First is consistent on this matter and is an indication of our strong feelings and belief that undefined principles by this House have no real benefit for this bill. It is not about doing away with the Treaty as some of our opponents would like this House—and indeed the New Zealand public—to believe; nor is it about doing away with reference to the Treaty in legislation. We would like to see references to the Treaty retained but not references to the principles because they are undefined and lead to a lot of unclear understanding. 
I want to give an example of how that applies in our society today. At the moment we have 21 different district health boards each required to deliver health services that give due recognition to the principles of the Treaty of Waitangi. First I suggest to members of the Committee that each district health board probably has a different understanding of what those principles are. Secondly I had the privilege of availing myself of our wonderful health service about 18 months to 2 years ago and after my operation I asked the surgeon under which principle of the Treaty of Waitangi he had undertaken his service to me. He could not give an answer. He told me just to be thankful that he was able to carry out his duty. That doctor was able to do that without any reference to the meaning or understanding of the principles of the Treaty of Waitangi. 
I suggest that this bill will be just as effective without references to undefined principles of the Treaty of Waitangi and I hope the Minister will consider lending some support to the amendment I have presented on behalf of New Zealand First. Again I say to the Committee that New Zealand First does have difficulty in terms of supporting the bill if the words “the principles of” are retained in new section 4. We have no difficulty with the section as it is proposed if those words are omitted. Kia ora. 
PANSY WONG (National) 
: 
 I am looking forward to seeing whether the Government rejects New Zealand First’s amendment. Does that mean New Zealand First would then not support— 
Hon Member 
: Will you support it? 
PANSY WONG 
: My learned colleague Maurice Williamson has already given that indication. But we will be interested to see whether New Zealand First pulls its support for the bill if the Labour Government does not accept its amendment. 
I want to talk about two points. Part 1 is the largest part in the Land Transport Management Amendment Bill and there are quite a few issues that I would like to raise with the Committee. In one of the regulatory impact statements—that is the reasons why this bill entered the House—the advisers pointed out that there is a need to meet a national transport objective. They said that the existing organisation and the existing structures are not clear and because of that they are not delivering the Government’s priority objectives. However it is difficult to deliver the Labour Government’s objectives because in previous years it has talked about such things as having economic transformation and sustainability; this year it has dropped that completely and talks about an emissions trading scheme. So it is difficult for the various agencies of local government that are supposed to deliver Government objectives if the Government is not very clear about what objectives it is going to pursue. 
I want to share with the public that I doubt very much whether the passage of this bill will make it easier because it talks about these agencies grouping themselves together and delivering the objectives set out in the GPS which I presume is something akin to a Government policy statement. Part 1 gives the definition of GPS and section 84 inserted by clause 32 states: (1) “A GPS which is issued by the Minister every 3 financial years enables the Minister to—(a) guide the Agency and the land transport sector on the outcomes and objectives and the short- to medium-term impacts that the Crown wishes to achieve—(i) through the national land transport programme; and (ii) from the allocation of the national land transport fund; and (b) link the amount of revenue raised from road users with the planned levels of expenditure …”. This is all very good until we get to the next section. Section 85 states: “To avoid doubt a GPS is not—(a) a direction for the purposes of Part 3 of the Crown Entities Act 2004; and (b) a regulation for the purposes of the Acts and Regulations Publication Act 1989; and (c) a regulation for the purposes of the Regulations (Disallowance) Act 1989.” 
So one could be forgiven for asking whether this Government policy statement is really going to give clear direction to the super-transport agency that Part 1 is going to set up. We know what the Government policy statement is not but we are not clear what it is. Anyway in the preparation of the Government policy statement section 87 states: “(1) The Minister must in preparing the GPS—(a) be satisfied that the GPS—(i) contributes to the aim of achieving an affordable integrated safe responsive and sustainable land transport system; and (ii) contributes to each of the following: (A) assisting economic development: (B) assisting safety and personal security: (C) improving access and mobility:”—unlike the Prime Minister’s motorcade that parked on the disabled parking bay I presume that means—“(D) protecting and promoting public health: (E) ensuring environmental sustainability;”. 
Maybe the Minister can take a call and explain to us how any agency or any Government policy statement will satisfy this motherhood and apple pie stuff because formulating a plan that tries to achieve all of these at times conflicting objectives would be almost impossible. I would like the Minister to take a call and tell us what the time line is in terms of issuing the Government policy statement that takes into account all these objectives—which of course are all fantastic and well meaning. 
But I can just imagine anybody who wants a public transport system—a rail or roading project—simultaneously achieving all those objectives about protecting and promoting public health. I presume it means that somehow we have to look at fuel usage or the design of the bus or rail carriages. I am not too sure what else we can do to promote public health. After all at the select committee the Labour members said they were not actually very happy with advertisements on buses. I thought we could promote health with messages on buses but they said they did not want to see any messages promoting public health on buses. Also how do we assist safety and personal security? They are very lofty ideas. I am not sure how they will all be carried out. 
National members are not the only ones who have lots of concern about this bill. I want to share with the Minister the Committee and the public the view of Local Government New Zealand which is the shall I say overall coordinating body for all local government in New Zealand. Local Government New Zealand like most people supports the general intent of the bill. But it is worried. Firstly it feels that the consultation and the provision in the bill would not foster the partnership relationship and as we know the Labour Government has always claimed it is in partnership with local government. But Local Government New Zealand believes that this bill is being imposed on it rather than being developed in a partnership way. 
Secondly it is very concerned about accountability. It wants to know how the creation of a super-agency—the New Zealand Transport Agency which will end up encouraging a top-down process planning will be driven by a technical consideration and will be solely focused on a national solution—would be beneficial to the regions. I think it has raised a very very good point. It uses the example of local communities in the Bay of Plenty and Christchurch. Apparently those two good cities have successfully used non-statutory agreements founded on best practice and political agreement to develop long-term strategies. Their big concern with the existence of this super-agency is whether those local community - derived solutions will still have room to blossom. 
The other issue I have raised before about that lofty idea of the Government policy statement concerns how the consultation requirements will be conducted under this bill. Local Government New Zealand reckons there is duplication between the consultation requirement under this bill and the Local Government Act 2002. I cannot say that Local Government New Zealand is a body that will be anti-transportation. It raised concerns firstly about the super-bureaucracy and secondly about the fact that the partnership approach was touted but was not implemented during the development of this bill. So with the super-agency that will be created how will this genuine partnership exist? I do share its concern about the duplication of roles within the bureaucracy. 
I am sure that the Hon Maurice Williamson would have shared with us again the fact that 10 years ago he was being got at on a daily basis about the super-agency that should be broken up because the national interest has always overridden the regional interest in terms of transport. So he conceded that and then 10 years later it is a case of back to the future. 
Hon ANNETTE KING (Minister of Transport) 
: 
 I will take just a very brief call to answer the member’s questions particularly around the Government policy statement. One of the issues that has been of concern to Local Government New Zealand is that our transport planning has never lined up with local government planning and of course it is a major partner in transport and has a major responsibility for its ratepayers’ funding. So the Government policy statement lines up with local government’s long-term council community plans. Local government is on a 3-year funding planning cycle and the Government policy statement actually lines up with that. We will put out a Government policy statement that local authorities can then take into account in their long-term funding proposals. This is something that local government has asked for and something that the Government policy statement enables. 
The first Government policy statement will be issued in July. The consultation has taken place with many stakeholders by first issuing what we called a trends and issues paper. Through that consultation which we did with many of the stakeholders including Local Government New Zealand we have been able to include the issues that local government would like to see addressed in a Government policy statement. We release that and then local authorities can use it for their long-term planning for local government. It finally lines up a whole lot of issues that are not taken into account now when we are planning for transport and I think it is a very sensible move. 
The CHAIRPERSON (H V Ross Robertson) 
: In accordance with the decision of the Business Committee for Dr Russel Norman to give his maiden statement at 5.30 I will report progress and ask to sit again presently. 
Progress reported. 
Report adopted.