Hutchison Paul: Hazardous Substances and New Organisms (Transitional Provisions and Controls) Amendment Bill — First Reading 
Hutchison Paul: Hazardous Substances and New Organisms (Transitional Provisions and Controls) Amendment Bill — First Reading 
[Volume:613;Page:10125] 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 It was very interesting to hear the Minister for Courts give a speech on the bill which is very technical and in many respects holds great hope in terms of doing what is needed in New Zealand and that is reducing compliance costs. Unfortunately the Labour Government does not have a legacy of reducing compliance costs but National will be supporting this bill to the select committee because it does hold that hope. The explanatory note states: “The amendments minimise the costs to business and Government and reduce barriers to innovation” and that is exactly what the  
New Zealand Biotechnology Strategy 
 and the Biotechnology Taskforce have pleaded with the Labour Government to implement in order to achieve transparency predictability and best regulatory practice. 
As I say I am optimistic that this bill after it has been to the select committee may achieve those things. But what does the Government say about it that gives us some degree of hope? It says that it hopes the amendments will minimise the costs to business and Government and reduce barriers to innovation by five different mechanisms the first of which is “enabling practical controls to be assigned to previously assessed existing hazardous substances by providing the Environmental Risk Management Authority with flexibility when assigning controls:”. There is no doubt that in the old regime there was a real merry-go-round of compliance costs and regulatory requirements that hopefully will be smoothed. 
The second mechanism is “streamlining the transfer process through removing the need to effect transfers by making an Order in Council:”. So again the somewhat cumbersome process of going through an Order in Council for each of these new substances will be circumvented—provided all the checks and balances are in place. Hopefully during the select committee process we will be able to confirm and improve that situation. 
The third mechanism is “providing for a smooth transition by enabling the Authority to grant businesses exemptions from complying with transitional controls to proactively move to the HSNO controls prior to transfer of the substances they use manufacture or import:”. That might seem a somewhat complicated phrase but in essence it means that those businesses that will move to the new Act and the new amendments to the Act will be able to avoid having to have dual compliance with the old regulations as well as with the new and the transitory. One always worries when one sees the term “grant business exemptions” but as far as I can gather in this circumstance it seems reasonable. The fourth mechanism is “providing for a smooth transition by enabling the Authority to allow businesses to continue their compliance with transitional controls and move them to HSNO controls under a staged programme:”. Again that seems sensible. The fifth mechanism is “enabling the assignment of cost-effective controls to all hazardous substances.” 
I hope that is not just Government rhetoric. I hope indeed that there are cost-effective controls for all hazardous substances because certainly when we were dealing with the new organisms part of this bill the controls went to extreme lengths that I believe were totally unnecessary and inappropriate. In many respects they were symptomatic of a Labour Government gone berserk in terms of not understanding risk management. Hopefully the fifth mechanism “enabling the assignment of cost-effective controls to all hazardous substances” will become a reality. 
There are some very interesting statements regarding the regulatory impact and compliance cost statement. It is important to be aware that collectively these problems affect all existing hazardous substances—of which there are about 80000—and an estimated 90 percent of new hazardous substances. It is pointed out that those unintended costs reflect a huge regulatory failure of the past and Government intervention is required to remove those costs. It certainly seems to be extremely reasonable in that respect. 
I note some optimistic predictions that the net benefits to industry will be considerable and obviously it will be important to ensure that submitters are in agreement with what the Government is trying to do here. The net benefits to society the Government says are that improved compliance due to improved understanding will result in health safety and environmental gains. Again it is very useful to have these fine words—I remember one of the submitters to the Hazardous Substances and New Organisms Act saying that fine words do not necessarily butter turnips—but it would also be useful to have an audit to know whether there really are net benefits to society. 
Jeanette Fitzsimons 
: Parsnips. 
Dr PAUL HUTCHISON 
: Parsnips or turnips—I think either would be appropriate. The primary benefit to Government is improved efficiency in assigning controls to all hazardous substances and ensuring compliance with those requirements. There is no doubt that it is important they all come under one bill rather than under the diverse number of bills they have been under for a long period of time. That also is sensible. 
I want to give one other quote from the regulatory impact and compliance cost statement: “… the HSNO controls replace any former controls (under previous legislation). All existing hazardous substances must be transferred by July 2006.” So there is an imperative on the Government to make sure this legislation is worked through and it certainly gives the Government plenty of time. The Act came into force for hazardous substances on 1 July 2001 and these are the amendments that will mean this operation is feasible. 
Finally I want to make a point about new section 95B inserted by clause 6 which creates a licence that authorises the possession of a hazardous substance. A licence under this section is required if the authority makes it a condition of the authority’s approval of a substance and the authority must grant a licence if it is satisfied the applicant is a fit and proper person to possess the substance and meets the relevant test certification requirements. The “fit and proper” test will be prescribed by regulations made under the Act. Once granted the licence authorises the possession of the substance specified in the licence in accordance with the terms and conditions of the holder’s licence and the approval of the substance. As members can see this is a highly technical bill. Hopefully it will achieve what the Government plans. The National Party is supportive of the bill going to the select committee. We will be scrutinising it carefully to ensure we achieve that substance of greater efficiency and cost-effectiveness. 
Debate interrupted.