Nash Stuart: Westpac New Zealand Bill — In Committee 
Nash Stuart: Westpac New Zealand Bill — In Committee 
[Volume:672;Page:18829] 
STUART NASH (Labour) 
: 
 My colleague Lianne Dalziel poses some very interesting questions. Lianne Dalziel has posed many interesting questions over the Committee stage debate on this Westpac New Zealand Bill. Unfortunately none of them have been answered. 
Hon Lianne Dalziel 
: Oh no the odd one has. 
STUART NASH 
: By us though. 
Hon Lianne Dalziel 
: No no. Occasionally the member to be fair has got up. 
STUART NASH 
: That is right he did get up; he did speak. I apologise to Mr Foss. But he has not answered this question and he has not answered questions for a while. What I might do is try to answer this question for my colleague but I could be wrong. I will give it my best shot because it is a very important question. Westpac New Zealand Ltd is an incorporated bank. It became a registered bank in 2006 and it did this in order to comply with the Reserve Bank of New Zealand’s local incorporation policy. It is a branch—there is no doubt about that—but it is also an incorporated bank in its own right. So it would surprise me if it did not come under the guise of the bill that as it says in here— 
Hon Lianne Dalziel 
: No no but we don’t know in the bill whether it’s a qualifying financial entity. 
STUART NASH 
: Yeah that is a good point. I would— 
Hon Lianne Dalziel 
: It’s a separate piece of legislation. 
STUART NASH 
: The member is right. But the incorporation policy says that systemically important banks should be incorporated in New Zealand. We talked about this before. What is a systemically important bank? It is a bank that has liabilities other than those to related parties of over $15 billion. I would assume that if an organisation of that size was not a—what do we call it again— 
Hon Lianne Dalziel 
: Qualifying financial entity. 
STUART NASH 
: —qualifying financial entity— 
Hon Lianne Dalziel 
: But that’s under the financial advisers legislation. 
STUART NASH 
: In fact the member is right. I do not know that so to say that I was going to answer that— 
Hon Lianne Dalziel 
: Do you think the member should answer that then? 
STUART NASH 
: I think that he probably should actually because it is not much to ask is it? It would not take long. We are not asking for a 10-minute call; we are asking for only a 5-minute call. 
If I could move to clause 27 we see that it talks about amendments to the Westpac New Zealand Act 2006. Clause 27(2) amends section 19(4) of the Act “by omitting ‘DB 23 of the Income Tax Act 2004’ and substituting ‘DB 31 of the Income Tax Act 2007’.” 
Hon Lianne Dalziel 
: Why? 
STUART NASH 
: Well that is the question I want to know the answer to. I would have thought that in a bill of this size—and it is not a large bill; we have to admit that compared with some of the bills that come before the Finance and Expenditure Committee this is about a third of the size of a Supplementary Order Paper that we are looking at the moment so it is not a big bill—perhaps just for clarity because people may look at this and wonder what it is about it could have been listed there. It actually means nothing. To tell the truth it means nothing. We were talking about this in the Finance and Expenditure Committee today and saying that tax legislation should be clear. It has to be easy to use. It has to be clear so that people are not running around looking for a whole lot of different Acts. 
Again if we look at clause 27(3) which amends section 19(12) of the Westpac New Zealand Act “by omitting ‘adjusted tax value’.” it would have been good if it could have just fleshed that out a little bit. I do not think there would have been any mischief there. It would have made it just a little bit easier. The legislation would have been a little clearer. Clause 27(4) states: “Subsection (2) applies with effect from 31 March 2008.” That is actually retrospective legislation in a banking bill. Again I think it would have been good to clarify that. As I said there is no mischief here at all. I am not trying to be smart and there is no attempt to deceive anyone or anything like that but I think it would be good in bills like this—which are quite important bills—if they were to set out what did come into effect from in this instance 31 March 2008. That was 2 years after the original Westpac New Zealand Act was passed and obviously it is 3 years before this bill will be passed. 
Again clause 27(5) states: “Subsection (3) applies with effect from 13 September 2006.” which was obviously just after the original Westpac New Zealand Act was passed. Again it would have been nice to put it down to clarify it and be a little bit clearer on what the legislation meant. As I said clause 27 apart from the title “Amendments to Westpac New Zealand Act 2006” means nothing. It means nothing. In fact if we really want to know what this means we have to go and grab the Income Tax Act and the original Westpac New Zealand Act 2006. That just takes time. It would not have been long at all. 
I come back to clause 26 “Banking legislation continues to apply”. That makes a lot of sense. We would hope—and it has been the case—that this Act did not change Westpac’s status with regard to any other Act governing the banking sector. That is clarified in this bill.