Volume 634 Week 28 - Tuesday 17 October 2006 
Volume 634 Week 28 - Tuesday 17 October 2006 
[Volume:634;Page:5751] 
Tuesday 17 October 2006 
Madam Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Points of Order 
Appropriation (Parliamentary Expenditure Validation) Bill—Parliamentary Service Advice 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. It is no secret that later this afternoon the Government will seek to introduce under urgency a bill called the Appropriation (Parliamentary Expenditure Validation) Bill. It is our understanding that the Parliamentary Service gave considerable advice to the people who were responsible for the preparation of this bill. 
The Parliamentary Service is there for the service of all members of Parliament and therefore it would be reasonable to say that the Parliamentary Service has a somewhat more representative role than any other Government agency when it comes to offering advice—in fact uniquely so. So I take this opportunity to express our deep disappointment that the General Manager of the Parliamentary Service notified us yesterday that he was unable to give us copies of the advice that had been supplied to those producing this bill because as he put it the Parliamentary Service had to protect the interests of the Government which was preparing this particular bill. At no time has the Parliamentary Service been a vehicle of the Government; nor has it been there to protect the interests of the Government. 
Madam Speaker I ask you to consider very very carefully the decision that was made by the General Manager of the Parliamentary Service. The reality is that we have now been denied the opportunity to consider that advice because at this point we still have not seen it. Madam Speaker we would appreciate your coming back to the House even perhaps during the time that the House is in urgency and telling us whether it is your view that the General Manager of the Parliamentary Service was in the right to refuse to release information that in reality belongs to all members of Parliament. 
Madam SPEAKER 
: I thank the member. I would note that that is a matter that is properly to be put before the Parliamentary Service Commission and that will be done so tomorrow in accordance with what the member has indicated. 
Questions to Ministers 
Ingram Report—Prime Minister's Statement 
1. Dr DON BRASH (Leader of the Opposition) 
 to the  
Prime Minister 
: Does she stand by her statement in relation to Noel Ingram’s report into allegations concerning Taito Phillip Field that “Dr Ingram found that no conflict existed or appeared to exist between Mr Field’s private interests and the use of his influence as a Minister.”; if not why not? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Yes. 
Dr Don Brash 
: What is the Prime Minister’s response to the assertion of Mr Sunan Siriwan made on Television One’s  
Sunday 
 programme that Taito Phillip Field then a Minister in her Government promised Mr Siriwan a work permit for New Zealand in return for slave labour in Samoa? 
Rt Hon HELEN CLARK 
: My response is that all such allegations should go to the police. 
Dr Don Brash 
: Does the Prime Minister see any irony in the fact that her Government which pretends to have such strong views about employment law has amongst its number a man who employed Mr Siriwan and his partner in exchange for food and board? 
Rt Hon HELEN CLARK 
: I do not have any evidence of an employment relationship. I suggest the member take his matters up with the police. 
Dr Don Brash 
: What is the Prime Minister’s response to the revelation on Television One’s  
Sunday 
 programme that Mr Siriwan has sworn an affidavit alleging that he was told what to say to the Ingram inquiry? 
Rt Hon HELEN CLARK 
: My response is that that allegation has gone to the police. 
Dr Don Brash 
: What faith can New Zealanders have in the Prime Minister’s half-million-dollar Ingram inquiry in light of the clear allegation that one of her Labour members of Parliament pressured a key witness to lie to the inquiry? 
Rt Hon HELEN CLARK 
: If the member has that concern he should put it to the police. I note that he generally has no confidence in the police—this Government does. 
Dr Don Brash 
: Does the Prime Minister now regret setting up a toothless inquiry with weak terms of reference which was designed to cover up activities of one of her MPs and former Ministers; and does she wish to express regret to the New Zealand public for the way in which she has handled this matter? 
Rt Hon HELEN CLARK 
: There was obviously no such inquiry and I repeat Dr Ingram’s words: “Even if I had possessed the power to administer oaths and to compel the attendance of witnesses and the production of documents the process of inquiry may not have been significantly more satisfactory.” 
Health and Fitness—Schools 
2.  
Hon MARIAN HOBBS (Labour—Wellington Central) 
 to the  
Minister of Education 
: What is the Government doing to support schools to promote healthy eating and encourage students to become more active? 
Hon STEVE MAHAREY (Minister of Education) 
: 
 I have a healthy answer. The Government is investing $67 million over 4 years in a campaign to improve nutrition and physical activity amongst young New Zealanders. Initiatives that support schools and early childhood services to play their part include nutrition guidelines a food and drink classification system school-based health promotions professional development for teachers a $3 million regional nutrition fund and high-profile events to encourage students to get involved in learning about good nutrition. 
Hon Marian Hobbs 
: Other than walking the talk what has the response been to the Labour-led Government’s commitment to improving nutrition in school and early childhood environments? 
Hon STEVE MAHAREY 
: I certainly would urge members of Parliament to walk the talk on this particular issue in order to give young people a good example. The response from both the education and the health sectors has been along those lines—overwhelmingly positive. The campaign has been endorsed by the Heart Foundation the Medical Association food industry groups the Post Primary Teachers Association the New Zealand Educational Institute and teachers and principals. Many schools around the country of course have already taken up this challenge. One example is the success of the Government’s Fruit in Schools programme which my colleague Pete Hodgson announced today will double in size. Reports from 80 schools that run the programme include reduced absenteeism increased attention in class healthier children and students encouraging the whole family to improve their nutrition. 
Hon Brian Donnelly 
: Will the Minister consider compensating schools through increased operational funding for the reduction of revenue they will confront from no longer selling goods either in canteens or through fund-raising activities that could be considered to be unhealthy? 
Hon STEVE MAHAREY 
: The campaign contains some money that may be helpful to schools that are in that situation. But most schools that have already gone down this track have found from their experience that they do not lose money; they just sell different goods from their tuck shops and as a result gain the same kind of revenue. 
Sue Kedgley 
: Is he concerned that despite the very innovative Fruit in Schools programme every week New Zealand’s primary and immediate schools sell around 56000 pies but just 4000 pieces of fruit; and what work is being done to help to turn these numbers round? 
Hon STEVE MAHAREY 
: Yes of course we are concerned because we want to ensure that what is sold on school-grounds is healthy. So as part as the Mission-On campaign the Government and the Green Party of course recently announced a $3 million-a-year nutrition fund to help schools and early childhood services become healthier eating environments for children. That funding was secured by the Green Party as part of its post-election agreement with the Government. It will be available from term 1 next year and supports school and student-led initiatives such as healthier choices in the school canteen shared fruit breaks for students and water-only schools. That is a good practical Green-led initiative. 
Sue Kedgley 
: Is he concerned that these excellent healthy eating messages and initiatives in schools are being undermined by some of the sponsorship activities in schools carried out by companies—for example fast-food companies giving away vouchers for hamburgers chips and pizzas as rewards for good behaviour—and would he therefore consider moves to make our schools commercial-free zones? 
Hon STEVE MAHAREY 
: Yes there are concerns about the promotion of particular foods to young people—food that may be high in salt fat or sugar. We will be working with the schools on guidelines for what should be consumed on school-grounds as well as guidelines on what can be sold on school-grounds. We hope as I mentioned before that a much healthier eating environment will come out of that. 
Election Advertising—Validating Legislation 
3.  
GERRY BROWNLEE (Deputy Leader—National) 
 to the  
Minister of Finance 
: What steps if any will the Government take to address issues raised by the Controller and Auditor-General in his report on election advertising? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I will be introducing a bill this afternoon on this matter to be taken through all stages under urgency. The Government will then seek to participate with all others in the House in the broader review of the appropriations and related issues. 
Gerry Brownlee 
: Can the Minister confirm that the validating legislation he is introducing today will not impose any legal obligation on parties to pay back taxpayers’ money spent unlawfully; and is that because some of the parties involved have no intention of paying the money back? 
Hon Dr MICHAEL CULLEN 
: Yes and I am not aware of the position of all parties on this matter. I know what the position of my party is. 
Rodney Hide 
: In light of the Government’s intention to pass legislation retrospectively validating unlawful spending by party leaders and members of Parliament has the Government given any thought to validating legislation for art fraud motorcade speeding defamation and the destruction of evidence; if not why not? 
Hon Dr MICHAEL CULLEN 
: No more than the outside contributions to MPs’ salaries. 
Gerry Brownlee 
: Why does the Minister’s bill seek to validate the unlawful spending of Mr Peters and the New Zealand First Party when Mr Peters is making it very clear that he has no intention of paying back the $160000 he owes the taxpayers of New Zealand? 
Hon Dr MICHAEL CULLEN 
: I am unaware of the truth or otherwise of that assertion. I do note that the bill validates all spending by the National Party including that for which it has not refunded the Government including for example its 2002 spending which under the Auditor-General’s rules is clearly outside the scope. [ 
Interruption 
] 
Gerry Brownlee 
: I raise a point of order Madam Speaker. Is that a parliamentary word and would its translation be a parliamentary word as well? 
Madam SPEAKER 
: It is a term. If the member wishes a translation I am sure we have an interpreter here to give it to him if he is not aware of it. 
Gerry Brownlee 
: If the Labour Party is taking such a highbrow attitude to this in saying that it will pay it back why has it not included that in the legislation? 
Hon Dr MICHAEL CULLEN 
: I have no parliamentary responsibility for that matter at all. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. The Minister has made the mistake of thinking I was asking him a question as the deputy leader of the Labour Party. I was not; I was asking him a question as Minister of Finance. He does have a responsibility for expenditure of taxpayers’ money and the question asked why he has not included the repayment or requirement for repayment in his bill. 
Hon Dr MICHAEL CULLEN 
: On a related matter whether particular people refund the expenditure is irrelevant to whether the expenditure remains unlawful. 
Gerry Brownlee 
: Why is the Minister then placing so much importance on the validating legislation to remedy a technical breach and such little importance on the actual requirement to pay the money back when it was spent from taxpayers quite unlawfully? 
Hon Dr MICHAEL CULLEN 
: There is clearly no requirement at this point. The member misses the second part. At the moment it is quite clear that unless changes occur through statute a trip like Dr Brash’s on parliamentary funding and at public expense to go and sign up a member of the National Party is outside the rules. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. Are you going to accept that answer from Dr Cullen? It would seem to contradict your own determinations in these matters quite flagrantly relating to parliamentary travel. I do not expect an answer right now but I think any consideration of the determinations that you have made about parliamentary travel as is appropriately your domain would mean that Dr Cullen’s assertion is quite wrong. 
Hon Dr MICHAEL CULLEN 
: Speaking to the point of order I say that of course the member does have a fair point if what we do is accept the legal opinion from Mr Jack Hodder so thoroughly condemned by Mr Brownlee last Thursday. If however we accept a legal opinion from the former Solicitor-General and the Auditor-General’s opinion based on that then clearly flying on taxpayers’ expense to sign up a National Party member and for apparently no other reason is clearly outside the rules. It is called electioneering. 
Madam SPEAKER 
: Ruling on the point of order I say that this is a matter for the Minister responsible for Vote Parliamentary Service. It is a matter that should appropriately be raised tomorrow at the Parliamentary Service Commission. 
Gerry Brownlee 
: Can the Minister confirm that the tests set out in sections 72A to 72D of the validation legislation as presented would make the pledge card legal and effectively overturns the Auditor-General’s concerns? 
Hon Dr MICHAEL CULLEN 
: That would be the case but the member should also note that section 7 lapses at the end of 2007. That was deliberately chosen to allow full review of the rules before election year. 
Rates—Independent Inquiry 
4.  
RODNEY HIDE (Leader—ACT) 
 to the  
Minister of Local Government 
: What progress has been made on establishing the “independent inquiry into issues around local government rates funding” that he announced on 23 August 2006? 
Hon MARK BURTON (Minister of Local Government) 
: 
 Good progress has been made. Consultation has been undertaken with a range of interested parties and I have taken time to give careful consideration to the suggestions of other stakeholders and interested individuals such as the member who asks this question. I anticipate announcing the terms of reference shortly. 
Rodney Hide 
: Is the expectation of ratepayers of rates relief from the Government a bit like the expectation that taxpayers have of the Labour Party ever paying back the money it owes—that it really is on the never-never and it is not going to happen? 
Hon MARK BURTON 
: I can only say to the member that I anticipate the suit size I have shed in pursuit of a robust inquiry will ultimately bear more tangible benefit to the public of New Zealand than his extended forays on to the dance floor which caused 12 weeks of parliamentary delay of his supposedly important parliamentary rates capping bill. 
Mark Blumsky 
: Does the Minister agree with the Local Government Forum when it says: “It is particularly unfair that the Crown makes no contribution for its land especially as local authority infrastructure can be put under severe pressure by the visitors who are attracted to national parks and other reserves.”; and will the inquiry address this burden on those who pay rates? 
Hon MARK BURTON 
: When the inquiry looks at the burden of rates I am sure it will also be taking into account the fact that central government contributes 13 percent of the finances of local government—the highest it has ever been. 
Hon Brian Donnelly 
: Has the Minister met with every party that has requested a meeting over the proposed terms of reference for the inquiry; if so has he met with ACT? 
Hon MARK BURTON 
: I can confirm that I have had meetings with any party that has sought a meeting; I can equally confirm that I have had no such meeting with ACT members—they did not ask for one. I received a letter from Mr Hide and I replied to it. 
Ingram Report—Prime Minister's Statement 
5.  
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
 to the  
Prime Minister 
: Does she stand by her statement to the House on 16 May 2006 with respect to the Ingram inquiry that: “Inquiries must always take the time required to get to the root of the matter.”? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Yes. 
Dr the Hon Lockwood Smith 
: How well did the Ingram inquiry get to the root of the matter when Noel Ingram “found no evidence to support an allegation that Mr Siriwan or Ms Phanngarm were promised work in New Zealand.” yet Mr Siriwan has sworn an affidavit claiming that Taito Phillip Field promised him that if he went to work for Mr Field in Samoa he would be issued with a work permit for New Zealand? 
Rt Hon HELEN CLARK 
: Evidence of course is more than allegation and I understand that the inquiry did speak to Mr Siriwan. 
Dr the Hon Lockwood Smith 
: How effectively did the Ingram report get to the root of the matter when Noel Ingram reported that: “Mr Field was unable to recall precisely when he did discover that Mr Siriwan was working on the house.” and when Mr Siriwan has sworn an affidavit saying that he did a deal with Taito Phillip Field to go to Samoa in March to work on Mr Field’s house in return for Mr Field obtaining a work permit for Siriwan here in New Zealand? 
Rt Hon HELEN CLARK 
: There are clearly conflicting statements that the police will need to address in their investigation. 
Dr the Hon Lockwood Smith 
: How effectively did the Ingram report get to the root of the matter when Noel Ingram concluded: “The evidence does not support a finding that Mr Field knew that Mr Siriwan was working on Mr Field’s house …” when he met with the Associate Minister Damien O’Connor on 17 May 2005 yet Sunan Siriwan has sworn an affidavit confirming that he did a deal with Taito Phillip Field to go to Samoa in March to work on Mr Field’s house in return for Mr Field obtaining a work permit for Siriwan here in New Zealand? 
Rt Hon HELEN CLARK 
: There are clearly conflicting statements that the police will need to address in their investigation 
Dr the Hon Lockwood Smith 
: How effectively did the Ingram report get to the root of the matter when Noel Ingram concluded: “I found no evidence that Mr Siriwan was influenced in his behaviour by the fact that Mr Field was a Minister.” and when Mr Siriwan has now stated publicly that he went to Samoa “because Taito Phillip Fields—he’s a Minister. He promised me to come to work on his house and then he will give me the visa to return to New Zealand.”? 
Rt Hon HELEN CLARK 
: I repeat that Mr Siriwan had the opportunity to speak to the inquiry and did not make those allegations then. 
Dr the Hon Lockwood Smith 
: How well did the Ingram inquiry get to the root of the matter where the conflict existed or appeared to exist between Mr Field’s private interests and the use of his influence as a Minister when Sunan Siriwan has now sworn an affidavit alleging he was told what to say to the Ingram inquiry and was under duress to say what he was coached to say? 
Rt Hon HELEN CLARK 
: That affidavit of course has been referred to the police who are making investigations. 
Gangs—Numbers 
6.  
RON MARK (NZ First) 
 to the  
Minister of Police 
: How many gangs are known by police to exist in New Zealand and what is the estimated number of affiliated members for each of these gangs? 
Hon PHIL GOFF (Minister of Defence) 
 on behalf of the 
 Minister of Police 
: The Minister of Police is advised that a survey of organised crime in 2004 identified 69 gangs with 32 of them being motorcycle gangs. The police have also advised that it is not possible with the ever-changing face of gangs to estimate the number of affiliates. 
Ron Mark 
: How many gang affiliates were apprehended in the last financial year and how does that figure compare with the number apprehended in previous years? 
Hon PHIL GOFF 
: To the best of my knowledge gang affiliation is not recorded against the names of convicted offenders. However the member will know that there is a high correlation between gang membership and criminal offending. He will also know that our jails are full of offenders who are affiliated to gangs. 
Martin Gallagher 
: How is the Government addressing the youth gang situation in South Auckland? 
Hon PHIL GOFF 
: There are a number of different types of gangs obviously and the youth gang problem is different in nature from the problem of gangs that are involved in organised crime. But it is a serious problem in South Auckland and in Otahuhu. An action plan was launched last month in Counties-Manukau and Otahuhu. That plan has the police working with non-governmental agencies local bodies and communities. It involves the setting up of youth action teams. It involves proactivity on the part of the police in dispersing large gatherings where violence is threatening. It involves the employment of youth workers responsible for juveniles who have been picked up by the police. It involves the vigorous policing of liquor bans and a series of other intervention and prevention measures run across a number of different Government agencies. 
Ron Mark 
: How many of the gang affiliates apprehended in the last financial year were charged under section 98A of the Crimes Act under which participation in a criminal gang is punishable by up to 5 years in prison; and how does that number compare with the number charged each year since the passage of the Transnational Organised Crime Bill passed by a Labour Government in 2002? 
Hon PHIL GOFF 
: Section 98A does make participation in an organised criminal gang a criminal offence with the police being required to prove that the individual knows that his or her participation contributes to the occurrence of criminal activity. My understanding is that that section was used on a dozen occasions in 2004-05 and 18 times last year. The reason the police do not use that provision more often—among other reasons—is that if it is possible to charge the gang member with a violent sexual or drug offence they will use that provision because it carries a higher maximum sentence. 
Taxation—Thresholds 
7.  
JOHN KEY (National—Helensville) 
 to the  
Minister of Finance 
: Will the indexation of income tax thresholds go ahead in 2008 as promised in the 2005 Budget; if not why not? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Any changes to tax thresholds will be considered in light of the final decisions around the business tax review. 
John Key 
: Does he agree with the comments made by Peter Dunne the Minister of Revenue yesterday when he said: “The business tax reduction proposals I announced with Michael Cullen in the Business Tax Review in July will go ahead from April 2008 and they will be accompanied by personal tax adjustments as well …”—not just “might” but “will”—if not why not? 
Hon Dr MICHAEL CULLEN 
: I am sure there will be some business tax changes. As to whether all the ones in the business tax review will proceed I would be rather doubtful. As I said implications for income tax thresholds and other matters will be considered in the light of the outcome of that and of course the fiscal situation at the time. 
Charles Chauvel 
: Has he seen any reports from the export sector on the importance of getting decisions around tax policy right? 
Hon Members 
: Ohh! 
Hon Dr MICHAEL CULLEN 
: They have woken up at last; it has taken a long time today. I have seen a number of reports including one from the chairman of Fonterra highlighting the need to ensure that undue pressure is not placed on the export sector. Certainly excessive fiscal loosening which pushes up the pressure on interest rates and the exchange rate will not help the export sector in current circumstances. 
John Key 
: Does he agree with Peter Dunne that not only will tax cuts proceed on the back of very large surpluses but they will be the largest tax cuts since 1996; in which case would he be so kind as to tell the House just how large those tax cuts in 2008 will be? 
Hon Dr MICHAEL CULLEN 
: It is not the purpose of my life to be kind to that member. 
John Key 
: Is the reason the Minister protested so loudly and stomped his feet up and down last week about tax cuts not because the tax cuts are not affordable—because the leader of New Zealand First Winston Peters knows they are affordable; the Minister of Revenue Peter Dunne knows they are affordable; and his own Prime Minister has been out telling people they will be taking place in 2008—but because when one is at the end of one’s political career one likes to defend what one has done or in his case not done rather than what a Minister of Revenue and future Minister of Finance may do in 2008? 
Hon Dr MICHAEL CULLEN 
: One of the important differences between that member and me is that I am happy in my job and want to continue in it. 
John Key 
: Can the Minister of Finance therefore confirm that he is the only person who is happy he is in his job—because no one else in New Zealand is? 
Hon Dr MICHAEL CULLEN 
: Unfortunately I cannot confirm that. Indeed more recent opinion polls seem to show growing approval of the Government’s economic performance. But I do note that just at the point where it looks a little more likely there may be some taxation changes a number of commentators are starting to warn against them. That is precisely what one would expect would happen. 
John Key 
: Did the Minister meet with Moody’s rating agency yesterday and did he ask it about the impacts of a modest tax cut on New Zealand’s rating? 
Hon Dr MICHAEL CULLEN 
: Not particularly in terms of the meeting. Moody’s— 
Madam SPEAKER 
: Other members in the House would like to hear the Minister’s answer. 
Hon Dr MICHAEL CULLEN 
: The member might know that when rating agencies call they largely ask the questions and I supply the answers. What the agency wanted assurance about was that there would be no sudden lurching around in the Government’s fiscal policy and I was able to give it that assurance. 
John Key 
: When the Government rolls out tax cuts in its 2008 manifesto in the miraculous way that it found the cash to extend Working for Families and to offer zero percent student loans who does he think should actually take credit for that: the New Zealand First leader Winston Peters; the United Future leader Peter Dunne; or the Prime Minister who is out there telling people that tax cuts will take place in 2008? 
Hon Dr MICHAEL CULLEN 
: There is one thing I am very sure about: if there are very large tax cuts everybody will try to take credit for them; if there are not I will take the sole credit I am sure. 
John Key 
: Who does he think will actually announce the tax cuts to be announced in 2008 as part of the Government’s election manifesto: Phil Goff Trevor Mallard or any of the other pretenders to his job? 
Hon Dr MICHAEL CULLEN 
: The only young pretender I know in the House is opposite me and he looks really silly in a kilt. 
Defence Force—Progress 
8.  
JILL PETTIS (Labour) 
 to the  
Minister of Defence 
: What further progress is he anticipating in strengthening and rebuilding the New Zealand Defence Force? 
Hon PHIL GOFF (Minister of Defence) 
: 
 The 2006 long-term development plan update was released today and records major progress in rebuilding the New Zealand Defence Force after National halved expenditure on defence as a percentage of GDP in the 1990s. The plan lists 13 major projects that have been approved by Government and are now in the acquisition phase five projects that have been approved in principle by Government and 12 in the capability development phase. Seven new projects have been added to the plan including infrastructure projects at Devonport and Ohakea major upgrades for the Anzac frigates replacement of pilot training aircraft and the possible acquisition of a new satellite communications system. 
Jill Pettis 
: Have final decisions been taken on the purchase of light utility training helicopters to go into service alongside the NH90s? 
Hon PHIL GOFF 
: Final decisions have been made by Cabinet to purchase six light utility training helicopters to replace the Sioux helicopters. They will have capabilities far in excess of the existing aircraft. They are expected to cost up to $110 million and will be a major asset complementing the decision and the contract signed to buy eight NH90 medium utility helicopters. 
Question No. 6 to Minister 
RON MARK (NZ First) 
: 
 I raise a point of order Madam Speaker. The Minister of Police has given an answer to one of my questions which I think he needs to reflect on and to possibly make an adjustment to. 
Madam SPEAKER 
: Would the member please be seated. Points of order are heard in silence. That is the last warning. Would Mr Mark please be succinct in his point of order. 
RON MARK 
: I seek leave of the House to table answer to written question No. 286 from the Minister of Police which states: “Statistics on gang affiliations are recorded by the police.” 
Document by leave laid on the Table of the House. 
Workforce Taskforce (Health)—Terms of Reference 
9.  
Hon TONY RYALL (National—Bay of Plenty) 
 to the  
Minister of Health 
: What are the terms of reference for the new health Workforce Taskforce and when were these advised to the task force? 
Hon PETE HODGSON (Minister of Health) 
: 
 The terms of reference are concerned with ways to streamline medical education and training. They were first advised to task force members before they accepted appointment. 
Hon Tony Ryall 
: Has the Minister seen reports that the junior doctor shortage has reached crisis levels with one in four junior doctor positions vacant at Middlemore Hospital one in eight vacant in Waitemata and at least 30 junior doctor vacancies in Christchurch; and how bad are the junior doctor vacancies at other district health boards and nationally? 
Hon PETE HODGSON 
: Yes and I have seen quite a range of reports refuting those assertions. 
Maryan Street 
: What reports has the Minister received on support for the workforce task force? 
Hon PETE HODGSON 
: The task force will be or has already been in discussions with the New Zealand Medical Association the Association of Salaried Medical Specialists the Medical Council of New Zealand the aforementioned Resident Doctors Association the Clinical Training Agency and so on. The support for the task force from the medical community unfortunately has not been echoed by Tony Ryall and the National Party. Mr Ryall called the task force members who include some of New Zealand’s most respected clinical leaders a bunch of do-nothing bureaucrats. That is unfortunate. 
Barbara Stewart 
: Can the Minister assure us that the transformation of the Health Workforce Advisory Committee into an action committee with a new name will result in the promised major changes in the way we train our doctors; and when will these changes be implemented? 
Hon PETE HODGSON 
: Yes I can. Indeed the task force is charged with taking a range of options already presented to the Government by earlier studies and turning them into a concrete way forward for the Government. I am confident that it will deliver just that. 
Hon Tony Ryall 
: Does the Minister really deny that there is a crisis in the junior doctor workforce that district health boards are being forced to employ locum junior doctors sometimes at twice the rate they would pay for a full-time junior doctor and that the latest data show that the cost of locums in public hospitals has rocketed up by 62 percent in Waitemata by 67 percent in the Hutt Valley by over 40 percent in the Bay of Plenty and has more than doubled in the capital in the last 12 months alone; or will we see in the next few weeks another U-turn from this Minister as we did on the general practitioner shortage the elective services crisis and the promise that Labour would not pay back the pledge card money? 
Hon PETE HODGSON 
: There have not been any U-turns on general practitioner training or indeed on elective surgery. There have been no U-turns. The member just needs to pay a bit more attention to his job a little more attention to his portfolio and to try to get some health policy out some time. In respect of the number of New Zealand graduates who apply for jobs in our hospitals all I can quote is the district health boards’ lead negotiator in the junior doctors’ negotiations who said there had been no change in the number of New Zealand graduates applying for jobs in our hospitals. The figures have not been finalised yet although reports suggest that only six doctors out of a graduating class of nearly 300 are looking for work other than in New Zealand. 
Hon Tony Ryall 
: Is he sure that it is the Government’s tactic to deny any crisis in the junior doctor workforce despite the number of applications for junior doctor positions being at a new low and the fact that we are rapidly losing many of our junior doctors to Australia—or is this like the Labour pledge card tactic where it was reported in the country’s largest newspaper that party strategist Pete Hodgson had been made to look an idiot by going on television at his leader’s behest to steadfastly maintain Labour would not pay back the overspending and when he did front up the hapless Hodgson had to admit that he had not been briefed on all the tactics by the Beehive’s ninth floor? A great strategist! 
Hon PETE HODGSON 
: Just a couple of points in respect of that roundabout question on the workforce of New Zealand’s health system. Firstly I myself do not know how many junior doctors are leaving New Zealand and going to Australia. I am advised that the number is six out of 300. Secondly in respect of the pledge card one thing that I think is worth pointing out is that this Government has put out a pledge card before every election has been elected on each occasion and on each occasion has kept every one of its pledges—and it will continue to do so proudly. 
Tariana Turia 
: Tena koe Madam Speaker tena koutou katoa. What work is being undertaken to implement the broad overarching goal in  
He Korowai Oranga 
 to increase the number and improve the skills of the Maori health and disability workforce at all levels? 
Hon PETE HODGSON 
: I suspect the member is already aware of a Maori health workforce action plan that of course has been taken around the country by my colleague Mita Ririnui and others over recent months and has received wide acclaim. 
Hon Tony Ryall 
: When New Zealand most needs to recruit and retain junior doctors in order to stem the outflow to Australia and the increasing number of vacancies in our public hospitals why is there an increasingly acrimonious negotiating relationship in the health sector; and whatever his answer may be why should we accept it when the last time he took a firm position the Prime Minister hung him out to dry saying his promise not to pay back the money was wrong and he was operating outside instructions—basically that he made it up? 
Hon PETE HODGSON 
: In respect of the last part of the question I suspect it was because she thought I was not dry enough already. In respect of the first part of the question this Government does not say that New Zealand has enough doctors. We have never said that New Zealand has enough doctors. This Government has increased training for New Zealand doctors. My colleague Annette King increased the number in 2004—the first time any Government had increased the number of doctors in training for about 20 years including the 9 years when that member was a lacklustre unimportant part of a National Government. 
Tariana Turia 
: Given the Minister’s response to my earlier question when he said that Mita Ririnui has been going around the country on the issue that I had asked him about can he tell me whether Mita Ririnui has advised him that 50 percent of Maori midwives have left the health workforce in the last 2 years; and what actions will the Government be taking to respond to that calamity? 
Hon PETE HODGSON 
: No he has not. Indeed if the member’s assertion is accurate it is certainly a cause for concern. She may wish to approach me. 
Dr Jonathan Coleman 
: How can the House have confidence in any answer this Minister gives when he appeared on television saying that Labour would not be paying any money back and the Prime Minister then said that Mr Hodgson was not under any instruction or encouragement to make that statement and that statement was wrong; and is being publicly hung out to dry by the Prime Minister not a sign that confidence in this hapless Minister continues to erode right from the back benches all the way to the front? 
Hon PETE HODGSON 
: Struggling though I am to find any link between this issue and the health workforce issues facing New Zealand I say it is my—[ 
Interruption 
] 
Madam SPEAKER 
: I must say that question was wide of the original question but I had asked the Minister to respond—and I would also ask members to refrain from barracking again so that the rest of us can hear the answer. 
Hon PETE HODGSON 
: The answer to the question is that the statement was made on radio not television—and that was only the first thing that the member got wrong in framing his question. 
Question Time 
RON MARK (NZ First) 
: 
 I raise a point of order Madam Speaker. On 10 October in question time a point of order was raised by Nandor Tanczos one of the politest MPs in this House and that point of order was preceded with a comment from yourself to him—a pre-emptive warning—that said: “This had better be a point of order.” Straight after that point of order a point of order was raised by Gerry Brownlee that was anything but a point of order for which you gave no admonishment. Now just prior to this question I sought to raise a point of order. I had barely started when I had an interruption which you dealt with—and I thank you for that. You then cautioned me that I should be succinct. Madam Speaker if you were to go back and play through the television footage of question time on those three particular instances—and a dozen since then from Gerry Brownlee in particular and the National Party in general—I put it to you that it might be seen that the minor parties have been treated by you in some way differently from the major parties. I ask you to contemplate that and to give that some thought in the actions you take from hereon in. 
Madam SPEAKER 
: I thank the member. That is not a point of order. 
House Prices—Treasury Investigation 
10.  
GORDON COPELAND (United Future) 
 to the  
Minister of Finance 
: Is work being carried out by the Treasury on a possible link between continuing high house prices artificial constraints in the supply of land and the price of housing; if so what is the current status of that work? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Treasury obviously is involved in a wide range of work on housing but it is not currently working on the specific matter raised by the member. 
Gordon Copeland 
: Does the Minister agree that raising the official cash rate has done little if anything to dampen the property market and is it possible that the variable most responsible for continuing high house prices may be the restraints placed on the supply of land for new housing? 
Hon Dr MICHAEL CULLEN 
: No I do not agree with the latter point. I think one of the problems is that with the high proportion of fixed-rate mortgages it sometimes takes quite a long time for monetary policy tightening to flow through into household incomes and disposable incomes. There are signs that it has been occurring in recent months. I think the problem with the member’s assertion is that presumably it would lead to the logic that one should have a variable land supply as a means of moderating demand and supply within the economy which I think could be pretty difficult to work in practice. 
R Doug Woolerton 
: Is the Minister concerned about the potential loss of valuable highly productive land if constraints were to be removed from city housing expansion? 
Hon Dr MICHAEL CULLEN 
: The member raises actually a very important and interesting point—that it is all very well to look at the housing issue from one specific side but there are a whole range of other issues around land use that also have to be considered. One of those is the maintenance of land in a productive capacity in the rural sector and at a reasonable enough price for the productive sector to be able to make a profit out of that land. 
Sue Bradford 
: Is work being carried out by Treasury on a possible link between the way property investors can claim tax losses against their investment and against their income tax and rising housing unaffordability; if not is the Government considering making any changes in this area? 
Hon Dr MICHAEL CULLEN 
: On many occasions these issues have been looked at by Treasury and obviously suggestions come forward from the general public. I think the conclusion that tends to emerge at the end of the day is that it does not seem to make a lot of difference. Countries like Australia which have heavy stamp duties on housing and which have a quite different kind of capital gains tax regime have at least as marked housing cycles as New Zealand does so it does not seem to be a particular answer to the actual problem in that respect. 
Gordon Copeland 
: In the light of that response is the Minister aware that in Australia the Federal Government is now giving a lot of attention to the freeing up of land for housing does he see a role for Treasury in making housing more affordable for first-time homeowners and would that include a rigorous economic analysis of any link between rising house prices and the availability of land for new subdivisions? 
Hon Dr MICHAEL CULLEN 
: The Government is already taking a number of actions that over time will assist in the affordability of housing for first home owners which obviously is where the key concern should be. After all once one is into the first home then rising house prices is an entry on both sides of the ledger from the point of view of most families depending on which part of the country they are living in. But again—going back to the previous answer—it is important to be careful in this respect. The Australians do have of course a lot more land to free up but they are also running into enormous problems around water supplies not least because of urban demands. 
Sue Bradford 
: Is any work being carried out by Treasury on a possible link between the lack of a capital gains tax and continuing high house prices here; and does the Minister accept that a capital gains tax on property sales apart from the family home could help to make housing more affordable again? 
Hon Dr MICHAEL CULLEN 
: I think it is extremely hard to make that connection between a capital gains tax and the affordability of housing in so far as there has never been a theoretical argument put forward about a capital gains tax on housing. It is more in the direction of a level playing field around investment; it is not around the notion that it will make houses cheaper. Indeed it is very hard to see how it would necessarily make houses cheaper. 
Keith Locke 
: What concerns does the Minister have about extending the urban limit in addition to the matter raised by Doug Woolerton—such as the cost to New Zealand in extra Kyoto Protocol carbon credits from allowing urban sprawl to continue largely unchanged in places like Auckland and the fact that it makes it more difficult to establish a viable public transport system to replace some of the longer car journeys from the suburbs? 
Hon Dr MICHAEL CULLEN 
: Again I think that is a very good point. Obviously unlimited urban sprawl simply raises the difficulties around providing adequate public transport which is already a major issue in terms of public transport in Auckland because of the very large amount of urban sprawl and the distances to be covered in relation to the size of the population. We are very different from say compact-style European cities. So there are a lot of factors that need to be taken into account. It would be very undesirable to seek short-term solutions for a particular point in the housing cycle which would have long-term damaging consequences from the point of view of New Zealand’s social economic and environmental development. 
Te Ururoa Flavell 
: What advice has Treasury provided to respond to the damning finding in the  
Social Report 2006 
 that the proportion of low-income households who are spending more than 30 percent of their incomes on housing is over twice as high as it was in 1988 and that of those Maori are highly overrepresented? 
Hon Dr MICHAEL CULLEN 
: It underlines the importance of policies such as the Working for Families package other means to assist with housing acquisition the rates rebate scheme and a whole range of measures targeted to try to ensure that people on low to modest incomes are able to be in a better position to afford housing. Of course as we move to the next stage of the economic cycle and monetary policy eases back again at some point in the future that housing affordability index will show again quite a significant change. It is a very cyclical measure of what is happening in society. 
Corrections Department—Confidence 
11.  
SIMON POWER (National—Rangitikei) 
 to the  
Minister of Corrections 
: Does he have confidence in his department; if so why? 
Hon DAMIEN O'CONNOR (Minister of Corrections) 
: 
 Yes but there is always room for improvement. 
Simon Power 
: How can the Minister be confident in his department when the indicative cost for Spring Hill prison was not known until June this year 20 months after earthworks began and the indicative cost for Otago prison also known as the “Milton Hilton” was known only in May 17 months after physical work began; and did Cabinet know that the estimates it was being given every time the Minister asked it for more money were not even based on agreed costs? 
Hon DAMIEN O'CONNOR 
: All of these issues have been thoroughly canvassed by the State Services Commission. Treasury is also inquiring into the processes that effectively managed one of the largest building projects in this country. Those four new prisons have been and will be completed on time. I think that is a major achievement. 
Simon Power 
: Can the Minister confirm that the State Services Commission report states that the indicative target out-turn costs should have been calculated before construction began because the delay meant that contractors were paid based on costs they claimed without any assurance that those costs were reasonable and with no incentives to save money; and how can the public be certain that contractors were not creaming it at taxpayers’ expense during that hiatus? 
Hon DAMIEN O'CONNOR 
: The inquiry by the State Services Commission uncovered no extortion by any contractors. The report did state that without the collaborative working arrangement management system it was unlikely that these projects would have been completed on time. They have been and will be completed on time and that is a major achievement. 
Simon Power 
: How can he be confident in his department when a report by Opus International Consultants done for Treasury stated that it could not find any clear rationale for the decision to adopt collaborative working arrangement contracts for the construction of new prisons that it was “untested in New Zealand” and “a significant departure from the previously agreed and well-tested methodology”? 
Hon DAMIEN O'CONNOR 
: This was effectively one of the largest construction projects undertaken by the Government in this country. The collaborative working arrangement was a new management regime. Internationally there are many other variations of that regime to manage such large projects. The State Services Commission and Treasury I am sure as identified have said this was an appropriate method of management. 
Simon Power 
: Can the Minister confirm that even before the collaborative working arrangement for the earthworks at Spring Hill could be signed off the cost estimates were already $9 million over budget which led a Treasury official to state in an email: “I can’t see how Corrections can enter into a contract that knowingly exceeds the amount Cabinet has specifically allocated for Spring Hill.”? 
Hon DAMIEN O'CONNOR 
: I am sure that email from a Treasury official will be part of the investigations. I await the report from Treasury. The report from the State Services Commission stated the collaborative working arrangement was appropriate for a project of that size. 
Simon Power 
: Can the Minister confirm the finding of the State Services Commission that there is no recorded decision by the project steering group to adopt the collaborative working arrangement methodology which was “heavily dependent” on the advice of the project director John Hamilton and the New Zealand expert on collaborative working arrangements Stewart Rix—who according to answers to my written questions has benefited by $1.3 million plus expenses to date—because the Department of Corrections had “very little knowledge and understanding of collective working arrangements”; and how can he maintain that this methodology has not lost the taxpayer hundreds of millions of dollars in budget blowouts? 
Hon DAMIEN O'CONNOR 
: I ask the member to read and quote the full report in this House. That report did not expose any major problems. It did however identify that at early stages of the project there were shortcomings and changes were made. I am confident that the completion of these projects on time will be acknowledged as a major achievement for the Government and the corrections system. 
Rates Rebate Scheme—Response 
12.  
STEVE CHADWICK (Labour—Rotorua) 
 to the  
Minister of Local Government 
: Has he received any reports on the response to the Government’s newly expanded rates rebate scheme? 
Hon MARK BURTON (Minister of Local Government) 
: 
 Yes despite the opposition of National and ACT to the rates rebate amendments to extend coverage earlier this year rates rebates totalling over $26.9 million have been approved for some 59560 New Zealand households in just the first few weeks of the 2006-07 year. 
Steve Chadwick 
: How does this compare with the level of rebates for 2005-06? 
Hon MARK BURTON 
: This compares with the 4200 households that received a rebate for the whole of the 2005-06 year. In other words there has been a fourteenfold increase in households receiving rebates and an almost fortyfold increase in the total value of rebates provided in just the first few weeks of the 2006-07 rating year. 
Urgent Debates Declined 
Election Advertising—Auditor-General’s Report and Speaker’s Response 
Madam SPEAKER 
: I have received a letter from Rodney Hide seeking to debate under Standing Order 380 the Auditor-General’s report on advertising expenditure and the Speaker’s response to the report. I have also received a similar application from Dr Don Brash. Standing Order 380 requires that the matter for debate be a particular case of recent occurrence and involve the administrative and ministerial responsibilities of the Government. This is a particular case of recent occurrence; this is the first day upon which it could be considered. However as I pointed out to members in my ruling on Thursday it does not involve the administrative or ministerial responsibility of the Government. It is clear that ministerial responsibility lies with the Minister responsible for Vote Parliamentary Service and administrative responsibility lies with the Parliamentary Service. The Government’s intention to introduce validating legislation does not alter this. 
I understand that the Government intends to introduce a bill today under urgency which seeks to validate the parliamentary expenditure in question. This will provide the House with ample opportunity to canvass the issues raised in the reports. Both applications are therefore declined. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. On what basis are you declining the applications? Firstly if you are making the case that Parliament is about to enter into a debate you cannot possibly know that that is the case. That most certainly should not have affected your decision. 
Secondly although you are saying this is a matter that is to do with the Minister responsible for these matters it is also a matter very much at the heart of concern for all parliamentarians. Although the way you have ruled is interesting Parliament itself has not had an opportunity to express a view on the Auditor-General’s report. What we have instead apparently is the Parliamentary Service telling us that it is now working for the Government and that it has been party to the drafting of this legislation. Effectively it is making itself a servant of the Government and is showing you—and therefore this House—a high degree of disrespect. 
Thirdly this debate today is on a very narrow issue relating to a whole spectrum of things. It deals only with the validation of appropriations and barely touches on anything else. In any event how can you rule that Parliament itself cannot express a view on this and how fair is it that the whole organisation of this place including your offices have been in cahoots with the Government to effect exactly this result? 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I will take up a number of points. First of all Madam Speaker obviously your decision on such a matter is final and in itself is not open to debate. Secondly on the point of view of foreknowledge by yourself of the Government’s intentions I say that my answer in the House to a question asked by the member was that the Government was going to introduce legislation under urgency as soon as possible. But I have no difficulty in stating that in response to your report to the House which recommended validation I wrote to you yesterday consequent upon Cabinet decisions that it was the Government’s intention to introduce a bill under urgency today to be passed through all stages. There is nothing improper at all in the Leader of the House communicating that information to the Speaker when the Speaker has recommended to the House that action be taken. 
The third point of course is that the primary reason why you have turned down the application is that the responsibility lies with the Parliamentary Service Commission not with a Government Minister. Therefore it fails to meet the actual test of responsibility. 
Madam SPEAKER 
: I will rule on the point of order. I have heard extensive comment on it. I ruled in accordance with Standing Order 380 that there is no ministerial responsibility. I also note that Dr Brash in fact included in his application an indication by way of a ministerial press release that the Government intends to introduce legislation. I would therefore ask the member to withdraw and apologise for his implication that something improper was done by the Speaker. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I withdraw and apologise. I raise a point of order Madam Speaker. This House took time to discuss as we have said before the issue of September 11—the planes flying into the World Trade Center. There was no ministerial responsibility for that. We could go through any number of other debates where the House has set aside time for a discussion about matters for which there is no ministerial responsibility. 
My point here is that you appear to be saying to the House that you have heard that the Government is going to fix it so members do not need to have a view on it. That is unfair. 
Madam SPEAKER 
: No Mr Brownlee. Of course any member can seek leave for the matter to be debated. That is the way in which matters are raised. Of course I am not indicating that that course of action could not be taken. It is the job of the Speaker to rule in terms of the Standing Orders and in this instance the Standing Order is clear. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 I raise a point of order Madam Speaker. I seek some elaboration of your ruling and you may wish to do this by way of a subsequent statement to the House. I thought you helpfully gave an indication to the House on Thursday as to your thinking on the question of ministerial responsibility. The Leader of the Opposition subsequently responded with a further letter to bolster his application for a snap debate in which he pointed out that the Minister of Finance had taken over some responsibility for the matter raised by the Auditor-General that he had made an announcement about his intention to legislate and that indeed the matters pertaining to the Public Finance Act then came into play which clearly of course do fall within the administrative responsibility of the Government. 
So while I can understand your reasoning so far as it went prior to the Minister of Finance taking the initiative and responding to the Auditor-General’s report I have some difficulty understanding how the actions of the Minister of Finance could still leave this matter outside the criteria for a snap debate. Without in any way challenging your ruling on this particular occasion I think it would help the House in the future in dealing with these matters if we could understand the reasoning by which we came to this process. 
Madam SPEAKER 
: I thank the member. As I pointed out in my ruling the administrative responsibility is with the Parliamentary Service Commission. If a member wishes to debate this matter all a member has to do is to seek leave to do so. [ 
Interruption 
] I have given my ruling Mr McCully. I have done you the courtesy of explaining the basis of the ruling again. I will enter into no further discussion on it. And the member should be seated while I am standing. I have given my ruling. I have explained the basis of the ruling. As far as I am concerned it is the end of the matter. 
RODNEY HIDE (Leader—ACT) 
: 
 I seek the leave of the House to debate the Auditor-General’s report and the Speaker’s response. 
Madam SPEAKER 
: Leave is sought. Is there any objection? There is objection. 
Urgency 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I move  
That urgency be accorded the introduction and passing of the Appropriation (Parliamentary Expenditure Validation) Bill 
. 
This motion is moved in order that the House may address as quickly as possible the uncertainty around the legal status of past and current appropriations and it will also give the chance for the House to debate the Auditor-General’s report. 
A party vote was called for on the question  
That urgency be accorded 
. 
Ayes 61 
New Zealand Labour 50; New Zealand First 7; United Future 3; Progressive 1. 
Noes 54 
New Zealand National 48; Maori Party 4; ACT New Zealand 2. 
Abstentions 6 
Green Party 6. 
Motion agreed to. 
presentation of report 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I hereby present a report on unappropriated expenditure on Vote Parliamentary Service for the period from 1 July 1989 until the day on which the Appropriation (Parliamentary Expenditure Validation) Bill comes into force. I move  
That that paper be published. 
A party vote was called for on the question  
That the motion be agreed to. 
Ayes 61 
New Zealand Labour 50; New Zealand First 7; United Future 3; Progressive 1. 
Noes 54 
New Zealand National 48; Maori Party 4; ACT New Zealand 2. 
Abstentions 6 
Green Party 6. 
Motion agreed to. 
Appropriation (Parliamentary Expenditure Validation) Bill 
First Reading 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I move  
That the Appropriation (Parliamentary Expenditure Validation) Bill be now read a first time. 
Dr Richard Worth 
: I raise a point of order Madam Speaker. Would it not be appropriate for us to see this bill? 
Madam SPEAKER 
: That is not a point of order. [ 
Interruption 
] The bill is on the Table. 
Hon Dr MICHAEL CULLEN 
: Speaking to the point of order I say that a copy of this bill was made available to National Party members this morning before their caucus. 
Gerry Brownlee 
: The bill was delivered to us halfway through our caucus this morning. One copy was given to me and another copy was given to Dr Brash. There are only two copies on this side of the Table and they were brought into the House just as Dr Cullen was about to speak. This debate should not progress until there are sufficient copies on the Table for every member to have an opportunity to read it. 
Madam SPEAKER 
: I understand that copies of the bill are available for members on the Table. 
Gerry Brownlee 
: I seek leave for the House to adjourn for 20 minutes while the bill is distributed. 
Madam SPEAKER 
: Leave is sought. Is there any objection? Yes there is. [ 
Interruption 
] Members please we will preserve a little bit of respect and decorum. 
Hon Dr MICHAEL CULLEN 
: Of course when bills are moved for introduction and passing under urgency they are tabled subsequent to the motion being approved. 
This bill does two things. Firstly it validates expenditure from 1989 to the present day and secondly it provides interim funding definitions to enable the Parliamentary Service to function until the end of 2007 when clause 7 of this bill lapses. The first part of the bill the validation is unspecific— 
Hon Brian Donnelly 
: I raise a point of order Madam Speaker. Given that some sensitivity has been expressed by National Party members about being able to see the bill some of us in this part of the House would like to actually hear what Dr Cullen has to say. It has become quite clear that the official Opposition is not going to allow that opportunity at all. I ask that you ensure we do not have a continuation of the barracking that has just started. [ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am ruling on the point of order Dr Smith. About five members on the National Party side of the House spoke during the member’s point of order. This is a final warning to those members. Mr Donnelly makes a perfectly valid point. We cannot hear. It is very hard for the parties on the cross benches to hear. I ask the member to show all members some respect. 
Hon Dr MICHAEL CULLEN 
: Madam Speaker—[ 
Interruption 
] I raise a point of order Madam Speaker. I have never done this in my career before but I have the right: I ask to be heard in silence. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has asked to be heard in silence and he will be heard in silence. I warn members that the member will be heard in silence. Members have had their warning. 
Hon Dr MICHAEL CULLEN 
: The validation is for expenditure under Vote Parliamentary Service that may have been outside the scope or purpose of an appropriation or other enactment. It is framed as generally and vaguely as that because the import of the Solicitor-General’s opinion followed by that of the Auditor-General and the Auditor-General’s subsequent report is that it is impossible to tell what may or may not have been outside the scope of Parliamentary Service expenditure up until the present day. It certainly casts a pall upon a whole range of expenditure around travel and other matters that may have been outside the scope. The Auditor-General did not look at those; he looked only at a 3-month period and only at the communications vote. Therefore of course there is nothing in his report that assists us in terms of determining what else may have been outside the scope including communications expenditure before 1 June 2005—expenditure that is exactly the same as expenditure that he has ruled unlawful in the period under review. 
Secondly the bill provides an interim funding definition because that uncertainty continues to the present day and into the future. It is not clear what the Parliamentary Service can spend money on at the present time. Were for example Dr Brash again to seek to travel to another place in the country to sign up a second National Party member for the year that would probably be outside the scope of the parliamentary appropriation according to the rulings of the Auditor-General. We should not forget that the Auditor-General did not look at the issue of travel funding. 
This issue began it would now appear with the Auditor-General’s 2005 report. That report was primarily about ministerial budgets—more precisely about Government publicity campaigns such as that surrounding the Working for Families package. The report incidentally made some observations and comments around Parliamentary Service funding but in no part did the Auditor-General state in any shape or form that the then currently understood interpretations of what was legitimate were in fact outside the bounds of what he considered to be legitimate. So no clear warning was given at that point. 
The Auditor-General’s report last week and the previous Solicitor-General’s legal opinion took that matter somewhat further. As for the Auditor-General’s 2005 report as I said the content was limited in some respects; the non-content in our view remains very significant. The Solicitor-General’s opinion in April this year took a very narrow view of what was in in terms of parliamentary purposes and I think it is worth reminding ourselves of the Jack Hodder opinion which states: “A fundamental feature of the context is that the potential scope of the work of the House of Representatives relating to legislation on public expenditure and of the parties represented in the House is almost unlimited. However that scope is the field of contestable policy proposals and decisions and of legitimate political dialogue between MPs and the electorate. The competition between parliamentary parties includes a continual contest for future electoral support.” I can only say “Hear hear!” to that; that is what we call democracy. But taking a narrow view of what is in as the Solicitor-General and the Auditor-General did then having a brightline test leaves a huge amount of uncertainty about what is in fact legitimate. That was comprehensively challenged as I said in the Hodder opinion and in the Speaker’s report to the House. 
Furthermore the Auditor-General’s report last week provides no clear guidance at all to the House as to what in the current parliamentary appropriations is legitimate spending. Wittingly or unwittingly the report ended up being partial in that respect both because it covers only a very limited time period from 1 June 2005 to the election and because it covers only certain appropriations—that is communications expenditure. 
It is clear that legislation is the only way to remedy the issue of unlawfulness and that is unaffected by the refunding of money. The passage of this bill does not at this point change at all whether a party should or should not refund money to the Parliamentary Service. The refunding of the money does not affect in any way the unlawfulness of the original expenditure. The National Party argument seems to be that it prefers to remain with its expenditure being unlawful. Indeed it is in the peculiar position of arguing—it is the only party in the House arguing this—that it knew that the rules had changed but it broke them nevertheless and has now chosen to refund the money. And Katherine Rich seems to be the sort of fall person in that respect. 
The real problem is that nothing is solved in terms of the current conundrum by the Auditor-General’s position. There is no clear guidance in the report as I have said and the bill therefore provides a narrow definition of what is out and a brightline test from there. What is out in terms of communications is seeking support for the election of a particular person or persons seeking support for a party vote for particular parties encouraging any person to become a member of a particular party or parties and soliciting subscriptions or other forms of financial support. That probably reflects a pretty fair summary of where the vast majority of parliamentarians believed the rules were up until the Auditor-General’s report. It is a narrow definition and then there is a brightline test; what is beyond that is therefore legitimate expenditure. Therefore Dr Brash will not have to refund the expenses of his travel to Nelson to sign up Ian Ewen-Street as a member of the National Party. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. Those references that Dr Cullen is wishing to pepper his speech with are in fact of themselves out of order. Dr Cullen has asked that the House give him the respect of being heard in silence. You have said that that is his right. We are not able actually to find anywhere in Speakers’ rulings or the Standing Orders that that is something speakers can ask for; nonetheless we respect his desire to get his message across. But we are not prepared to sit here and hear him make personal reflections on members on this side of the House without your intervention—without your calling him to account. There have been three occasions now. I am loath to take a point of order during the Minister’s speech—it is the opening speech on a bill—but Madam Assistant Speaker you do have a duty if you are preserving Dr Cullen’s right to be heard to ensure that our right not to be impugned in any way is also treated with some respect from the Chair. 
Hon Dr MICHAEL CULLEN 
: Speaking to the point of order I was not impugning Dr Brash at all. The point I was making was that in my view what Dr Brash did was a perfectly legitimate action. But that legitimate action is cast into doubt by the Auditor-General’s ruling. What this bill does is make clear that what Dr Brash did was legitimate. So if the member thinks there was a personal reflection I am happy to withdraw and apologise for that. But let me assure him that there was no personal reflection in that comment. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Perhaps from the point of view of clarifying the issue if the member would like to withdraw and apologise. 
Hon Dr MICHAEL CULLEN 
: I withdraw and apologise to the extent that it appeared to be a personal reflection. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Yes. 
Hon Trevor Mallard 
: Point of order— 
The ASSISTANT SPEAKER (Ann Hartley) 
: No please I want to make two points. First of all to the member—[ 
Interruption 
] 
The ASSISTANT SPEAKER (Ann Hartley) 
: That member will leave the Chamber now. I was in the middle of giving a ruling. That was extremely bad manners. 
Phil Heatley withdrew from the Chamber. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The point I was making to Mr Brownlee was that under Speaker’s ruling 57/2 any member is entitled to be heard without interruption. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I think it is important. A member—I am sorry I do not know the member’s name but the one next to Mr Bennett—called out twice during Dr Cullen’s speaking to the point of order. I think she should be disciplined because you did say that people were on a final warning. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I ask the member whether she called out. 
Paula Bennett 
: I am sorry Madam Assistant Speaker but I am desperately trying to find in the Standing Orders—that is what I was actually doing; I have not been calling out. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Please be seated. I ask the member to stand and just answer my question: did the member call out during that point of order? 
Paula Bennett 
: I am sorry Madam Assistant Speaker. I am not trying to be smart; I am just trying to work out which point of— 
The ASSISTANT SPEAKER (Ann Hartley) 
: Did the member call out during—[ 
Interruption 
]—just a minute; just answer the question. We have been hearing points of order and they will be heard in silence. Did the member call out during the point of order? 
Paula Bennett 
: Yes. Yes. I am not sure to be honest with you. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will leave the Chamber. [ 
Interruption 
] Just wait please. I will wait until the member leaves the Chamber. 
Paula Bennett withdrew from the Chamber. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. None of the Speakers’ rulings or the Standing Orders work if members of Parliament are not prepared to respect them. The Chair has no authority other than the authority that comes from the respect members of Parliament are prepared to give the Chair. You have taken a pre-emptive strike—and I use those words very deliberately—on our side of the House this afternoon when two members were provoked quite unreasonably by the very member who stood up to complain about them just a few minutes ago and who is well known for his loud and smart mouth in this House. 
Madam Assistant Speaker I want to explain to you that the decorum in the House from this point is extremely tenuous. We are not prepared to be treated in a manner that is any different from the Government. Our observation at the moment is that that is exactly what has just happened in the last couple of minutes particularly in respect of the last incident where one of the loudest people through points of order—during my own point of order for example—was the very person who appealed to you and whose appeal you accepted by throwing one of our members out of the House. That is not a good way to progress. 
I want to point out to you also Madam Assistant Speaker that when you call on Speaker’s ruling 57/2—which states: “Strictly speaking a member is entitled to be heard without interruption but with the tacit consent of the House the rule has been relaxed in favour of members asking reasonable questions.”—you should remember that we are part of the House; it does not belong exclusively to the Government. Anybody who is witnessing the sort of legislation we are getting pushed through today who has witnessed the activities of the last couple of days and who is witnessing the very partial position taken by Parliamentary Service could well believe that the Government thinks that this is just some sort of a rubber-stamping exercise for dictatorial powers. But it is not and it is your job Madam Assistant Speaker to ensure it is not seen to be that. We expect fair treatment and we expect you now to turn to Mr Mallard and deal with him as you have two of our members. 
Hon Dr MICHAEL CULLEN 
: I just want to draw it to your attention that Dr Nick Smith has yet to leave the Chamber having been ordered to do so— 
The ASSISTANT SPEAKER (Ann Hartley) 
: No it was not him; it was another member. 
Hon Dr MICHAEL CULLEN 
: Was he not ordered to go? 
The ASSISTANT SPEAKER (Ann Hartley) 
: No. 
Hon Dr MICHAEL CULLEN 
: In that case—and I think he thought he was ordered to for a moment—I make a point about being heard in silence. I know that that is done relatively rarely recently. In fact it is a very longstanding principle of this House that members have the right to ask that and it applies to any member of the House. If Dr Brash in responding wishes to be heard in silence then he also can make that request. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Thank you— 
Gerry Brownlee 
: It’s not the issue. 
The ASSISTANT SPEAKER (Ann Hartley) 
: It is the issue Mr Brownlee and it is what I ruled on. I also tell the member that a warning was given. Several interruptions occurred prior to Ms Bennett’s interruption. There was not an interruption from the Hon Trevor Mallard. He was entitled to raise the point of order he raised. I ask Dr Michael Cullen to continue. 
Hon Dr MICHAEL CULLEN 
: Can I make the point— 
Hon Murray McCully 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I just warn the member that I have dealt with the point of order to date so I presume he is raising a new point of order. 
Hon Murray McCully 
: I am Madam Assistant Speaker. I heard you direct the Minister of Finance to withdraw and apologise after offence was taken on this side. That should have taken place without any qualification. Dr Cullen sought to make that withdrawal and apology with qualification. I now ask that you require him to withdraw and apologise in the terms required by the Standing Orders. 
The ASSISTANT SPEAKER (Ann Hartley) 
: He did withdraw and apologise the second time without any qualification. He did that the second time. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. Are we to take from your ruling in respect of the request by the Minister of Finance for silence on this very contentious bill that any interjection will result in a member being ejected from the House? The reason that that is important is that Dr Cullen has repeatedly claimed that the Leader of the Opposition Dr Brash specially travelled to Nelson to— 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will be seated. I have dealt with that point of order. The member has withdrawn and apologised for that. The point of order has been dealt with. 
Hon Maurice Williamson 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I presume it is a new point of order. 
Hon Maurice Williamson 
: It is a very new one as of this minute. I have been in this Parliament a long time and one of the traditions I have been very keen to follow and observe is that whenever Speakers were making a ruling or discussing a point of order they would always be on their feet. In fact it was important that any member of this House had to resume his or her seat whilst the Speaker did that. I want to make a plea on behalf of my colleague Phil Heatley because Madam Assistant Speaker you did not rise to your feet on a number of occasions. Rather you sat while you made a ruling. I did not realise you were even involved in making a ruling when I looked up. On a couple of occasions since then you have stood up to so do but you were not on your feet when you were dealing with Phil Heatley’s interjection. 
Going back a number of Speakers I see Sir Robin Gray here in the House. He will know that he used to get to his feet all the time and deal to people like me when we were being badly behaved. I suggest on behalf of Phil Heatley that because the sign was not there that you at least allow him to come back into the House and make sure that he then behaves himself according to the principle that when you are on your feet we remain silent. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I take the member’s point and also note that although Speakers often stand when they are giving a ruling they often remain seated too. I also make the point on the ruling I gave in respect of Mr Heatley. I had very clearly said I will address the ruling. 
Hon Dr MICHAEL CULLEN 
: I make the point now more theoretically and assisted by the intervention from Dr Smith. Let us suppose a member of Parliament travels somewhere and has a range of business at that place. Amongst that business he or she may sign up a member for his or her political party. The import of the Auditor-General’s opinion and the brightline test that is imposed there is that the entire expenditure is out of being legal. [ 
Interruption 
] I am afraid that that is not rubbish. The member should read the Solicitor-General’s opinion again. Mr McCully is nodding his head. He actually agrees with me. He understands the point being made. 
The Solicitor-General’s opinion quite clearly is that if something is outside then that renders the entire vote activity—the expenditure that that involves—outside the appropriation. The member really has to read those reports very carefully because if he does not he will not understand how important it is to actually carry forward the second part of this bill which is to clarify the current spending rules. And might I say to the House that the Government if it were self-interested would not bother to do that part because half the Government is covered by Vote Ministerial Services in that respect not Vote Parliamentary Service and that would give us an undue weighting and advantage in that respect. 
However in carrying forward that interpretation—in setting out that narrow interpretation—there is a sunset clause: it will expire at the end of next year. That is done because we have to respond to the need for a broader review of the rules. Another independent report is being done by John Goulter and Adrienne von Tunzlemann which may have implications for the structure of Parliamentary Service votes. There are issues that will almost certainly lead us into the legislation around the Parliamentary Service in terms of the apparent responsibility of the Speaker for expenditure incurred by a political party with which the Speaker is not in the least connected. I think that in itself places the Speaker in an impossible position. 
This House and the parties in this House must move on from these issues to actually address those issues over the coming few months so they can be clarified before we enter upon another election cycle in 2008. That is why the sunset clause is both long enough to enable the review to be done but short enough to make it clear that it does not go into the 2008 election year. 
This is not a difficult bill; it is a bill that requires some degree of detailed application in order for it to be understood clearly and to make sure that people understand the actual surrounding issues. I am sure that most of the debate will have absolutely nothing to do with the actual contents of the bill but then that is not unusual unfortunately for debates in this House these days. 
Hon MAURICE WILLIAMSON (National—Pakuranga) 
: 
 I raise a point of order Madam Speaker. I am sorry to carry on with the point of order I raised before but I ask you to look at Standing Order 80(2). Under the heading “Maintenance of Order” that Standing Order states: “Whenever the Speaker rises during a sitting members must sit down and be silent so that the Speaker can be heard without interruption.” Now I think that is a very clear Standing Order in our book—that is when the Speaker rises to his or her feet members must sit and remain silent. When my colleague Phil Heatley interjected you were not on your feet Madam Speaker and therefore I make the plea again—because Mr Heatley could easily not have realised you were in the process of standing—that he be allowed back in the Chamber. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The point that I made stands exactly as I said. The ruling certainly does not state that the Speaker has to stand at every point. But I take the points that Mr Brownlee made and I say both those members can come back at 4 o’clock. 
Dr DON BRASH (Leader of the Opposition) 
: 
 This House has rarely seen more cynical and self-serving legislation. If this bill passes in its present form there will be no legal obligation on any political party to pay back the money that was stolen from taxpayers—none at all. Let me say that again: if this bill passes in its present form— 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. On behalf of Katherine Rich and other National Party members as well as other members of the House who have stayed within the old rulings of the commission and accidentally stepped outside authorised expenditure I object to being called a thief. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Again members were calling out during that point of order. Members know there should be silence during a point of order. I thought that comment was part of the debate. The member has taken a personal reflection at being called a thief—is that correct? 
Hon Trevor Mallard 
: I have taken a personal reflection at the member saying that the money was stolen. I am one of the members who made an error by taking the rules as they had always been and as they were confirmed to me by the Auditor-General. He subsequently changed his mind. The money was not stolen and I say that on my behalf and on behalf of Katherine Rich who did exactly the same thing as I did. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is not making a direct accusation to the member or to a party which the member cannot do—he cannot use those words. But that is not really what he did. 
Katherine Rich 
: I raise a point of order Madam Speaker. Mr Mallard’s interest in my well-being is rather touching but I am a bit unaware as to why he keeps including me in the debate. That member knows he is not able to seek leave on behalf of other members. He is a member who has been in this House for a long time so I would have thought that he would be aware of that. I take offence at being continually included in the debate when there is no reason for that. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Again that is not a point of order because of the non-direct reference. I have ruled that no direct reference was made to a member. Is Katherine Rich taking direct offence? 
Katherine Rich 
: Yes I am taking direct offence at inclusion. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has taken direct offence. Would the member please withdraw and apologise. 
Hon Trevor Mallard 
: I withdraw and apologise. 
Hon Murray McCully 
: I raise a point of order Madam Speaker. I apologise to my colleague Dr Brash for interrupting his speech. You have just given a couple of rulings Madam Assistant Speaker and I just draw your attention to the fact that again you have given those rulings while being seated. If you do that it will make things quite difficult for us this afternoon during what is going to be quite a robust debate. If you want to retain order in the House I urge you to obey the Standing Order and stand when you want to make a ruling. 
Hon Trevor Mallard 
: If one reads the Standing Order carefully one sees there is no requirement on the Speaker to stand. What it does make clear is that when the Speaker stands everyone else is to be quiet. There is no requirement for you to stand. Over the years some Speakers have stood all the time some have stood some of the time and frankly in the case of some people one cannot tell the difference. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is quite right. I tell the Hon Maurice Williamson that I gave exactly that ruling quite a while ago. 
Dr DON BRASH 
: If this bill passes in its present form there will be no legal obligation at all on any political party to pay back the money that it has in deference to the sensitivities of Mr Mallard misappropriated. For that reason primarily the National Party will be voting against this legislation. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member cannot make a direct allegation against a member about misappropriation. I said before that the member had not made such an allegation but this time he clearly has. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. What Dr Brash said was effectively “in deference to the sensitivities of Mr Mallard” and he referred to the money having been misappropriated. If it helps you Madam Assistant Speaker I will table the Auditor-General’s report which talks about the money having been misappropriated. That is not an aspersion against the Minister; it is a fact. It is the only reason that we are here to discuss this bill today. To say that we cannot mention that has to be absurd. 
The ASSISTANT SPEAKER (Ann Hartley) 
: That is not what I said at all. I said: “when it is made against an individual member.” The member cannot say that about an individual member. He can certainly say that in the context of the debate. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. He did not say it about an individual member. He said “in deference to the sensitivities of Mr Mallard”; he did not accuse Mr Mallard of misappropriating funds. The fact is that the Auditor-General’s report talks about the Labour Party having misappropriated funds. If Mr Mallard wants to say that by virtue of his membership of the Labour Party he is affected well that is only a matter of fact surely. If he is also offended by the fact that the Auditor-General did put that in the report then I guess that is the reason why the Government has brought in the legislation—to tell the Auditor-General he is just a plonker and to go away because the Government does not want to know about him. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I take the point Mr Brownlee. I would just remind members that they cannot make accusations against individual members. 
Dr DON BRASH 
: I repeat: we will be opposing this legislation because in its present form it imposes no legal obligation on any political party to pay back the money that has been misappropriated. We will be moving amendments to make the passage of the bill conditional upon every political party repaying the money that has been misappropriated. 
The Labour Party has been trying to avoid this issue for over a year. I came across a press statement issued by my colleague Simon Power on 5 September 2005— 
Hon Member 
: Before the election? 
Dr DON BRASH 
: —before the election last year in which he drew attention to the fact that the pledge card issued by the Labour Party bore the parliamentary crest. And he asked whether that could mean it was funded from taxpayers’ money. Of course we now know that it was. When Simon Power raised that question at that time he was quietly ignored by the Labour Party. But we know that 3 or 4 days before that the Chief Electoral Officer had warned Mike Smith of the Labour Party by phone that the pledge card was an election expense. On 2 September last year—3 days before my colleague discovered it—the Labour Party received that advice in writing. Initially Labour Party members accepted that the pledge card was an election expense and then of course they changed their minds—just after the election. 
At the beginning of this parliamentary year I drew attention to the fact that $446000 spent by the Labour Party on its pledge card was almost certainly an improper use of taxpayers’ money. Then a few months back we had the draft of the Auditor-General’s report. At that point neither I nor anyone on the Opposition side of the House knew precisely what the Labour Party’s obligation was in that draft report—we did not have it. But we knew from the criteria listed in the document that we had that the pledge card at least would have been caught by the Auditor-General’s ruling. 
So what happened? Well the Labour Party started to make excuses. It said the rules had changed. The Auditor-General said no they had not changed. The Labour Party said the rules were unclear. The Auditor-General said no they were not unclear. The Labour Party said everybody had been doing it since 1989 and $350 million was at stake here. Helen Clark told people to move on because it was a beltway issue and nobody cared about it outside Wellington. Then Mike Williams the president of the Labour Party said the party had made such expenditure in 2002 and 1999 so it was OK. The situation is worse than that. Not only was that an admission that because Labour had sinned before it thought it could sin again without penalty but we now know that in 1999 the pledge card did not carry the parliamentary crest and was published with material saying it was proudly supported by members of the Labour Party. That raises some very serious questions about whether the public and Parliament were misled about where the money came from. 
Now we have a bill that validates what has been done so there is no legal obligation at all on political parties to pay back the money that has been misappropriated. Helen Clark says that Labour will pay it back but we know that sometimes Helen Clark makes “commitments” that she has no intention of actually honouring. I think back to when she first became the Prime Minister. She said her objective was to get New Zealand into the top half of the OECD within 10 years. Well 6 or 7 years on she is hoping we have all forgotten about that because of course she has not a dog’s chance of actually achieving that objective. When she talks about getting this money paid as a target for this financial year is that a target or a commitment? Why will she pay anything back after the law has been changed in order to make what is currently illegal legal? 
Not only is that the case but this bill at clause 7 proposes a new definition of “funding entitlements for parliamentary purposes” that would clearly allow the Labour Party pledge cards to be OK. In order to be counted as electioneering material has to explicitly ask for a vote explicitly ask for membership of a party or explicitly ask for money. Under that definition of electioneering the pledge card would be legal. 
We should also however note that even if this cynical and self-serving bill passes in its present form it does not get Labour off the hook for having breached section 214B of the Electoral Act. That section makes it a corrupt practice to knowingly spend above the legal limit. We know that is exactly what the Labour Party did. It had a limit of $2.38 million; we know it spent at least $2.8 million. It was warned by the Chief Electoral Officer that it was at risk of doing that. Even the Labour Party’s own auditors said that if the pledge card was electioneering expenditure then the Labour Party had breached the cap. I think of what happened to my poor friend Bob Clarkson. He was taken to court by a Minister in this Government who thought he might have overspent slightly the $20000 electoral limit. Bob would have forfeited his election to the seat of Tauranga had he been found to be guilty. He was not guilty—the court found he was not guilty. The Chief Electoral Officer the Electoral Commission the Auditor-General and the Solicitor-General all accept that Labour spent more than its legal entitlement in the 2005 election and nothing in this bill will change that fact. 
Passing this bill into law will remove any legal obligation that political parties may have to pay back the money that they owe. The National Party has paid back the small amount of money that was inadvertently used by a small number of my colleagues. ACT has paid back the money that it inadvertently used too and I congratulate the party on that. The Maori Party has paid back the money that it inadvertently spent. The Progressive party did not spend outside the terms of the rules at all. Why? Because Matt Robson said the rules were entirely clear. Let me congratulate the Progressive party the ACT party and the Maori Party. We had very careful people running our money and I call on the Labour Party and the other parties that have not yet paid back the money they owe to pay it back and to pay it back now. 
The Labour Party stole the last election by the slimmest of margins by breaking not one law but two laws. The very least it can do is to pay back the money that was misappropriated and to pay it back now. 
Hon STEVE MAHAREY (Minister of Education) 
: 
 The Leader of the Opposition made I think four points. Before I move on to rehearse a bit of the history of the Appropriation (Parliamentary Expenditure Validation) Bill that is before us today in the spirit of sound debate I thought I would answer each of those four points if I am able to. 
In the first point the member argued that there was no obligation to pay back this money. Of course he is right. There is no legal obligation for reimbursement of this money. But the Labour Party has made it absolutely and unequivocally clear that now we are in the position of having in front of us the reports of both the Auditor-General and the Minister responsible for this we will be refunding the money. So I say to the member that that is the first point. 
In the second point the member asked why Labour has been not responding in this way for some months. The reason was we have not had the Auditor-General’s report until now. We have not had the response from the Minister responsible for this funding until now. The member himself is debating this point now because we have those reports now. Even the member himself and the other parties that he has quoted as paying that money paid that money prior to receiving those reports. They now in a post hoc way have to be sure that they are paying back what they now regard as the appropriate amount of money on the basis of those reports. In other words most of this debate has taken place because of a leaked report. The real debate takes place now because we have the actual reports—the final report and the response from the Minister responsible. 
 The third point he made was that perhaps we need to look at commitments being carried out. I do not want to get into a silly argy-bargy back and forth across the House I simply say to the member that the reason he is sitting in an MMP Parliament of this construction is that politics had become so bankrupt following Governments that preceded both himself and myself it led to people saying that people do not carry out commitments—compared with the last 7 years when this Government has restored the notion of politics being about carrying out commitments. 
Fourthly the member said that the Labour Party’s knowingly spending money had led to a situation where it has now been required to pay it back. I do not think anybody in the House including the few members on his side who spent money during this time—I will vouch for them as well as everybody else—spent the money knowingly. The only people who appear to have done that I am sorry to say are those who did so in relation to the GST issue that applies to broadcasting. It beggars belief to think that someone who sat on the GST committee and who understood exactly what GST was did not understand that GST applied to broadcasting spending. That is knowingly spending the money and that is why the member’s party should pay the $115000 back. That is the one bit of knowingly spending money that really does need to be put to bed. The $115000 that was knowingly overspent on broadcasting is obviously something the member should have would have and could have known should be paid back. So the $115000 that we are constantly told is sitting in a bank vault somewhere should be paid back. The money should be paid back so that the member can move on. 
Hon Dr Nick Smith 
: The member who is speaking has raised the issue of the GST refund. My colleague and National leader Dr Don Brash has often sought leave to introduce the bill in his name. To see whether Mr Maharey’s just-stated comments are in fact true to his word I again seek the leave of the House for Dr Brash’s bill in the ballot to be introduced to lie upon the table and to receive its first reading forthwith. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has sought leave for that bill. Is there any objection? There is. 
Hon STEVE MAHAREY 
: I say to Dr Smith that there is absolutely no impediment in the way of the National Party paying that money back today. National members should put the cheque on the table today. There is no impediment at all to their paying it back. If they are so eager if the money is there they should write the cheque and pay it today. 
Let me go back to the bill itself and rehearse the story so far. This is how it goes. The Auditor-General reviewed advertising expenditure for the 3 months before the last election. What he did during that time was to broaden what we understood to be money being spent for parliamentary purposes. The Auditor-General I think from all of our points of view has applied a definition of parliamentary purposes that is different from what has been used by people for a large number of years. What that means is that although he focused only on the 3 months prior to the last election the implications of the ruling by the Auditor-General go back to 1 July 1989 when the rules were changed. Also just because the Auditor-General focused on advertising it should not lead us away from the fact that the way in which he has interpreted advertising’s purpose has raised implications for all of the spending by members of this House under that parliamentary rubric. 
So two points have been raised by the Auditor-General that we need to look at. One is the broadening of the “parliamentary purposes” definition—the range of spending that people in the House are involved in. As a result it is important for us to have a look at how we operate in the House. From the point of view of the Auditor-General we have not been operating properly. Therefore the rules need to be changed. 
An important point is what we do with all of this. How do we deal with the fact that he is effectively saying there are unappropriated expenses here? Effectively what he is saying means that expenses incurred outside the appropriation are in breach of section 4 of the Public Finance Act. According to the Auditor-General such a breach when it occurs is illegal notwithstanding any repayment of the money—that does not sweep away that fact. So we are put in the position that no matter what members might do to put it right—a National Party member a Maori Party member or whoever who is putting it right by deciding to refund the money—we will still be outside the Act. So the only legal remedy for such a breach of section 4 of the Public Finance Act is for those expenses to be validated by an Act of Parliament. Without that validating legislation no matter what people do it will remain an unlawful situation. Is this unusual? No it is not. Unappropriated expenditure is something that has been validated before. For instance last year the financial review bill included validation of $310 million relating to forecast liability under the Kyoto Protocol. 
Now what happens after that in respect of the situation with the Auditor-General and the situation in terms of the law; what happens next? This is what happens next. The report goes to the Minister responsible for that expenditure. That Minister makes a response because in this case the Auditor-General asked for a response. The response from the Minister responsible stated among other things that “in accordance with section 26C of the Public Finance Act 1989 the unlawful breaches of the seven party appropriations should be validated by legislation and that legislation should be introduced as soon as is practicable.” The Minister said that the validations should not await the normal annual validation process. 
The report of the Controller and Auditor-General and the report of the Minister responsible for the vote said of course that what we might want to do—and the Minister has confirmed that she will—is go for an external review of our institutions to have a look at what we do in the future. So we have validating legislation and we will have an external review to see where we go from here. One of the things we need to do of course is to look in particular at what “parliamentary purposes” will actually mean in the future. All of us are in a situation right now where we may well be spending money in a way that is outside this new understanding from the Auditor-General. So in the interim we need to make sure we are OK and that is why this legislation finishes in 2007—it is an interim measure. I reiterate the point I made before that there was no requirement to reimburse from what the Auditor-General and the Minister said but we have made it very clear that we will do it. 
This bill does three things. First it validates past expenses that may have been outside the scope of appropriations in Vote Parliamentary Service from 1 July 1989 until the bill comes into force. Secondly it validates any associated breach of a range of validated Acts such as the Civil List Act 1979. Thirdly it provides an interim solution for the period through to 31 December 2007 following which the work that we will do between now and then will set the scene for the future. 
That is the nature of the game here today. We are in a situation where nobody here has intentionally spent money except in relation to the GST. We have had the Auditor-General’s report which has changed the rules of the game. We have had the Minister’s response for Parliament to consider and the result of that has been for us to have validating legislation and a working party to look at what we will do post - December 2007. That is the situation we are in. 
Hon Dr Nick Smith 
: You are corrupt cheats. 
Hon STEVE MAHAREY 
: I say to Dr Smith that we are in the same situation as members in his party. This legislation is absolutely necessary but if the member is extremely excited about what he is doing today I ask whether we can have a cheque for the GST before the end of the day. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 The explanation from Mr Maharey was an utter disgrace. I ask simply these questions: what definition do we give to the word “thief”; what definition do we give to the word “cheat”; and what do we call a group of people who deliberately take something that is not theirs use it for their own ends then try to hide the fact that they took it in the first place? They are thieves and they are cheats. 
 We are here today only because they were caught. Let me make it very clear to anyone who wants to know with regard to all this talk from Mr Maharey about the need to validate this spending if the Labour Party had not been caught we would not be here today. It is as simple as that. What we have is a bill to cover up the theft by Labour from the taxpayer—a theft that it has now been caught for—and Labour members are all holding up their hands and saying that they are holier than thou and will pay it back. 
Chris Auchinvole 
: When? 
GERRY BROWNLEE 
: Well the question is when. I notice that when Labour was caught by the Auditor-General for appropriating some $21 million to advertise its Government programmes and it was later pinged back to only $15 million those members said that it was not much. But I tell you what this morning the Labour caucus found out that $750000 split 50 ways is a huge amount of money. So we do want to know when it will be paid back and we want to know why this legislation does not include that information. 
What I was most fascinated by was the Prime Minister’s reaction on last Monday’s  
Breakfast  
television programme when she was asked about the intention to pass validating legislation. She said: “Oh well that is just a technical thing. We are paying it back. There it ends. Let us move on.” It was classic Helen Clark—13 months of saying that Labour will not pay and of saying that everyone else is wrong except Labour and then it is: “Oh well we will pay. We are moving on. That is the end of that.” 
The rules are extremely clear around this particular issue and they have been for a very long time. For Labour to suggest that they are not is completely disingenuous. I refer Mr Maharey to the Hunn-Lang report of 1990 which was the basis for the establishment of the Parliamentary Service and the rules that go with the expenditure of taxpayer money around parliamentary support in the first place. Apparently we are being told today that these rules have been wrong for the last 16 years and that we have to go right back to that time to sort it all out. Well I say to Mr Maharey that that was a Labour Government report which was put on the Table by no less a person than Sir Geoffrey Palmer and that there is nothing in it that would suggest that any of the behaviour that has gone on before this time was particularly illegal. 
For Dr Cullen to suggest that somehow if this legislation is not passed simple things like MPs’ travel their communication with their constituents and their use of a research facility to find out whether some idea is worthwhile would be completely wrong is of itself wrong. That is what democracy is built on: the idea that we elect some people to think a little bit about the future—some people who can move freely and speak freely. But when it comes to the election period there is no provision and there never has been for some party to confuse its campaign expenditure with its parliamentary expenditure. What we saw from Labour members was a cynical decision to very deliberately pay for the pledge card—and it would appear for a great deal of other advertising—from its Parliamentary Service funding. 
What they knew also because let us remember they had letters from the Auditor-General the Chief Electoral Officer and their own auditors stating that if this pledge card is considered election spending—and they have admitted right from the word go that it was—they would breach their electoral spending cap. It was a breach of section 214B of the Electoral Act as Dr Brash pointed out and in that sense of knowing it makes those members party to a corrupt practice. What we are doing here today is apparently alleviating that situation. Well this Appropriation (Parliamentary Expenditure Validation) Bill will not do that. The question still remains out there for New Zealanders to ask themselves: “Is this a Government that respects the conventions of governance in our country?”. The answer overwhelmingly is “No”. 
We have asked over and over when the Government will pay this money back. What we have had in return is a deafening silence. The reality is that when this bill passes today there will be no legal requirement for the money to be paid back. In fact we might ask ourselves this question. If the pledge card was not illegal because 14 months or so after it was posted out the law changed to make it legal why would one pay the money back? 
The other point that Mr Maharey made was that even if one paid the money back one still has to validate it. Well I want to know why we do not do that every time someone commits benefit fraud or every time the Government pays a prison construction bill that it should not be paying. We could go on and on about where Government appropriations are going in the wrong direction but there is no need to refer back to Parliament. 
Mr Maharey said that it is not unusual to come back for appropriations to be realigned. Those appropriations are usually within the policy confines of a Government. They are not about some Government choosing to stick its hand deep into the pocket of the taxpayer and reach money out for its own political purposes and that is the strong and serious difference we have here. 
I am in possession of some information that tells me the land grab undertaken by Robert Mugabe’s Government in Zimbabwe is perfectly legal because after that Government got in the bulldozers and all those thugs who whipped those people off those farms it passed a law to make that action legal. Although I do not want to exaggerate become carried away and suggest that this Government is operating as if it were a Mugabe-style Government the reality is that the comparison is chillingly close. Mr Hughes shakes his head and says “No no no”. I would ask Mr Hughes why we are here today and why we have this legislation in front of us. If Mr Hughes and his colleagues had not robbed the taxpayer of nearly $1 million we would not be here today. The reality is that this legislation makes perfectly legal the terrible and disgraceful act that the Labour Party committed. Members opposite are saying that it happens all the time. It does not happen all the time. There are appropriation realignments but there are none like the sort of situation we have today where illegal activities are being made legal. 
I reserve my final comments for New Zealand First members who I think have been a very big disappointment on this particular issue. They have a $160000 overspend and a statement from their leader that they will not pay it back but will go to court. Well everyone knows that when this legislation passes—assuming that the House will be compliant enough to pass it—then there is no basis on which to go to court because Mr Peters will be stumping up to court saying: “I am not paying this money back because I did not break the law.” and the judge will say to him: “You are dead right sonny. Fourteen months after you spent the money your mates in the Labour Government made it perfectly legal for you to do so.” So I hope that the New Zealand First members get up today and tell us whether they will accept their moral obligation to repay the money and whether they will accept the fact that New Zealanders expect politicians to repay the money. 
I would also ask the Labour Government members whether we can expect during their speeches today to have put in front of us a time line for when they will repay the money. Finally I want to know why Labour members keep swinging arrows across to this side of the House asking whether National will pay the GST. The answer is “Yes”. 
Hon Judith Tizard 
: When? 
GERRY BROWNLEE 
: Well unlike the Labour Party we want the law changed so that we can pay. Labour members are changing the law so that they do not have to pay. This is utterly disgraceful legislation and we will be fighting it very hard. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 New Zealand First will be supporting the Appropriation (Parliamentary Expenses Validation) Bill. [ 
Interruption 
] Yes we will. We will do that for three reasons. The first reason is that the Controller and Auditor-General has recommended that we do so. [ 
Interruption 
] Members should take the time to read the Auditor-General’s report. On page 53 of the report he makes the recommendation that this legislation should be passed. As the Auditor-General notes the relevant sections of the Public Finance Act 1989 require this type of legislation to validate the appropriation. The Controller and Auditor-General is the man who is telling virtually every party in Parliament that it owes some money. 
The second reason New Zealand First is supporting this bill is that the Speaker herself has recommended that this step be taken. Finally we are supporting this legislation because Treasury suggests that it should be supported. Treasury in its report explained why this sort of legislation is required in terms of the Public Finance Act 1989. 
In fact New Zealand First is somewhat disturbed about the politicking that surrounds this type of legislation. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Nobody can hear at all. Will members please show some respect to the speaker. 
PETER BROWN 
: To put it simply if the Controller and Auditor-General the Speaker of the House and Treasury all independently say we must pass this legislation then New Zealand First agrees that it should be passed. I invite members of the National Party to read the documents—maybe I should table them. 
I want to make this point perfectly clear: New Zealand First will pay any moneys that it rightfully and lawfully owes. 
Hon Members 
: What does that mean? 
PETER BROWN 
: The members do not understand what that means. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I say to the members at the back of the Chamber that one or two interjections are acceptable but that constant barracking is not acceptable. 
Rodney Hide 
: I raise a point of order Madam Speaker. I have been sitting here quietly actually. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Yes you have. 
Rodney Hide 
: But it is very very hard to keep quiet when the deputy leader of New Zealand First speaks in favour of a law to validate his party’s unlawful spending and has the temerity and audacity to say that New Zealand First as a matter of policy will pay back any money it lawfully owes when it is busy here under urgency changing the law so— 
The ASSISTANT SPEAKER (Ann Hartley) 
: The members knows that that is not a point of order. [ 
Interruption 
] No the member will please be seated. The member cannot go on with a point of order that is not a point of order. It is a debating point. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. Mr Hide’s offering to the House leads us to an interesting point. I refer you to Standing Order 165 and Speakers’ rulings 70/5-6 and 71/1-5 which deal with financial interests pecuniary interests and declarations thereof. Given that Labour MPs have today received the bad news that they each have to write a personal cheque given that many other parties have found themselves in a similar position and given that New Zealand First is the only party out there saying that it will not pay it back then— 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sorry but this is not a point of order. 
Gerry Brownlee 
: With all due respect it is. 
The ASSISTANT SPEAKER (Ann Hartley) 
: It is not a point of order. The member will be seated. That is a debating point and the member knows it. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sorry but I have ruled on the point of order. Please be seated. What the member has been raising for the last 2 or 3 minutes are matters within this bill that are for debate. 
Gerry Brownlee 
: Madam Assistant Speaker you cannot debate the Standing Orders. The Standing Orders are clear. This member has a financial interest in this bill and he has an absolute obligation to declare it. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is just completely misinterpreting the Standing Orders and— 
Gerry Brownlee 
: Would you interpret them for us. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Mr Brownlee—[ 
Interruption 
] Please be seated Mr Brown. Before we go any further Mr Brownlee will withdraw and apologise for his interruption of the Speaker. 
Gerry Brownlee 
: I withdraw and apologise. I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No please be seated—I was ruling on that. It was not a point of order. The member was bringing into the debate Standing Orders that do not apply to this matter. Please continue Mr Brown. 
Hon Dr Nick Smith 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I say to the member that if he is contesting my ruling that in itself is disorderly. 
Hon Dr Nick Smith 
: Madam Assistant Speaker I want to read to you— 
The ASSISTANT SPEAKER (Ann Hartley) 
: No just a minute. Can I be assured that the member is not contesting— 
Hon Dr Nick Smith 
: I am not contesting your ruling Madam Assistant Speaker; I am raising a new point of order. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I call Dr Nick Smith who is raising a new point of order. 
Hon Dr Nick Smith 
: Madam Speaker I draw to your attention Standing Order 166 which states: “A member must before participating in the consideration of any item of business declare any financial interest that the member has in that business.” We are all aware in this House that there is a court action involving members of this House. A court case in the High Court of New Zealand names every Labour member—in fact I think the interest applies also to yourself Madam Assistant Speaker—as having a financial interest in this bill. 
This is a very serious point of order. It goes to the heart of the integrity of this Parliament. I ask you Madam Assistant Speaker to give a considered ruling on the following point. Given the fact that there is a legal action involving the financial accountability of all 50 Labour MPs then a clear interpretation of that Standing Order particularly when one adds to it the Speakers’ rulings would say that members opposite who are affected by the legal action must declare a financial interest in this bill. I ask you Madam Assistant Speaker to give a considered ruling so that the Standing Orders of this House are upheld. 
It is a perfectly proper Standing Order because when we debate issues in this House it is the public interest not our own personal interests that must take precedence in the business of this Parliament. I believe that the 50 Labour Party MPs have a very distinct private interest in this bill. Madam Assistant Speaker we need your ruling on Standing Order 166 for those members to be required to declare that financial interest. If you do not do so these Standing Orders are not worth the paper they are written on. We are talking about a sizable amount of money—over $10000 per member. Those members have a financial interest it must be declared and they should not be able to participate in a debate in which they have that financial interest. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The financial interest is not different from that of any other members generally. That is the point. Court proceedings or anything else do not— 
Hon Dr Nick Smith 
: Can you explain why? 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will now leave the Chamber. 
Hon Dr Nick Smith 
: I simply asked you to explain why. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will now leave the Chamber with no backchat. [ 
Interruption 
] 
Hon Dr Nick Smith withdrew from the Chamber. 
Debate interrupted. 
Naming of Member 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member’s behaviour is disgraceful and I ask the House to name the member. The question now is  
That the House name Hon Dr Nick Smith whose conduct is grossly disorderly and judge the conduct of this member. 
A party vote was called for on the question that the House name Hon Dr Nick Smith whose conduct is grossly disorderly and judge the conduct of this member. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 I raise a point of order Madam Speaker. You put the motion. It was very clearly won on the voices and no member called for a ballot. I put it to you that the proper course for you and there is only one course open to you was to declare that the Noes have it. I invite you to make that calling. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is not correct. It is up to the Speaker to call and I have said that the Ayes have it and that the vote be called. There will be silence during the voting. 
A party vote was called for on the question  
That the House name Hon Dr Nick Smith whose conduct is grossly disorderly and judge the conduct of this member. 
Ayes 67 
New Zealand Labour 50; New Zealand First 7; Green Party 6; United Future 3; Progressive 1. 
Noes 54 
New Zealand National 48; Maori Party 4; ACT New Zealand 2. 
Question agreed to. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: This matter has been dealt with. You cannot relitigate or further debate a matter that has been dealt with. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I seek leave to table this piece of paper on which I have a number of scribblings. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I do not think that is enough explanation of what the member wants to table. 
GERRY BROWNLEE 
: These are my speech notes from before. Do you wish me to read them? 
The ASSISTANT SPEAKER (Ann Hartley) 
: No. The member wants to table his speech notes. I just warn the member that he cannot trifle with the House. We have dealt with this matter before but the member wishes to table these speech notes. Is there any objection? There is. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I just warn the member that I will not tolerate trifling points of order. The member cannot proceed to table matters that are not within the House’s business. We have dealt with this point on another occasion as the member well knows. 
GERRY BROWNLEE 
: In my speech I referred to the  
Review of the Office of the Leader of the Opposition 
 DK Hunn and Henry Lang January 1990. I seek leave to table that report. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member wishes to table that report. Is there any objection? There is. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 I raise a point of order Madam Speaker. I want to draw to your attention that I was halfway through my speech and although I have no problem with Mr Brownlee taking as many points of order as he cares it is a custom of this House to allow a member to finish his or her speech then take the points of order. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Members are always entitled to take points of order as we have seen. But the House needs to get on with its business. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 During the course of my speech I referred to a number of matters that are covered in the legal opinion given to the Speaker by Mr J Hodder and Ms BA Davies 11 October 2006. I seek leave to table that document. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Leave is sought to table that document. Is there any objection? There is. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 I seek the leave of the House to table a copy of the opinion of Mr Jack Hodder of the law firm Chapman Tripp which has been referred to by previous speakers and which I intend to refer to at length in the speeches that I will be giving to the House in respect of this bill. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I thought that was one that Mr Brownlee just did but if it was not is there any objection? There is. 
JUDITH COLLINS (National—Clevedon) 
: 
 I raise a point of order Madam Speaker. I raise an issue under Speakers’ rulings 16/7 and 16/8 which relate to appropriate business attire for members of the House. I was wondering whether the electioneering badge being worn at the moment by some members of this House including yourself would be considered as part of business attire. I think it has electioneering on it. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will be seated; she is just trifling with the House. 
Judith Collins 
: No I’m not. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Just a minute I will explain. Many members wear as the member is wearing right now a support emblem or whatever one likes to call it. This badge is actually in support of board of trustees’ elections. It is exactly the same as the member is wearing herself. 
Judith Collins 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I have ruled there is nothing against the dress code. 
Judith Collins 
: Madam Speaker— 
The ASSISTANT SPEAKER (Ann Hartley) 
: Could you please be seated. 
Judith Collins 
: Could you please give me the courtesy of making my point of order without interrupting me. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Please be seated. I have ruled on the matter of the dress code. I have explained what it is if the member could not read it from there. It is exactly the same as many members wear in this House to support a cause or otherwise. If the member has a new point of order please raise it. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Madam Speaker. That point of order from Judith Collins was not a great point of order but she was allowed to be heard in silence. You have ejected members of the National Party when they admitted to interjecting on a point of order and there is no doubt I know that if you asked the Hon Harry Duynhoven whether he interjected on Judith Collins’ point of order he would say he did and therefore I think you should ask him to leave. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The Hon Harry Duynhoven did you interject? 
Hon Harry Duynhoven 
: I did. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member will leave. 
Hon Harry Duynhoven withdrew from the Chamber. 
Dr WAYNE MAPP (National—North Shore) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I will hear the point when there is silence. 
Dr WAYNE MAPP 
: Thank you Madam Assistant Speaker. You will have noticed a number of members here seeking leave to table certain things. The point that my honourable colleague Judith Collins made was about her points of order being able to be heard. I have to make this point although it does not give me any pleasure to make it: consistently when we on this side of the House make points of order on various things when you Madam Assistant Speaker are in the Chair before we have said two or three words you cut us off. If you want to know one of the reasons why there is often difficulty when you are Chair it is that on this side of the House we do not feel that we get fair treatment. It does pain me to say that Madam Assistant Speaker but I want you to reflect on what I am saying. I do not take trifling points of order but this is a serious matter and it will cause trouble for you in the future and trouble for the order of this House. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I just say to the member that that was a very threatening statement to the Speaker. The member knows that there is a correct procedure if the member wants to complain about the Speaker and the member will follow that. 
ERIC ROY (National—Invercargill) 
: 
 I raise a point of order Madam Speaker. I am in some difficulty because I believe that procedure has not been followed correctly. You will know that when procedural motions take place such as a closure the wording of the motion has to be used precisely. The point of order that I make is that if you look at Standing Order 87 you will see that the correct wording of the naming was not adhered to. You said: “I move that the member be named.” Standing Order 87 says: “ ‘That [ 
such member 
] be suspended from the service of the House’. ” That is the naming process. I put it to you that in your attempt to deal with the disorder that you perceived you did not use the appropriate wording for the procedural motion that should have ensued at that point. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I called on the House to judge the member. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Madam Speaker. Naming a member of Parliament as you know Madam Assistant Speaker is the most serious thing that can happen outside of a breach of privilege. So what has gone on here today is very serious indeed. It is not often that the Standing Orders specify the precise wording that has to be used. I cannot see how Dr Nick Smith can have any sense that there was a proper vote of Parliament when an incorrect procedure was followed. I think the easiest thing to do is essentially to validate the vote of the House by your naming him correctly and our having the vote again. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I hardly think that is necessary. The intent was perfectly clear—as under Standing Order 87. Can I just say to members that we have had a lot of trifling points of order. I am not going to tolerate it much longer. 
Dr DON BRASH (Leader of the Opposition) 
: 
 I raise a point of order Madam Speaker. Dr Nick Smith raised a question about Standing Order 166. Unfortunately he did interject when you were giving your ruling. I wonder whether it would be helpful to the House if you were willing to explain more fully why the Labour Party speakers in this debate have no pecuniary interest given that as Dr Smith pointed out there is a case in the High Court at the moment that if it were to proceed would involve every member of the Labour Party caucus being up for an amount in excess of $10000. That is not a common interest for the rest of Parliament; it is peculiar to the Labour Party. I think those members do clearly have a direct pecuniary interest that is not general to the rest of Parliament. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I do not know whether you were here before Dr Brash but I clearly made a point that court proceedings do not prevent legislation from proceeding. 
JUDITH COLLINS (National—Clevedon) 
: 
 I raise a point of order Madam Speaker. I refer you to Speakers’ ruling 63/1 which is in relation to a party vote. I do this because when it came to the vote in relation to the naming of Dr Nick Smith after the vote was lost on the voices you directed that there be a party vote. I quote the Speakers’ ruling: “A party vote is not an opportunity for a member who does not agree with the result on the voices to test the position of another party. The Chair will have the Clerk conduct a party vote only if asked to by a member who gave his or her voice contrary to the Chair’s declaration of the result on the voices.” I believe that your decision to require the Clerk to go ahead with a party vote was a wrong decision in terms of Speakers’ rulings and the Standing Orders. I seek that you revisit that decision because I believe that it invalidated your attempt to have Dr Smith named. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No the member is quite wrong. That is completely the Speaker’s call. [ 
Interruption 
] I have dealt with this issue and I will not have any further discussion on it. 
Dr DON BRASH (Leader of the Opposition) 
: 
 I raise a point of order Madam Speaker. This is a different point of order. 
The ASSISTANT SPEAKER (Ann Hartley) 
: A different point of order Dr Brash. 
Dr DON BRASH 
: You said that High Court cases did not invalidate legislation going through and I accept that completely. But Standing Order 166(1) states: “A member must before participating in the consideration of any item of business declare any financial interest that the member has in that business.” I think that all we are asking for is that members of the Labour Party who speak on this bill do declare they have a financial interest in its outcome. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No that is not correct. 
Eric Roy 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Is this a different point of order Mr Roy? [ 
Interruption 
] Yes I have concluded. The information I have been given is that this financial interest is not different from that of other members generally. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Madam Speaker. I understand your ruling about the court case but I will give a situation where it is quite different from that of every other member in this House and that is the situation of Peter Brown and the New Zealand First MPs who by their own words and actions have declared clearly a financial interest in this bill. They have said that if it is found that their spending has been unlawful then they will cough up $150000. 
Peter Brown 
: No we haven’t. 
RODNEY HIDE 
: Peter Brown now says he will not. I notice that he can interrupt on my point of order. [ 
Interruption 
] I do want to hear Peter Brown’s speech eventually; I would rather that he was thrown out when he had finished his speech. But by his words he said: “If this legislation doesn’t pass we’ll have to pay the money. If the legislation does pass we won’t have to.” I cannot understand a more clear financial interest in a matter before this House than the one that Peter Brown and New Zealand First confront here today. 
The ASSISTANT SPEAKER (Ann Hartley) 
: This affects all members generally. It is not— 
RODNEY HIDE 
: It does not affect me because I have paid the money. It does not affect the National Party because they have paid the money. It does not affect the Maori Party because they have paid the money. It does not affect the Green Party because they have paid anyway. It does not affect the Labour Party because they are not going to pay it ever! 
The ASSISTANT SPEAKER (Ann Hartley) 
: Mr Hide you have made your point. 
Hon Tau Henare 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Is it a new point of order? Because I have ruled on this point of order. [ 
Interruption 
] Please be seated. I want all members to be very clear that I have ruled on this point of order relating to this appropriations bill for the Parliamentary Service. The points that members have been making affect all members generally. I have ruled on this matter. 
Hon Tau Henare 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Can I just check with the member because I have ruled on this matter. 
Hon Tau Henare 
: Madam Assistant Speaker I think you will find out that it is. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Please be seated. I will just make it clear again. The bill is to validate expenditure and provide an interim funding arrangement. It is not to do with members individually—their pecuniary interest. Please continue Mr Brown. 
Hon TAU HENARE (National) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I am not taking any more. Please be seated. I have warned the member that I have ruled on this point of order several times. If the member wants to raise a new point of order that is different but I must warn the member that I have ruled on this point of order. For the member continually to raise it is in itself out of order. 
Hon TAU HENARE 
: During Rodney Hide’s point of order—and you have now dismissed two members of this House—Peter Brown interrupted. I ask you to treat equally everybody in this House and ask him to leave the Chamber for the exact reason that my colleague Paula Bennett and my colleague Harry Duynhoven were removed from the Chamber—for interjecting on a point of order. 
The ASSISTANT SPEAKER (Ann Hartley) 
: And while the member was making a point of order—Mr Hide—several members here were raising points of order. I was trying to clarify this matter which had become complicated. Please continue Mr Brown. 
Eric Roy 
: I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sorry Mr Roy—is this a new point of order? 
Eric Roy 
: No it is not because— 
The ASSISTANT SPEAKER (Ann Hartley) 
: OK I have ruled— 
Eric Roy 
: Could I please explain. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Please be seated. I have ruled on this point of order. That is the end of the story. 
ERIC ROY (National—Invercargill) 
: 
 I raise a point of order Madam Speaker. Can you repeat your ruling on the point that I made because I have completely missed the point you made. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I have ruled on the points of order that numerous members have made about members not being able to participate in this debate because of their perceived pecuniary interest. What I have said very clearly is that this expenditure relating to the validation of appropriations in Vote Parliamentary Service affects all members generally. 
ERIC ROY (National—Invercargill) 
: 
 I raise a point of order Madam Speaker. Mine is quite separate. I did raise a point of order and then it was kind of overtaken by other matters. The point I make is quite simply that procedural motions are quite prescribed and have to be adhered to accurately particularly because in the case of naming a member it is a very serious matter. There is a very prescribed and stated motion in Standing Order 87. You did not adhere precisely to that wording so I questioned the validity of your move. You mentioned that we had understood the intent. My point of order is that that is not the point. This is a procedural motion in which very exact wording must be used. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I have already ruled on the matter. As I said the intent was clear in the naming. All members who voted on it are clear about the intent of the naming of a person in this House as the member—[ 
Interruption 
] Mr Simon Power would you like to withdraw and apologise. 
Simon Power 
: I withdraw and apologise. 
The ASSISTANT SPEAKER (Ann Hartley) 
: As I said Mr Roy the intent was clear. All members are clear about the naming of a member. I asked the House to name this member. [ 
Interruption 
] I am sorry but I will not enter into this any longer. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. Can we expect then to see a written ruling changing the Standing Orders to comply with your determination that as long as the Speaker loosely indicates what is intended then procedure is deemed to have been followed? 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I am sure you cannot because it is unnecessary. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I have dealt with the matter that you have just raised Mr Brownlee. I have ruled on it. 
GERRY BROWNLEE 
: Madam Assistant Speaker have you ruled that the Standing Orders in the case of naming members no longer apply? 
The ASSISTANT SPEAKER (Ann Hartley) 
: Of course I have not. 
GERRY BROWNLEE 
: Well that is exactly what you have done. You either follow the Standing Orders or do not. Naming someone is a serious matter. You cannot expect us to be totally compliant while the Speaker gets it wrong. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is absolutely right; the naming of a member is a serious matter. That is why I referred to the Standing Order that the House be asked to name the member. All members of the House are very clear about that when a member is named. [ 
Interruption 
] I have dealt with this matter and there will be no further points of order on it. 
Dr RICHARD WORTH (National) 
: 
 I am glad that the Leader of the House is here because I seek leave for the naming of Dr Smith to be revoked. The reason for doing that is twofold. Firstly with great respect to you Madam Assistant Speaker I do not believe that when there was no call for a party vote you were entitled to require a party vote to be taken; and second—and I respect your ruling on this but I nevertheless suggest it is not correct—there has been a formal breach of those two Standing Orders that relate to naming Standing Order 87 and Standing Order 88. So that we can move on I seek leave for the revocation of the naming of Dr Smith. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Leave is sought for that purpose. Is there any objection? There is. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I seek leave to table a document entitled  
Principles to underpin management by public entities of funding to non-government organisations 
. 
Document not tabled. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 I raise a point of order Madam Speaker. I think we have got ourselves into a bit of an impasse here that it is useful to revisit. This is an important matter. It is one that the House has the right to consider properly. We are being held up here on an issue that is not of some insignificance. I do not wish to undermine your authority at all but I suggest that it would be appropriate for Dr Worth to seek the leave again to enable the House to move forward. Clearly Dr Smith will then be on some pretty clear notice about his behaviour moving forward and I am sure other members will be as well. 
Dr RICHARD WORTH (National) 
: 
 I seek leave for the naming of Dr Nick Smith to be revoked. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Leave is sought for that purpose. Is there any objection? There is not. 
Question by leave revoked. 
Appropriation (Parliamentary Expenditure Validation) Bill 
First Reading 
Debate resumed. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Madam Speaker. I think that in the spirit of cooperation we should just move on but I want to draw your attention to something; I am not worried about it now but I want to make this point and then I am happy for Mr Brown to resume his speech. Your ruling has been a bit tough. I noticed that when Paula Bennett interjected on Trevor Mallard’s point of order you threw her out. When Mr Harry Duynhoven interjected on Judy Collins’ point of order you threw him out. But when Peter Brown interjected on mine as was acknowledged by everyone somehow that was perfectly OK and you did not offer any sanction whatsoever. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Mr Hide I have already dealt with that. As I said when you raised several points of order several other people were interjecting at that time and there was a lot of discussion. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 I raise a point of order Madam Speaker. I take you back to the events surrounding your request for Mr Duynhoven to leave the Chamber. When members are told by the Speaker to leave the Chamber they are required to go immediately with no further action taking place in the Chamber and normally the Speaker holds up proceedings to make sure that the member who has been instructed to leave does leave. 
 After Mr Duynhoven’s offence was drawn to your attention you decided you had to require him to leave. You instructed him to leave but rather than leaving he wandered over to the whip and engaged in a lengthy conversation. My colleague who had raised a further matter was already well into the development of his theme before Mr Duynhoven left the Chamber. I draw to your attention the fact that you had already ruled his actions to be disorderly by requiring him to leave the Chamber. The only thing that can happen after that is for his behaviour to be ruled to be grossly disorderly and for him to be named. That is the approach that you took with regard to one member today and I now require that you consider taking precisely that action in respect of Mr Duynhoven. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 This is quite important. The matter is now out of time. That matter should have been raised when it happened; the member cannot raise it later. It is now out of time. One could have made exactly the same point about Ms Bennett when she delayed her departure from this House. It is beyond the point of time that the matter should have been raised; the member should not try our patience further. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I noted that Mr Duynhoven did do that. I thought about interrupting the speaker and refrained from doing that. Mr Duynhoven went. I take your point Mr McCully. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 I raise a point of order Madam Speaker. 
The ASSISTANT SPEAKER (Ann Hartley) 
: We have dealt with this matter now. 
Hon MURRAY McCULLY 
: I am raising a new matter. Dr Cullen has just made a suggestion that my actions were out of time and I want to clarify that matter. This has been something of a brawl. I am not allowed to refer to the fact that the Leader of the House was not here at the time but I simply say that Dr Cullen may not be in full possession of the facts in relation to the proceedings of the House in the last hour or two. I respond to his assertion by simply saying that I have been trying to raise this point for some time now. The fact that the Speaker has chosen not to give me the call because other matters have been given precedence is not my responsibility and I reject absolutely the suggestion that I did not raise the matter in time. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member is probably correct in that a lot of other points of order have been raised. I did not realise that that was the particular point that you were going to raise. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 I will commence where I left off before that interlude. I want to make this point absolutely clear: New Zealand First will pay any moneys that it rightfully and lawfully owes. However we have reservations—and we are entitled to have reservations—about the Auditor-General’s summation. [ 
Interruption 
] 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Mr Brown please continue. 
PETER BROWN 
: And because we have reservations about the Auditor-General’s report— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. It might be that not many other people are interested in what this member is saying but I am and I cannot hear him even leaning back hard against the speaker behind me. Could you maybe ask for a little more decorum so that we can hear the member? 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Mallard. Can the member please continue. 
PETER BROWN 
: We have reservations about the Auditor-General’s findings we are entitled to have those looked into and we are seeking legal advice. On this issue I tell members that some top Queen’s Counsel in the country cannot agree on the whole thing. 
I want to make this clear also. The Auditor-General alleges he went and spoke with the political parties and outlined his concern. We know that he spoke to Dr Don Brash because Don Brash was on the radio saying so but he did not speak with anybody in New Zealand First and I do not believe— 
John Hayes 
: I raise a point of order Mr Speaker. I seek your judgment on Standing Order 111. Given that Mr Brown and his leader have intimated they are seeking a judicial review of their circumstances it seems to me that it is important that you give a ruling on the issue of whether we can hear his speech or whether there is a real and substantial danger of prejudice to the trial of the case. On that matter Mr Assistant Speaker I seek your view. 
Hon Trevor Mallard 
: It is a very simple matter. This is not a matter awaiting or under adjudication in any court of record at the moment. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you very much. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. If Mr Mallard’s proposition were correct then clearly Mr Brown is misleading the House and you must most definitely have a view on that. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I have only just stepped into this debate. I am listening very carefully to what Mr Brown is saying and I will continue to do that. In the meantime I say that Mr Brown should not get into the details of the case if papers have been filed. 
PETER BROWN 
: Mr Assistant Speaker— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I have already ruled Mr Brown. 
PETER BROWN 
: Well let me make clear what I have said. I have not said— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Hang on Mr Brown. I am on my feet; please be seated. I am saying to the member that he should not get into the details of the case if papers have been filed. If they have been filed the member should not get into the details of the case; if they have not been filed it is a different matter. 
PETER BROWN 
: Thank you Mr Assistant Speaker and let me put your mind at rest. I have not spoken about any judicial review or any papers or any speaking about any judicial review or papers—or any legal court or anything else along those lines. I have suggested that New Zealand First will be consulting lawyers and getting their advice. We understand that the Auditor-General spoke with at least the National Party and advised its members some time before that he was going to take a tougher or a different line on this issue. At no point did he speak with anybody in New Zealand First. I will say that again: at no time did he speak with anybody in New Zealand First. I do not believe that he spoke with the Maori Party the Green Party or United Future but they can clarify that for themselves. At no time so it appears did he advise even the Parliamentary Service because some of the so-called offending material that we have been found guilty of using was checked by the Parliamentary Service. We had clearance from the Parliamentary Service. Then for the Auditor-General to claim by vague references— 
Simon Power 
: Like a Solicitor-General’s opinion. 
PETER BROWN 
:—that this July 2000 report constitutes a warning for the third parties is we believe patently unfair. It is all very well for Simon Power to say: “Like a Solicitor-General’s report.”; the Auditor-General knocked on Don Brash’s door and spoke with him for quite some considerable time. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Can members be seated. I say to the members on my left—many of whom have been in this Chamber for many years—that I would like them to look at Speakers’ ruling 57/3: “Interjections … are out of order unless they are rare and reasonable;”—and as a former colleague in this place used to say they sometimes at least might be witty. 
Judith Collins 
: Point of order— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Speakers’ ruling 57/3; I have made a ruling. 
Judith Collins 
: I have a point of order—a new one. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am sorry. 
Judith Collins 
: I raise a point of order Mr Speaker. I want to clarify because of all that has gone on this afternoon whether the member speaking—and I raise this point now before he continues so that I am not interrupting him again—has declared his financial interests in this matter and whether his case is different from those of the rest of us. We think it is different because we do not owe the money. Is this a financial interest that should be declared by the member? 
Hon Trevor Mallard 
: I think you know Mr Assistant Speaker and I think that that member knows that there is not a financial interest in this. If one looks at this appropriation legislation one sees that the case is exactly the opposite. If there were to be any interest it would be in the approach that some members opposite have been suggesting. There is none in this bill. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I think the Minister has made a good point but I am prepared to listen to what the member has to say. 
Judith Collins 
: Mr Assistant Speaker I refer you to Standing Order 165(1) which states: “A financial interest is a direct financial benefit that might accrue to a member personally or to any trust company or other business entity in which the member holds an appreciable interest as a result of the outcome of the House’s consideration of a particular item of business.” I put it to you that the member who has just resumed his seat—Mr Brown—would on an ordinary reading of that particular Standing Order have a financial interest. He needs simply to declare that interest as I see it under Standing Order 166 and I request that you ask him to do that. 
Hon Trevor Mallard 
: I do not want to prolong this any more than is necessary but I explain for the House that when one is dealing with financial matters there are really two sorts. The first is when there is spending—the sort we are currently dealing with—and the second is one when there is income revenue to the Government or taxation which would deal with matters of refunds. At the moment we are dealing with an appropriation and therefore it makes no difference to whether refunds are made. Therefore members cannot possibly have a financial interest in it. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Mallard. It is up to members individually to declare whether they have a financial interest. It does not relate to individual members. I understand that the matter has been dealt with in a previous sitting. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. You pointed us to Speakers’ ruling 57/3 on interjections and I notice here that the rule was originally made by Speaker Statham in— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: 1923. 
Gerry Brownlee 
:—1923 yes. It was upheld by Speaker Barnard in 1936. It was further upheld by Speaker Barnard in 1936 and there have been no updates since. So this is a 70-year-old Standing Order. Things have moved on a bit Mr Assistant Speaker and I think there is an opportunity here for you. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: You have everybody laughing Mr Brownlee. 
Gerry Brownlee 
: No I think Assistant Speaker Robertson could well find himself making the 2006 ruling. It would be quite a contrast—1936 with 2006. I was fascinated that you obviously are very aware of it because you called our attention to it without reference to the book. You are well aware of the importance I suspect of the interjection process. Goodness the whole House would be asleep most of the time if it were not for interjections. I just say one more time that you really do need to think about updating that particular Speaker’s ruling. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Brownlee. I have taken note of what you said. I call the honourable member Peter Brown. 
PETER BROWN 
: I raise a point of order Mr Speaker. How long do I have left? 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Just under 3 minutes. 
PETER BROWN 
: I seek leave to start at the beginning and go through it all again because clearly members opposite do not understand the issue. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The House is the master of its own destiny. The member is perfectly entitled to seek leave if he so wishes. 
PETER BROWN 
: I seek leave to start again right at the beginning and go through the whole thing in one hit. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Is there any objection to that course of action being taken? There is. The member will continue.  
Hon Members 
: Ha ha! 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Let us give Mr Brown the courtesy of being heard colleagues. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. There has been a misunderstanding. The “Yes” was in fact an affirmation that we would like the member to start again. Put the leave again. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Would the member please continue. 
Rodney Hide 
: I raise a point of order Mr Speaker. I think that what Mr Brownlee is saying is that there was no objection from the National caucus to leave being granted and that there was a misunderstanding. Everyone was so enthusiastic to hear Mr Brown’s speech uninterrupted from the start that an involuntary exclamation was emitted. I think the House actually—and I am relying on the previous Speaker’s ruling that it is the intent that is important—intended that leave be granted and I think it was granted. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: You cannot seek leave for somebody else. 
Eric Roy 
: I raise a point of order Mr Speaker. The House sets precedents for itself. The very last time that my colleague Dr Worth sought leave the very same thing had happened; there had been an error of judgment from within the Labour caucus and Dr Worth sought that the leave be put again. I think it is totally appropriate that it be put again. The same mistake has occurred on this side. There is a precedent. We would certainly encourage Mr Brown to put his leave again. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you. The thing is that the issue is in the hands of Mr Brown. 
PETER BROWN 
: Thank you Mr Assistant Speaker. If I have one serious thing to say about this afternoon— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I have two points. The first is that again I am having trouble hearing the member. The second point is that in the racket he might have missed the point that everyone wants to hear his speech again. But only he can seek leave for that. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Mallard. I just say that the practice of members engaging in barracking is intolerable in this Chamber. I call Mr Brown to continue his speech. 
Rodney Hide 
: Point of order— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: No I have dealt with this issue Mr Hide. The member is to continue his speech. 
Rodney Hide 
: I raise a point of order Mr Speaker. I do not think you understood what I said. Maybe I did not communicate it very well to you. My point was that leave had actually been granted. It does not need to be put again. The House granted Mr Brown leave—that was the intent of the House—to start his speech again. Leave has been granted. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Hide. That is not the intent I got from Opposition benches. We have all been in this House for a long time and know that when somebody says “Yes” when leave is put he or she is objecting. That is the normal practice and has been ever since I have been a member of Parliament which is nearly 20 years. I will put the case back in the hands of Mr Brown. It is his call. He is the man making the speech and he is the only one who has the right to ask for leave. If he chooses not to do so that is his decision.  
Judith Collins 
: I raise a point of order Mr Speaker. I put my hand up and say that I said “Yes” but it was a “Yes Mr Brown! We’re going to hear it again!”. It was an affirmation. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I thank the member but it is up to Mr Brown. I have already ruled. Please continue your speech Mr Brown. 
PETER BROWN 
: I would have thought it appropriate for the Auditor-General at least to have advised the Parliamentary Service in clear concise terms what he was going to do. When New Zealand First had our pamphlets our brochures checked off they were OK’d by the Parliamentary Service. On page 54 of the report—if anyone in the National Party wants to read it—the Auditor-General makes it quite clear that he sees that one of the remedies is that the Parliamentary Service should sign off any proposed spending. That is exactly what we asked for. We think this bill is essential in order to clarify the circumstances in which we operate in Parliament. 
In conclusion I have to say that I have never seen such childish behaviour in my life. If this is what the National Party has become then God help it. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 The Greens will abstain from voting on this bill in accordance with our cooperation agreement with the Government on all matters of confidence and supply. A month ago I announced that the Greens would pay the full amount found to have been spent outside the scope of our parliamentary appropriation but that we would not support validation legislation on the principle that MPs should not use their power to legislate in order to remove themselves from accountability. Since then it has been clarified that the form taken by the legislation makes it a matter of confidence and supply so there would need to be an extremely good reason not to observe our commitment under the cooperation agreement which is to abstain. It is also clear that this legislation is actually required by the Public Finance Act and the House cannot really get around that. 
We would be entirely happy not to oppose the bill at all if all parties had committed themselves to their moral obligation to repay any spending that has been found to be outside the scope of the appropriation. However two parties have yet to make that commitment. We would be very concerned if this legislation was used by them as an excuse not to pay the money back. The obligation is simply a moral one. We can find no legal obligation on any party to make restitution for what is found to have been spent in error. But the passing of validation legislation does not absolve anyone from that moral obligation onerous though it must be for parties that like our party have reduced representation this term compared with that in the previous term. 
In the Committee stage we will support those clauses that set out the rules from here on. If the bill could be split into two we would support those clauses at the third reading too but it appears that it will not be. It is essential that the law gives us some guidance as to the meaning of “parliamentary purposes” and “electioneering”; otherwise none of us know what we can and cannot do with our leaders’ budgets right now. It is true that we were all warned that we could not use parliamentary appropriations for electioneering and I think we all agree with that. It is also true that electioneering has never been defined so we all followed a rule of thumb that we could not ask for votes for a candidate or a party and that we could not solicit money or membership in any way. 
 The Auditor-General’s 2005 report did not clarify electioneering any further than that. To the extent that it did try to clarify the rules those criteria are not applied in the Auditor-General’s 2006 report. Our 2006 spending has been audited using a different set of rules from those set out in the Auditor-General’s 2005 report. For example the 2005 report identifies a principle of democratic interaction saying that dialogue between representatives and the public is a valid and fundamental part of a democracy. Yet newspaper advertisements that invited the public to discussions with me on climate change and oil depletion were ruled out of order though they made no reference whatever to the election. 
We also have a new rule that the legality of an action changes dramatically 3 months before an election. That is despite the opinion of the Solicitor-General which the Auditor-General says he relies on that explicitly says that things lawful for the rest of a parliamentary term do not suddenly become unlawful 3 months before an election. The Auditor-General relies on the Electoral Act for that ruling which is never applied to the spending of the Parliamentary Service appropriation. It is a particularly difficult ruling to apply given that one never knows that the 3-month period had started until the election has been called which usually occurs at least a month later. So we are meant to try to second-guess when the election will be held in order to determine when spending suddenly becomes unlawful. 
The Auditor-General has applied a ruling that any mention of the future or of a vision by a party constitutes electioneering. That would seem to favour parties that wish only to preserve the status quo. I also fail to understand the application of a criterion of wide dispersal where the more widely a communication has been dispersed the more it is held to be electioneering. Under MMP list members and parties have nationwide constituencies. Surely if a communication is lawful in one place it is lawful in several places. I raised my concerns regarding all those newly imposed criteria with Mr Brady when I asked to see him and I have still not had any satisfactory explanation of the criteria that he has used. 
Since the election the Auditor-General has defined as electioneering any discussion on matters not actually before the House. No such ruling was given to us before the election and it advantages members of the Government who are likely to want to talk about legislation they are promoting rather than Opposition parties who prefer to discuss with the public legislation they would like to introduce but have not had the opportunity to introduce. 
Clause 7 defines “parliamentary purposes” in the way they have been understood for some time: excluding the seeking of votes money or members. At least with that through we can continue to do our jobs as MPs in the interim while new rules are developed before the next election. The Greens look forward to participating in that process. 
Some very serious issues of democratic principle are raised by this investigation and this ruling. Members and parties are elected to pursue certain policies on behalf of the public. Elections are or should be a contest of policies. The business of Parliament is partly about ensuring stable government and much of its lawmaking is not particularly contentious. But it is also about a contest of ideas for the future of our country. A central question is whether MPs are allowed to use parliamentary funding to discuss their policies with the public. That goes to the heart of the issue. If they are not permitted to do that then parties without rich backers will have difficulty in informing the public about what they propose and a poorly informed public cannot support a democracy. The ruling from the Auditor-General says that we may not use our leaders’ budgets to tell the public about the policies we are advocating. It is hard to see what we can then use them for. Can Dr Brash for example give the House his word that no letters were sent from his office in the 3 months before the election outlining the National Party’s policies or is it just that there is no audit trail for that sort of activity as distinct from advertisements taken out in newspapers? 
It will always be difficult to draw a line between where work as a parliamentarian stops and electioneering starts. That is why we need clear guidelines if the line is to be drawn in a different place from where we always thought it was drawn. In particular this report is a very partial audit of parliamentary funding for parties. It has looked only at advertising expenditure. If the advertising budget cannot be used to discuss our policies with the public then surely neither can our staffing budget our travel budget our accommodation budget or our phone budget. 
If staff are not allowed to prepare responses to questions from the public and the media about our policy positions it is difficult to see what they can do in the period after the House rises for the election. There is no parliamentary business for them to assist with. Parliament is in recess then in order to allow the democratic process of electing representatives to occur at which time the overwhelming public interest is in learning factually about the policies the parties are proposing. No one has ever told us that all staff must be sacked on the day after the House rises for the election which would be the consequence of applying the criterion the Auditor-General has proposed. 
The report also raises questions about the use of money allocated for MPs’ travel and other expenses during that period. It is surely absurd that we cannot use parliamentary money to invite people to a meeting to discuss our policy but we can use it for the leaders to travel to the TV debates which are totally about electioneering. 
Those are all matters that the Parliamentary Service committee must consider in order to have new rules in place before the next election. It may be that the definition of “parliamentary purposes” should be somewhat narrower than that set out in clause 7. Advertisements that do not solicit votes or money but that nevertheless make disparaging comments about other parties or simply carry slogans with no information or content might equally be held not to be for parliamentary purposes and to be solely for electioneering purposes. That is for the Parliamentary Service committee to determine in its deliberations. For the moment we have the guidance we need in order to continue to do our work as MPs. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe; kia ora tatou. For months this Parliament has been swooning over three little words and they have not been “I love you.” “Pay it back” has been the constant call and today we see how this Government is addressing the political inferno that has erupted around paybacks. We thought that last Thursday the Government had the guts to fess up to come clean— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: No the member will be seated. You cannot challenge the Government’s courage or that of a member. That is a personal reflection. The member cannot use that word. He cannot challenge someone’s courage. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I hate to disagree with you. I think the member actually praised the Government for having courage and a member is allowed to do that. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am sorry; that is my mistake. My apologies Mr Flavell. 
TE URUROA FLAVELL 
: —and to plead guilty that spending of $447000 on a pledge card is unlawful expenditure and we welcomed the Prime Minister’s statement to that effect. Compliance with party and member support appropriations under Vote Parliamentary Service is a critical part of doing our job. 
The Maori Party accepts the report of the Controller and Auditor-General Kevin Brady and understands only too well the importance of certain concepts that are very freely thrown around in this Chamber—concepts such as honesty integrity and accountability. We endorse unreservedly the Auditor-General’s comments on the need for the prudent management of public money. We also share his concern around the significant breaches of the appropriations. We look forward to robust debate about what are legitimate parliamentary purposes as opposed to electioneering purposes at the table of the Parliamentary Service Commission and the appropriation review committee. But no Labour had to shuffle the cards before they were even dealt and it has introduced appropriation legislation as a confidence and supply matter. We are all under the scope of public scrutiny and the Maori Party has stood up to that scrutiny and paid the money back. We paid the dues—all $53.70 worth. That was the right thing to do and it was the honourable thing to do. 
I want to talk a little more on the concept of honour for just one moment. Is it honourable to accuse an official of besmirching the reputation of politicians? Is it honourable to send strongly worded dispatches to the Parliamentary Service in order to apply more pressure to make it pay a bill for the distribution of the infamous pledge card? Is it honourable to take money from the public to pay for political electioneering not just in 2005 but in 2002 and 1999 as well? Is it honourable to introduce legislation to validate unlawful spending? The honour comes in admitting a wrong has been done and offering to pay the money back. The honour comes in meeting our responsibilities as members of Parliament to the taxpayers of this nation. The honour comes in being accountable to the citizens of Aotearoa. 
The response from the Speaker to the Auditor-General’s report was a stunning display of verbal gymnastics. In particular it states that if there is no validation reimbursement does not purge the unlawfulness. I quote: “Without validating legislation the unlawfulness remains.” So what is the issue at hand? Is it the unlawfulness or is it the lack of validating legislation to purge the unlawfulness? Clearly the latter has prevailed with today’s introduction of legislation whipped up under the frenzy of urgency. 
We absolutely agree that in the court of public opinion this Parliament has been found guilty of crimes against the taxpayer in terms of some $1.2 million of parliamentary funds having been spent unlawfully on electioneering by MPs. We need to have a speedy resolution to the issue if we are ever to build confidence in the public so that we will not be summed up in one of those Tui ads that might read: “MPs can be trusted not to fritter away taxpayer funds for their own election campaigns. Yeah right!”. 
The Maori Party considers the question of transparency to be central to the debate at hand. When our whanaunga break the law they are charged and prosecuted. They plead guilty or not guilty enter a plea bargain get immunity because they are prepared to give evidence against another person or if convicted get fined home detention community service or even incarceration. I have never heard of any of them seeking retrospective legislation to validate their unlawful behaviour. The Maori Party has to ask where the old maxim “do the crime do the time” went. All of a sudden the high-minded parliamentary moral police are silent. Although paying up will not purge the unlawfulness of the expenditure is it not transparently obvious that in wanting to pass retrospective legislation all this Parliament will do is to validate or legalise the illegal? The logical upshot of this is that the most guilty parties will then claim that what they did was not unlawful and we can therefore expect that they will say they do not have to pay their dues. That is cheeky and arrogant and it knows no bounds. 
We cannot resile from the fact that this whole inquiry into parliamentary spending came into being because of the lack of transparency—the fuzzy boundaries between departmental ministerial and political advertising—that was evident through the Working for Families promotion. The Maori Party has asked on a number of occasions where the honour was in introducing a policy that actively discriminates against 250000 New Zealand children who have at least one parent on a benefit. How can this Government sit silent knowing that it has forced the Child Poverty Action Group to take legal action in the High Court over the in-work payment—the $60 a week that beneficiary families are prevented from accessing. How ironic it is that on this day International Anti-Poverty Day on the one hand we are discussing an Appropriation (Parliamentary Expenditure Validation) Bill to justify unlawful spending by MPs—MPs who will soon benefit from another pay rise—while on the other hand this Government is denying money to our most vulnerable families. 
We absolutely agree with the Speaker’s advice that this matter must be considered seriously if public confidence in Parliament is to be maintained. In honour of this moment in history we want to shift the rhetoric from a focus on “payback” to a drive to “pay forward”. The concept of payback brings with it notions of revenge punishment and retribution. We want instead to promote the notion of paying forward. Paying forward is an investment in the future. It says: “I will care for you I will look after you.” Paying forward is a way of contributing to the well-being of people. It is a promise of compassion and a commitment to integrity. 
How much more honourable it would be for the record Government surplus of $11.5 billion to be spent on the future of Aotearoa. We could invest in justice—Treaty justice. We have been told repeatedly that $1.3 billion until 2010 is all that the country can afford to pay for the land alienation and confiscation that occurred over 150 years. I remind this House of the advice from Professor Margaret Mutu that the settlement claims equate to approximately 0.6 percent of what the claims are really worth. Hirini Moko Mead of Ngati Awa in describing the direct negotiations process explained: “Very often there is no negotiation but rather there is a statement that this is the Crown’s policy and this is what you have to live with.” Our people have gone into settlements accepting that the deals that are done are at best a compromise that by no means compensates for the magnitude of their loss. And even then in the case of the Te Arawa lakes settlement the settlement contained confiscations anew through the intervention of a new concept: the Crown stratum. Paying forward would acknowledge a grievance had occurred and the claimants could be supported to achieve fair and durable settlements. 
The opportunity provided by the Auditor-General’s report was indeed a turning point in the history of this nation. But the hard work will come with paying forward and setting a pathway for the nation. Now is the time to invest in the future—a future based on honesty accountability and justice. We could invest in the ongoing health of the nation by ensuring we retain quality medical specialists rather than losing them to international salaries. We could invest in Maori Pasifika sole parents and benefit-dependent families for whom poverty has become entrenched. We as a nation could pay forward clawing back our reputation internationally from that of a nation that breaches the human rights of indigenous peoples to that of a nation that upholds the rights of every citizen to achieve his or her optimal well-being—mauri ora. This is an opportunity to truly pay forward and to invest in a new direction in setting a pathway for the nation. Now that would be extraordinary legislation which we would sign up to. Kia ora tatou. 
Hon PETER DUNNE (Leader—United Future) 
: 
 In speaking to the Appropriation (Parliamentary Expenditure Validation) Bill I want to make my remarks in two parts. The first part deals with the Auditor-General’s report and the response to that and the second deals with the legislation itself. I think that at least one party in the House may not have quite caught up with the news that United Future has agreed to repay the amount deemed owing in the report and we will do so as soon as we are in a position to meet that commitment. 
That commitment will not change with the passage of this legislation. Our view is that although we think there are considerable flaws in the Auditor-General’s report and the logic that he applied to his decisions those considerations actually count for nothing in the public mind. The public is clearly of a view that parties misappropriated their funding and that parties have consequently to make good that misappropriation. Whatever our thinking about the nature of the report and the way it was carried out we will honour that commitment. That stands regardless of the fate of this bill. So I say unequivocally to those who fear that the passage of the legislation may be used as a vehicle to say that what was deemed to be unlawful is therefore now lawful so our obligations do not apply that in our case we do not accept that logic. We accept the commitment and we will meet it. 
The second point I make relates to the bill itself. It has been said—and I think with some truth—that validation measures are not unusual in this Parliament and some very large validation measures have been passed through this Parliament over the years. In fact I recall one for something in the order of $350 million in one instance. In this case Treasury has advised that given its role as the steward of the public finances and looking at the provisions of the Public Finance Act there is now a question—a very real question—about the validity of all parliamentary expenditure under these headings going back to 1989-90. The consequence of a question being asked about the lawfulness of expenditure over a 17-year period raises serious questions for the integrity of the books of successive Governments over that period. Therefore there is a strong case to pass legislation to clarify immediately that that expenditure was in fact lawful; that removes not just a question of doubt over the 2004-05 and 2005-06 years but the question of doubt that Treasury has identified right back to 1989-90. 
I observe in passing that at that level this is just not an argument about parliamentary spending. If the integrity of the books of New Zealand is in question then so too is our integrity in the international financial marketplace and our ability to do business in that sense has been adversely affected. So this legislation becomes more serious and more necessary in that regard. 
The next aspect of the legislation that is important is to clarify the definition of “electioneering”. We may not be in election mode at the moment but it is unclear arising out of the Auditor-General’s report—and particularly if one relies on the advice of the Solicitor-General then looks at the conflicting advice from Mr Hodder—what actually constitutes electioneering at the present time. One thing we can say is that a majority of parties in this House if not all have historically had a view about what one can and cannot say and that view is challenged in the Auditor-General’s report. So at the very least an argument emerges that we need to codify what it is that constitutes election spending and that is what this bill does by taking a very conservative approach in that it effectively replicates what most of us have understood to be the status quo. 
But because there is uncertainty moving forward the bill introduces a sunset clause at the end of next year—31 December 2007—on the strong understanding that in that time the Parliamentary Service Commission members of Parliament and the parties in this Parliament will work to develop new rules that are more specific more transparent less uncertain and less open to the misinterpretation that clearly applied across the board at least in the mind of the Auditor-General before the 2005 general election. So this bill sends a signal in that regard—that it expects further work to be done. 
Members may well ask: “Why the urgency—why the need to do this right now?”. I say two things in response to that. Firstly the Speaker in her response to the Auditor-General’s report last week—and I hope I am not involving her in the debate by quoting her report—highlighted some circumstances that could be occurring right now where expenditure by members on areas they thought were legitimate is brought into question. For the safe and good running of this Parliament and the whole process that we are about that cannot continue unanswered. 
The second point is that my party has already had accounts for payment returned to it by the Parliamentary Service since last week—accounts that in the normal course of events would be paid because they satisfy the conditions—on the grounds that in the wake of the Auditor-General’s report new uncertainties now apply. So we are now getting to the situation where the day-to-day business of this place—and I am not talking about electioneering accounts—is being put in some doubt not by officious bureaucrats but by cautious people saying: “Given that ruling we are uncertain as to how we proceed.” So that is what introduces an element of urgency into this legislation. 
There will be many who will say that this is Parliament rushing to get itself out of a hole. I do not think that is true because even by making lawful what the Auditor-General has deemed to be unlawful in my view we do not remove the moral obligation on those who have accepted it to repay the debts that have been attributed to them. But what we do is remove the uncertainty that now affects the Crown accounts that now affects the way in which this Parliament operates and the big question that hangs not so much over us but over the staff who support us about what they can actually do as part of their normal duties helping us do the work we are elected to do. 
This has not been one of Parliament’s most glorious moments. This has not been a happy affair whatever position one takes in relation to it. But the reality is that we need to act decisively to resolve it. Given the commitments that most parties have made to meet the obligations imposed upon them by the Auditor-General we need now to tidy up this situation so there can be no uncertainties in the future. 
I hope that parties do not take the view that this lets them off the hook. United Future takes the view that we have some obligations imposed upon us by the Auditor-General’s report. In the case of a very small party they are very big obligations. I was tempted at the beginning to declare a massive financial interest in this because it certainly is for my bank balance. That is actually not the point. We accept that responsibility we move on and now we make sure that the rules that emerge as a result of this exercise are ones that are robust clearly understood able to be supported by all and not subject to the sort of misinterpretation misunderstanding and unruly and sometimes very bitter debate that the experience of the last election has occasioned. 
RODNEY HIDE (Leader—ACT) 
: 
 There is no need for validating legislation. Sure there has been some unlawful spending as identified by the Auditor-General. Well that can stand. It can be left as unlawful spending. I do not believe that our Parliament and our Government have done themselves at all proud in the way this matter has been handled. 
The Auditor-General is an officer of Parliament. We make him an officer of Parliament so he is independent of the political day-to-day business of Government. We spend taxpayers’ money. I believe that we did try to stay within the rules. I believe every party when it says that. However we know that it is possible to get it wrong and we did. The person who said that we got it wrong was the Auditor-General. He gave us an opportunity to have an input on his draft report and I believe that every party bar New Zealand First did so. New Zealand First for its own reasons chose to dispute the report after it had become finalised. I myself sent a strong letter to the Auditor-General and I met with him and spoke on the phone on I think three occasions. I made a very strong representation to him and he listened to me most carefully. 
In the end he reached his conclusions and I regard him as a referee. If this Parliament we as politicians and indeed the Government are to have any sort of integrity and legitimacy then we have to say: “OK I gave it my best shot. The Auditor-General gave me an opportunity and this is what he has found.” And it does hurt that he found against us. It hurts not just financially it actually hurts that we have been accused of spending money unlawfully. I know that our party—and I am sure the other parties including the Labour Party—believed that it was following the rules. But having been found by the Auditor-General to be outside the rules then I think that as parliamentarians we have to accept it and lump it. 
What I found particularly distasteful was Ministers of the Crown including the Prime Minister attempting to bully the Auditor-General and to attack the Auditor-General because I think that brings his office into question. I certainly believe that it undermines the authority of our Parliament because every other New Zealander apart from the 121 MPs in this House when found to be operating unlawfully cannot rush off and change the law. They cannot turn round and abuse the referee. There are consequences for doing that. 
Here are we making the laws for the rest of New Zealand to follow attempting to uphold our justice system and indeed offering some integrity to the way in which taxpayers’ hard-earned money is spent yet we saw the Prime Minister and Ministers of the Crown attack the Auditor-General in a way that we would not accept from any other New Zealander. We have seen Ministers of the Crown including the Prime Minister attempt to say that there are no rules for how they spend hard-working taxpayers’ money. Well that cannot be right. 
Now we find ourselves in Parliament changing the law to make lawful what the Auditor-General found to be unlawful. I will make it plain what we are saying here: MPs have unlawfully spent money that was hard-earned by taxpayers so what will we do? We will use the special privilege and special power we have to change that law in order to make what was unlawful lawful. That is wrong. 
It is wrong that we are doing it and it is wrong that we are doing it in such haste. We can think of all the issues that confront New Zealanders and our Government and our Parliament say that they are too busy to deal with them but when it comes to our politicians’ own self-interest—wow! Suddenly Parliament has time. And we are rushing it through under urgency so that the public whose money it is that is being spent—by us—does not have a say and so that when we are found in breach of the rules that we expect all New Zealanders to follow and all civil servants to follow and uphold at their peril we do not worry. No under Helen Clark’s Government we rush in with the legislator’s pen we stop Parliament in its tracks we bring legislation into the House and we pass it under urgency. 
That cannot be a right process and the easiest thing to do is for us to pay the money back. I value United Future’s position that those members will pay it back; I value the Labour Party’s position that it will pay it back. I think that that is the right thing for us to do as much as it pains us. But it cannot be right that we are here under urgency changing the law and I will make it plain. 
We had a situation where the Prime Minister signed a painting that she did not paint. There were legal implications arising from that. We cannot rush off and change the law on that basis. The law of art fraud has to stay as it is. We know from the police report that yes the Prime Minister broke the law. What she did was unlawful. She was not prosecuted or convicted and that is fine but what she did was unlawful—just like the spending that Helen Clark did was unlawful and just as the spending that the National MPs did was unlawful—and it should just stand. It does not need validating legislation. Helen Clark’s motorcade sped through the South Island at breakneck speed. That too was unlawful. We did not rush off to change the law to say that we will make lawful what was unlawful. Ruth Dyson was caught having had too much to drink then driving. We did not rush to change the law—no! Members of Parliament have to accept the consequences of the rules. They cannot use their special position of power and privilege to change the law. 
I listened most carefully to Dr Michael Cullen’s reasons for the other expenditure that MPs make and I think there is confusion over what the rules now are. I certainly think that when we head into the next election there will be huge confusion so the rules have to be tidied up. But the way to tidy up the rules is not to rush legislation through Parliament. It is not actually Parliament’s legislation that defines how we can spend the money. There is a reason for that: we do not want the courts looking into Parliament and at how it spends the money. That is why we have never put it on the statute book; it is for Parliament itself to decide. So what we should be doing rather than rushing in here in Parliament to change the rules is to take a considered approach as is envisioned in order to get some proper rules about how we spend the money. 
Let me put in my two pennies’ worth. I think we should have budgets like we have with the leaders’ budgets and for MPs. I do not think we can control the spending with a whole lot of rules. I think that is too tough. So I suggest instead that we have fewer rules and more transparency. I think the public has a right to know how political parties spend its money what they spend it on and how it is broken down and I think the Parliamentary Service should be subject to the Official Information Act. In fact I would go so far as to say that the Labour Party should be able to take its leader’s budget and spend it on the pledge card. That is its budget. But I say that the public has a right to know because we have found that that is where the rubber hits the road. The public has a right to know how we spend its money. 
Hon PETE HODGSON (Minister of Health) 
: 
 In the few minutes between now and the dinner break I will see whether I can convince my colleague Mr Rodney Hide to change his vote on the basis of this logic. I understand that the member said he felt that passing this legislation did not matter. He did point out that it had no bearing on whether one paid the money or refunded any outstanding moneys. He did understand that the passage of this legislation lets no one off the hook in terms of one’s decision of whether to refund any outstanding moneys and he does understand that the non-passage of this legislation puts no one on the hook in respect of refunding any moneys owed. 
He also pointed out the fact that money has been unlawfully spent and even though Madam Speaker and Treasury think that the legislation should be passed he has an argument that asks: “If it were not passed what harm would be done?”. I will not respond to that; that is his point of view. But I do invite the member to reflect on this: we do not know now what we can spend money on. We do not know that now. There is a reason prospectively—not retrospectively I say to Mr Hide but prospectively—to say that this legislation should be supported because it provides parliamentarians with a brightline as to what they may and may not do prospectively until new rules are in place. The Auditor-General’s findings whether or not one agrees with them are broad wide reaching and significant. The changes have been enunciated by speaker after speaker. 
Well that ruling stands unless this legislation passes. Therefore all this stuff about Dr Brash going to Nelson to sign up a person from the Green Party into the National Party and all of the examples given by Dr Cullen in the first speech in this debate are true—and any legal opinion would back that. In fact the Solicitor-General’s own legal opinion backs that. 
Hon Bill English 
: It’s all rubbish. 
Hon PETE HODGSON 
: Bill English says that it is all rubbish because that is as far as his intense intellectual ability takes him. The problem is that we do need to think prospectively. I would say to Mr Hide that there is a case for him to consider changing his vote to one of support—if not now then at the third reading because I do not think that this group of 121 people can operate unless there is validating legislation that tells us with some certainty what we can and cannot do. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Before we start I say to Mr English that I heard the comment he made as I sat down. Would the member like to withdraw and apologise? 
Hon Bill English 
: I withdraw and apologise. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Thank you. 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 In order to remind the House of why we are debating the Appropriation (Parliamentary Expenditure Validation) Bill today let us go back to 22 August last year. On that day Labour Party volunteers all around the country went to their electorate offices and campaign headquarters and picked up boxes of the pledge card. Those volunteers set off to every corner of every suburb in every town to deliver that pledge card. They put it in mailboxes street by street. 
The families young people and pensioners of New Zealand went out to the mailbox picked up their mail and took the pledge card back inside. Some of them just threw it in the rubbish because they were sick of the election already and some of them had a quick look and saw Helen Clark’s face on the card—nothing new—and did not take any more notice of it. Others picked up that pledge card and looked at it. They saw promises of a rates rebate; of 250 new community police which made them think about the burglary down the street last week; and of a $10000 grant to young couples who were trying to buy their first home. Then they looked at the TV and saw pictures of the political leaders going about the business of election campaigning. Those good citizens of New Zealand thought they were in an election campaign. And so did the Labour Party volunteers who were delivering that pledge card. 
But if members read the evidence that the Labour Party gave to the police when they investigated complaints under the Electoral Act they will find that two people at least thought Labour was not in an election campaign. They were the people who were running it: Helen Clark and Heather Simpson. 
Phil Heatley 
: Pete Hodgson thought they weren’t. 
Hon BILL ENGLISH 
: Everyone else thought they were in an election campaign. Some of those mums and dads might have made up their minds on that night but it was still 3 weeks until election day. Over those 3 weeks those mums and dads faced a barrage of advertisements in the newspaper and on TV that tried to change their minds about how to vote. Do members remember the newspaper ads in the last week of the campaign—“Don’t take the risk.”? 
Labour told the police that its spending was legal and that the pledge card was not electioneering but normal parliamentary business. Who ever believed that Labour believed what it was saying? The truth was that all that advertising in the last week or so before the election was unlawful because it was paid for by taxpayers’ money in the first place and more important because it broke the cap on electoral spending in a campaign. 
We are told that the law is unclear. Well the law on electioneering and the election spending cap are very clear. That has been laid down by the courts and the consequences of a failure to comply are very clear. Members should ask Reg Boorman who was ejected from Parliament and Bob Clarkson who could have been ejected about that. 
We have order in a community when people obey unenforceable law. If a sign says “No dogs allowed” people do not take their dogs there; if there is a red traffic light at 2 o’clock in the morning people do not run that red light. That is order in a community. It has turned out that the electoral law that caps campaign expenditure is unenforceable. The Labour Party dared the police to prosecute a Government that had just won an election and the police decided not to do so. So it has turned out that that law is unenforceable. That is why the Labour Party has breached the bond of trust with the New Zealand public. It did those things knowing full well what it was doing. How do we know that? Well the Auditor-General warned us—all of us—that the conduct of politicians had been too loose. The Chief Electoral Officer put that in writing to the Labour Party and said that it must count that spending as electoral expenses. But Labour ignored that letter. 
You see respect for the rule of law is a positive quality; it is not just obedience under the fear of discovery and punishment. It is clear now that although there has been a discovery of Labour’s breach of the electoral law there has been no punishment for that. The positive quality of respect for the rule of law must be exhibited particularly by those who make the law because a Government has more power than anyone else. It has more opportunity and more temptation to breach the law and more capacity to fight its corner if it breaks the rules. Of course a Government has the deepest pockets. It can take anyone to court at any time and it can put up with any attack from anybody. 
We are here because the Labour Party breached the bond of trust and lost its moral authority. It showed no respect for the law for its officers or for the consequences of breaking the law. At some stage we all have broken the law and we have respected those consequences. But this Government does not respect them. It has exploited the privilege of power. It has bullied browbeaten and used every tool at its command—including this parliamentary process—to avoid the consequences of breaching a law it knew it was breaching. What does it say about a party that was founded on the principles of defending the poor and vulnerable that Labour has shown in the last 12 months in New Zealand an ugly and a fierce willingness to use the privileges of power totally in the service of its own political ends—not the public interest? 
Who could possibly argue that the behaviour of the Prime Minister Helen Clark has been in the public interest in the last 6 months? It has not been; it has been in the interest of the Labour Party. It is just one more round of a record that has gone round and round: “paintergate” “speedgate” and “Doone-gate”. I ask members to remember the attitude of the Prime Minister then. She said: “by definition the Prime Minister cannot leak.” 
Today we have found out that by definition Labour cannot misuse public money because it thinks the money belongs to it and because it thinks it is so morally superior in its use of public money that any use of it by definition must be right. Of course it is not. When one strips back the technicalities the legislation the convenient legal opinions and the procedural manipulation one finds that Labour believes deep in its heart that it is entitled to make any use of the tax derived from the hard-earned incomes of New Zealanders—and in Labour’s interest not in the public interest. We have unmasked an ugly and a fierce sense of entitlement. The Labour Party is willing to do anything say anything and bully anyone in order to defend that sense of entitlement. In fact if one had listened to the debate on this issue over recent months one would think the wronged party was the Labour Party. One would think Labour was being unjustly attacked. One would think that Labour was the one whose money had been put up in good faith and misused. One would think Labour was the injured party. 
We have seen that deep and ugly sense of entitlement in the attacks on the Auditor-General. 
Hon MURRAY McCULLY (National—East Coast Bays) 
: 
 The bill and the circumstances in which the House finds itself tonight should invite members opposite to reflect. Indeed it should make all members in this House reflect because we in this Parliament have a unique role. We have unique powers and with those unique powers go some unique responsibilities. Yet today we find ourselves not just legislating under urgency; we find ourselves legislating about ourselves. 
I invite members opposite and those who want to prop them up in this Chamber to apply a very simple test. It is this: if the Auditor-General’s report concerned the actions of private citizens or a private organisation or even of a Government department or local authority and that organisation or local authority had breached the terms of the Public Finance Act would we be here tonight rushing a bill through all stages on the first available parliamentary day to address that matter? Would we be here tonight under urgency using the extraordinary powers of this House to rectify the matter on the first available day? Would we be trying to avoid the select committee process by which every other measure that goes before this House is subject to scrutiny? No we would not. Would we be trying to avoid any form of public scrutiny over the normal parliamentary timetable of a bill? No we would not. Would we see the lack of consultation with the parties that are affected by the law that is sitting on the Table of the House because parties on this side have not been subjected to any form of consultation in the way that any ordinary New Zealand citizen or organisation would enjoy that consultation about a measure that touched their affairs? No we would not see it happen were it not for the fact that this legislation suits the affairs of the New Zealand Labour Party. 
Today as a consequence of that fact we see that this Government has no hesitation in hijacking the legislative process hijacking the parliamentary process and the parliamentary timetable through urgency; in reducing the normally non-partisan role of the Minister responsible for the Parliamentary Service and of the officers who serve in that service to the role of pawns of the Labour Party and their mates—all to serve the narrow partisan interests of the Labour Party and its friends. That is an abuse of this Parliament. It is an abuse of the legislative process. It is an abuse of the confidence of the New Zealand public who elected the representatives who sit in this Parliament. It is an abuse of that confidence. 
Worst of all these are actions that are driven by a motive that should never be allowed to rear its ugly head in this Chamber. It is naked shameless unprincipled self-interest. It is the very thing that we commit ourselves at the commencement of each day of sitting that we will put aside in the interests of the public we are here to serve. That is what is driving this Labour Government in taking this bill through the House under urgency tonight. 
This measure has some important implications. First of all as a result we will see State funding of political parties in a significant way introduced into the New Zealand law. That is something most New Zealanders are opposed to; something that New Zealanders will have no say about because we are doing this without consultation with them and in many ways without their knowledge. We certainly do so without their consent. 
This is also bad legislation because it places politicians above the law. We are simply passing this measure because unlike any other class of New Zealanders we can. We know that it is wrong and members opposite know that it is wrong. That is why of course we are doing it under urgency. The way in which this measure is being handled politicises the Parliamentary Service Commission which has now some decades of history running this institution. It politicises that institution in a way that members opposite along with others will learn to regret over time. And that is not a threat; that is a promise. There is no going back from that. 
Let us be clear about one thing as this measure goes through the House in the space of these 2 days. Some parties in this Parliament despite what they might say have absolutely no intention of paying back the money they have unlawfully taken from the public of New Zealand. That is the reason for this bill. This bill is being passed so that those parties will not have any legal obligation to pay back the money they have taken unlawfully. The New Zealand First Party knows full well that it votes for this measure tonight so that it will not have to pay the money back. It is galling to sit in this Chamber and hear Mr Brown tell the House that the New Zealand First Party will meet all of its lawful obligations as it participates in passing under urgency a bill that will ensure that New Zealand First has no lawful obligations at all. Even Mr Brown can work that out. 
There is only one reason for the rush for the urgency for the avoidance of public scrutiny for the avoidance of a select committee process—that is because some people in this Parliament have no intention of meeting the obligation they have to the New Zealand taxpayer to pay the money back. By the end of this week they will have no legal obligation to do so. 
We do not have State funding of political parties in New Zealand and there is a reason for that. The public is opposed to it. The public has always been opposed to it. That is why for three successive elections the Labour Party has hidden the fact that taxpayers have picked up the tab for the centrepiece of its election campaign—the Labour Party’s pledge card. Members on this side are pretty suspicious; those of us who have been in the Parliament for a while are deeply suspicious about the Labour Party and we think all sorts of terrible things about Labour from time to time. But it did not cross our minds—it never ever crossed our minds—that the Labour Party would have the sheer gall to use taxpayers’ funds to purchase the pledge card which has been the centrepiece of not just the last election campaign but the last three election campaigns. 
Members of the press gallery have asked us almost incredulously: “How can it be that you people haven’t got on to this before?”. We have had to give them the honest answer that we simply did not think that even the Labour Party could stoop so low as to use taxpayers’ money to fund the Labour Party pledge card. We did not ever think it was possible. Nor did many of the institutions that guide our society think that it was appropriate. It is deeply revealing as a result of the revelations we have seen in recent days that the Parliamentary Service officers did not think it was the right thing to do either. Those officers paid over the money they were obliged to only because they had a gun to their head from Heather Simpson. They were told absolutely: “Pay up or you know what consequences will be coming your way.” By the end of this week the Labour Party pledge card will be able to lawfully be paid for with taxpayers’ money. That is the fundamental change in the law that clause 7 of this bill will make. 
 I conclude by regretting most sincerely the shabby politicisation of the Parliamentary Service Commission that has seen this bill come to the House. Normally when we pass a bill we have procedures that ensure the bill sits on the Table for a while so that all of the parties that will be affected by it will know what will happen to them that they will have their ability to have a say that we have a select committee process that we have transparency and that we pass bills over weeks and months not over hours and days. That is because transparency and accountability to the public are fundamental principles of the way in which this place operates. 
But because of the naked self-interest of the Labour Party all of that is being put to one side to pass a bill that suits certain members of this House. That is an outrage. It is an outrage that the Minister responsible for the Parliamentary Service Commission has been prepared to engage with the Minister of Finance in that process and make her officers do the same. She has sold down the river members of Parliament on this side of the House and she will never ever regain our confidence as a consequence. She will never regain the confidence of members on this side of the House in relation to the administration of the Parliament. Her use of Jack Hodder and Chapman Tripp who foolishly lent their names to this enterprise is very much a matter for regret. That was a shoddy piece of work on their part. Even the Attorney-General will know that that is the case. 
The New Zealand public are not silly. They know what is going on here. They have worked it out. This is one giant nail in the coffin of this Government. These people will be down the road and the sooner the better. 
A party vote was called for on the question  
That the Appropriation (Parliamentary Expenditure Validation) Bill be now read a first time. 
Ayes 61 
New Zealand Labour 50; New Zealand First 7; United Future 3; Progressive 1. 
Noes 54 
New Zealand National 48; Maori Party 4; ACT New Zealand 2. 
Abstentions 6 
Green Party 6. 
Bill read a first time. 
Second Reading 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I move  
That the Appropriation (Parliamentary Expenditure Validation) Bill be now read a second time 
. There has been an enormous amount of huff bluster and nonsense this afternoon. I want to start with the most obvious—Mr Hide. Only a few weeks ago Mr Hide was complaining to me privately about the stupidity of the National Party and the line it was taking on the Auditor-General’s draft report and threatening to expose the Auditor-General to serious examination in front of a select committee. Today of course it is a totally different story in public from Mr Hide. There is a word for that. 
But let us come to National Party spending. 
Dr the Hon Lockwood Smith 
: It is not as bad as the dishonesty of Labour. 
Hon Dr MICHAEL CULLEN 
: Oh here goes the so-called lawyer from the north who has become the prosecutor on immigration cases. Let us ask some questions of the National Party. What did the National Party spend its leader’s vote on before the last election? There was no accounting and no scrutiny. Was it spent on staff on Brian Sinclair on campaigning? But because it was not communications it was not studied by the Auditor-General who declined to look beyond at what might have implicated the National Party. The Auditor-General also declined to look at 2002 and the National Party’s pledge advertising at that point. I invite a National Party MP to get up and tell us what those members spent their leader’s budget on because it was all spent. No of course they will not. 
Hon Dr Nick Smith 
: We didn’t break the law. 
Hon Dr MICHAEL CULLEN 
: If they spent any of it on anything to do with electioneering as defined by the Auditor-General then they broke the law and it was unlawful. 
But in terms of breaking the law we know the one party that did break the law by overspending on its broadcasting expenditure. What happened when the police investigated? Steven Joyce general manager New Zealand National Party told the advertising agency named Rainmakers—what a wonderful name—that it was GST inclusive but the Rainmakers person said it was GST exclusive. The police cannot attribute responsibility for the GST overexpenditure to either the New Zealand National Party or Rainmakers and are not therefore in a position to charge either person. How convenient for the National Party! 
What did that party want this House to do? It wanted this House to retrospectively validate its overexpenditure on the GST not so it could pay it back—the party could pay the broadcasters any day—but to avoid a conviction and a fine for overspending on its broadcasting. That is why National wanted leave of this House for retrospective validation. No wonder Mr McCully the Peter Mandelson of the National Party does not want to listen to these particular facts. 
What about the money spent on travel by the National Party? Was none of that to do with electioneering in the 3-month period? Are we to assume that what we thought about Dr Brash was true—that he wandered around the country in a daze for those 3 months and did not spend a single period of time electioneering on the public expense? But the Solicitor-General’s opinion means that if any of his time was spent electioneering then I am afraid all that expenditure was unlawful. 
Poor Katherine Rich who sent out a letter that was absolutely legitimate within any previous understanding of Vote Parliamentary Service took the pratfall for the rest of her colleagues. I respect loyalty and therefore I respect Katherine Rich in that regard. Murray McCully of course has always been the first in any coup developing in the National Party. He is telling everybody that Don Brash is gone. 
What about the National Party’s involvement with the Exclusive Brethren? 
Hon Dr Nick Smith 
: So what? 
Hon Dr MICHAEL CULLEN 
: So what? This is the man who accused the Exclusive Brethren of breaking up families for religious purposes. 
Hon Dr Nick Smith 
: That’s right. 
Hon Dr MICHAEL CULLEN 
: “That’s right.” he says. Well what was Dr Don Brash doing in bed with the Exclusive Brethren to the tune of $1.2 million payment to Don Brash for his services in trying to get rid of a Labour-led Government? What was happening in Napier and Hastings when schoolchildren were being used for push-polling in conjunction with the National Party? How come Craig Foss was paying for pamphlets that the Exclusive Brethren could not deliver to be delivered? Did he declare it in his election expenses? What was going on in terms of that relationship with a small extreme group? This is a group that does not believe in defending New Zealand but it condemned the Labour Government for not spending enough on defence that does not believe in voting but says it should have the right to choose who the Government is and that is so strange that it does not believe in joining up sewerage pipes until they reach the city council sewer if it is running across a neighbour’s property. What was the National Party doing in bed with a bunch of fruitcakes like that when in fact it was receiving vast sums of money to do whatever it was the Exclusive Brethren expected of them? That is the reality. 
We heard from Mr English. I have to say that Mr English gave the only decent speech on behalf of the National Party this afternoon. I disagreed with it but by God it was a powerful speech compared with “Dr Magoo” at the start and then the bully rant and rave— 
The ASSISTANT SPEAKER (Ann Hartley) 
: I draw the member’s attention to the fact that he must refer to members by their correct name. 
Hon Dr MICHAEL CULLEN 
: Dr Brash at the start was not quite clear why he was in the House and of course Mr Brownlee has tried just to bluff and bluster his way through without any understanding of the legal issues involved. But we heard from Mr English about respect for the law. The Labour Party disagrees fundamentally with the Auditor-General’s conclusions but because he has provided that ruling we are refunding that money. 
What happens when the National Party does not like the referee’s decision? Mr McCully got up only 10 minutes ago and said: “No cooperation with the referee. We don’t like the decision. That’s it. We won’t obey the referee any longer.” That is National Party members on the rule of law. They are all for the rule of law when they are the rulers and they are the law but when the law disagrees with them they do not have any respect for the rule of law at all. We however disagree fundamentally. 
Then we had the big king-hit from Mr McCully who said that the bill is not going to a select committee. I invite Mr McCully to look at the bill; it is an appropriation bill. I invite him to read the Standing Orders. An appropriation bill does not have to go to a select committee whether or not there is urgency. If we had simply had the first reading today the bill would have been set down for second reading tomorrow without going to a select committee. [ 
Interruption 
] That is right Mr Power—an appropriation bill does not have to go to a select committee. But this is a party whose members complained in the House this afternoon that they had not yet seen the bill when I had sent one over to them this morning. The problem was that Mr Brownlee does not know where a photocopier is so he could not run off any copies for any of his colleagues. Yet strangely by the time the National members got to the House they said they had already drafted amendments to the bill even though they had not seen it. That is National Party logic for us. 
Finally I ask why the National members hate the pledge card. I do not believe Mr McCully at all when he says that National members did not know it came out of Parliamentary Service funding in 2002; they have complained about that for a long period of time. What they hate about the pledge card is really very very simple—it breaks the rules as they understand them. In the pledge card we say what we are going to do and we have done it three times in a row. The National Party will never forgive Labour—not for being the Government but for much much worse. We have ratted on the National Party principles. In Government we have done what we said we would do. 
I draw a conclusion that the National Party will never have a pledge card. We can guarantee that whatever promises its members make they will not keep them—like that of Dr Smith who was going to remove the toll gate on the road to knowledge by removing student fees and instead made them much bigger; or like that of getting rid of the surcharge “no ifs no buts no maybes” and so on. 
Well bad luck the Labour Party will carry on keeping its promises standing for the rule of law and despite my own somewhat low instincts making sure that the Parliamentary Service’s appropriation is able to support the National Party for the coming year or so—which without this bill it would not be able to do. 
JOHN KEY (National—Helensville) 
: 
 That speech was typical of Michael Cullen and the Labour Party members who just cannot seem to get the order of things right. If we go and ask average Kiwis what they expect we find they have a pretty simple order of things. The first thing they want from the Labour Party is the money back. They do not want validating legislation that somehow makes them feel good. Michael Cullen was on  
Agenda 
 on Saturday morning telling New Zealanders that he had to make the accounts be all tickety-boo so he was going to ram through validating legislation. Well here is a novel idea for Dr Cullen. If he wants the accounts to be all tickety-boo he should not break the law in the first place. That would be a good start. The second way is to pay the money back. I tell the House that no New Zealander should be under any illusion: we were always going to be here passing validating legislation under haste. We always knew that from the moment Labour members got caught with their fingers in the till there would be validating legislation. The only thing that changed was that when the public found out the facts—when they really knew what went on—then Labour had to pay the money back as opposed to just passing the validating legislation in the first place. 
How ironic in a party that absolutely polls itself to death for this bunch of poll-driven fruitcakes to have woken up on 6 September to read a poll that stated that 81 percent of New Zealanders wanted them to pay the money back and that 75 percent of their own supporters knew that Labour’s actions had been criminal and wrong and wanted the money returned. I say to the Labour Party: here is a novel idea. To get the order right the No. 1 thing is to pay the money back. No. 2 how about an apology? How about a bit of regret? How about saying sorry to the people of New Zealand who trusted the Labour Party—trusted it with their taxpayers’ dollars? Labour caucus members went into their caucus room today and moaned and complained about having to put their own money back. Instead of feeling sorry for themselves they should have felt sorry for the people of New Zealand the people whom they misled for 13 months. How about Labour saying sorry instead of rushing with validating legislation? 
Something very interesting has happened over the last 13 months. Labour members have come up with every excuse in the book. They have tried the lot; we have heard the lot. This has been a spin extravaganza from the party that has perfected spin. I ask the Labour Party to spare us the spin—we have heard enough. 
Let us run through the different spins now. The first of them was that somehow the rules had changed and it was all a bit different. That is not what the Auditor-General actually said in the  
New Zealand Herald  
when he was interviewed on 22 August. He made it quite clear that he had warned the Labour Party that he expected there to be no surprises in its spending and that he drew a line in the sand. 
 There was no ignorance of the rules there was no kind of mistake and the referee did not change things afterwards. What happened was that Labour Party members who knew they would lose unless they spent one hell of a lot of money in the last 10 days and who knew absolutely that they would get carted out said: “To hell with the rules let’s get the money from wherever we need to get it from.” Now that they have been caught they have the audacity not to say sorry and to feel sorry for themselves. Well we do not feel sorry for them. 
Rodney Hide 
: I raise a point of order Madam Speaker. I am sorry to interrupt the member who is on his feet but in the barracking the Hon David Benson-Pope accused Mr John Key in a most unparliamentary way and I ask him to withdraw and apologise. 
Hon David Benson-Pope 
: I withdraw and apologise. 
JOHN KEY 
: The second part of this long and miserable tale that we should not forget is Michael Cullen’s own actions. This is the man who threatened the  
New Zealand Herald 
—who said to the  
New Zealand Herald  
and its owners APN that Labour would have no hesitation if it had to in ripping up the legislation relating to APN. He made a veiled threat that APN knew and understood. That is the level Labour was at with its back to the wall. The message was pretty clear: stop talking about the fact that the Labour Party had been caught with its hand in the till or Labour would have a closer look at the legislation relating to APN. 
As is typical from Labour as we saw yesterday regarding charities when this Government does not like anybody it changes the rules and it does not matter who is collateral damage along the way. 
The third person to get in the way of this Labour Party trying to avoid paying back its debts was the Auditor-General. Helen Clark with more venom than we have ever seen attacked the independent person in New Zealand politics the Auditor-General. She should be ashamed of herself for the way she attacked that man. He is quite rightly a superstar in these events. He is not the guilty party—the Labour Party is. That was yet more spin. 
The fourth part of Labour’s spin came from Pete Hodgson who came right out and said that the Labour Party would not be paying the money back. Yet he had the audacity to go out and make a statement to the  
Sunday Star-Times 
: “the public would say that it was clearly for political purposes—and for Christ’s sake of course it is you know? If it wasn’t we would put out a pledge card the day after the election not before it.” When one issues a pledge card that says “Vote for me and we’ll do these things.” one is on pretty safe ground to assume it is an electioneering expense. 
Steve Maharey knew that. He did not get up and complain in caucus today when he had to front up with his $15000 because he knew that he was part of a cabal of individuals who were as guilty as sin. That was the fact. 
And then the last of the five spin-merchant campaigns came when Trevor Mallard decided he would play a dirty tricks campaign on the National Party and on our leader. So absolutely no one was going to get in the way of the locomotive Labour Party; it went right through all the way. It was prepared to take out anybody and anything that got in its way. The only minor problem that occurred for the Labour Party was that 81 percent of New Zealanders have woken up to what it was on about; they want their money back they want a bit of contrition they want an apology. What they do not want is validating legislation rushed in through urgency—the kind that makes the Minister of Finance feel happy. 
So why are we here passing validating legislation in urgency? We all know that is because the Labour Party is facing a lawsuit that it does not want to face and the simple way to get rid of that lawsuit is to pass this validating legislation. The person taking that lawsuit Mr Darnton admitted on Newstalk ZB tonight that once this legislation is passed under urgency—the Government forced by its support partners to do so—that lawsuit will go away and we all know it. 
How sneaky this whole campaign has been. Let us go back and have a look at what really happened in 2002. The Labour Party produced a pledge card that very conveniently on the side of it had “authorised by Mike Smith c/o PO Box something”. Labour did everything it possibly could to make that card look like an expense paid by the party as part of its campaign. Of course National did not know because we were tricked as everyone else was tricked. It was only when the crest turned up on the 2005 card—an action the Auditor-General made happen because he knew that that would alert other political parties—that my colleague Mr Simon Power brought it to the attention of the authorities. 
So the Labour Party can never get up and tell the people of New Zealand that it did not know what was going on—that the rules changed and that somehow it was a little bit different. This Labour Party has been sneaky this Labour Party has broken every rule in the book and this Labour Party has been caught with its fingers in the till. 
I finish by saying that when a political party comes into office and forms a Government it does so with the trust of the people of New Zealand. It is expected to use its money to spend it wisely and to do that with integrity authority and honesty. One thing above all that has been proven over this very sorry saga is that that party will never be trusted by the people of New Zealand again. The people of New Zealand know a bunch of crooks when they see them and even crooks in the dock have a policy of saying sorry and showing some remorse. So before Labour members get up and force through this legislation I offer them this bit of a starter: why do they not get their cheque books out pay the money back say sorry and for once in their lives accept they have done wrong. 
Hon STEVE MAHAREY (Minister of Education) 
: 
 That was the man who at the present time is travelling the world and telling people that he will be the next leader of the National Party. He has talked about the notion of restoring trust but I say to that member that before he can take over the leadership of the National Party he should say he is sorry about the 1990s. Was there one single promise that National kept in the 1990s? Was there one single thing National said it would do that it actually carried out? 
John Key 
: Say sorry! 
Hon STEVE MAHAREY 
: Mr Key may first like to say on the way through to taking over the leadership that he is sorry about the 1990s and that if National ever gets a chance to be back in power this time it may try to keep one single promise. On the way through to the leadership Mr Key should also have a crack at telling us about the trust funds. What is in the trust funds? How much money is in the trust funds? Who put the money in the trust funds and what do those people want in return for that money? 
Second now that Don Brash has admitted he did not take the appointments with the Exclusive Brethren out of the diary can he try to recover a little of his memory and tell us when the meetings were what went on what the deal was what the $1.2 million was for and why a major party was getting alongside a sect like the Exclusive Brethren which has a fundamentalist agenda that is being pushed in country after country. Why did the National Party defend those people in advancing their agenda—people who want to send New Zealand boys and girls off to war yet who are pacifists themselves? That is called something beginning with “h” I think. I ask Mr Key to let us have Mr Brash clear up the issue of the Exclusive Brethren on the way through to the leadership. 
Third National should have a crack at paying the GST back—at writing out a cheque for $115000 for the GST. It is unbelievable I tell Mr Key that Mr Brash—Dr Brash; whatever he wants to be called—the man who helped to invent GST did not understand the implications of not paying GST on the broadcasting money. He invented the thing he sat on the committee and he is now the leader of the party. He was the person in charge of the National Party campaign but he did not know about the GST. Well I say: “Pay it back—pay the money!” It is $115000. Mr Brash should have his cheque book out here tonight sign the cheque hand it over and not keep on saying there is a legal reason not to pay it. There is not a legal reason. Mr Power who is one of the few people on the National side of the Chamber I have any time for at all is a lawyer. He could spend a little time advising Mr Brash there is no legal impediment to paying the money back. So I say to Mr Key to let us have the GST payment on the way through to his taking over as leader. 
If Mr Key apologised for the 1990s if he told us about the trust funds if National unpacked the Brethren and if it paid the GST back then maybe the New Zealand public would say that Mr Key looked like a person who was a little on the honest side of things. But until that day arrives the legacy the National Party has is of its members breaking every single word they have ever put on a piece of paper and today of sitting here but not paying the GST back. That is amazing. 
When I first came into this House there was a man here called Richard Prebble. Richard Prebble used to take us aside when we came to the Chamber to make our speeches and he would say we knew too much about the topic. He would tell all of us new entrants that that was a waste of time. He said we should want to know nothing and then we could go in and make extraordinary speeches because we would not have the impediment of the truth in front of us. And that is what I am hearing from National speakers today and tonight. They have been to the “Richard Prebble School of Politics”. If someone does not know anything about the argument then he or she can come in here and rave on as if somehow we live in Zimbabwe and we are about to pass legislation like Mr Mugabe’s. In Zimbabwe there would not be an Opposition to sit in Parliament and talk about passing legislation but this is not that situation. But if people are of the Richard Prebble style of politician they can get away with ignorance because they have to have that sort of thing if they are to make an argument. 
The argument is extremely simple. People should forget all the stuff that has gone on over the last little while and the fact that there was a leaked report and a huge debate. The fact of life is that we have just received the final report and we have just found out what the Auditor-General was actually saying. We have just heard the Speaker’s report from the Chair—[ 
Interruption 
] Members are becoming very excited here; they should calm down. We have just had those two reports and now we can begin to react to them. That is what in our calm considered way the Labour Government is doing. We are now responding calmly to the information we know. We know we have to respond to the fact that the Auditor-General has broadened the definition of what it is reasonable to do as a parliamentarian—what we understood about spending money not being allowable unless one was doing just normal things and not asking for any kind of vote. He has broadened that definition and we will have to legitimise that kind of expenditure. 
We know that even if we pay back the money—which Labour is committed to doing; we will refund that money—the expenditure will remain unlawful. So we are passing legislation that will help not just ourselves but every member in the House Katherine Rich included—a member who as Michael Cullen said is one of the few members on the Opposition side we also respect. We say that we understand that in doing this we are helping everybody out and we will go ahead and do it. We know that the Minister in charge of this legislation has suggested we validate the expenditure quickly. That is what we are doing. We are also going to have an external review. That is what we are doing. In other words we are making sure that we leave this Parliament in shape so it is able to carry on doing its work. 
But what do we hear from the National Party? Its members have gone on and on this evening about an issue that has nothing at all to do with validation. For one person after another—people with the integrity of Murray McCully—it has just been an opportunity. It was amazing to watch Murray McCully rise in the House with indignation. It was such good method acting that it was as though Robert DeNiro had arrived in the House to tell us with all the moral authority of someone like Moses that we should all behave ourselves—and that is in spite of the way that member has behaved in this House year after year. Does anybody remember tourism? Does anybody remember what Murray McCully did with regard to tourism? Let us get the situation right here. This is simply National Party posturing. 
I want to finish with this thought for the National Party. The National Party quite clearly started off this term with a plan to character-assassinate people and to run issues that have nothing to do with policy. Do you remember Madam Assistant Speaker that it ran a whole lot of that over the summer period? Do you remember what happened? National got nowhere; it went down in the polls. It has done that again. Why are National members so desperate tonight? I will tell members why. They have put all their eggs in the basket of this particular issue. This is the issue they have fought on for months. The whole country has had no policy at all from the National Party. National has a leadership change to come and it has no policy whatsoever. The National members need this issue to work for them. That is why they are so desperate. That is why there is so much venom. That is why there is so much bile. That is why so much hatred is coming through from the National Party. National members are desperate for this issue to work. 
I say to the National Party that it will not work. Once this legislation is through the public will put this issue behind them. They will move on and they will start to ask questions such as: “Who can run the Government?” “Who can run this country?” and “Who has a vision for the future?”. There is only one party with a vision for the future. It is called the Labour Party. The National Party is in the gutter. It is looking at the stars but it will never get there. 
SIMON POWER (National—Rangitikei) 
: 
 I start tonight by congratulating someone. I want to begin my contribution to this debate by congratulating the Auditor-General. This is a person who has stood against a barrage of personal abuse and bullying tactics to try to get him to change his view. Attempts were made to discredit him publicly not only in the media but also in other fora as well and he stood firm against all of those tactics. Frankly the only court of opinion that matters on this issue is the court of public opinion and members opposite would do well to read the editorials of all the major daily newspapers around New Zealand when the Auditor-General’s report was finally tabled in this House. It said one thing. Underneath the detail the Auditor-General simply said he would not be pushed around. It was wrong and he was going to say it was wrong. He said in his report: “Some MPs and parliamentary parties have said that I acted unfairly by ‘changing the rules’ after the event. I have not changed any rules.” 
So who does the Labour Party think the public are going to believe—somebody who said right from the start that he would not be pushed around or a Labour Party that is wildly spinning the line that the rules have changed? Well the public have made up their minds. They believe the Auditor-General. The bullying did not work. If the Labour Party—as Steve Maharey said in his contribution—thinks that the public are going to put this issue behind them I assure him that it will not be the case. If the Labour Party thinks today that this issue will not be raised on the hustings at the next election it is wrong. If New Zealand First Labour and United Future think this issue will disappear into the ether after the legislation gets through the House and they will not have to pay the money back then let me assure them that that is wrong. 
I must admit that at 11.30 this morning I thought of those first-term MPs in the Labour Party who 12 months into their job arrived here to the news that a campaign they had very little to do with—that they had no say in but simply participated in—will now cost them between $8000 and $10000 of their personal money. If I were Maryan Street I would be saying: “Well the collective is fine but actually this isn’t my fault and I am not going to pay it. Maybe Heather Simpson should.” 
The question I found particularly interesting is where the senior Labour Party Minister is who has been nowhere near this stuff and has run a mile. Where is Phil Goff? Phil Goff has so much confidence in the Labour Party’s ability to handle this issue that he negotiates separately with the Auditor-General. He wanders off on his own and has a separate negotiation with the Auditor-General and he sits in his caravan waiting waiting waiting because he knows that the opportunity is not far away. 
I have to say that over the last 7 years I have on occasion sat on this side of the House and quietly admired some of the political management skills I have seen but having been a student of politics before becoming an MP I was totally disbelieving when as senior whip this matter was brought to my attention in September 2005. In the first week of that month I wrote to the Auditor-General after looking at the pledge card the fold-out sheets the conference banners and the like and not actually believing what I saw. I actually did not believe that the Labour Party would have the overwhelming gall to think it could get away with it. In fact I read the letter seven times before I sent it to make sure I was not overstating the case. But it was impossible to overstate; it was almost too obvious. My colleague Bill English has spoken about the deep level of cynicism required to actually take an affirmative step to sign that letter to Parliamentary Service and to say: “Pay this bill or else.” 
This was not an accident. This was not reckless even. This was a wilful step that was taken by senior party officials. Frankly that level of inherent arrogance was just gobsmacking if one steps back and looks at it objectively. Even if it could be argued that the expenditure was legitimate which it cannot be and even if it could be argued that all parties will pay the money back—and my colleague the Hon Murray McCully has done a very good job I believe of summarising the fact that there are parties in this House that have no intention of paying that money back—if all of those factors were legitimate why are we in urgency? If those factors were legitimate why not allow the public to have a say? Why not allow the bill to withstand the select committee process? This bill does not have to be an appropriations bill—particularly Part 2. Any normal form of legislation could contain these matters and be dealt with in an open and transparent way. 
But let us step back. Helen Clark has always campaigned on her integrity. That has been her No. 1 asset and something I have observed over the last 7 years she guards and protects viciously. Fair enough! Well that has gone. That integrity has gone. 
Darren Hughes 
: No never. 
SIMON POWER 
: It does not matter for Darren Hughes. He is 12. He can spend some time on this side of the House and go back over to the Government benches in 20 years’ time. It does not matter to him. It is Rick Barker I feel sorry for—no I do not feel sorry for him. Rick Barker has done his dash; it is time he moved on. 
The moral authority that allows the Government to do its business has gone. Its political capital to use the phrase is spent and we will table in the Committee stage a series of amendments that will seek the votes of those in the Chamber who believe validation should occur only in the event that the money has been paid back. I say this to the Greens: do not abstain on that point. Do not become a party of Ashraf Choudharys. Take a stand and decide to vote for amendments that say “Validating legislation is OK as long as the money is paid back.” 
There are members opposite in the Labour Party who actually respect in my opinion the political process in the Parliament and they know this is wrong. They know this is wrong and it is a big rat for them to swallow before returning to Opposition. John Key made an excellent point when he spoke earlier tonight. If one has done something wrong show some contrition. At the very least one should front up to the public and say “Hands are up got caught made a mistake.” I have had to do it and believe me it is not hard. Just put the hands up and say “A mistake has been made.” and accept the punishment. Those Labour members should accept one thing: they will be in Opposition in 2008. They should save what little integrity some of them still have because the winds of change are blowing through the electorate and I tell the members of this House that Helen Clark’s integrity in this country is nil. Which members opposite want to go down with that ship? 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Madam Speaker. Kia ora tatou te Whare. Everyone in the House well knows how seriously the members of the Maori Party take their roles as MPs. We attended the induction we swotted up on the Standing Orders we read  
Speakers’ Rulings 
 and in fact we even came in for parliamentary training before the election because we were so sure we were coming into Parliament. We worked our butts off because of our commitment to our people. On the very rare occasions when we have slipped up we have copped the flak and done the punishment. 
So with this bill as with other bills when it comes to talking about appropriation legislation to validate parliamentary expenditure we decided to have a really good look into what this was all about. We know that appropriations are supposed to be limited to a specific amount and scope. We know that in this situation there is a serious case to be answered because expenses were incurred outside the scope of the appropriation and the Government was warned against doing it before it actually incurred those expenses. That means that Parliament stands in breach of section 4 of the Public Finance Act of 1989—a breach of law an illegal act and an unlawful offence that puts Parliament’s already tarnished credibility further at risk. Now I may be only a new boy on the block but even I know that political parties are supposed to operate according to the law. 
The Maori Party made a mistake—no issue. One of our people sent in an account that we should have paid but it was paid by the Parliamentary Service—a paltry 53 bucks. But it had nothing to do with overspending. In fact we came nowhere near our spending limit because we did not have enough money. It was a straight-out mistake. We were informed of the mistake and we repaid the bill—end of story. 
Then I hear that persons of privilege—MPs—can simply introduce new laws to right any wrong. I guess that is what is meant in the latest edition of  
Parliamentary Practice in New Zealand 
 which states: “The office to which members are elected has a considerable amount of legal freedom guaranteed to it so that members themselves have the capacity to carry out their duties of the office as they sit and indeed are able largely to define what the duties of that office are.” I guess that means that in the house of privilege—the House of Parliament—legal freedom means that those who control the House can do exactly what they want to do. That is what really sucks about this bill because it is about an abuse of the concept of legal freedom. In fact it is about legal highway robbery. 
So I turned to  
Hansard 
 to see exactly what this legal freedom means and surprise surprise we have already been here before with the 1894 Native Land (Validation of Titles) Act amendment. In case members’ memories do not go back as far as that that Act widely known in Maori circles as the “Validation of Invalid Land Sales Act” has actually come before the House on a number of occasions recently—6 May 2004 to be exact a day that will remain etched forever in the minds of Maoridom. That is the day the infamous foreshore and seabed legislation came before this House—legislation that the Maori Party is seeking to repeal. Dr Cullen was asked that day to consider the similarities between the foreshore and seabed legislation and the “Validation of Invalid Titles Act” which legislated away Maori rights to court redress for land taken without their knowledge or consent. 
Two years later on 15 June 2006 my esteemed colleague Te Ururoa Flavell asked a question of the Minister of Maori Affairs about whether the Maori Purposes Bill would legalise decisions that did not have a legal mandate in much the same way as legalising the theft of Maori land that occurred with the “Validation of Invalid Titles Act” of 1893. Third time lucky my even more esteemed leader Dr Pita Sharples raised the same “Validation of Invalid Land Sales Act” in the context of the Gisborne District Council (Alfred Cox Park) Validation Bill. 
So there is no doubt in my mind at all about where the Labour Party turned to try to get itself out of this mess because as the Speaker has rightly pointed out without validating legislation the unlawfulness remains. Although she urged parties to pay the money back her key point was that repayment itself would not change the unlawfulness of the spending. So hey presto a new law would be required; a new law based on precedent based on the validation of imperfect titles of legal theft and the justification of banditry from the 1800s. The precedent then for validating unlawfulness was in 1894 when the amendment to the 1893 Native Land (Validation of Titles) Act was passed in which the illegal confiscation of Maori land was justified legalised and validated. 
That amendment also created a perception that every bit of Maori land taken from that point on would also be legitimate. George Elliott Barton the first Validation Court judge said something in 1893 that could have been written for Dr Michael Cullen in 2006. I quote from 1893: “the chief object of the legislature in passing validating statutes has been the validation of all honest and straightforward purchases whether they are legal or illegal in their inception”. He was saying that the illegal orders that he did not have the power to make as a Native Land Court judge would now be validated. This tells us that it does not matter whether acts are legal or illegal or whether one has the authority to make orders all that matters is that one has the power to make one’s thievery legal. 
This House has a history of dishonesty concealment and conspiracy to deceive stretching back to the very earliest days of parliamentary deception in Aotearoa—a history I have no doubt the learned Dr Cullen a professional student of social and economic history has studied in depth. I refer the House to a book written by Dr Cullen himself called  
Lawfully Occupied 
 
for clues as to where this Government’s notions of lawfulness and unlawfulness may have been sourced. 
Last week we quoted Santayana who said that those who do not learn from history are doomed to repeat it. But given the experience and the intellect of the Labour leadership we would have to say that this is not the case here. Was Labour’s overspend an accident? No way; this was a deliberate and calculated act. It was a conscious decision to ignore the advice of the Auditor-General and go ahead with an overspend of some $800000. They have got snapped with their fingers in the cookie jar and this bill is nothing more than legal screaming. 
Last week Dr Cullen said that Parliament would need validating legislation to cover election overspending. But honestly folks who here genuinely believes that in such a close election as we had last year $800000 over the top could be seen as anything but a deliberate act of election chicanery? There have been overspends before—$309 million in respect of the Kyoto Protocol $56 million in tourism and $12 million in corrections—but they were blunders. They were of a completely different nature to the lust for power we see manifest in this Labour Government’s appropriation legislation. 
What sort of example does this unlawful shenanigans give to the nation? Does it say that any Maori on the street can go to jail for pinching a bar of soap but political parties can validate the theft of millions of dollars of Maori land? That any Pasifika can lose his or her home as a result of being caught in a shady finance deal but politicians can validate the theft of a million dollars in election overspending? Or that any poor Pakeha can watch their kids suffer because they cannot afford a doctor while we watch a Government build a surplus of $11 billion? 
This is the challenge we face here today. The 1997 Waitangi Tribunal report said that validating illegal transactions was “a very dubious proceeding” especially where it fails to protect Maori owners from hasty or excessive alienation. The Maori Party strongly opposes any thought that people of privilege should be able to validate their wrongdoings while those in genuine need in this country have to suffer the laws the police the courts and the jails that are so often their lot. “Walking your talk” is the first principle of genuine leadership. Cowering behind a façade of legislation is the domain of thieves and scoundrels. Kia ora tatou. 
GORDON COPELAND (United Future) 
: 
 On behalf of United Future members I say there is not much else we want to say about the Appropriation (Parliamentary Expenditure Validation) Bill because the ground was very adequately covered by our leader the Hon Peter Dunne during the first reading debate. But there are a couple of things I think we should respond to in terms of some of the information that has been placed before Parliament during this debate. In particular I want to comment on the—in my view—very simplistic analysis presented to the House by Rodney Hide in his speech. 
Rodney Hide suggested that his respect for the Auditor-General and his office and for that of the Solicitor-General would ipso facto lead to the conclusion that it was wrong for us to pass this legislation because somehow or other that would be disrespectful to the Auditor-General. He suggested that since the Auditor-General has declared the expenditure to be unlawful we should leave it for all time to sit in some kind of limbo in the Government accounts as unlawful expenditure. But I point out to Rodney Hide that the House faces a slightly deeper dilemma than that simplistic analysis. It is that in addition to having advice from the Auditor-General on this matter Parliament has also had advice from Treasury. Treasury has advised the House in its written report which has been tabled with the papers that expenses incurred without or outside an appropriation are in breach of section 4 of the Public Finance Act 1989. 
Now two wrongs never amount to a right. So I think it is quite illogical and it would really be quite crazy to argue that because a party—and this is certainly the case for United Future whatever may be the case for other parties—inadvertently broke the rules regarding electioneering expenditure as per the Auditor-General’s report based upon the opinion of the Solicitor-General we should then set about to deliberately break the rules and the law as set out in the Public Finance Act by failing to validate the resulting unlawful expenditure. Someone has really lost the plot in the analysis of the whole thing because all that we are doing here tonight is to go with the law—the Public Finance Act 1989 which obliges us to validate the expenditure. 
The unlawful or lawful nature of the expenditure as Peter Dunne so adequately described has nothing to do at all with the moral imperative of whether the money should be repaid. United Future as a party has resolved that moral imperative very clearly by saying that we intend to repay the money. We will do so irrespective of whether this bill goes through tonight or is defeated. We will repay the money because it is necessary to do so. Inadvertent though the unlawful nature of the expenditure may have been we acknowledge that there is a case to be answered in terms of the New Zealand public and that the only reasonable response to their concerns about what has happened through these unfortunate events is to make a repayment. That is exactly what we intend to do. I repeat those assurances tonight to this House and I say that that moral imperative from our point of view remains whether or not the expenditure is validated by this legislation. But because it would be wrong to deliberately breach the Public Finance Act 1989 we will continue to vote for this bill through the Committee stage and its third reading. 
Hon CLAYTON COSGROVE (Associate Minister of Finance) 
: 
 This debate centres on restoring public confidence in the institution that is Parliament. Members of the public who are listening tonight could be forgiven for thinking that everybody has inadvertently been caught by the Auditor-General broadening the definition of what was appropriate—everybody except the National Party. Tonight we have heard a whole lot of invective a series of auditions by the “super - front bench” of Simon Power and John Key. Interestingly Katherine Rich has remained—quite logically and smartly—very silent. But people would be forgiven tonight for thinking that everybody had inadvertently sinned apart from the National Party. I could remind National Party members that they got caught by the same broadening of the same definition to the tune of around $10000. They got caught by the same definitional broadening as every other party in this House yet they conveniently sit here tonight pretending they are lily-white they did no wrong and everybody else inadvertently sinned apart from them. Well there is a word for that. 
This Government—it is true—did not act on a draft leaked report. This Government did not have a rush of blood to the head—that is true. This Government did not play politics with the issue—that is true. This Government waited until we had a final report and then reacted to that. Anybody with a logical mind—and I do not include Nick Smith in that definition—anybody with a calm low-tempered mind who did not turn red as he or she took a third glass of water would think that that was a logical procedure to undergo unless one had a brainwave or a rush of blood to the cranium as one or two people over that side of the Chamber are wont to do. 
When we talk about validating legislation let us look at some of the past precedents when there has been inadvertent use of appropriations. The “Prince of Darkness” Murray McCully came down and as Michael Cullen quite rightly said tried to lecture us on what was moral fibre. I remind Mr McCully that back in 1995 and 1996 there was a thing called the Tourism Board. There was a mess-up in appropriations of around $56 million and the expenditure could not be aligned with the appropriations. So what did National do? 
Gerry Brownlee 
: Call in the medics. 
Hon CLAYTON COSGROVE 
: Yes Mr Smith is nodding in agreement with Mr Brownlee. That member might need a medic or a weight-watcher—one of the two. What did Mr McCully do and what did the National Government do? They validated $56 million worth of expenditure. They validated that $56 million of expenditure because that is the appropriate thing to do as per the Treasury advice. So they validated $56 million of misappropriated tourism expenditure in 1995-96. Members opposite cannot have it both ways and that is where Mr Hide’s logic as Mr Copeland pointed out falls down. If we have mismatches in appropriations for departments for instance year to year the National Party says: “Leave it. Let it sit. She’s right.” Mr Brownlee says that. That shows how much he knows about the finances and the books. Then the Auditor-General raises it every year and we look like a laughing stock as a First World economy. That is what validation is for and that is why the National Government did it to the tune of $56 million in 1995 and 1996. 
I say this: if we are going to get the ledger right and if the National Party is going to portray itself as lily-white in the whole scheme of things then I ask National members to do this. As Dr Cullen said Simon Power knows as a lawyer—I am not; he is—that $112000 of GST presents absolutely no barrier in respect of the National Party paying that back. If National members want to bring back confidence in this institution they should tell us what they did with their leader’s budget because the Auditor-General had a problem. The Auditor-General could find Labour’s records of expenditure but there was a bit of murk around the National Party leadership budget. He could not quite find the records. I also say this. When it comes to fronting up as Steve Maharey said: “Tell us about the trusts Gerry. Tell us about those. Tell us why you hide the money.” 
The second thing I say is that in respect of the Exclusive Brethren we had the biggest attempted hoodwink in political history to the tune of $1.2 million. I ask those members to come clean. Will John Key tell us whom he met with that afternoon? If we look at the reruns shown on television we see that the faces are blacked out. Can he tell us whom he met? He could have given a personal explanation when he protested about the fact he was challenged on it. He could have given a personal explanation which is unchallengeable in Parliament and which is also on the record of the House but he chose not to do so. I also say that National members should tell us about the legal representation that the Brethren have received. I ask the lawyers in the National Party those formerly from law firms to tell us about the legal representation that for a long time the Brethren have received and the connection there. Dare I say and they know who they are that there is an untold story that will be told at some point. Tell us what favours were accrued in that respect! Tell us what promises were made! 
If members opposite are serious about restoring integrity transparency and confidence in what is probably the most important institution in the land then they cannot debate in this House hour on hour and say they did not sin when they did sin to the tune of $10000 at least. They were caught by the same rules as every other political party in this House but that has been conveniently forgotten in the minds of National members. They were caught by the same broadening of the definition as every other party and that is a fact. Nick Smith accused one of our members of getting in the gutter when that member reminded him of that. I say that Mr Smith has broadened the definition of gutter politics because now under that definition when facts are raised that Dr Smith does not agree with he hides behind that little smug definition. I say to the National members that they should front up. They have spent their hours in the House being holier than thou. They have commitments from all the political parties as to where they stand. It is an open sea now. 
But the unanswered questions around the last election remain. The unanswered questions are about collusion with a sect that is quite happy as Steve Maharey said to send other people’s kids overseas to be killed but not theirs; that is quite happy to go around the country saying: “We are praying for you all.” As a Catholic but not such a good one—Mr Brownlee and I would agree on that—I say that National members should front up that they should not try to hoodwink the public. They should not have a sort of Ronald Reagan amnesia as Dr Brash did: “I cannot recall.” How many times did he say that he could not remember whom he met with what he said what commitments were given and what he was told? I say to Mr Brownlee—because he and I both know the truth—that like some other members he feels exceptionally uncomfortable about that situation. 
We now have a bill that opens the whole thing up but the questions remain on that side of the House. I challenge members opposite to tell us about the trusts to tell us when they will pay back the GST and tell us why they validated $56 million of misappropriated expenditure in 1995 and 1996. Then when they have answered those questions they can stand up and portray themselves as lily-white. The next cab off the rank is the scone-doer from Tasman. 
Hon Dr NICK SMITH (National—Nelson) 
: 
 Tonight is a really sad and depressing time for this Parliament. I know of no time in my 17 years when I have seen a bill that will bring this Parliament into as much disrepute as the bill before us. It is a matter of folklore that in 1987 when we had the last Labour Government an MPs’ superannuation bill was bunged through late at night through all three stages that went down in political folklore as one of the great breaches of the public trust. Even this year the New Zealand public remember that duplicitous act. Well this piece of legislation—[ 
Interruption 
] He is just breaking my speech up. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. It should be pointed out that the National Party’s voting record on that superannuation bill— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: No that is not a point of order. 
Hon Clayton Cosgrove 
: They voted— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am on my feet. It is not a point of order. The member has been here long enough and he knows that. Frivolous interjections or points of order used to break up a speech are themselves disorderly. The member is warned. 
Hon Dr NICK SMITH 
: I seek leave for my speech to begin at its original 10-minute time to take into account that that was deliberate breach of the Standing Orders aimed at breaking up my speech. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I will consider that Dr Smith. 
Darren Hughes 
: He’s so embarrassing we agree. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: They are agreeing. 
Hon Dr NICK SMITH 
: Tonight is one of those sad depressing times when every member of this Parliament knows that we are bringing this democratic institution on which the tender flower of democracy is based into gross disrepute. Why are we passing a bill under urgency to make lawful what Labour had done that was unlawful? We are being asked simply to rush a bill through to somehow make Labour’s breaking of the law right. Well no matter how many bills those members pass and no matter how many pathetic speeches we hear from the likes of Clayton Cosgrove the public of New Zealand knows that this is rotten that it is sick and that it is the hallmark of a corrupt Government. 
I use the word “corrupt” with care and wisely because the question that no member opposite has answered is this: “Was the pledge card electioneering?”. Well Mr Clayton Cosgrove has a lot to say for himself. I ask whether he could answer that point for the House whether the pledge card was electioneering. The silence is deafening because every member of the public who received Helen Clark’s pledge card knew that it was electioneering and every Labour Party volunteer who delivered that pledge card knew that it was electioneering but there are two people—Helen Clark and Heather Simpson—who told the police that it was not. What does that say about the leadership of the Labour Party that it will try to put that sort of porky past the New Zealand Police? 
The reason that this issue is so sick and so rotten is that a fundamental part of our electoral law is the spending cap. It limits Labour’s spending at $2.4 million. What the Labour Party did during that election campaign was to knowingly breach that cap not by a little bit—not by 1 percent or 2 percent—but Labour spent more than it was allowed to spend by $820000. Under the Electoral Act that amounts to a corrupt practice in the law. I say to members opposite who watched with glee as my colleague Bob Clarkson was put through the courts: “If he had got it wrong would we be having retrospective legislation to make sure that he could keep his seat in Parliament?”. In fact I know that Bob Clarkson is a member of integrity. He would not have had the audacity to ask for retrospective legislation if he had got it wrong. So I ask how 50 members of the Labour Party can sit in their seats in this Parliament when they know that they were elected through deliberately breaching the Electoral Act and committing a corrupt practice. 
Hon Maurice Williamson 
: They’re illegitimate. 
Hon Dr NICK SMITH 
: My colleague Maurice Williamson says they are illegitimate. There is another word for that but I will not lower the standards of the House by saying it. I challenge the Steve Mahareys the Harry Duynhovens and the George Hawkins to tell the House how they can sit in this Parliament when they know that they came here on the basis of a corrupt practice. What sort of moral mandate do they have? How can a Minister of Revenue go to the people of New Zealand and say they should pay their taxes according to the law when that Minister has broken the law? How can a social welfare Minister in this Government say that those thousands of New Zealanders who claim social welfare benefits should fill out their forms honestly when that Minister did not do that and broke the law? How can Labour members sit in a Cabinet room passing laws and expect New Zealanders to obey those laws when they break them they break them blatantly and then they introduce a dodgy bill into this Parliament to say that even though they have broken the law they will just pass a bill retrospectively under urgency to somehow make the situation lawful? 
Hon Clayton Cosgrove 
: What did the judge say about you? 
Hon Dr NICK SMITH 
: It may make it lawful I say to Mr Cosgrove but it is wrong and the people of Waimakariri know that it is wrong. Tonight this Government loses the moral mandate to be the Government of New Zealand. With this bill it loses the moral mandate to govern this country. 
Then we come to the Auditor-General and the disgraceful conduct that this Government has gone down the road of—and for me it was particularly interesting in regard to the Solicitor-General. People may recall that the Solicitor-General believed that I broke a law and at the time Labour members said that I had to face the consequences. They said I had to roll over to the High Court and face the music. Would Labour members—who actually passed a law only 3 months later repealing the very law under which I was prosecuted—have accepted a retrospective clause to undo it? Not on your life! Not on your nelly! That is how duplicitous those members are. 
Then we come to what is proposed in this bill in respect of electoral spending. This bill will—under urgency—override the Auditor-General’s report. The Auditor-General’s report provides us with complete clarity now about what we can and cannot do. Any members who pretend that there is any doubt now as to what is lawful and what is not are kidding themselves but has Labour accepted the ruling of the Auditor-General? I know that the people of New Zealand have. I see that the Auditor-General is already being nominated as the New Zealander of the year. 
So have Labour members said: “OK the rules are there now and we will accept them.”? No—what we have in this bill is to provide a new meaning of what funding entitlements for parliamentary purposes are which basically throws the Auditor-General’s report into the bin and allows Labour to get its sneaky little fingers back in the tin of public money and back to its old tricks of using public money for political purposes. 
Let us remind ourselves of just what is in this sneaky little bill that Labour wants to pass tonight. Clause 7 states that the term “funding entitlements for parliamentary purposes” is to include performing the roles and functions of a party. That is State funding for political parties in drag. Under this bill the pledge card would be quite lawful. I think that there is a good chance there will be a snap election or an early election in this term such will be the loss of public confidence in this lot that pretend that they are a Government. If we have an election before the end of next year Labour will again be able to produce a pledge card and again have it funded by the taxpayer. I simply ask whether that is the public will. 
I would ask Labour members whether they have asked their constituents whether they want legislation that will allow the Labour Party to use public funds for political purposes again. Have they asked their constituents whether they want legislation that would allow another dodgy pledge card to be funded by the taxpayer? You see this bill is really State funding for political parties in drag. What Labour is doing quite sneakily quite secretively and under urgency is passing legislation to allow it to put its sneaky fingers back into the public tin again—and National says that that is wrong. 
The final point I will make in my contribution to the second reading is to ask why the need for urgency. Why has the Prime Minister not contributed to this debate? It is because Labour members know in their heart of hearts that this is a morally corrupt law and that they are throwing away their mandate to govern. This is the nail in the coffin of this Labour Government’s mandate to govern. 
Hon PETE HODGSON (Minister of Health) 
: 
 Every now and again in the annals of Parliament and in the history of the debates of this great place we seem to reach a debate in which one side of the House decides that to scream the loudest is to win the argument that to show the greatest anger is to display the most accuracy that to be thundering is argument in itself that shouting down is a good idea and that a running tirade of abuse against the speaker on his or her feet somehow represents debate. 
We have seen Dr Nick Smith become physiologically frightening. God knows what he did to his systolic pressure as he trotted out the words “corrupt” and “lacking moral authority” as many times as he could fit them into a sentence—as if there was a thread of logic around the unctuous prattle of that simple man. That was not an argument; that was a tirade. That was not a debate; that was high-tension abuse. The gentleman headed off into hyperspace. He demonstrated kangaroos in the top paddock. Minute after minute his blood pressure rose his redness became more and more ruddy and his shouting grew as the argument faded. He thought he had made some good points. 
Well here is something to think about. The Appropriation (Parliamentary Expenditure Validation) Bill lets no one off any hook of refunding any money that needs to be refunded whether or not the legislation is passed. One would not think that judging by the tirade of abuse that has come from the National Party whose members have gathered in their numbers for this historic debate. One would think that there is a link between refunding unlawful expenditure and the passage of this legislation but there is none. One would not think that there is any uncertainty about the Auditor-General’s ruling though the Speaker thinks there is Treasury thinks there is and every party in the House except the National Party thinks there is. But one would not think so listening to the National Party. 
National members have made it up. They do not want to understand what is in this legislation because it does not suit their purposes to know that what they did today might also be unlawful that what they do tomorrow or over the weekend might also be unlawful that that is the state in which we find ourselves and that we have plenty of legal advice that says we need to fix it—one would not think those things by listening to the tirade of the most angry Hon Dr Nick Smith and other speakers before him. One would not think that there was logical strong official advice in favour of this legislation—oh no! This is somehow a cover-up a loss of moral authority and something that the House has apparently never done before! The House does it often but one would not know it in this case because National members have got themselves into a high little lather as if they will seize the benches of power like the born-to-rule folk whom they consider themselves to be on the basis of this. 
Well I say to the National Party that we should talk about television and television expenditure and we should begin by looking at the law. The law says that there shall be an amount of taxpayers’ money to be divided by an independent commission using criteria that are in New Zealand statutes that that money shall be spent on television and that no other money can be spent on television. That is the rule. The rule is that there is a quantum of money that is identified as expenditure for that purpose. It may all be spent on that purpose but not one dollar more may be spent on that purpose. That is the New Zealand law. 
Do members know what happened? Every party in this House obeyed that law in this election as they have done in every election that I have had anything to do with. But the National Party overshot its spending on the grounds that it did not realise that it was a GST inclusive figure. We are expected to believe that and we are further expected to believe that the National Party does not want to pay the GST because it will then break the law! Actually the trouble is that the law is broken already. That is why the police investigated it. Let me say that again. The National Party has in respect of television funding already broken the law which is why the police investigated it. Why did the police take this matter no further as indeed they took other matters no further? Well the answer is that they did not know whom to take to court because they did not know who had broken the law. Why did the police not know who had broken the law? It is because the National Party said it was its agent the agent said it was its client and that was where the matter was left to rest. The truth is that the law has been broken by the National Party. 
Dr Don Brash 
: No no. 
Hon PETE HODGSON 
: It does not matter how often Dr Brash says this is not true—the law is there it has been broken and the National Party knows it. So its little attempts to introduce legislation to make itself within the law—including indeed earlier today—are simply an attempt to smokescreen. National has broken the law and if it pays the GST the law will still be broken. It will not be newly broken; it will be broken as it already is. Will National pay the money? No. National has not said it will pay the money; it has decided to try to convince this House that only by paying the money will it break the law and therefore it needs some sort of absolution from breaking the law in order to pay the money. That is nonsense. The law has been broken by the National Party and its members simply will not admit it. 
So if those members want to do unctuous if those members want to do angry and if those members want to do “high moral authority” and put together the nastiest adjectives one can ever think of—especially a big string of them in one sentence—then I have to say that the National Party unfortunately has broken the law all by itself and it denies doing so. I say to National Party members that they should climb off their high horse just a little bit peer underneath the tail and see whether there is anything nasty—I suspect there is. I think the National Party needs to get some more legal advice. Quite apart from the fact that it managed unlawful expenditure itself in the last election in respect of the Auditor-General’s opinion—in that respect it did manage to act unlawfully as well but one would not know it; the only difference is that the amount was much much less—the next time it decides to throw a bit of mud around it should remember that in respect of television advertising the law has been broken. 
The law has been broken by the New Zealand National Party not by any other political party in New Zealand or in any previous election in New Zealand that I know of. The National Party is in denial. It has broken the law already in respect of television. Its members are busily denying it even as I speak. They are shaking their fingers at me and saying I am wrong. Well there is nothing wrong about what I have to say. The law has been broken and the National Party should pay the money back. We could get a chorus up saying: “Pay the money back.” but hey that is old hat and it has been done before. 
The truth of the matter is that the National Party does not like being told that it is not lily-white. There is nothing lily-white about National Party members. These are the people who put 92 percent of their funds through a blind trust in order to obscure the origins of the donations and in order to directly frustrate the spirit of the Electoral Act. These are the people who decided to climb into bed—to an extent that we are still uncovering a year later—with a very strange group of people who gave them $1.2 million of support in such a way that it would not be counted within the laws of the land. 
The National Party decides to get on its high horse and it has nothing to get on its high horse about. No one has ever rorted the trust system to the extent that the National Party did in the last election. No one has ever done third-party funding in the history of this country to the extent that the National Party has and no one else has broken the broadcasting legislation in respect of television in the history that I know of this Parliament. Those are the things that the National Party stands accused of. 
It is just a shame that National is not part of this legislative debate because the truth of the matter is that the National Party has done much wrong and National all by itself in one election has triggered a review of the electoral legislation. There is no doubt that that will be needed because the rorting has gone on forever. It is about time National members took a bit instead of giving it it is about time they got off their high horses it is about time they stopped doing unctuous and it is about time they stopped trying to shut down the speaker in full flight because these guys have dirt written all over them. 
Hon HARRY DUYNHOVEN (Minister for Transport Safety) 
: 
 I raise a point of order Mr Speaker. First I want to assure you and your predecessor in the Chair that earlier this afternoon when I was asked to leave the House I certainly moved to do so and did not intend in any way to disrespect or disobey the Speaker’s direction. I was simply under Standing Order 85 doing as I was asked but I was informing the acting chief whip that I was the duty Minister so he needed to arrange for someone to replace me. 
My second point relates to the current debate. We have heard a lot of interjection from the Opposition and on occasions I suppose we might even expect it to be a little witty. We have been disappointed so far. However a large number of the interjections have been made by people who are not sitting in their normal seats. Former Speakers have ruled on many occasions that interjections should be rare and reasonable and hopefully witty and should be made by members who are sitting in their seats and not deliberately moving to be closer to the member who is speaking. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Duynhoven. I will be the judge of that. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 We accept that the Hon Harry Duynhoven should be taken at his word when he said he had not deliberately dallied in the House but was notifying the senior whip that he was the duty Minister. I am sure the senior whip was greatly appreciative because quite clearly he would not have been following proceedings at the time and probably of his own volition could not have worked that out. 
On Mr Duynhoven’s second point I assure him that all of the people on this side will try not to speak at a greater audible volume than they would from their normal seats. But if he thinks we are speaking too loudly he should take another point of order and we can have some further discussion about the matter. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Thank you Mr Brownlee but that was not a point of order. 
JUDITH COLLINS (National—Clevedon) 
: 
 We have just sat through 10 minutes of personal abuse from the Labour Party’s strategist Pete Hodgson. That is the man who went on television and said: “We will not pay it back.” Then he was overruled by Helen Clark who said he should not have said that and was not authorised to say that. I presume the 10 minutes of personal abuse that he threw at this side was authorised. Because in not one word did Pete Hodgson mention the bill we are supposed to be debating tonight. Not for one moment did he seem to think he should address the bill. 
But why would he want to? This bill is such a disgrace—just like that Minister opposite. The reason it is such a disgrace is that 1 year and 1 month after the election was stolen this Parliament is back here tonight under urgency rushing legislation through to make legal what is clearly illegal. Some wonder why people out there say the law is an ass. The reason the law is an ass is that people push through legislation that has no right to be legislation. 
Most people in this country try to be law abiding at least most of the time. Some people who are beneficiaries occasionally rip off the benefits system and we know that. Those people get prosecuted and can end up in jail. For $2000 they will be prosecuted and forever condemned as cheats thieves and dishonest people. But not the Labour Party! No no; it can take taxpayers’ money misuse it hide it know it is wrong be told it is wrong but it gets to pass a law to make it all better. 
Let us look at the example of those beneficiaries whom I sometimes deal with. Through no fault of their own they end up in debt to the Ministry of Social Development—the ministry that deals with beneficiaries. If beneficiaries try to come off the domestic purposes benefit or the unemployment benefit and get into work they can sometimes have their benefit paid for 2 3 or 4 weeks after it is supposed to have stopped. The mistake is made by the ministry but the beneficiary gets a note telling him or her to pay back the money. We are talking about people with very very little money who do not have savings accounts or credit cards they can use. These people have no option yet they get threatening letters from the ministry telling them to pay back the money that the ministry wrongly paid them. Do they get retrospective legislation making everything better? They certainly do not. They in fact get stood over and bullied and harassed by the very people who made the mistake in the first place by keeping on paying them. 
Some of us have dealt with estates and the situation when people have died and the old-age pension is being paid from New Zealand superannuation and is paid for another few weeks or whatever and the estate gets a nasty letter saying the money must be paid back. Someone is grieving for his or her partner and gets a letter saying there has been an overpayment and to pay back so many of the hundreds of dollars. That is the sort of way in which the most vulnerable people are treated. 
Yet the Labour Party the New Zealand First Party and United Future are all giving really not a huge commitment to paying it back. We hear Helen Clark say there is a target. Well we all know about targets under “Helen Clark’s land”. It is a “target” that at some stage they will pay back. Apparently it is within some financial year. Maybe it is this financial year or maybe another. We have heard bleeding heart stories from the back-bencher Dave Hereora that he might have to pay it by means of time payment. Tell that to the beneficiaries who have to pay by time payment. 
What about New Zealand First! It is the most disgraceful element in this matter. No wonder Winston Peters has been quiet throughout this entire debate! Not a peep have we heard from Winston Peters. Why is that? He of course is in a situation where he is in an unholy alliance with the Labour Party all for the baubles of office. That is a man who is the first to go around telling other people how they should live their lives and what they should be paying. We are talking about “Mr Wine Box” of course! Unfortunately it was $160000 was it not that he stole from the taxpayer? The poor old taxpayer! Who paid for those billboards—the “Oh I’ve got something on my shoe!” billboards—that he had up and down the country? The taxpayer paid for them. 
One of the most disgraceful things about this legislation is that as soon as it is passed—and it will be because those people are in this unholy alliance to do exactly that to cheat the people of New Zealand—there will be no legal obligation to pay. It is all right for the Prime Minister to say: “Oh well we’re going to pay in the Labour Party; we’re going to tithe them.” It is so sweet that Labour is going to tithe. Then what will happen in New Zealand First? It has said it will go to court. 
Hon Tony Ryall 
: The “Dance of the Seven Lawyers”. 
JUDITH COLLINS 
: Yes the “Dance of the Seven Lawyers”. As soon as Winston Peters gets into trouble he says: “We’ll charge off to court.” That is what he will do. But there will not be any point because at the end of the day this bill that I hold in my hand will make it all better anyway. It is like putting a little band-aid on. Winston Peters said: “We will pay what is lawfully owed.” but nothing will be “lawfully” owed. It will all be gratis. So anything he does pay—and it will be nothing—will be a bonus and he will be able to traipse around the three old-folks homes that will have him back and say to them: “I paid back more than I legally had to do.” He will be right because it will all be right. This is a clean slate bill for Winston Peters and Helen Clark. 
In fact in this country most of us as I said most of the time try to respect the law but occasionally people like the Chief Electoral Officer come along and say: “If you keep spending like this you will have broken the law.” That is what happened to my friend Bob Clarkson. He was spoken to and Bob listened to the Chief Electoral Officer who said that if he kept spending like that he would be outside the law. Bob listened because Bob respected the law and respected the Chief Electoral Officer. 
But what happened to the Labour Party? It heard as well but unlike Bob Clarkson it did not stop spending. Members in the Labour Party said: “Let’s not be like Bob Clarkson; let’s keep on spending and rark it up because we’ll get into Government and have our mate Winston in there. It won’t matter we’ll shove through any legislation and do whatever to remain in power.” That is what they did and that is exactly what they are doing now. 
Tell me again why do people think the law is an ass? It is because of this sort of legislation and because of the disrespect that those on the other side of the House have towards the taxpayers of New Zealand. They are so used to being at the receiving end of other people’s money time and time again. They do not care. 
These are the same people of course who with the unions went around the factories and told people lies upon lies took their union fees off them and paid them through to the Labour Party. Those poor people today now have to say that they agree with this nonsense where suddenly the Labour Party New Zealand First and United Future are wiping off their debt all for the baubles of power for their limousines for all the accoutrements they get—the taxpayer benefits. 
This bill will allow that pledge card to be legal—legally paid for by the taxpayer next time. This is in fact a declaration of war on the taxpayer. The poor old taxpayers might as well know that they have never approved State funding for parties they have never voted for it they have never been polled on it. What will they now have? State funding legalised through the back door! It is State funding in drag—State funding by another name. That is what this Parliament is about to go and vote on and it is an utter disgrace. The members over there should be looking glum because when they go back to their electorates they will be told exactly what the people of this country think. They know that this is nothing more than a whitewash. These people are dog-tucker and it is about time they went. 
Hon TONY RYALL (National—Bay of Plenty) 
: 
 I am pleased to take this opportunity to participate in this debate. The people of New Zealand need to know that opposite the National Party today sits an illegitimate Government. It is an illegitimate Government because it stole the 2005 general election. Don Brash has shown conclusively that that party opposite spent $750000 on the election that it should not have. That $750000 was spent on top of the $2.4 million that it was allowed to spend. The party opposite spent $3 million - plus on the election. The legal limit was $2.4 million. Labour broke the law. Section 214B of the Electoral Act says to the Labour Party that if it spends more than $2.4 million on an election that is a corrupt practice. Labour spent $750000 on top of that. It stole the election. That $750000 made a material difference to that election. It was a knife-edge election. It was the closest we have seen in a generation. Every foot soldier counted every telephone call counted and every dollar counted. 
What has outraged me the most was the Minister of Justice pontificating from his seat this afternoon. He is a man whose 10000 majority in Taupo was shaved to 1100. I say to Mark Burton that if Helen Clark had not taken that $750000 of taxpayers’ money and spent it in electorates like his he would be out of Parliament today. Steve Chadwick the person who took a 10000 majority in Rotorua down to 686 is there only because of the good people of Kawerau. The people of Rotorua wanted to kick her out and replace her with a dentist from Auckland. That tells us something about what the people of Rotorua thought. Steve Chadwick is in this House today only because Helen Clark and Michael Cullen spent more than the electoral law allowed. That $750000 made a difference in Rotorua. Steve Chadwick would be out of Parliament today if Helen Clark had obeyed the law. Let us look at the back bench. The fact is that Maryan Street would not be a list MP in Parliament today if Helen Clark had obeyed the law. 
What is clear is that Labour was told that the limit must be obeyed and it deliberately ignored it. As our good leader Dr Don Brash has said time and time again before the election the Labour Party was twice warned by the Chief Electoral Officer David Henry that the pledge card spending would have to be included in Labour’s election return. Remember that week before the election when the chief returning officer announced that he had told Bob Clarkson not to spend any more money? Well Labour saw that press statement and thought: “My God! We’ve got this letter from the chief returning officer telling us that this pledge card spending had better be included in it.” So what did Mike Smith and the Labour Party do? I am sure he went to the Labour campaign committee and immediately a letter was dispatched saying: “Yes we’ll declare that in our spending return.” What do we know? What happened after the election was the Labour campaign committee said: “No it’s not going to be part of our spending return.” because Labour had worked out that it had spent the $2.4 million already plus the $750000 that has been declared in the Auditor-General’s report and that put it way over the limit. 
What makes it worse is that in the 2 weeks before the election the Labour Party campaign committee members would have been fully aware of the warning from David Henry but those Labour Party campaign committee members still decided to spend well over a million dollars on newspaper advertising when they were fully aware of the warning that had come from David Henry. So they could have stopped overspending they could have obeyed the law but that Labour campaign committee decided that it would carry on and spend the money. So this is an illegitimate Government because this Government would not be there if Labour had not spent that three-quarters of a million dollars that it spent unlawfully in the last election. 
Hon David Benson-Pope 
: What about the Brethren? Tell us about the Brethren. 
Hon TONY RYALL 
: David Benson-Pope can pop in there and throw a few things around. But the fact is he would not be a Minister in this Government today if the Labour Party had not overspent in the last election. This is an illegitimate Government. How many members in this House receive  
The Parliamentarian 
 magazine from the Commonwealth Parliamentary Association? How many times have we read complaints about Caribbean and African Governments whose members overspend their election limits then pass legislation to authorise their misappropriation of public money? We read that we tut-tut and we say: “What banana republics! What illegitimate Governments! What corrupt people!”. 
Well what is different here? This is a Labour Party in which Helen Clark Michael Cullen and Heather Simpson must have knowingly allowed themselves to breach section 214B. Oh Dr Cullen shakes his head. Was Dr Cullen on the Labour Party campaign committee? Who were the other people on the Labour Party campaign committee? I ask Dr Cullen who the other members of this House are who sat in on those decisions. How about telling us? I reckon this House would be very surprised to know those names—would it not Madam Speaker? Who were the Labour MPs sitting in on that discussion Madam Speaker? If their names were made public I am sure it would be very embarrassing for the Labour Party. They sat on the campaign committee and made the decision that they would overspend. 
This is a Government that is not legitimate. More and more people in New Zealand realise that this Government broke the law to secure its electoral mandate. The law is clear. David Henry spelt it out. He told the police who said: “Oh well you know we’re all a bit confused by it.” David Henry set it out very clearly. He warned the Government twice before the election that the pledge card must be included in election spending. Days before the election the Labour Party admitted that the card would be included—solely to prevent David Henry from putting out a press statement like the one he did about Bob Clarkson. As a result we now have a Government that has secured its mandate through committing an electoral offence. It must be an electoral offence. If the limit is $2.4 million and Labour spends over $3 million then that is a breach. 
Michael Cullen would not be Deputy Prime Minister of New Zealand today he would not be travelling the world at taxpayers’ expense and he would not be sitting in a limousine—[ 
Interruption 
] Oh that is the bit that winds the Labour Party members up—the overseas travel and the limousines. Dr Cullen would not be sitting over there Steve Chadwick would be out Cosgrove would be out and Street would be out. MP after MP would have been kicked out of this Parliament because this is an illegitimate Government. The Government stole the money they spent more money than they should have they broke the electoral law and they were let off. 
The National Opposition will make sure that the people of New Zealand know that there is no legitimate mandate that supports the Labour Party in office. Its members cannot break the electoral spending cap by three-quarters of a million dollars and stand up and say they are honestly the legitimately elected Government of this country—they are not. That three-quarters of a million dollars made a material difference to the election. It made a huge difference. Remember that this was an election on the knife-edge. Government members spent all that money in the last week when they knew they had breached their spending limits. That is how they secured a fraudulent victory in the 2005 election. The sooner they are back on the Opposition benches the better. 
MARYAN STREET (Labour) 
: 
 The issue that made the material difference in the last election was the fact that previous years of promises had been kept by the Government as opposed to the years before that when the National Party in Government broke promise after promise after promise. That is what made the material difference in the election. As other speakers on this side of the House have said this debate should be to do with restoring faith in political institutions and in Parliament. The National Opposition should in fact be playing its part in doing that by explaining to New Zealanders why legislation like this is necessary. This debate and the circumstances around it have reminded me of that situation whereby the very proud mother is watching the military drill—[ 
Interruption 
] 
Madam SPEAKER 
: It is becoming difficult to hear the member. 
MARYAN STREET 
: The debate has reminded me of that situation whereby the very proud mother is watching the military drill and says that everybody is out of step except her Jack. The truth of the matter is that the Auditor-General’s summary and conclusion mean that every party in this House bar one offended according to his definition. Labour will be refunding the money—we have made that perfectly clear. As somebody who has conducted and run Labour Party campaigns nationally—unlike those novices over there—I say to members opposite that we have done the same thing before and that it has never previously been considered illegal. The fact is that this Labour Government—[ 
Interruption 
] 
Madam SPEAKER 
: It is impossible to hear the member. As we know the Standing Orders say that interjections are permitted but we are starting to barrack again. If members want to remain in the House to participate they should please lower the tone and give the member the opportunity to be heard. 
MARYAN STREET 
: We have had recounted previously the need for validating legislation to have been used in the past particularly in respect of the Tourism Board but in the history of this Parliament there have been other examples as well. When mistakes have been made or mistakes have been imputed to have been made then validating legislation has sometimes been used by National when in Government. 
My challenge to members opposite is why not elevate this debate for the sake of New Zealanders. Why not take the opportunity to explain the issues adequately? Why not take the opportunity to lead the debate about how democratic processes in this country ought to be funded? What about a debate about disclosure? What about a debate about State funding and its pros and cons? What about leading that debate and taking the opportunity to do it? Does the House know why members opposite cannot do that? Because they have not the wit to do it. If they had— 
Hon David Benson-Pope 
: I raise a point of order Madam Speaker. I am sorry to interrupt my colleague but I am barely more than a metre from her yet I can hardly hear her speak. You have just made a ruling. The barracking is just ridiculous and it is not acceptable. 
Madam SPEAKER 
: No I am sorry but I cannot hear either so I am afraid some members will be leaving the Chamber if this continues. Unfortunately some members have louder voices than others. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. If you are going to be hard on members on this side of the House for interjecting then I think you need to listen to the content of the speech being delivered. The general tenor of that speech— 
Hon Damien O'Connor 
: You can’t hear it. 
Madam SPEAKER 
: Would the member please continue with his point of order. 
Gerry Brownlee 
: Well Madam Speaker is it OK for my points of order to be interrupted by Damien O'Connor? National has had people thrown out of the House left right and centre today for that sort of thing but he apparently can just sit there. 
Madam SPEAKER 
: Did the member interrupt? 
Hon Damien O'Connor 
: I did. 
Madam SPEAKER 
: Would the member please leave—from now until the end of today. 
Hon Damien O'Connor withdrew from the Chamber. 
Madam SPEAKER 
: Would the member please come to the point of his point of order. 
Gerry Brownlee 
: Well the general tenor of that speech is quite insulting to the Opposition— 
Madam SPEAKER 
: I am sorry to interrupt the member but I might agree with the member if I could hear it. So would the member please continue. 
MARYAN STREET 
: Thank you Madam Speaker. I was trying my best to make myself heard but I prefer not to raise my voice. The issue is that here we have an opportunity to describe the facts and the reasons for this validating legislation to the public but the Opposition has not the wit to lead or participate in that debate. Those members have not the wit to do it. Here is a moment when some integrity can be restored and when some faith can be held again in political institutions because we are doing the right thing—we are refunding the money. Even though we disagree with the finding that caused that action we will do it because we believe it is necessary to assist in the restoration of integrity and the restoration of faith in the processes. 
There are a number of things I regret about this circumstance. One of the things I regret is the Opposition’s facile opportunism. I regret the lack of integrity of its members in dealing with the real issues. But most of all I regret their inability to seize the moment appropriately. In the end they are probably too limited to recognise my final line as a quotation: “They have not the wit to do it.” 
A party vote was called for on the question  
That the Appropriation (Parliamentary Expenditure Validation) Bill be now read a second time. 
Ayes 61 
New Zealand Labour 50; New Zealand First 7; United Future 3; Progressive 1. 
Noes 54 
New Zealand National 48; Maori Party 4; ACT New Zealand 2. 
Abstentions 6 
Green Party 6. 
Bill read a second time. 
In Committee 
Part 1 Preliminary provisions 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 This is the part of the proceedings when the bill is discussed part by part. Really I am imploring you Mr Chairman to ensure that the part by part debate is a genuine clause by clause analysis of this bill. I say at the outset that the National Party has put a considerable amount of time into the preparation of amendments which will be tabled first thing in the morning for consideration by the Committee. We thought we might supply those amendments ahead of time in order that the Labour Party might be able to consider them but then we thought that if the Labour Party was not considerate enough to give us the bill ahead of time then why would we be particularly concerned about doing that? Having said that I point out that a large bundle of papers has just been put on the Table. They are some of the amendments that will be delivered to the Table as we proceed through this bill over the next short while because this bill is one that needs a great deal of work. 
The first part of that work must surely start in the purposes clause. It is interesting to read that the purposes of the bill include doing everything that the Labour Party has been saying we should do such as validate the appropriation and follow the instructions of the Auditor-General except that the Labour Party with one hand tied behind its back has limped into the House today having to follow this particular course of action. We know that the purpose of the bill is to validate illegal activity done by the Government. The purpose of this bill is on the one hand to make legitimate the extreme over-expenditure of the Labour Party last year and on the other hand to make legitimate the dipping into of the taxpayers’ fund—the Parliamentary Service fund—to fund the pledge card and it would seem a great deal of advertising in the electorates of sitting Labour members. So we must amend the purposes to reflect just that. 
This is the “Get the Government Supporters Out of Trouble Bill”. This is the bill that New Zealand First members sit smugly over there happily awaiting because they know that their leader Winston Peters—who is running up and down the country saying: “I’m going to court to sort this matter out.”—is going to shove up his hand at the third reading to vote for the bill knowing that he then will not have to go anywhere near a court because of the actions he took having been made legal. I am not sure exactly how the Committee will end up wording the purposes clause to this extent but the National Party most certainly will be giving people an opportunity to amend it. 
The next bit in this part of the bill is clause 4 “Interpretation” containing the interpretations. Here we can see some extremely creative work from the Government. A number of things are described one of them being “expenditure”. “Expenditure” in this bill is very very tightly defined. The clause states that expenditure “(a) includes the spending of public money and the incurring of any expense or cost; but (b) excludes any expenses incurred on or after the day on which this Act comes into force.” 
At some stage the Minister of Finance will explain to us what that means. He laughs but you see we are aware of the Tamihere warning which is that Michael Cullen with just the slight shift of a word here and there is able to pull the wool over the eyes of the New Zealand people. Everyone would have to agree now that that is absolutely right because that is what Labour members did at the time of the last election. It is what they did in 2002. It is what they did in 1999. The former Labour Party president who ran those campaigns stood up here today and said: “It wasn’t a problem in the past so why should it be a problem now?”. Well in case that new member did not notice this bill actually goes way back. It recognises that there was a problem way back in those years—in fact all the way back some 17 years from the time that Sir Geoffrey Palmer first introduced the legislation to put the Parliamentary Service into effect. 
I know that a large number of National Party members want to have a say on this bill. They have been denied a say on the Parliamentary Service Commission so far therefore they have every right to speak. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 First of all I will deal with that extraordinary assertion that Mr Brownlee—or maybe it is not an extraordinary assertion in his case—does not understand what is meant by: “includes the spending of public money … but (b) excludes any expenses incurred on or after the day on which this Act comes into force.” That means we are validating expenditure up to the point the Act comes into force. I will come to the reason in a moment. Moving forward we come to Part 2 which is why Part 2 comes straight after that line of the bill. Part 2 provides definitions for expenditure moving forward. So there is no need to provide validation for that. 
Why is that so? I invite the member to turn to paragraph 32 of the Speaker’s report: “While the 2006 report deals only with advertising expenditure it is clear that the principles articulated by the Auditor-General will have general application to all expenditure under Vote Parliamentary Service appropriations at all times and not only in relation to the three months prior to a general election.” Then there are examples of where various activities occur that are funded from Vote Parliamentary Service. They are standard activities such as research staff proving background information for a speech about one’s own party’s achievements in some kind of public meeting—the kind that Mr Key frequently holds in his electorate to a dazzled audience of three or four. Those are matters that under the current Auditor-General’s rulings would potentially be tainted by electioneering and therefore unlawful. 
The reason clause 3 states “May”—and I notice a rather cute amendment to something else—is that we simply do not know going back to 1989-90 what might or might not be included within that. The Auditor-General’s report gives us no clear guidance around that point at all. All we know is that in some vague way expenditure used for a range of purposes such as public meetings newsletters to one’s electorate or flying off to sign up a member for the National Party could be tainted by electioneering. 
What is more there is the former Solicitor-General’s legal opinion about the entire expenditure in that area. For example did any of the members opposite at any point talk on their cellphones to members of the Exclusive Brethren about the funding the Exclusive Brethren was engaged in or for example the polling they were carrying out in electorates? [ 
Interruption 
] Oh I am supposed to believe that Mr Foss—oh he was not an MP at the time but that none of those members who were MPs ever called up anybody about those matters on their phones? So all the meetings were face to face. I thank the member for that confirmation. We now know that all the meetings were face to face. But was any money expended on getting to any of those meetings? 
John Key 
: No meetings. 
Hon Dr MICHAEL CULLEN 
: Oh they did not have any meetings? Mr Key had no meetings with the Exclusive Brethren. He would like to put on the record right now would he that he had no meetings with the Exclusive Brethren? So who were the shadow-faced people on television that Mr Key was meeting? But the point does not matter. Dr Brash finally admitted after denying it that he did have meetings with the Exclusive Brethren and if the Parliamentary Service paid in any shape or form for the travel then I am afraid the whole thing was out of order and tainted by electioneering and the expenditure was unlawful and needs to be validated—unlike the payment of GST by the members opposite where all they want validation for is to avoid conviction and a fine. 
Debate interrupted. 
Sitting suspended from 10 p.m. to 9 a.m. (Wednesday)