Volume 634 Week 28 - Thursday 19 October 2006 
Volume 634 Week 28 - Thursday 19 October 2006 
[Volume:634;Page:5937] 
Thursday 19 October 2006 
Madam Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Visitors 
Republic of South Africa—Deputy President 
Madam SPEAKER 
: I have much pleasure in informing members that Her Excellency Ms Phumzile Mlambo-Ngcuka the Deputy President of the Republic of South Africa is within the precincts of this Chamber. I am sure that members would wish that she be welcomed and accorded a seat on the left of the Chair. 
Ms Phumzile Mlambo-Ngcuka accompanied by the Minister of Customs entered the Chamber and took a seat on the left of the Chair. 
Business Statement 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 Next week in the House priority will be given to the first reading of the Injury Prevention Rehabilitation and Compensation Amendment Bill and to the remaining stages of the Reserve Bank of New Zealand Amendment Bill the Sports Anti-Doping Bill the Communications Legislation Bill the Insolvency Law Reform Bill and the Business Law Reform Bill. 
Speaker’s Rulings 
Ministerial Responsibility—Questions for Oral Answer 
Madam SPEAKER 
: Before the House comes to questions for oral answer I remind members that last Wednesday I indicated that I would examine replies given by the Minister of Education in answer to questions about reports he had received relating to changes in funding provided to independent schools. 
The practice members have adopted of asking whether a Minister has received reports has resulted in a reasonably broad interpretation of ministerial responsibility. This broad interpretation allowed in questions flows through to the replies. A Minister in reply may indicate any report he or she has received. These may be official reports but the Minister in replying is not restricted to official reports. However the reports that are the subject of a reply must relate to the subject matter of the question and to some matter for which the Minister is responsible. 
Speaker’s ruling 155/4 establishes that in replying to a question about a report the Minister can set out what is in the report. The Minister may include statements from reports in his or her reply in the same way that statements may be included in questions. 
On Wednesday the Minister in his replies addressed reports from the National Party. The Minister was entitled to do so in so far as they related to education policy. However the Minister has no responsibility for the National Party policies contained in those reports. It is not in order for the Minister to give an opinion about those policies or to be hypothetical about their implications. 
Points of Order 
Election Advertising—Reimbursement of Expenditure 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. Yesterday as you are aware Parliament passed legislation to validate various previously questionable expenditures relating to the 2005 election. A consequence of the discussions on that is that a number of parties have indicated they will refund moneys to the Parliamentary Service. Can you tell us what your process will be for reporting to the House when parties are making such payments? 
Madam SPEAKER 
: I can indicate to the House that I have indicated that I will report on whether parties intend to reimburse. I intend to do that at the appropriate time. After I have done that I intend to take no further action. That is up to the parties themselves. 
Hon David Carter 
: It’s a bloody cover-up. 
Madam SPEAKER 
: There is no authority for the Speaker to do anything more than I have said. So please refrain from commenting on my rulings if you wish to remain in the Chamber for the rest of the day. 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. Can you clarify for the House that the situation now is that firstly the law makes it clear that no payment is necessary so New Zealand First for example does not have to make any repayments; and secondly there is no provision for Parliament to recognise parties that do make repayments and therefore it becomes just a matter of discussion between the Parliamentary Service which of course does not publicise these things and the party concerned? Or does the Minister responsible for the Parliamentary Service make some public statement? 
Madam SPEAKER 
: I thank the member. I think I can assist the House in this. It is not the Speaker’s responsibility to attend to any of those matters. 
Questions to Ministers 
Pathology—Workforce 
1. PETER BROWN (Deputy Leader—NZ First) 
 to the  
Minister of Labour 
: What if anything is being done by the Department of Labour to ensure we have a pathology workforce that is able to meet our needs? 
Hon RUTH DYSON (Minister of Labour) 
: 
 There is a worldwide shortage of pathologists. Pathology is listed on the Department of Labour’s long-term skill shortage list meaning that New Zealand employers can recruit without the need for a specific labour-market test. 
Peter Brown 
: Is the Minister concerned about the prospect of a significant loss to New Zealand of competent experienced staff resulting from the decision of the three Auckland district health boards to change the provider of community laboratory services given that significant numbers of staff and pathologists have indicated publicly that they would rather move overseas than work for the new provider; if she is not concerned why not? 
Hon RUTH DYSON 
: I share the member’s obvious concern about the loss of any skilled New Zealand workers and particularly about those who would leave permanently. Could I refer the member to an answer given by the Minister of Health who reported to the House that the evidence that he was presented with was that our pathology workforce was growing. He further invited the Royal College of Pathologists of Australasia to present him with any evidence to the contrary which he would then consider. I invite the member to do the same. 
Dr Ashraf Choudhary 
: What reports has she received about the growth of the health workforce in the last 7 years? 
Hon RUTH DYSON 
: New Zealand has a hard-working world-class and growing health workforce. There are 4000 more nurses and 1000 more doctors working in our public hospitals than there were in 2000. 
Peter Brown 
: Does the Minister consider a cut from 645 fulltime-equivalent skilled jobs in an established laboratory to around 450 in a phantom laboratory—a laboratory that does not yet exist—to be more of a reduction in profit or of a blatant cut in the skilled workforce of this country? 
Hon RUTH DYSON 
: The comparison the member has made is not between apples and apples. My understanding is that the total number in the workforce regardless of who held the contract would have been reduced because of the requirement in the contract for a significant reduction in collection points. 
Peter Brown 
: Does she believe that the method of awarding a tender to a phantom tenderer and the impact of that on the staff are good ways to treat skilled professional people? 
Hon RUTH DYSON 
: I will make two points if I may in regard to that question. The first is that this is an existing Australian-based company and secondly the tendering process is now a matter of judicial review so it would be preferable for me to make no further comment. 
Government Revenue—Comparison 
2.  
JOHN KEY (National—Helensville) 
 to the  
Minister of Finance 
: What was the amount of tax revenue raised by the Government in 1999-2000 and in 2005-06? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Excluding the accounting effect of the provisional tax change—the one-off effect in the last year—tax revenue has increased over the period from 28.8 percent of GDP to 32 percent. At the same time the economy grew by 24 percent making it one of the fastest growing in the OECD. 
John Key 
: Why has he allowed tax revenues to rise by 62 percent over the period of time that he has been Minister of Finance when the economy as a whole has grown at 41 percent and what justifies him taking a bigger and bigger slice of the cake? 
Hon Dr MICHAEL CULLEN 
: The year 1999-2000 of course represented the bottom end of an economic cycle and therefore of the revenue cycle. Since that period we have had very very strong economic growth and obviously therefore that has been a factor. There was of course a change to the top tax rate that has affected revenue as well. 
Gordon Copeland 
: Is the Minister aware that personal taxation increased by $8.5 billion between 1999-2000 and 2005-06 and that approximately $1.85 billion of that was solely due to inflation and will he now commit to adjusting the thresholds so that at least in real terms and at a minimum New Zealand taxpayers are put back to where they were as at 1 April 2000 in line with United Future’s advocacy to him over the last 3 years? 
Hon Dr MICHAEL CULLEN 
: My advice is that those figures somewhat overstate the case but it is interesting that on the member’s own figures the so-called fiscal drag effect was only about 20 percent of the total movement in income tax returns. I acknowledge the continuing interest in the issues around tax thresholds and of course they will be considered in the light of final decisions around the business taxation review in the context of next year’s Budget for implementation on 1 April 2008. 
John Key 
: Does he think people who are fed up with increases in local body rates realise that taxes have gone up faster than rates in recent years—growing 62 percent since 1999-2000 compared with a 45 percent increase in rates—and does he think that when people cotton on to the fact that central government taxes have been rising at a faster rate than rates there will be not just a rates revolt but a tax revolt as well? 
Hon Dr MICHAEL CULLEN 
: The member makes a very interesting point that rates have risen by only 45 percent compared with nominal GDP growth of 41 percent. In other words they have scarcely shifted as a proportion of GDP contrary to what National Party members often claim. 
John Key 
: Does he think the enormity of tax increases will become even more stark when people realise that over the last 6 years the take from rates has increased in nominal terms from $2 billion to $3 billion—a $1 billion increase—while total taxes have risen in nominal terms from $32 billion to over $52 billion which is a $20 billion increase? 
Hon Dr MICHAEL CULLEN 
: Nearly $2 billion of that is simply an accounting change that will not be repeated as the member well knows. Of course one of the things that has also driven Government spending in that period is that we have now increased the subsidisation of local government to some 13 percent of its total revenue—an all-time record. 
John Key 
: If his Government is supporting an independent inquiry into rates can he now tell us whether his Government will also be supporting an independent inquiry into taxes? 
Hon Dr MICHAEL CULLEN 
: The Government has a business taxation review document out for public consultation. We are making decisions on that in the context of next year’s Budget and those will come into implementation on 1 April 2008. I am sure that if there are any tax cuts and if they are big enough the member will try to claim full credit for them from his position as Leader of the Opposition at the time. [ 
Interruption 
] I raise a point of order Madam Speaker. I note that the member just interjected on my statement that he would probably be Leader of the Opposition at the time. I do not know whether he meant to do that but it is interesting. 
Madam SPEAKER 
: That is not a point of order. 
John Key 
: That is not even amusing. Can the Minister confirm that according to the latest statistics only nine OECD countries had a lower tax to GDP ratio than New Zealand in 1999 but that by 2004 a total of 15 countries were ahead of us putting us in the bottom half of the OECD—a further sign that under his financial management our country is becoming less competitive on a relative basis than other countries? 
Hon Dr MICHAEL CULLEN 
: I can confirm that a clear majority of OECD countries saw tax increase as a proportion of GDP over the period including the United States. I can confirm that New Zealand had one of the best fiscal performances over that period—unlike say the United States which was running massive deficits throughout that period. I can confirm that we are in a far better fiscal position for the long term than almost any other OECD country along with Australia. 
John Key 
: I seek leave to table three of the latest OECD revenue statistics which clearly show that New Zealand’s position has slipped from 10th to 16th. 
Document not tabled. 
Primary Health Care—Affordability 
3.  
DARIEN FENTON (Labour) 
 to the  
Minister of Health 
: What initiatives has the Government implemented to ensure all New Zealanders have access to affordable primary health care? 
Hon PETE HODGSON (Minister of Health) 
: 
 In addition to our work to lower the cost of seeing a doctor for all families the Labour-led Government’s extra investment in general practices that charge very low fees has proven to be more successful than originally expected. Two hundred and twelve practices have taken up the new funding. That is a higher number than the 166 projected to do so. Most of those practices serve high-need communities and I am delighted that the Government has been able to assist in ensuring their financial stability. 
Darien Fenton 
: What will the impact of the very low fees initiative be for patients? 
Hon PETE HODGSON 
: The initiative is being implemented primarily to support general practices that charge low fees not to lower fees for patients. However the Government’s investment does mean that over 7600 New Zealanders will have secure access to doctors’ visits at a cost of no more than $15 for adults $10 for those aged under 18 and nothing at all for those aged under 6. From 1 July next year all New Zealanders will have access to low-cost primary health care. That is what a Government can achieve when it puts the health of families before reckless tax cuts. 
Barbara Stewart 
: What work if any has the Ministry of Health done towards ensuring that the mean amount charged for general practitioner visits for children under 6 is zero given that some parents face charges of up to $45 for a service that is supposed to be free? 
Hon PETE HODGSON 
: It is true that National with help from New Zealand First as I recall it long ago introduced zero fees for under-6-year-olds. Regrettably it managed to get the contracting wrong and as a result of that a number of doctors—not too many—charge more than zero. The median level is zero but the mean level is more than zero and this funding will reduce it a little. 
National Certificate of Educational Achievement—Variation 
4.  
Hon BILL ENGLISH (National—Clutha-Southland) 
 to the  
Minister of Education 
: Does he stand by his statement in relation to the 2005 NCEA results that: “Standards are set each year and the standards this year were set in a way that people regard is fine and the variation is fine.”? 
Hon Brian Donnelly 
: I raise a point of order Madam Speaker. I do not know whether you have noticed but there is a sign over on an Opposition desk that I do not think is within the Standing Orders or is acceptable. 
Madam SPEAKER 
: Would the member please withdraw the sign. 
Hon TREVOR MALLARD (Minister for Economic Development) 
 on behalf of the 
 Minister of Education 
: I meant to say that achievement standards are set. They are publicly available through the New Zealand Qualifications Authority website. Although some standards are reviewed periodically they are not changed every year. To ensure we keep variability within acceptable levels the qualifications authority has developed profiles of expected performance. That has allowed it to address problems of variability that occurred in the 2004 exam season and were highlighted by Bill English and we have no reason to expect that this will be any different in 2006. Variability does occur for good reasons—for example changes in the cohort of students sitting the standards or improvements in teaching—and that variation is perfectly acceptable. 
Hon Bill English 
: Can the Minister confirm that despite his reassurances to the House that the National Certificate of Educational Achievement (NCEA) in 2005 was “fine” he has since then taken advice from a range of assessment experts and is now in the process of changing fundamentally the design of NCEA assessment; if so what problem is he trying to solve now that he hid last year? 
Hon TREVOR MALLARD 
: No. 
Hon Brian Donnelly 
: What is the Minister doing about the demotivating elements of NCEA uncovered by the Ministry of Education’s research into that issue? 
Hon TREVOR MALLARD 
: As I am acting for the Minister I am not briefed on that supplementary question. 
Hon Bill English 
: Can the Minister confirm that after the 2004 Scholarship debacle the basis of assessment for Scholarship was changed and that since then he is now using the same group of people to make extensive and fundamental changes to NCEA; and why did he give assurances to the House that the NCEA was “fine” in 2005 when he was already in the process of making fundamental changes to fix it? 
Hon TREVOR MALLARD 
: No. 
Hon Bill English 
: Well if the Minister says “No” why did he answer a parliamentary question by saying “Yes”? 
Hon TREVOR MALLARD 
: Because that is not the question in the written question. 
Hon Bill English 
: Can the Minister confirm that he is taking advice from the technical overview group comprising Professors Gary Hawke Terry Crooks John Hattie Cedric Hall and Jeff Smith to investigate the use of exemplification of standards written scoring rubrics and item analysis for external assessment; and can he also confirm that this is a fundamental shift in the way that external assessment is done and that he said that this is a similar approach to that used for Scholarship 2005? 
Hon TREVOR MALLARD 
: Yes no and yes. 
Hon Bill English 
: What are New Zealand students teachers and parents to make of all the assurances given by the Government over the last 2 or 3 years about the validity of NCEA assessment when it has now become apparent that the Government is secretly changing fundamentally the way it runs external assessment in the NCEA? 
Hon TREVOR MALLARD 
: It is not. 
Hon Bill English 
: Well if the Government is making no changes why is it using a collection of New Zealand’s only assessment experts to change the way the standards are communicated to teachers to change the way the exams are written to change the way the marking schedules are written and to bring in pre-testing—which every other country has used for years and years—yet the Minister does not think that that changes the basis of NCEA assessment? 
Hon TREVOR MALLARD 
: Minor improvements are not fundamental changes. 
Sedition—Law Commission 
5.  
KEITH LOCKE (Green) 
 to the  
Minister of Justice 
: Does he agree with Law Commission prsident Sir Geoffrey Palmer that in a free society like New Zealand which respects the democratic value of free speech people should not be able to be punished for defaming the Government; if so will he act to implement the recommendation of the Law Commission “that the seditious offences set out in sections 81 to 85 of the Crimes Act 1961 be abolished.”? 
Hon MARK BURTON (Minister of Justice) 
: 
 The Law Commission’s work on this matter is in response to the Government’s request for it to review seditious offences and to make any necessary recommendations for reform. The Law Commission released its consultation document 3 days ago which includes this proposition. The Government will carefully consider and respond to the Law Commission’s final report which will no doubt be written following this period of consultation. 
Keith Locke 
: I raise a point of order Madam Speaker. I understand that the Government is considering the report but the first part of my question asked about whether the Government agreed with Sir Geoffrey about the question of being charged for defaming the Government. Could I have a response to that part of the question. 
Madam SPEAKER 
: The Minister did address the question but if he wants to add anything more— 
Hon MARK BURTON 
: No. 
Keith Locke 
: Has the Minister any fears that Labour politicians could be in danger of sedition charges under a future National-led Government given that three former leaders of the Labour Party were convicted of sedition under anti-Labour Governments—namely Harry Holland Peter Fraser and Walter Nash? 
Hon MARK BURTON 
: I have no fears in the foreseeable future. I do not anticipate there being a National Government for some time. Given the member’s question I do think it is timely that the Government’s initiated sedition review takes place—as it is doing. 
Dr Richard Worth 
: Why would New Zealand move to abolish seditious offences when in just the last year the Australian Government is moving in the opposite direction with its recent tightening of anti-terrorist laws as part of its war on terror? 
Hon MARK BURTON 
: The Australian Government has reviewed—and I think quite significantly changed—the proposition and definition of seditious offences in that update. More to the point the Government has not taken a position—only that it is timely to have a review and indeed that is what we are doing. It is an opportunity for wide consultation with members of the public and people will have their say. 
Keith Locke 
: Does the Minister agree with Sir Geoffrey that if sedition offences were proposed today they would attract an adverse report under the New Zealand Bill of Rights Act; if not why not? 
Hon MARK BURTON 
: As I said in answer to the primary question 3 days ago a discussion document was released. It would be inappropriate for either me or the Government to offer an opinion on the discussion document rather than respond to what I am sure will be a final report. 
Keith Locke 
: Does the Minister agree in response to Richard Worth’s question that the anti-terrorism legislation we have now is fully adequate to deal with any terrorist activity that the sedition laws are a relic of a bygone era and that those charged with sedition in the past now look like a roll-call of our heroes from Te Whiti of Parihaka to the Tuhoe leader Rua Kenana to Catholic bishop James Liston to conscientious objectors Ormond Burton and Bob Semple? 
Hon MARK BURTON 
: The Government and I certainly agree that it is timely to have a look at the sedition laws which is why we have asked the Law Commission to have the current review and to engage in public consultation which is what is going on and I await its report with interest. 
Question time interrupted. 
Points of Order 
Election Advertising—Auditor-General’s Report and Speaker’s Response 
GERRY BROWNLEE (Deputy Leader—National) 
: 
 I raise a point of order Madam Speaker. Further to the matter I raised with you earlier today I have now had our office send down to the House a copy of a press release that you released last Thursday in which you said that you therefore require the parliamentary parties to consider the two reports—that is your report and the Auditor-General’s report— 
Madam SPEAKER 
: I am sorry to interrupt but I will be giving that report at the appropriate time. 
GERRY BROWNLEE 
: Today? 
Madam SPEAKER 
: Yes of course. I said I would and I told you that before—[ 
Interruption 
] The member is entitled to seek clarification. 
Question time resumed. 
Questions to Ministers 
Ingram Report—Immigration Minister’s Statement 
6.  
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
 to the  
Minister of Immigration 
: When he told the House on 24 August 2006 that “The Ingram report makes clear that Mr Field may have committed some errors of judgment” was he referring to Mr Field’s failure to advise the Associate Minister of Immigration of all relevant information or were there other matters he was referring to? 
Hon DAVID CUNLIFFE (Minister of Immigration) 
: 
 Yes; and no. 
Dr the Hon Lockwood Smith 
: Was it merely an error of judgment that Taito Phillip Field kept from the then Associate Minister of Immigration the fact that Mr Field did a deal with Mr Sunan Siriwan for him to work for Mr Field without pay in Samoa in return for a work permit for New Zealand as alleged in a sworn affidavit by Mr Sunan Siriwan; if so why is that merely an error of judgment? 
Hon DAVID CUNLIFFE 
: The matter discussed is the subject of a conflict of evidence and has been referred to the New Zealand Police. 
Dr the Hon Lockwood Smith 
: Was it merely an error of judgment that Taito Phillip Field kept from the Associate Minister the fact that Mr Field employed Mr Sunan Siriwan’s partner Ms Phanngarm as his wife’s personal housekeeper in Samoa where she “clean everything even her shoe clean her house clean her clothes by hands and wash her underwear by hands everything” without pay in exchange for his assistance in securing a New Zealand work permit for her; if so why is that merely an error of judgment? 
Hon DAVID CUNLIFFE 
: I repeat that the matters referred to are the subject of a conflict of evidence and have been referred in the proper way to the New Zealand Police. 
Dr the Hon Lockwood Smith 
: When Taito Phillip Field kept from the Associate Minister of Immigration the information that Ms Phanngarm was working for Mr Field’s wife without pay in Samoa “like slave I still have to work even I’m sick” in exchange for immigration assistance does he consider that merely an error of judgment; if so why? 
Hon DAVID CUNLIFFE 
: I repeat that the matters have been referred to the New Zealand Police who are the competent people to investigate and where appropriate decide whether they are for the courts to determine. 
Dr the Hon Lockwood Smith 
: When considering the latest immigration applications of Mr Sunan Siriwan and his partner Ms Phanngarm was it merely an error of judgment for Mr Field to take $2000 in cash from Mr Sunan Siriwan neither issuing a receipt nor returning the $69 overpaid for Ms Phanngarm’s deportation costs; if so why is that merely an error of judgment? 
Hon DAVID CUNLIFFE 
: The allegations referred to to my knowledge have not been established as fact but have been referred to the New Zealand Police for further investigation. 
Dr the Hon Lockwood Smith 
: When considering the latest immigration application by Mr Siriwan was it merely an error of judgment for Taito Phillip Field to pay Mr Siriwan $1000 in cash—cash he just happened to have in his pocket—when he met Mr Siriwan in Samoa last week given that Mr Siriwan has signed an affidavit alleging Mr Field offered him the money to stop him from talking to the media; if so why is that merely an error of judgment? 
Hon DAVID CUNLIFFE 
: I am sure that the matter to which the member refers will be further investigated by the New Zealand Police. The member is indeed brave to refer to things in people’s pockets. 
Benefits—Transition to Work 
7.  
GEORGINA BEYER (Labour) 
 to the  
Minister for Social Development and Employment 
: What reports if any has he received on the Government’s progress at moving New Zealanders off benefits and into work? 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 I am pleased to advise the House that Government policies like Working for Families and Work and Income’s new service approach are continuing to have success in assisting people to move off benefits and into work. In the year from September 2005 to September 2006 the total number of people on benefits fell by a further 10000. This is one of the reasons why under this Labour-led Government we have the highest-ever levels of labour-force participation and record low levels of unemployment at 3.6 percent. 
Georgina Beyer 
: What have been the changes in the number of people on the domestic purposes benefit? 
Hon DAVID BENSON-POPE 
: In the year to September 2006 the number of people receiving the domestic purposes benefit fell by over 5000. This was nearly all accounted for by a drop in the number of sole parents on domestic purposes benefits which in the year to September fell from 97796 to 92148. 
Judith Collins 
: Has the Minister seen reports showing that the number of sickness and invalids beneficiaries has increased by 50 percent since his Government came to office; and if he has why are sickness and invalids beneficiary numbers increasing despite his numerous employment assistance programmes? 
Hon DAVID BENSON-POPE 
: The member will be pleased to hear that over the past 6 years more than 800000 people have left the unemployment benefit. Of those— 
Hon Dr Nick Smith 
: What about the sickness benefit? 
Hon DAVID BENSON-POPE 
: Wait up ugly! Of those people only one in 11 or 9 percent have transferred to the sickness benefit. I also remind members that sickness and invalids benefit beneficiaries are people certified by doctors as being in need of Government support. 
Heather Roy 
: Why when—as the Minister states—the number of people on the domestic purposes benefit has dropped by over 5000 or around 5.2 percent from 2001 to 2006 have the debts owed by domestic purposes benefit beneficiaries increased by more than $15 million over this time? 
Hon DAVID BENSON-POPE 
: I remind the member that we have a zero tolerance policy on debt fraud but the reason for the increase in the figure according to my advice is that recoverable debts are also being included in that total. 
Land Information New Zealand—Confidence 
8.  
Hon DAVID CARTER (National) 
 to the  
Minister for Land Information 
: Does he have confidence in Land Information New Zealand; if not why not? 
Hon DAVID PARKER (Minister for Land Information) 
: 
 Yes. 
Hon David Carter 
: Why does he have confidence in Land Information New Zealand if he is going to have to personally vet every land tenure review proposal? 
Hon DAVID PARKER 
: The Government has said it has concerns about outcomes of tenure review particularly around landscape values in lakeside areas. That is the reason I am paying more attention to that issue at the moment. 
Hon Marian Hobbs 
: Why has the Government said that it is reassessing landscape outcomes from tenure review especially around lakes? 
Hon DAVID PARKER 
: It is hard to think of a more important landscape issue in New Zealand. These landscapes are central to the vision we have of ourselves as New Zealanders and to our tourism. These are long-held values and they are well expressed on the memorial at Burkes Pass to Michael John Burke a runholder back in 1855. That memorial includes the words: “O ye who enter the portals of Mackenzie to found homes … shall your mountain faces and river flats be preserved to your children’s children and for evermore.” Those issues remain current and that is why I am paying more attention to them now. 
Hon David Carter 
: Will he assure the House today that his decision to be personally involved in every land tenure will not delay any final decisions? 
Hon DAVID PARKER 
: No. 
Hon David Carter 
: What was the point of commissioning the Donn Armstrong report into valuation methods if the Government is going to ignore totally the findings of that report? 
Hon DAVID PARKER 
: The Government is not totally ignoring the Donn Armstrong report and indeed it is clear that the process of that report has led to clarity as to the rules that ought to be applied. The Government has also made it clear—and I emphasise—that it values the contribution of sustainable high country farming in New Zealand both to the New Zealand economy and to South Island communities. The Government wants that contribution to continue and it is confident that it will. 
Jacqui Dean 
: Is the Minister aware of a proposal to transfer 20000 acres at Mount Ida in Central Otago from Land Information New Zealand into the Department of Conservation estate which will have the effect of probably forcing three farming families off their land and does he care? 
Hon DAVID PARKER 
: I am aware of the issues there that relate to the Mount Ida syndicate and the so-called Soldiers Syndicate. These are areas of land where the occupiers have no security of tenure because they are not pastoral leases they are non-renewable pastoral licences. 
Hon David Carter 
: Is this Minister ever going to stand up to the relentless march by the Department of Conservation and Royal Forest and Bird Protection Society to lock up vast chunks of the South Island which has been farmed without detriment for over 100 years? 
Hon DAVID PARKER 
: The only mechanisms that enable land to be returned to the Department of Conservation from pastoral leases—other than consensual sales—are through the voluntary tenure review process which is voluntary and there is no compulsion on either lessees or tenants. [ 
Interruption 
] The member shouts out it is voluntary. There is no proposal from the Government to make it compulsory. 
Fishing Foreign Crews—Public Comment 
9.  
SUE MORONEY (Labour) 
 to the  
Minister of Immigration 
: Has he received any public comment on the recently announced policies for foreign fishing crews? 
Hon DAVID CUNLIFFE (Minister of Immigration) 
: 
 I have seen an editorial in the  
Dominion Post 
 of Monday 16 October that warmly welcomes the foreign charter fishing crew policy the Government announced last week. In particular it notes that it was the fishing industry’s failure to drive out the “cowboys” that prompted the Government to act and that we “should not be put off by the squawks of those who cannot see past their own bank balances.” 
Sue Moroney 
: Why will the fishing policy announced by the Government protect and promote the New Zealand fishing industry over the longer term? 
Hon DAVID CUNLIFFE 
: The policy promotes human rights and decent labour conditions thus enhancing the reputation of the New Zealand fishing industry. It also prevents a race to the bottom whereby legitimate New Zealand operators are undercut by cheap foreign labour. 
Peter Brown 
: Can I take it from the Minister’s answer that he shares New Zealand First’s view that foreign fishing crews should be allowed only when it is proved that New Zealand workers are unwilling or unable to undertake the work and does he also agree that adopting industry-wide minimum employment standards will encourage New Zealanders to do the work which will reduce the reliance on foreign crews? 
Hon DAVID CUNLIFFE 
: It is a longstanding tenet of Government immigration policy that jobs should always be offered to New Zealand workers where they are available. Secondly it is a longstanding part of Government policy that terms and conditions for foreign crews should be equivalent to those of domestic ones. 
Tariana Turia 
: Would the Minister agree that the real concern for the minimum wages being paid to foreign fishing crews has more to do with undermining the Maori fisheries industry and assisting the Talley’s family to achieve cheap quotas and control of Maori fisheries because of that family’s relationship with politicians? 
Hon DAVID CUNLIFFE 
: It ill-serves a party that claims to represent some of the lowest-paid New Zealanders to be advocating that iwi fishing companies make a profit from the sweat of Third World workers being paid even less. The officials’ advice is that although there may be some economic impact on firms—[ 
Interruption 
] 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. I have my speaker on high I am trying to listen and I cannot hear the Minister who is two benches behind me. 
Madam SPEAKER 
: Yes I know. I thank the member and I understand that that is also why the members were rising at the back of the Chamber. I ask the Minister however to just directly address the question. 
Hon DAVID CUNLIFFE 
: I will directly address the question again. It ill-serves a party that claims to represent some of the lowest-paid New Zealanders to be advocating that iwi fishing companies make a profit from the sweat of Third World workers being paid even less— 
Tariana Turia 
: I raise a point of order Madam Speaker. I would like to ask the Minister to address the question. 
Madam SPEAKER 
: So would I. I ask the Minister please do not preface it with statements but just get to the substance of the question. 
Hon DAVID CUNLIFFE 
: Maori make up a significant percentage of the people working on fishing vessels and it is important that their conditions are not undermined by allowing foreigners to do the work on substandard terms. The officials’ advice is that although there will be some economic impact on some firms there is no evidence that iwi will be disproportionately affected. 
Gambling—Problem-gambling Service Providers 
10.  
SANDRA GOUDIE (National—Coromandel) 
 to the  
Associate Minister of Health 
: Is he satisfied with the Ministry of Health’s contracting and monitoring of problem-gambling service providers; if not why not? 
Hon DAMIEN O'CONNOR (Associate Minister of Health) 
: 
 Yes I am satisfied with the strategic progress being made but there is always room for improvement. 
Sandra Goudie 
: Can the Minister explain why his ministry paid the Pacific People’s Addiction Services of Hamilton $143000 last year for counselling eight people at an average of $18000 each? 
Hon DAMIEN O'CONNOR 
: That provider along with 12 other providers is currently being reviewed. They are new providers in a difficult area of social responsibility in this Government. They have been funded to develop services to assist people with problem-gambling habits. The outcome of that review will identify whether any problems have occurred. 
Sandra Goudie 
: Can the Minister explain why his Government overpaid the Pacific People’s Addiction Services of Hamilton $143000 last year for counselling eight people when that organisation’s official contract requires it to see over 300 people; and does he realise that his ministry agreed to pay this money for people who may have had only a 16-minute phone conversation? 
Hon DAMIEN O'CONNOR 
: As I said before a number of providers have been set up to assist in the problem-gambling area. This is one of those organisations. It along with 11 others is currently under review in order to ensure that the money provided has been spent wisely. 
Sandra Goudie 
: Can the Minister explain why the Government paid the Waipareira Trust $180000 for counselling only 13 people last year—an average of $14000 for each person—when the contract required the trust to counsel 440 people for the year; and why is the Government overpaying when these contracts are not being met? 
Hon DAMIEN O'CONNOR 
: Those questions will be answered by the review. I would like to remind that member— 
Madam SPEAKER 
: Please be seated. Members will be leaving the Chamber if this continues. We have done quite well so far. People are entitled to be heard. Would the Minister please address the question. 
Hon DAMIEN O'CONNOR 
: I would like to remind that member that we are dealing with a very serious public health issue here. Every day New Zealanders lose $5.5 million. Currently 39000 people are considered to be problem gamblers and another 17000 in this country are considered to be at risk. The Ministry of Health has taken over responsibility for this area and it is developing work with problem-gambler providers. 
Sandra Goudie 
: I raise a point of order Madam Speaker. I ask that the Minister address the question which asks him to explain why the Government paid the Waipareira Trust when the contract was not being met. 
Madam SPEAKER 
: The Minister did address the question. But the member is entitled if she wishes to ask another question. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. The Minister did not answer the question. The contract was for some 440 treatments. The organisation provided only 14 treatments but it was paid out for the whole lot. Then he proceeded to tell us that 17000 people in this country have a gambling problem. Well how can we believe that given that only 14 people turned up the contract was for 440 treatments and the money was paid? The member should just answer the question. 
Madam SPEAKER 
: That is not a point of order. I have ruled on it. 
Sandra Goudie 
: Why is the Minister happy to pay $14000 for a 16-minute phone conversation or a single half-hour counselling session; and if he has known how poorly all these problem-gambling providers are performing why has he given nearly all of them extra contracts worth tens of thousands of dollars more? 
Hon DAMIEN O'CONNOR 
: I do not accept for a moment the claims made by that member. A review is currently under way. There will be a normal audit process of every one of those providers. They have been paid money to assist them to set up the organisation that they have and if there are any problems they will be identified through the review. 
Steve Chadwick 
: I raise a point of order Madam Speaker. It is impossible to hear the Minister’s response at the back of the Chamber due to the constant interjections. 
Madam SPEAKER 
: Will the Minister please repeat his answer succinctly. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. While you were ruling there was again a barrage from Simon Power. I could hear you but I am sure people at the back of the Chamber will have trouble in doing so if he keeps that up. 
Madam SPEAKER 
: Mr Power has a loud voice and he sits right beside the Speaker. So I ask the member not to intervene in future. Will the Minister please succinctly address the question. 
Hon DAMIEN O'CONNOR 
: That question and a number of others will be answered by the review that is currently under way. 
Sandra Goudie 
: Does the Minister realise how bad this scandal looks when only yesterday a casino was fined for not dealing with a problem gambler yet this Government is wasting thousands of dollars overpaying counselling services; and is it not time that the Auditor-General was called in to blow the whistle on this misuse of public money? 
Hon DAMIEN O'CONNOR 
: The fact that a casino was fined yesterday identifies the major problem that some organisations throughout the country are not taking responsibility to try to minimise harm from problem gambling. 
Indigenous Rights—Consultation 
11.  
TE URUROA FLAVELL (Maori Party—Waiariki) 
 to the  
Minister of Foreign Affairs 
: What were the 13 occasions between 1997 to 2003 on which New Zealand has consulted “interested Maori and others” on the Declaration on the Rights of Indigenous Peoples and what are the names of the groups and individuals that were consulted on those 13 occasions? 
Hon Dr MICHAEL CULLEN (Leader of the House) 
 on behalf of the 
 Minister of Foreign Affairs 
: They were on various days in May 1997 July 1997 October 1999 October 2000 November 2000 May 2001 November 2001 July 2002 August 2002 and August 2003. Many hundreds of people attended so obviously one cannot list all of them. Amongst the groups involved were the Maori Women’s Welfare League New Zealand Maori Council National Maori Congress Maori Legal Service Ratana Church Waitangi Tribunal and the Maori Land Court. 
Te Ururoa Flavell 
: What advice did his office give that led the Prime Minister to respond to Dr Pita Sharples in a letter of 16 October 2006 regarding the Declaration on the Rights of Indigenous Peoples which states that some critics “have not even read the chair’s text or the many statements we have given on the subject.”; and what evidence does he believe the Prime Minister may have to support that claim? 
Hon Dr MICHAEL CULLEN 
: There is a great deal of misinformed comment on the declaration. One of the saddest things is that a number of countries indicated that they are voting for the declaration but have no intention of implementing it. 
Te Ururoa Flavell 
: What is his responsibility for the statement made on 16 October 2006 which was tabled at the 61st session of the United Nations General Assembly by a representative of New Zealand which stated: “Social and economic policies are best determined on the basis of need.” and where does he suggest that the notion of “rights” fits within this? 
Hon Dr MICHAEL CULLEN 
: The Government is a signatory along with a very large number of other countries to the Universal Declaration of Human Rights. Unlike many of those countries we actually follow that declaration. 
Te Ururoa Flavell 
: I seek leave to table a letter from the Prime Minister to Dr Pita Sharples concerning the Declaration on the Rights of Indigenous Peoples. 
Document by leave laid on the Table of the House. 
Te Ururoa Flavell 
: I seek leave to table the statement made by the representative of New Zealand to the United Nations General Assembly 61st session. 
Document by leave laid on the Table of the House. 
Food Standards Australia New Zealand—Folic Acid 
12.  
Dr PAUL HUTCHISON (National—Port Waikato) 
 to the  
Minister for Food Safety 
: Does she intend to sign up New Zealand to the Food Standards Australia New Zealand plan to add folic acid to bread at the Australia New Zealand Food Regulation Ministerial Council this month; if so why? 
Hon DAMIEN O'CONNOR (Minister of Corrections) 
 on behalf of the  
Minister for Food Safety 
: The Minister is on record as being a strong supporter of folic fortification and will take into account the submissions and advice she has received to date and will continue to receive when she participates in the discussion on the Food Standards Australia New Zealand proposal at the upcoming ministerial council meeting. 
Dr Paul Hutchison 
: Why would she commit New Zealand to a rushed-through new plan for mandatory fortification of most breads with folic acid when folic acid supplements will still need to be taken to prevent neural tube defects when evidence of effectiveness is in doubt with this new plan and when a public opinion poll shows that more than 80 percent of New Zealanders are against mandatory fortification? 
Hon DAMIEN O'CONNOR 
: This is not a rushed process. When we came into Government in 1999 that member led the charge to have folic fortification. There has been much discussion about the level of fortification within bread and it is important that we do not have levels that are unsafe. That member supports that position and I am sure he will support—or he should support—the precautionary approach being proposed. 
Steve Chadwick 
: Has she seen any reports on this matter? 
Hon DAMIEN O'CONNOR 
: Yes I believe she has in the  
Sunday Star-Times  
of 23 July where Dr Hutchison called for more time for consultation which would delay the introduction of the one known means of reducing neural tube defects. The question I ask of Mr Hutchison is this: does he support this or does he not? 
Madam SPEAKER 
: The member is not entitled to ask that question. 
Barbara Stewart 
: Can we expect to see further Government action aimed at removing additives such as excess sugar from food once a precedent has been set for the Government to interfere with food by adding folic acid to bread on a population-wide basis? 
Hon DAMIEN O'CONNOR 
: Any proposal such as that is up for discussion between officials of Australia and New Zealand which is the agreed process. 
Sue Kedgley 
: Will the Minister listen to the appeals of the baking industry and the entire organics industry and seek to exempt organic breads from mandatory fortification thereby ensuring some consumer choice or will she undermine the entire organics standard which explicitly prohibits the adding of synthetic additives to organic products? 
Hon DAMIEN O'CONNOR 
: I know that the Minister is aware of the issues around organic production and will take on board those concerns when she has discussions with officials from Australia and her counterparts from Australia. 
Dr Paul Hutchison 
: Why is she considering adopting mandatory fortification of most breads without due consultation when even the New Zealand Food Safety Authority as recently as 31 July this year stated: “All the government departments involved in this joint submission have strong concerns at the very short consultation period provided for the proposal.” and why is she going off once again half-baked? 
Hon DAMIEN O'CONNOR 
: For that member to claim this has been a rushed consultation process is ridiculous. He himself was advocating for this in 1999 when we came into Government. There has been extensive consultation. The Minister is to have discussions with her colleagues in Australia and decisions will be made then. 
Dr Paul Hutchison 
: Can the Minister confirm that in the excellent article by Dr Paul Hutchison in the  
New Zealand Herald  
in 2000 he states that there would initially be voluntary fortification of bread; and that in the United Kingdom 6 years later in the light of new evidence the UK scientific advisory committee on folate and disease has requested further time to consider potential risks and benefits of increased folic acid intake? 
Hon DAMIEN O'CONNOR 
: I believe that that member does support folate fortification. The approach in the proposal is a precautionary one. The proposed levels are quite low but will assist to reduce neural tube defects in the New Zealand population which currently run at about 50 a year. 
Madam SPEAKER 
: Would members just settle please. 
Dr Paul Hutchison 
: Has the New Zealand Government undertaken any substantial ethical processes relating to the introduction of mandatory fortification of most breads; if yes what are they; if not why not? 
Hon DAMIEN O'CONNOR 
: I am not aware of the detail of that. If the member would like to put down a question I am sure we can get a substantive answer for him. 
Madam SPEAKER 
: I call Dr Paul Hutchison. [ 
Interruption 
] We need to hear the question. 
Dr Paul Hutchison 
: Does she agree with the joint food standards submission that a comprehensive monitoring programme should have been developed as part of the draft assessment report and can she offer proof that New Zealand is ready for a comprehensive monitoring programme; if not why not? 
Madam SPEAKER 
: Members we need to hear the answer in the same manner—in silence. 
Hon DAMIEN O'CONNOR 
: I am sure those assurances and those issues will be part of the discussion that the Minister will have next week in I believe Australia. 
Hon Paul Swain 
: I seek leave of the House for Paul Hutchison to table the excellent letter from Paul Hutchison on this subject. 
Madam SPEAKER 
: The member cannot seek leave on behalf of another member. 
Sue Kedgley 
: I seek leave to table a document that indicates that at the ministerial council next week we will have one vote out of 10. The Australians will have nine votes and we will have one. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Dr Paul Hutchison 
: I seek leave to table the excellent article in the  
New Zealand Herald 
. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Speaker’s statement 
Election Advertising—Reimbursement of Expenditure 
Madam SPEAKER 
: In my report to Parliament under section 65Z of the Public Finance Act 1989 on the 12 October I stated I would require the parties to report to me on whether they intend to reimburse the unlawful expenditure. All parties except New Zealand First have indicated they will be reimbursing the expenditure. New Zealand First has indicated it needs more time to receive legal advice on the reports but will inform me as soon as possible of its intention once it receives that advice. Once I have received that notification I will report to the House. 
Privilege 
Television New Zealand—Action Taken Against Chief Executive 
Consideration of Report of Privileges Committee 
SIMON POWER (National—Rangitikei) 
: 
 I move  
That the House take note of the report of the Privileges Committee on the question of privilege referred on 16 February 2006 on the action taken by Television New Zealand in relation to its chief executive following evidence he gave to the Finance and Expenditure Committee. 
 The Privileges Committee has now reported back to the House on the question of the action taken by Television New Zealand (TVNZ) in relation to its chief executive following evidence he gave to the Finance and Expenditure Committee. Members will recall that this report is the second report. It follows an interim report presented to the House on 5 April 2006 in which the Privileges Committee found and the House agreed that TVNZ had committed a contempt. We recommended and the House agreed that a written apology be made by TVNZ and that for the first time in well over a hundred years a fine be imposed on the company. As I said the House adopted both those recommendations. 
There were however some remaining issues as a matter of principle and direction that the Privileges Committee has sought to clarify for the House. For example in the interim report the Privileges Committee questioned whether it was realistic for the House or for a select committee witness to assume that no consequences to a relationship would arise from a witness appearing before a select committee particularly if that witness was giving prejudicial or critical evidence. We suggested that it was a matter of balance and that it would be necessary for the House to develop some principles and guidance for use in those situations. 
Accordingly the Privileges Committee recommends to the House that Standing Order 399 be amended to include the following in the considerations that are relevant in deciding whether to invoke the power to punish for contempt: firstly the conduct of any person taking part in parliamentary proceedings; and secondly the nature of any action taken against any person on account of that person’s parliamentary actions—in particular whether that individual was disadvantaged or dealt with otherwise than he or she would be in accordance with the privilege that accrued to him or her at the time the evidence was given to a select committee. Further the Privileges Committee recommends to the Finance and Expenditure Committee that in 12 months’ time it review progress made by the State Services Commissioner in providing guidance to the boards of Crown entities and State-owned enterprises on their responsibilities in their relationships with Parliament. 
Before I deal with the last recommendation I will just pause and say that the Privileges Committee’s strong view was that people taking up appointments with Crown entities and State-owned enterprises did not have sufficient training or guidance in how to deal with institutions of Parliament. In particular there was insufficient training in giving evidence before select committees and in issues relating to contempt privilege and the like that could arise by way of that evidence being tendered. In fact as the Privileges Committee report tabled yesterday shows many of those matters are not covered in any detail at all at the time those appointments are made. The Privileges Committee did spend some time considering whether such guidance should also apply to the senior management of those agencies but we leave that matter for further consideration. 
 Important for the Government the Privileges Committee also recommends that the Government revise its guidelines—as supplied for example in the  
Cabinet Manual 
—regarding witnesses who appear before select committees. The guidance should make it absolutely clear that pressure must not be placed on individuals to deter them from giving evidence and that action cannot be taken against them as a direct consequence of their giving evidence to a select committee. 
By way of background we reviewed a number of privileges reports about the disadvantaging of witnesses in jurisdictions such as the United Kingdom Canada and Australia. We endorse the following common themes: firstly the protection of witnesses before a select committee is a fundamental aspect of parliamentary privilege secondly the freedom of witnesses to give evidence must be absolute and thirdly the protection of witnesses who appear before parliamentary committees is the single most important duty of a Privileges Committee when determining possible contempts. 
It has long been recognised that if parliamentary inquiries are to be carried out effectively witnesses who give evidence to the House or a committee have to be protected against adverse consequences they may suffer as a result of giving that evidence. That point is well understood and there is a long-held rule of law dating back to the Bill of Rights 1688 to provide immunity for parliamentary proceedings from legal liability. The absence of recent case law on the issue in New Zealand or overseas suggests—and this is important—that it is well understood that evidence given by a witness before a select committee cannot be questioned in a court of law. If Parliament is to hold witnesses liable or accountable for that parliamentary evidence that is a matter for Parliament not the courts. However that principle can as we say in our report fly in the face of reality. The House must decide on a case by case basis whether a particular action or omission has the tendency directly or indirectly to obstruct or impede the House in the performance of its functions. 
 Disadvantaging a witness on account of his or her evidence before a select committee may amount to a contempt but whether it does so requires consideration. It is on that basis that the Privileges Committee has recommended to the House that that be done by adding to Standing Order 399 a reference to the factors that the House will consider in determining whether conduct constitutes a contempt. 
It is worth emphasising one or two further points. Evidence given to a select committee cannot form the sole basis for an action against the person who gave it. The Privileges Committee looked carefully at that point and I make the following statement in support. The evidence might act as a prompt for an employer to establish a separate inquiry into the conduct of the staff member concerned but any action against the staff member should be based on the results of that separate inquiry not on the evidence given before a select committee or before Parliament. That was a fundamental point that members of the Privileges Committee worked hard to clarify starting on the basis of the interim report. 
Those recommendations are made to the House and as I said I move accordingly. 
Hon LIANNE DALZIEL (Minister of Commerce) 
: 
 I want to take a brief call on the final report of the Privileges Committee on the action taken by Television New Zealand in relation to its chief executive following evidence he gave to the Finance and Expenditure Committee. As the chair of the Privileges Committee has already stated despite what the title of the final report indicates that issue was essentially dealt with in the interim report. The final report deals with a proposed amendment to the Standing Order that gave rise to the contempt and recommends that the Finance and Expenditure Committee review the guidance that is given by the State Services Commission to the boards of Crown entities and State enterprises on their responsibilities in relationships within Parliament. Finally it recommends that the Government revise its own guidelines regarding witnesses who appear before select committees. 
Certainly I agree with the comments that the member who has just resumed his seat has made in respect of the advice we received and the evidence we considered—that there does appear to be a considerable gap in the provision of information to board chairs in that important regard. I think that that is unfortunate because it leads to results such as the one we have had in this particular case which I am sure was not the intention of anyone involved. That being said the committee did not at the time believe that it was realistic for witnesses to assume that there would be no consequences to relationships arising from prejudicial or critical evidence and this report reinforces our view in that regard. 
This report sets out some common themes that have been derived from overseas cases regarding the disadvantaging of witnesses in the UK Canada and Australia and it would appear that inadequate guidance on parliamentary privilege is not a uniquely New Zealand problem. The reality is that the relevant Standing Orders 399 and 400 state what the House may treat as contempt. It is a discretion; it is not absolute. The recommendation we have made to amend the Standing Order would add a reference to the factors the House will consider in determining whether conduct constitutes a content. Two such factors are the conduct of any person in parliamentary proceedings and the nature of the action taken against any person on account of that person’s parliamentary action. In fact the example that the chair of the committee used is exactly the example I was going to refer to—that is where evidence is given in a select committee that could not of itself form the sole basis for an action against the person who gave it but could prompt the employer to establish a separate inquiry. If that separate inquiry in itself led to cause for action to be taken against the employee then it would not offend against the principles that we have discussed in this report. 
The State Services Commissioner gave a very helpful submission saying that parties in a parliamentary process need an appreciation for each other’s positions and he highlighted the fact that Parliament has the ultimate overriding oversight of the State sector. But he pointed out that it is equally important to protect the standards of good faith loyalty political neutrality and independence of public servants and officials in New Zealand. He felt that in his view forbearance by both sides from actions that might unnecessarily undermine the positions of those involved may prevent difficulties arising and I think that that was very helpful advice indeed. The State Services Commissioner has also advised that he will be considering this report in terms of any revising of State Services Commission guidelines that may be necessary. 
In terms of the Finance and Expenditure Committee review that we have recommended take place in 12 months’ time we have suggested also that training and guidance provided to those we have described as gatekeepers within those organisations be a matter for consideration. 
The final point I make is to highlight the suggested wording that we have worked on for an amendment to Government guidelines. I think that this wording is extremely helpful in terms of laying out very clearly what we are proposing: “Parliamentary proceedings are subject to absolute privilege to ensure that those participating in them including witnesses before select committees can do so without fear of external consequences. This protection enshrined in the Bill of Rights 1688 is an essential element in ensuring that Parliament can exercise its powers freely on behalf of its electors. There must be no pressure placed on individuals to deter them or action taken against them as a direct consequence of their giving evidence to a select committee. Any such action might be regarded as contempt of the House with potentially serious consequences for those involved.” I think that if those words had been available to Television New Zealand prior to the appearance at the Finance and Expenditure Committee then perhaps this report would not have been necessary. But in many respects this has produced a good report which will be useful for all agencies and all individuals appearing before select committees in the future. I recommend this report to the House. 
SIMON POWER (National—Rangitikei) 
: 
 I raise a point of order Madam Speaker. Although this is probably not the appropriate forum I have just realised that I failed to thank the committee staff for their assistance during the preparation of these two reports. I omitted to do that at the interim report stage as well. So I take this opportunity to thank both of them for the hard work they did in putting together these two quite technical and legalistic reports. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sure the House will accept that. Thank you. 
Hon LIANNE DALZIEL (Minister of Commerce) 
: 
 I too forgot to do that and I would like to associate the Government with those remarks. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Thank you. 
SUE KEDGLEY (Green) 
: 
 The Green Party wishes to support the report of the Privileges Committee. It is an excellent report it is thoughtful and well-considered and it deals with extremely important issues. Those issues really boil down to freedom of speech in this Parliament and that is obviously something we believe we must jealously protect. 
We support the recommendations of the committee about amending Standing Order 399 and revising the guidelines to make it absolutely clear that witnesses who appear before select committees must not be subject to any pressure that would deter them from giving evidence or to action taken against them as a direct consequence of their giving evidence to a select committee. These principles are so fundamental that it might be useful that the guidelines once written up be given out widely perhaps even to witnesses when select committees have inquiries before them. The guidelines should be given maximum publicity so that not just people in the State Services Commission but also people in New Zealand are aware of the consequences that would occur if they tried to interfere with the giving of evidence or deter a witness from giving evidence. 
I have one concern. Often it is very difficult to establish that pressure has been brought to bear on a witness who has presented evidence in a parliamentary select committee. Even though the pressure that is brought to bear may have been quite intense it may not be so direct or obvious that a person can make a case to the Privileges Committee. It was very clear-cut in the case of Television New Zealand (TVNZ) because that company was foolish enough to write a letter spelling out that it was effectively punishing the previous chief executive because of remarks he had made in a select committee. So that was very clear. TVNZ made the mistake. It committed its intention to paper and we were able to make quite a clear-cut ruling in that case. 
I am aware of a situation where an employee approached a parliamentary committee and the employer sought to prevent that person from coming to that committee. It is quite possible that intense pressures were put on the employee but it would have been very difficult to sheet that home in a Privileges Committee action. There are very many ways that someone—particularly someone in a position of power such as an employer—can put pressure on or punish an employee who has approached a select committee and presented evidence that for example an employer was unhappy about. There are many ways of doing that without it being so obvious that the employee could take a case before the Privileges Committee. I am aware of specific examples where this may have happened. I am not quite certain how one gets around this situation but I hope the guidelines will be quite fulsome and try to cover cases where the pressure is intense but not overt as it was with TVNZ. 
The other principles and themes that have been highlighted here—such as the freedom of witnesses to give evidence the necessity that that freedom be absolute and that the protection of witnesses from intimidation must be absolute—are tremendously important and we strongly support them. We very much welcome this report and look forward to the guidelines and the amendments to Standing Order 399. 
One other aspect I would like to remark on is that at some point we need to consider the issue of Ministers who refuse to appear before select committees. This happened recently in the Health Committee where a Minister said she would attend the committee hearing. Basically a select committee is powerless in that situation. All other witnesses can be compelled to come before a select committee but Ministers cannot be. So that perhaps is something we need to look at in future. 
In summary the Green Party strongly supports this report. We think it is very thoughtful and well-written. We have concerns however that individuals can be subject—or may in the future still be subject—to intense pressure that is exercised by people in ways that are insufficiently direct or overt to allow for a case to be brought against them. We are still concerned about that. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Madam Assistant Speaker. Tena tatou te Whare. Well what a week it has been. Standing Order 399 is about obstructing or impeding the House in the performance of its functions. How ironic it is that the day after the Government rushed through legislation to validate unlawful expenditure we all get up on our high horses to sit in judgment on the improper conduct of others. As a member of the Privileges Committee it was interesting to receive evidence from the Clerk of the House the executive director of the Crown Company Monitoring Advisory Unit and the State Services Commission about the relationships and obligations of Crown entities and State enterprises to Parliament. It was interesting because our mania for rules and regulations matches very much the scenario we had at Television New Zealand (TVNZ) with the chief executive officer saying one thing and his bosses saying another and then the Privileges Committee coming along and smacking the bosses on the hand. 
We could look at the Auditor-General as being the chief executive officer the Government as the bosses and Parliament as the Privileges Committee. The only difference of course is that the Government rammed through a law to justify its wrongdoing regardless of the outcry from Parliament and the public. 
 It was also clear throughout the committee hearing that whatever book one turned to be it the  
Cabinet Manual 
 the State Services Commission guidelines or even the  
TV Guide  
there is not much help for people asked to come before a select committee. When we finally saw the papers that State-owned enterprises directors get it soon became clear that the directors’ responsibilities and obligations to the Crown were very hard to understand. In fact it all looked as clear as the pollution at the bottom of the lakes that the Government recently gave back to Te Arawa. Understanding responsibilities and obligations is critical because if there is one thing we should have learnt over the last couple of days it is that once the rules are agreed upon then it is the referee—the Auditor-General—who blows full time not one of the players. It is about playing by the rules. So the Maori Party is happy to support any suggestion to improve the rules for people appearing before a select committee and we offer this saying as the token of our assistance: ehara i te mea he kotahi tangata nana i whakaara i te po. It is not about only one person being awake to danger. Because as we strive in vain it seems to restore public confidence in this den of iniquity we must ensure that we are prepared to step up to the plate first—the plate of adherence to the law and accepting of the view that the referee’s decision really is final. 
The basis of much of the committee’s discussions was the notion of parliamentary privilege an idea that derives from the Legislature Act of 1908 and the 1865 rulings in the British House of Commons which themselves were the descendants of article 9 of the Bill of Rights of 1688. More relevant though to us as a Maori Party is not so much privilege but the rights that this Government is denying Maori right now in the greatest Parliament of the world the United Nations where discussions are taking place on the Declaration of the Rights of Indigenous Peoples where this Labour Government is actively opposing those rights and where this Government is doing its best to destroy a text that has been cobbled together by indigenous people from all over the world for the last 25 years. 
What exactly does this Declaration of the Rights of Indigenous Peoples say? Does it speak of terrorism? No. Does it speak of death? No. Does it speak of the denial of anyone’s rights? Hell no. It states: “Indigenous peoples have the right to the full enjoyment as a collective or as individuals of all— 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sorry the member needs to address the question. There is a question before the House. 
HONE HARAWIRA 
: Yes the question is one of privilege and I am referring to this Government’s commitment to privilege and to rights and in particular to rights that right now are being denied in another place—rights to people in this House. 
The ASSISTANT SPEAKER (Ann Hartley) 
: There is a very specific question before the House on a specific report that the member needs to address. 
HONE HARAWIRA 
: Yesterday when we were talking about the Appropriation (Parliamentary Expenditure Validation) Bill I noted that Dr Michael Cullen was talking about Don Brash being in bed with the Exclusive Brethren. That was hardly what the bill was about yet no condemnation was made of his comment. 
The ASSISTANT SPEAKER (Ann Hartley) 
: First of all one cannot compare this with another day—that should have been raised at the time. I am drawing the member’s attention to the fact that this is a specific report by a specific committee that the member needs to address—the question as raised by the Privileges Committee. 
HONE HARAWIRA 
: Here we are talking about privilege and in particular the question of privilege on the action taken by TVNZ in relation to its chief executive in this House while this Government cannot even accept the rights of its own citizens. The issue of contempt—the debate about the rightness or otherwise of conflicting statements from TNVZ’s bosses—is tied up in the dilemma that the Government has foisted upon TVNZ by demanding that it lives up to public charter requirements as well as make a bucket load of money. Should TVNZ focus on providing high-quality public-good programming or say: “Damn them all and let’s make money.”? How does TVNZ deliver on its social imperatives when the only quantifiable measure is the bank balance? 
It seems to me that the issue of contempt and the conflict in TVNZ reflects the dominance of the commercial brigade over the keepers of the flame. In considering this issue of privilege and the conflict between commercialism and kaupapa I note that it is a tension I know well. I come to this House from the world of broadcasting myself—a world hampered by limited funding and a world where my own directors were constantly challenging me to meet the requirements that the TVNZ chief executive officer was being asked to meet: get advertising on board; increase our commercial profile; become a player in the world of commercial radio. I resisted that of course because I am a kaupapa man at heart a man for whom Maori principles mean more than money. But still I pondered at length how best to resolve the dilemma between commercialism and kaupapa—that dilemma led to the dispute the dispute led to the contempt and the contempt led to the ruling from the Privileges Committee. 
Our answer was simple: we started another station to touch gently those who were not used to Maori language and to respond to commercial imperatives. By splitting our focus we were able to be successful in both worlds. The worry of course is that TVNZ already has that option Television One and TV2. So what is the problem? Well that is simple too actually. Although TVNZ has a charter and a commercial focus public service programming is still being treated with disdain. Because of that conflict still arises; because that conflict still arises the dispute arises; because of the dispute there arose the contempt. Because of the contempt it came before the Privileges Committee. 
Te Karere 
 TVNZ’s daily window on the Maori world—the so-called Maori news—is still sitting out in the kid’s programming slot of 4.35 p.m. I stopped watching it when they kept shunting it around to catch the cricket. It had been such a while since I had seen it I had to check the  
TV Guide 
 to see what time it was on. The TVNZ 2006 report said that it was working to expand its range and depth of programmes that reflect Maori language and culture to all New Zealanders. Later in the report it was noted that it was doing less for Maori programming in 2006 than it did in 2005. I hear that it is going to get its money cut so I would like to see whether it will pay out of its own pocket for a change to expand its range and depth of programming that reflect Maori language and culture or whether it will be just like Maori think it is all walk and no talk. 
 These are critical issues for TVNZ and it needs to get proactive right now or it will get run over by that award-winning station Maori Television. If I might be so bold I suggest to TVNZ that if it wants someone who knows how to deal with commercial and charter responsibilities it could do far worse than look to Maori radio for a saviour. 
The committee also took a lash at the inexcusable ignorance of some rather well-paid corporate high-flyers who are supposed to be providing the board with good advice but I recommend that the committee saves some of its sting for this House for it is the Government itself that has not properly addressed in its own mind the correct balance between commercialism and kaupapa. It is that greyness that has created the competing environment and the conflict in cultures that burnt TVNZ. 
Can TVNZ be an effective channel for the visions and aspirations of all New Zealanders or has that crown already been taken by Maori Television? Is TVNZ still a genuine player in commercial television or simply a free-to-air option for Sky television? All things are possible for TVNZ. What is desperately needed now though is clarity of vision and a commitment to excellence. Kia ora tatou katoa. 
Motion agreed to. 
Reserve Bank of New Zealand Amendment Bill 
Second Reading 
Hon DAVID CUNLIFFE (Minister of Immigration)  
on behalf of the 
 Minister of Finance 
: I move  
That the Reserve Bank of New Zealand Amendment Bill be now read a second time 
. This is an omnibus bill that will amend two Acts the Reserve Bank of New Zealand Act of 1989 and the Racing Act of 2003. The amendments to the Reserve Bank of New Zealand Act are a significant step in the trans-Tasman single economic market agenda. They will promote trans-Tasman cooperation on banking regulation which is important given that Australia and New Zealand have banking markets that are among the most highly integrated in the world. 
The bill implements the recommendations of the Trans-Tasman Council on Banking Supervision which was established in 2005. The Governments of both countries agreed to make the legislative changes that are necessary in order to implement the council’s recommendations. I am pleased to report that since this bill was introduced in June reciprocal legislation of almost identical effect has been introduced to the Senate in Australia. The bill and its Australian equivalent should reduce the compliance costs of banks with trans-Tasman operations and assist in the maintenance of financial stability in both countries. The bill will require the Reserve Bank in its prudential supervision role to support prescribed Australian financial authorities such as the Australian Prudential Regulation Authority in the performance of its statutory responsibilities for financial stability and prudential regulation in Australia. 
The Finance and Expenditure Committee has considered the bill and recommended two amendments in order to better align the bill with the Australian equivalent legislation. The first amendment modifies the duty upon the Reserve Bank to support its Australian counterparts by aligning the drafting with the equivalent Australian legislation. “Support” is intended to have its ordinary meaning and in practice will require the Reserve Bank and the Australian Prudential Regulation Authority to support each other in ways such as providing and sharing information cooperation on policy development and coordination on matters of common interest particularly crisis preparation and management. The second amendment adds a new clause that will provide that no action taken by the statutory manager will be invalid by reason of the failure of that statutory manager to comply with its duty to consult the Reserve Bank where it has undertaken an action that is likely to have detrimental effect on financial stability in Australia. The Australian legislation has a similar clause. 
Part 2 of the bill amends the Racing Act by delegating the responsibility for rounding dividends to the New Zealand Racing Board. The board will be required to make betting rules that specify the denomination to which dividends must be rounded and paid out. The committee has not recommended any changes to the amendments proposed to that Act. 
It remains for me to thank the members of the Finance and Expenditure Committee for their hard work in considering this bill. I commend the bill to the House. 
JOHN KEY (National—Helensville) 
: 
 I rise on behalf of the National Party to support the Reserve Bank of New Zealand Amendment Bill. I will start by saying that there is an interesting dynamic to this bill which is that the bill does not go as far as the Australian Treasurer Peter Costello wanted it to go. He wanted to have a single banking regulator in the form of a kind of Australasian version of the Australian Prudential Regulation Authority that would have overseen the banking activities of Australia and New Zealand. One can understand why Peter Costello would want that because 85 percent of the banks that operate here in New Zealand have an Australian parent. They would have enjoyed that situation and it was an issue to be considered. 
I say there is an interesting element to that because Michael Cullen believed in that model. He privately supported a single banking regulator in the form of a New Zealand and Australian prudential regulatory authority and he was very happy to make those comments known to those who should know them. An interesting person to whom he made those comments known was none other than the Australian Treasurer Peter Costello himself. So Peter Costello for quite a period of time believed that his New Zealand counterpart Michael Cullen was indeed an honourable member and would honour what he was telling him in the private little soirées they had as they met on each side of the Tasman as they do on a yearly basis. 
Interestingly enough though Michael Cullen who has proven that he has been unable to get support for much of what he does including the carbon tax his own agenda of not wanting to have tax cuts—I could continue to list them but it would take up the entire 10 minutes I am allocated for my speech—could not get support in New Zealand for a single banking regulator. FinSec made some pretty strong claims as did a number of other people. So he had an interesting dilemma if one likes. On the one hand over a nice bottle of Australian Penfolds red he promised Peter Costello— 
Dr the Hon Lockwood Smith 
: Was it Penfolds Grange? 
JOHN KEY 
: I do not know whether it was; I am not sure whether Peter is quite up to Penfolds Grange. But anyway over a nice bottle of Australian Penfolds red by the fireside Michael Cullen promised Peter Costello that he need not worry because it was a done deal that there would be a single banking regulator in New Zealand. 
 Back in New Zealand Michael Cullen could not actually get that over the line not the least reason for that being that the Governor of the Reserve Bank Alan Bollard saw a part of his fiefdom moving away. That case was put to Michael Cullen in New Zealand in no uncertain terms. He realised he was out of step with what he could pass in New Zealand and at some point he had to deliver the bad news to Peter Costello that his word was not worth very much and that by the way they needed to back away from that position and get something else. 
Why is all that interesting? It is not particularly interesting in terms of talking to the character of Michael Cullen because he does that all the time—there is nothing new about Michael Cullen doing that. He is the same guy who before the election was up on the ninth floor telling Helen Clark and Heather Simpson that Labour was so far over the line on using taxpayers’ funds for paying for the pledge card that it was not funny. But he said they should not worry about that and that because Labour was kind of desperate to win the election it should just go ahead with that spending anyway. I bet Helen Clark did not put quite that spin on that situation on Tuesday when Labour was having its 5 percent giant whip-round. All of that is an aside. What is interesting about this is— 
Eric Roy 
: A good point though. 
JOHN KEY 
: It is a good point and it is all fair but a lot of it is an aside. The serious part of it is that Peter Costello thought he could trust Michael Cullen and found he could not. If Peter had rung me I would have put him straight at the outset and saved him from all the embarrassment. But the reaction— 
Dianne Yates 
: Did he ring you? 
JOHN KEY 
: He does ring actually. 
The reaction from Peter Costello was this. New Zealand wanted the streaming of imputation credits with Australia. We wanted that because without it more New Zealand companies will head offshore. Interestingly enough for those who follow the stock market—and I am sure all members of the Finance and Expenditure Committee do—on Friday the Fletcher Building share price went up by about 25 cents or 30 cents very late in the day. It looked as though—and this could still well be the case—there was a lot of buying in Fletcher Building on the basis of yet another rumour that Fletcher Building was moving to Australia. So here is another company that is potentially moving on the back of the fact that the streaming of imputation credits causes its Australian shareholders a problem. Here was the deal. Over a nice bottle of red wine in Australia Michael Cullen told his old mate Peter Costello that he would deliver for him a single banking regulator in return for Peter Costello delivering for him the streaming of imputation credits. Peter Costello said there would be no problem in doing so and that the way things were done over there was on the basis of a handshake so it was a done deal. Michael Cullen came home and could not deliver on his side of the bargain. So there is no surprise that the streaming of imputation credits is off the agenda with Peter Costello and Michael Cullen. 
The Minister and my colleague the member from New Lynn which is very close to my electorate in Helensville— 
Hon David Cunliffe 
: You fly over me on the way to work. 
JOHN KEY 
: No I do not fly there. Mr Cunliffe has made it clear that this Government is committed to a single economic market. That is interesting because Australia and New Zealand had a leadership forum but Michael Cullen was too busy having his hair and nails done in Napier to pop up to Auckland to that meeting. He did not go and why did he not go? It was because Peter Costello did not go. Why did Peter Costello not go? It was because they both care very much about a single economic market with Australia except that they do not care enough to have a single banking regulator and they do not care enough to have the streaming of imputation credits. Actually they do not even like each other any more because Michael Cullen has done the dirty on Peter Costello. 
So there members have it. That is the interesting little tale about the Reserve Bank of New Zealand Act. So if any New Zealand company is wondering why it is moving to Australia I say it is because it has to because otherwise it cannot get the streaming of imputation credits. It has Michael Cullen—that winning Minister of Finance as he likes to think of himself; the man who could not keep his word with Peter Costello—to thank and to blame for that. That is a very interesting situation and I think a very interesting addition to this debate. 
I move on to the second more interesting and important bit of this debate. Why do we have regulatory oversight of our banks? I ask people who are interested in those things to go back to 1997 and the Asian debt crisis. That was caused by a lot of countries in Asia—the Malaysias Thailands and Indonesias of the world. They had a great issue because their banking systems were fundamentally flawed there were no good oversights their banks were fundamentally insolvent and that caused a collapse. It went on and I saw exactly the same scenario in Russia in the Russian debt crisis. For those who have nothing to read over Christmas I recommend Bob Rubin’s  
In an Uncertain World 
—a very interesting read on those kinds of matter. Amazon knows about it. What is interesting about that scenario is that he talks about the rating of countries. A country is rated in part on the health of its financial system. That is really important. In the financial system in New Zealand 70 percent of the assets are controlled by the banks and regulated by the Reserve Bank of New Zealand and 85 percent of the banks are owned by Australia. There is a huge interdependent relationship between the two. 
This week Michael Cullen met with Moody’s Investors Service. There are three big rating agencies in the world: Standard and Poor’s Moody’s and Fitch Ratings. A week earlier Michael Cullen had been on  
Close Up 
 with me telling the good people of New Zealand that if we have a tax cut we will be downgraded. Interestingly enough we are running a surplus in New Zealand of 7.3 percent of GDP. ANZ also thinks New Zealand could be downgraded if we do not run a surplus. The bank thinks a surplus of less than 1 percent could be an issue but that is quite a long way away from 7.3 percent. What do Moody’s think about whether New Zealand could be downgraded on a tax cut? The company says there is not a dog’s show that New Zealand will be downgraded. In fact New Zealand has probably more chance in the long term of being downgraded if it does not have a competitive tax system. As we saw from the OECD data that came out last week we are becoming less competitive under the Labour Government. 
Interestingly enough Standard and Poor’s made some interesting comments. Kyran Curry the analyst for New Zealand made a few comments that could be interpreted— 
Hon David Cunliffe 
: I raise a point of order Madam Speaker. Amusing though the member can sometimes be this diatribe has absolutely nothing whatsoever to do with prudential supervision by the Reserve Bank. That is the subject of this debate. 
The ASSISTANT SPEAKER (Ann Hartley) 
: I think that the member has stuck to the tenor of the bill. 
JOHN KEY 
: Speaking to the point of order I suggest that Mr Cunliffe when he goes back to his office looks at the impact of the supervisory oversight of banks on the rating of a country’s financial system and at how important that is. 
The ASSISTANT SPEAKER (Ann Hartley) 
: That is not a point of order— 
JOHN KEY 
: I think that he will then realise how on message I actually am. Interestingly enough Kyran Curry has made a few comments that were interpreted in the New Zealand press as meaning that there could be a downgrading of New Zealand’s rating if there were a tax cut. Our office rang Kyran Curry to ask him whether that was accurate and I can assure the people of New Zealand that those comments are not accurate. New Zealand will not be downgraded if there is a tax cut—and there certainly will be a tax cut under a National Government. 
R DOUG WOOLERTON (NZ First) 
: 
 I see that I was nearly beaten to the call by the chairman of the Finance and Expenditure Committee. I hope that he gets the call after me because we recognise these little chats from John Key. They are interesting and what makes them signature tunes if you like is that they are exclusively about finance; the fact that people are involved never actually occurs to him. 
New Zealand First is supporting both parts of this Reserve Bank of New Zealand Amendment Bill. We think they are necessary and should be passed and I do not think that anybody thinks any differently. When Mr Key talks about his nice little speculation of what might or might not have happened between Peter Costello and Michael Cullen and of whatever sort of wine they were drinking it makes a good little story but it is sort of like watching  
Holmes  
on TV. It is more infotainment than anything else but very good infotainment and it connects up a whole lot of speculation. 
I think that this bill is important and whatever it is that has brought Michael Cullen to the realisation—whether or not he was ever of any other view is beside the point—that we in New Zealand would like some control over our finance industry our banks exchange rate and those sorts of things I think is to be welcomed. We in New Zealand First do not and are certainly not ready to accept that New Zealand either partially or totally will be run by Australia. We certainly do not accept that our financial markets and our banks should be run from there. It is bad enough that our banks are being bought by Australians or being taken over by Australians—mainly through compulsory superannuation funds I might say—but Dr Cullen would certainly not be popular if he were to subsume our finance industry into that of the Australians. But we are not doing that. We are lining up with Australia; that is true. We are lining up taxation and we are lining up a lot of things. That is a very different thing from being told what to do and having decisions made in Canberra rather than Wellington. We will certainly oppose any moves of that sort. 
Part 2 of the bill—which will become another bill I understand if Dr Cullen’s Supplementary Order Paper comes into play—is the business of getting rid of the 5c coin. The Reserve Bank is calling in 5c coins and the bill provides for the Racing Board to have the authority to set its payouts and round down its dividends and to make those sorts of changes come under the purview of the board rather than of Parliament in future years. We also agree with that because we think that it would be nonsense for the board to keep coming back to Parliament to change things like that. It is far better to give that body itself the power to do that and we are sure that the board will do it responsibly and properly as it should. If the board does not of course then it will be up to Parliament to make sure that it does. 
So New Zealand First supports both parts of this bill. We will indeed support both bills when the bill is split. 
SHANE JONES (Labour) 
: 
 Kia ora Madam Assistant Speaker. Greetings to the House— 
Lindsay Tisch 
: I raise a point of order Madam Speaker. There is a format to follow when we are looking at— 
Madam SPEAKER 
: Yes—we just got it out of order with New Zealand First taking a call before the Labour speaker. Labour was next on the list. 
Lindsay Tisch 
: Well fourth on the list for speakers is National. If New Zealand First took Labour’s spot then it does not mean that Labour should come in ahead of National. The No. 4 call is a National call and Dr Lockwood Smith is ready to take that call. 
Tim Barnett 
: Madam Assistant Speaker my understanding was that Labour also went for that call and New Zealand First got the call. So now we go back to Labour and then to National. 
The ASSISTANT SPEAKER (Ann Hartley) 
: No I have called Shane Jones. 
Dr the Hon Lockwood Smith 
: I raise a point of order Madam Speaker. Madam Assistant Speaker the order in which you take speakers in this Parliament is actually quite important. You chose to take New Zealand First second; that does not mean that you then call Labour. I went for the call immediately and you should have called me. It is important because members have engagements they have to attend. If you get the call order wrong you cause considerable difficulty for members. I insist that you give the call correctly to National. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The position is that the order is a guide only and usually we are able to stick to it. It is a guide only and quite often it gets out of order. That is not uncommon and we try to get it back into order as much as we can for the next speaker. I have given the call; there is nothing that can be done about that unless the House by leave wants to change that. 
Lindsay Tisch 
: I raise a point of order Madam Speaker. The order of calls is determined at the start of the parliamentary session. This is the 48th Parliament and we had earlier determined what the calls would be on the readings. Although calls can be transferred and are tradable between parties when we look at the schedule in front of us we see that National gets the fourth call. In this case New Zealand First took the call—you gave the call to one of its members before giving the next call to a Labour member—but that was not because we were not ready to take the call. Dr Smith was on his feet seeking a call when the fourth call came along and it was our entitlement to take that call. Otherwise he would have jumped up immediately following the previous speaker which was our own speaker John Key and gone for the call then. But we know that there is an order—there is some decorum here—and that is what we have been following. Now we find that you are giving a call out of sequence to another party. Madam Assistant Speaker you have made a ruling; we do not agree with it but I understand your ruling. I seek leave for Dr Lockwood Smith to be able to take the fourth call as determined by the Business Committee. 
Hone Harawira 
: Point of order Madam Speaker— 
The ASSISTANT SPEAKER (Ann Hartley) 
: I am sorry; leave has been sought and it must now be put then I can deal with your point of order. Leave is sought for that purpose. Is there any objection? There is objection. 
Hone Harawira 
: I raise a point of order Madam Speaker. I can suggest a way forward from this situation. To deal with the conflict between the speaker from Labour and the speaker from National you can simply follow the list. The last speaker was from New Zealand First and the Greens are not taking a call so that would make it my call. 
The ASSISTANT SPEAKER (Ann Hartley) 
: Well it was a good try. However the call has been given. 
SHANE JONES 
: Kia ora ano. I speak as the chairperson of the Finance and Expenditure Committee and I am sure that the deputy chairperson Dr Lockwood Smith will have very interesting things to say. At a time prior to the torrid bout of name-calling etc. we recently endured he might have got to speak before me. However that time is past. 
Firstly I will obviously speak in support of the Reserve Bank of New Zealand Amendment Bill. As we heard during the course of our select committee proceedings we should not overlook the importance this bill represents in relation to the infrastructure between our economy our apparatus and that of the Australians. Naturally there was fear that the quality of our governance and our sovereignty might be compromised if our Reserve Bank could not continue to exercise a distinctive and independent level of prudential control and oversight in respect of banking infrastructure. So it was particularly pleasing to receive information and submissions in relation to the bill that that was not to be the case. Who knows what will happen as globalisation gathers pace and as we see the migration of investment further over to Australia. But I think that that trend can be overstated because there are always new shoots and new leaves growing on the tree of capitalism despite the attempts of John Key to deprecate diminish and doubt the quality of our Kiwi entrepreneurialism to replace the companies that are predated upon. 
Why are those companies being predated upon? Because of the surplus pool of funds they have as a consequence of the savings industry they have a bit of a head start on us. Of course the Government has a plan for that and we will soon see a surplus pool of funds arise as a consequence of the KiwiSaver Bill—but I will say more on that at another time. 
In relation to the proposed amendments I say that yes it is important that our regulators take account of their Aussie counterparts. I have to say in this House that we were assured the Australian legislature would not be indulging in its most famous sport which is “Aussie Rules” and that in actual fact we would see a statute come into being in the fullness of time that would be a mirror image—or something remarkably close—to what we are working on today. Of course it is a rather dim and troublesome thought to even utter the words “statutory manager” but coordination was received there. 
The final thing I have to say in relation to the Racing Bill is that we were reassured by officials from the racing industry about the concerns punters may have had in relation to how the rounding policy would be carried out. Firstly those concerns would be taken account of and secondly the punters who participate in the racing industry would not be left in a net negative position. If the rounding policy continued and amounts came down then the cost structure surrounding their industry would also come down so that there would be no net negative impact. I personally as chairperson of the committee along with various other members paid particular attention to those assurances because at the end of the day the committee has some very competent people and experienced parliamentarians—although the deputy chairperson may be in a slightly sour mood—and we have to trust the integrity and the quality of the advice we get. We were given advice from the racing industry that the punters would not be negatively impacted upon as a consequence of its rounding policy so I in particular will watch this space into the future. 
I wholeheartedly support the bill. The committee worked quite well in a collaborative sense—no doubt that was due in some part to the quality of the chairperson. Kia ora tatou. 
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
: 
 In speaking to the second reading of the Reserve Bank of New Zealand Amendment Bill I acknowledge and thank the chairperson of the Finance and Expenditure Committee Shane Jones who has just spoken. He was prepared to allow me to take the call ahead of him. I appreciate that because my reason for seeking the call was that I had organised—on the basis of the schedule this afternoon—an interview in a few minutes’ time. I note New Zealand First members were so mean-spirited that they would not allow that but that is their decision. They have had their snouts in the trough to the tune of $157000 of taxpayers’ money which they have stolen. New Zealand First is the only party in this House that has refused to promise to pay back the money. 
Ron Mark 
: I raise a point of order Madam Speaker. I take absolute offence at that member in particular—the “Calendar Boy”—suggesting I am a thief. I ask that he retract and apologise for saying that I stole money. 
The ASSISTANT SPEAKER (Ann Hartley) 
: The member has taken offence at that remark. The member will stand withdraw and apologise. 
Dr the Hon LOCKWOOD SMITH 
: I withdraw and apologise. The voters of New Zealand will note that New Zealand First members have made no commitment to pay back that misappropriated money and other members will not let them forget about it. 
This bill amends two Acts. First I will follow up some comments made by the Labour member Shane Jones in respect of the amendment to the Racing Act. Of course it is necessary to amend the Racing Act 2003 because the Reserve Bank is withdrawing the 5c coin. Mr Jones mentioned the importance the Finance and Expenditure Committee attached to the issue of rounding down. 
This is an important issue because when the 5c coins are out of circulation we will be looking at a situation say of rounding down up to 9c—for argument’s sake it may be $1.29 being rounded down to $1.20. We can well understand that good New Zealand punters might say: “Hang on! We will miss out here.” With it being a systematic system across the board of rounding down punters might think that a rounding down of say 9c would mean that they were significantly worse off as a consequence of this amendment. National members of the committee also gave considerable attention to this matter because we must always make sure that legislation such as this which on the face of it seems technical does not result in systematic damage to the interests of New Zealanders. 
The New Zealand Racing Board gave evidence to the committee and it gave us an assurance. Although this legislation gives the board the power to set the rules for how it rounds matters it will be rounding down to the nearest legal unit once the 5c coin is withdrawn. The board assured us that it will alter the proportion of the betting revenue or if you like alter the margin that is retained. So the total amount paid out after the extra rounding down will remain the same. The committee questioned the board very closely about that and we received an absolute assurance that its margins or proportion of revenue gathered that is retained will be reduced to compensate for the rounding down. So punters will receive exactly the same proportion of total bets back into their hands. 
This bill also deals with trans-Tasman matters. The New Zealand Racing Board pointed out that it was quite important that the method of rounding used in New Zealand be consistent with that used in Australia because with our two economies—and in fact our societies—almost being one big trans-Tasman family a lot of trans-Tasman betting goes on. If the New Zealand arrangements were significantly different from those in Australia and if they did not match the Australian arrangements there could be an incentive for New Zealanders to gamble offshore and to do more of their betting on races in Australia rather than on races in New Zealand. That would not be in New Zealand’s interests; it would not be in the interests of our thoroughbred industry. So it is quite important that we take the advice of the New Zealand Racing Board. As has been mentioned this matter needs to be watched to make sure that there is a reduction in the retained margins so that payouts to New Zealand punters are maintained at their previous levels despite the larger quantum of the rounding down. 
Most of us on the select committee when we first heard about this rounding down said: “Hang on! Why do you not round to the nearest legal unit rather than automatically rounding down?”. But we were satisfied that the arguments presented by the Racing Board for supporting the rounding down were sufficiently sound and robust. However we need to make sure there is a reduction in those proportions retained so that New Zealand punters are treated fairly. 
In my remaining minutes I will just follow on from the excellent and insightful comments made by my colleague John Key—the next Minister of Finance in this country—about the issue of trans-Tasman banking regulation which is hugely important. I well remember that when I was trade Minister for New Zealand in 1999 at the time of the Asian financial crisis I did a lot of work around Asia because New Zealand was chairing APEC—the Asia Pacific Economic Cooperation group. That group involved 45 percent of total international trade. 
One of the reasons why the Asian financial crisis became so serious was the problem around the banking sector. Asia unlike New Zealand has many small often private banks and banking regulation would not be of quite the same standard that we have here. Banks were simply not as sound as they should have been and they went broke. That was part of the reason why the Asian financial crisis spread as widely and went as deeply as it did—and it is for that reason that banking regulation in New Zealand is so important. 
Many people criticise the fact that most of our trading banks are Australian-owned banks. Some people lament that fact and say how terrible it is that we do not have our own banks operating in New Zealand. I do not happen to share that view. I think the important thing for an economy like New Zealand’s is how sound and efficient the banking sector is. It is less important who owns it. What is important for the confidence of the New Zealand economy is how well regulated it is how sound it is and how efficient it is. I think New Zealand is reasonably well served with a banking system that is sound and well regulated. 
What is fascinating—as my colleague John Key said—is that there is an issue though around this loss of New Zealand companies to Australia. That issue will become worse as New Zealand’s Labour Government presses ahead with its proposed changes to our foreign tax regime. As the Government presses ahead with its concept to introduce a 5 percent fair dividend rate on the ownership of foreign shares in New Zealand the Finance and Expenditure Committee has been warned that doing that will add to the problem of New Zealand businesses shifting to Australia. 
That is why the issue raised by my good colleague John Key—the issue of streaming of imputation credits or full franking of credits between Australia and New Zealand—is so important. It is very interesting that Dr Cullen failed to achieve that for New Zealand because the select committee has heard in recent weeks how hugely important that is for New Zealand investors. The benefit of having a single trans-Tasman economic market is probably the No. 1 issue for New Zealand investors. I think the fact that Dr Cullen promised Peter Costello that the single banking regulator the Australian Prudential Regulation Authority could deliver for New Zealand say a full franking of imputation credits is kind of sad. That could have delivered so much benefit for New Zealand when in fact having a common banking regulator with Australia would not have been a huge loss for New Zealand. I think that is a very revealing aspect. 
Despite the fact Dr Cullen could not deliver that for New Zealand National does support the legislation as it will deliver sound regulation for our banking sector. There is no question that any move to improve the stability of the banking sector—which this bill delivers—is beneficial for New Zealand and the bill has the support of National. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Madam Speaker. Kia ora tatou katoa. Every time an omnibus bill such as this Reserve Bank of New Zealand Amendment Bill comes before the House the Maori Party asks about the value of jamming an apple and a pear into the mixer to get a smoothie when all we want is a decent apple and a proper pear. The completely separate issues of trans-Tasman financial sector regulation and the bizarre notion of rounding dividends in the racing sector following the recall of the 5c coin are ones that we think would be better addressed in two separate bills. But the bill remains intact with two separate agendas. 
The first issue is the alignment of the Reserve Bank of New Zealand Act 1989 with Australian legislation. My judgment about trans-Tasman cooperation is a little coloured at the moment by Australia’s victory in the netball the other night and its win in the rugby league on Saturday but I freely admit to feeling a little chuffed about “Wee Willie Wonker” getting squared away after insulting our nation’s haka. But getting over that it is obvious that the amendments to the Reserve Bank of New Zealand Act following hot on the heels of the Trans-Tasman Council on Banking Supervision 2005 are all aimed at moving us closer to a single economic market. 
The proposals discussed at the council indicate very close links between the two countries’ banking systems and throughout the select committee process we heard that the success of this bill depends on the same changes being made in Australia. So a critical issue for us today is whether we can trust the Aussies to do the right thing. This issue relies a lot on both parties having a relationship based on cooperation and mutual respect and given the lack of respect from Governments in this country to the Treaty of Waitangi I have to suggest that New Zealand should not be too put out if its intentions were not treated honourably by Australia. 
While I am on the Treaty and relations between Governments and indigenous peoples I cannot help but ask whether tangata whenua in Australia are likely to benefit from the financial capacity that will result from reduced banking operating costs. In fact how exactly will the goal of a single economic market enhance opportunities for the indigenous peoples of both lands? 
This bill suggests that cooperation between banks on both sides of the Ditch will help financial stability. But a reference in the bill to outsourcing will have a big impact on us because the bill says that outsourcing will be bad for Australia but our own Reserve Bank’s 2004-05 report says that outsourcing is a main priority and its 2005-06 report says that outsourcing is a key priority for financial stability. We are keen to see how this pans out because the Maori Party wants to be able to assure bank workers in this country that no New Zealand jobs will be lost through outsourcing. 
Last month the finance workers union FinSec called on New Zealand’s three big Aussie banks to say they will not be outsourcing New Zealand jobs to cheaper labour markets. Its call was in response to an announcement in Australia that three major Australian banks are planning to outsource jobs to India and an estimate by the Australian Finance Sector Union that up to 50000 of Australia’s 280000 finance jobs could disappear if outsourcing continues. In the light of recent decisions by Air New Zealand to outsource a lot of its finance and clerical work to Fijian low-cost labour the Maori Party is supportive of proposals to restrict outsourcing. The irony of course is that last month Air New Zealand announced a net profit of $96 million—hardly an argument for outsourcing work and denying jobs to Kiwis. It also bears reminding this House just after International Anti-Poverty Day that our very own Government has an 80 percent shareholding in Air New Zealand—a clear statement that the concerns expressed by this Government about lowly paid workers are just hot air. 
While we are talking about poverty it is also appropriate that we look at the other aspect of this bill—the change to allow the New Zealand Racing Board to continue to promote gambling after the recall of the 5c coin. One might think this is a mere technicality to tidy up payouts but it is also an opportunity for those like the Maori Party who see the pain and suffering of gambling to support any opportunity to restrict this disease within our society. A paper prepared by Dr Lorna Dyall for a conference in Darwin last month showed that despite having half the average income Maori spend more on gambling than everyone else and that one in three who seek help with gambling problems are Maori. Her paper also noted that one in three prisoners have gambling problems with Maori making up at least 50 percent of the prison population. That situation is even more extreme for Maori women; in fact even the Minister of Corrections recognises the link between the increasing numbers of Maori women in jail and their increased gambling problems. 
Given all of this why would the Maori Party support a bill that just makes it easier to offer attractive betting prices that satisfy TAB customers? This of course is where the trap of an omnibus bill is most apparent. If this bill was just about Reserve Bank cooperation with Australian financial authorities the Maori Party might support aspects of it. But we will not support a bill to make things easier for the TAB. Gambling outlets such as the TAB just like junk food outlets such as Kentucky Fried Chicken are generally concentrated in low-income high-Polynesian areas. The Maori Party has a duty to do what we can to eliminate gambling problems from our communities. We would suggest that other parties also take this opportunity to think about other strategies for minimising gambling. 
We know of the potential for companies to benefit from overseas business through this bill. We know that lower banking costs and greater financial stability may also benefit Maori land incorporations. But in recognition of International Anti-Poverty Day on 17 October we stand alongside the cleaners the low-paid workers and their supporters who are rallying in Auckland and Wellington this week against poverty right here in Aotearoa. The Maori Party stands alongside them in their challenge to the Government to face up to its responsibility to tackle poverty in its own backyard. I can do no better than to repeat the question asked by Pacific Island Presbyterian Church Minister the Rev. Mua Strickson Pua: “Why should low paid workers continue to bear the burden of a low wage society?”. 
Whether the issue is the Racing Board and its damnable rounding of dividends because of the withdrawal of the 5c coin or the outsourcing of key New Zealand jobs to overseas low-wage economies we as a nation face critical issues whereby far too many families feel trapped in the cycle of poverty and quite simply are unable to make ends meet. The Maori Party can do no more at this point than speak up for those rallying for an end to poverty and the right to a decent standard of living. Kia ora tatou katoa. 
GORDON COPELAND (United Future) 
: 
 The Reserve Bank of New Zealand Amendment Bill continues actions taken over recent times by the Reserve Bank of New Zealand to increase the quality of its prudential oversight over the New Zealand banking system. It is very very important that the bill does so. Many of these actions—and this bill is certainly in this category—actually anticipate bank failure or a bank coming under stress. These are the kinds of bills we pass while hoping desperately that the provisions of the bill will never actually have to be brought into practice. 
I for one clearly remember the mad banking days of the late 1980s when we saw the State Bank of Victoria going under owing billions and the State Bank of South Australia going under owing $3 billion. As most people remember the Government of the day had to come to the rescue of the Bank of New Zealand which was also owing a very very significant amount of money and going under. This event led directly to the sale of the Bank of New Zealand; it went from the ownership and control of New Zealanders to what is now the ownership and control mainly of people living in Australia. 
Because 85 percent of our banking industry here is owned by Australian-owned companies it is extremely important that the Reserve Bank does all it can to protect New Zealand depositors in those companies. Recently we had before this House the Westpac New Zealand Bill which was also part of this same task of increasing prudential supervision. The legislation now sees the Westpac bank incorporated in New Zealand as a company whereas previously it operated merely as a branch of an Australian operation. 
John Key raised some interesting issues about the interrelationship of the New Zealand and Australian economies. When it comes to the dovetailing of banking operations I think it is extremely important to bring to the attention of the House that in the view of United Future we should also be looking at the possibility of a currency union. Clayton Cosgrove and Pansy Wong were both members of the Finance and Expenditure Committee delegation that went across to Canberra in 2004. In one of those meetings with our Australian counterparts we talked about the whole subject of a currency union. I stress that it would be a currency union of the type that would see New Zealand retaining a New Zealand dollar and Australia retaining an Australian dollar but would in some way merge or peg the rates between the two so that we became part of one complete integrated currency system. I say to the House today that I think it is extremely important that the Government continues to look at that option. 
We have been working for a long long time now—we had the 20th anniversary of CER during the last Parliament—to try to ensure that we have one single market between Australia and New Zealand. But in fact there is one great defect in that and that is that the exchange rate between Australia and New Zealand fluctuates up and down on a daily—indeed an hourly—basis. Whereas we could potentially with a currency union create a domestic market of 24 million people for New Zealand companies we are still in practice restricted to a domestic market of just 4 million people. That is a tremendous problem for the future growth and prosperity of this nation. 
We want to get into exports right across the board in manufacturing information technology and other areas—and I must say that the 4 million Kiwis who live here are well-educated and entrepreneurial by world standards—but we have a huge problem in that our domestic market is so small. The second problem is that among official OECD nations New Zealand is geographically the most distant nation in the world from its major markets. So we have a double whammy. We have a very very small domestic market of just 4 million people and we are a long way from our markets. 
The ability therefore for us to grow our companies outside this country and into strong export markets in manufacturing and other areas is extremely difficult. When we look at those figures we see that it is more difficult for New Zealand to do this than it is for any other country on the face of the Earth. Therefore to have the potential of having a domestic market of effectively 24 million people without having the ups and downs of the exchange rate would be most desirable. I talked to the Canterbury Manufacturers Association for example and heard that when the New Zealand dollar is weak against the Aussie dollar manufacturers make money big-time. On the other hand when the New Zealand dollar is strong against the Aussie dollar manufacturers are on the verge of bankruptcy. No one can actually run a business and no one can plan to grow a business on that basis. 
I want New Zealand First in particular to look very very closely at that point because that party is in favour of a New Zealand export growth market. I am sure Ron Mark will confirm that it is at the heart of New Zealand First’s policy to grow our export markets internationally. 
Ron Mark 
: Yes that’s right. 
GORDON COPELAND 
: Yes New Zealand First is a persistent advocate of that policy. But that position cannot be lined up with that of somehow being nervous about New Zealand losing its sovereignty if we go into some sort of monetary union with Australia. It does not work that way. New Zealand will retain its sovereignty; it will still be a separate country. There will still be an All Blacks team there will still be a Silver Ferns team we will still have the Kiwi rugby league team and so on and so forth. Those things are not at issue; what is at issue is both our ability to expand and grow our economy through export-led growth and the way in which the variable exchange rate between our two nations affects that in a negative way. 
So I want to advocate that at some point in time—and we would probably need to get some international experts here to look at it—we should continue to explore a currency union between our two nations based on a New Zealand dollar for New Zealanders and an Australian dollar for Australians but with the removal of those risks and variabilities in the connections. Then I think we would have not only an integrated banking system but a truly integrated domestic and export economy. Thank you. 
PANSY WONG (National) 
: 
 I am quite sure that the chairman of the Finance and Expenditure Committee Shane Jones must have breathed a sigh of relief in deliberating on the passage of the Reserve Bank of New Zealand Amendment Bill because I note that there were only five submissions and one oral submitter and all parties were in total agreement in supporting the passage of this bill. That must be a great relief in contrast to another piece of legislation going through that select committee that relates to the taxation of unrealised dividends on overseas investments of New Zealand residents. That bill has attracted 3000 submissions and it is now being opened up for a second round of limited submissions relating to the last-minute U-turn which was made by the Minister of Finance for political reasons examining an alternative method called a deemed dividend taxation regime. The reason I am contrasting these two pieces of legislation is to demonstrate that there might be within New Zealand’s financial or commercial sectors a lot more agreement and less nervousness around aligning the financial systems of New Zealand and Australia because those people involved have by now gained enough interaction between our two countries to be confident about that. I want to encourage the Minister of Finance and the Labour Government to take that on board and reflect on it. The people of New Zealand in effect are a lot more confident and understand the benefits when there is alignment between Australia and New Zealand. That is actually good for them in terms of business interaction. After all in most areas Australia is one of our biggest export markets and it is our largest inbound tourist source. 
Before I go on to define the changes to the Reserve Bank bill I want to raise quite an interesting little issue that arose during the speech by the chairman of the Finance and Expenditure Committee Shane Jones when he was trying to explain something to punters. Mr Shane Jones and Labour Government members pride themselves on being ordinary New Zealanders who speak in plain English but I was constantly bemused by Mr Jones assuring punters that because of the changes to the Racing Act and the rounding up of bets caused by the withdrawal of the 5c piece they would not end up in a net negative position. Next time I go to a race meeting I will just ask those punters how many of them understood what he meant by their not ending up in a net negative position. Apparently he is going to be personally accountable to make sure that they will not end up in a net negative position. 
Although National supported this legislation particularly its intent to enable both regulators of the banking system to be operated in a seamless system I do have feelings of nervousness. I hope that during the Committee stage the Minister will enlighten us further—firstly on the issue of compliance costs. Certainly most members of Parliament by now will have come to the observation that we are always assured that somehow a piece of legislation will reduce compliance costs or will not lead to a significant increase in those costs. Well we had a recent experience 2 weeks ago when the legislation called the Standards and Conformance Bill was passed. There is now a joint New Zealand - Australia accreditation agency and in future all certification bodies in New Zealand can seek accreditation only from that body. 
 There is nothing wrong with that if the intention is to simplify procedures and cause less confusion by having only one certifying body. The problem with that is illustrated by the very good example of an organisation called Health and Disability Auditing New Zealand Ltd. This organisation is accredited by the Director-General of Health to audit certain health service providers—that is it is recognised by our Director-General of Health to be competent. Previously it was certified by a different accreditation agent. By a single piece of legislation removing that choice that organisation’s fees will increase by 9.2 percent. Let us examine this. A mere $10000 fee for example will suddenly become something like $92000. No one will be convinced that overnight somehow this health and disability audit service should have to front up with $80000 or more in fees just to get itself re-certified. If that organisation is not competent and credible why would the Director-General of Health who already recognises it authorise it to carry out audit services on various New Zealand health service providers? 
During the Committee stage I would like the chairman of the Finance and Expenditure Committee—because he seems to like taking personal responsibilities very seriously—to ensure that what his Government has promised will in fact eventuate. We all know that with regulators passing on increasing costs to organisations eventually it is the consumers the New Zealand public who end up paying. That is an aspect on which we will seek further assurance and clarification during the Committee stage. 
Another issue I would also like the Minister to enlighten us on during the Committee stage is why if the Government is so confident that this legislation will enable the banking regulators to carry out their functions properly it is necessary to include a provision in the bill stating in section 68A(4) inserted by clause 6: “No performance of a function or duty or exercise of a power is invalid by reason only of a failure to comply with the provisions of this section.” This is a very short bill. It comprises only 6 pages but that qualification appears twice. Even if we the New Zealand Parliament go to all the trouble of examining the bill and approving its passage the bill actually states that if any bank has not carried out the performance of a function then its action cannot be ruled to be invalid just because it failed to comply. Well if we do not actually care about whether these people comply with the provisions of this bill why should we go to the trouble of deliberating on it and examining it in detail? I am very much looking forward to the Minister and the chairman— 
Shane Jones 
: Read the bill. 
PANSY WONG 
: I read all six of the bill’s pages and I am surprised that the chairman of the Finance and Expenditure Committee on a little bill like this has not detected the existence of this issue. 
LINDSAY TISCH (National—Piako) 
: 
 The Reserve Bank of New Zealand Amendment Bill is important legislation amending the Racing Act of 2003. National supported the introduction of that Act but it was not envisaged at that time that there would be a rounding-down of the currency which will come into effect on 1 November. 
It is important that the racing industry which is a vibrant and growing one has the support of this House. As an owner of a racing horse— 
Hon Clayton Cosgrove 
: Shetland pony. 
LINDSAY TISCH 
: I can assure the member that it is not a pony. It ran third yesterday. So I have a vested interest in making sure the racing industry is able to support the punters the owners and the investment in the industry. The racing industry depends on gaming for its viable operations and it is underpinned of course by that. The significance of the industry is borne out in some figures. 
I will give some background because I think it is important that we see how important the racing industry is. I am not talking just about horses; I am also talking about greyhounds. They are part of the racing industry. The social and economic benefits of the industry are quite significant. In 2004 the study carried out for the racing industry showed that the industry directly contributes about $424 million to GDP. It supports about 9500 full-time jobs and another 18000-odd people are involved in an indirect way so it is a pretty big operation. In the Piako electorate that I represent—the heartland of racing in Matamata Cambridge and those areas—racing is very very important. 
If we were to look at what the Racing Act did in 2003—and as I said National supported that legislation—we would see that it set up a new framework. It disestablished the Racing Industry Board and the Totalisator Agency Board bringing them together under one umbrella the New Zealand Racing Board. The board has the role of making the betting rules for totalisator fixed odds and sports betting. Sports betting is a growing part of the income for the racing industry 
 Of course like all TAB operations around the world the board retains a commission. That is how it operates. That is known as the betting deduction and from each totalising betting pool it distributes the remaining to the winning bettors. If one has a win on a horse then the stake money is paid out. On top of that of course for those bettors who put their money on a win a place bet a trifecta—whatever one likes to do—some money will come back. So the board takes out its deductions and pays the money back into the industry as a whole—the owners and the punters. 
When declaring dividends for totalisator betting the board rounds down the dividend to the nearest multiple of 5c. 
Jacqui Dean 
: Is that right? 
LINDSAY TISCH 
: Yes and this is why legislation is so important. Because under the Racing Act the board must pay the 5c to winning customers. So an example of this would be a totalisator race betting dividend calculated at $3.18 which is declared and paid out as $3.15 and the board would retain that difference between $3.18 and $3.15—that 3c is not paid out. 
The Reserve Bank of New Zealand Amendment Bill is saying in the amendments to Part 2—and this is why it is so important—that we will not have 5c coins shortly. They will be phased out and the racing industry will not be in a position to meet the requirements under the Racing Act because of that change and that is why the Reserve Bank of New Zealand Amendment Bill is so important. The decision has been made to call in those 5c coins. They will cease to be legal tender from 1 November of this year. The board’s decision has implications for the racing board’s ability to facilitate racing and sports betting because of the requirement as I just mentioned to round down to the nearest multiple of 5c and to pay the 5c to winning customers. That requirement will come into effect on 1 November 2006. That will cause some issues and this amendment looks to address them. 
When that 5c is called in how will the board operate and be able to promote racing and sports betting? Well the board has been delegated the responsibility for making betting rules on the rounding of dividends for future-proofing of the Racing Act. This is so the board will be able to change the betting rules in response to any further decisions of the bank to call in other denominations of coins. Thus further legislative amendments will not be required to address the consequences of that. 
The submission that came from the Racing Board—which was a very good submission—was concerned and the Finance and Expenditure Committee took this on board which is good. Here is an example of what will happen. Although I do not know whether every party will support the amendments they will be passed as I understand that most parties will support this measure. The rules on the dividends will change and the dividends will be rounded down to the nearest 10c because we will not have 5c pieces. 
Colin King 
: That makes sense. 
LINDSAY TISCH 
: It will make sense as my colleague Colin King says. Of course harness racing in the area that Colin King represents is a very very important industry especially around the Blenheim area and he understands the importance of this industry. 
It would probably be best if I illustrate some points. 
Hon Member 
: Who will miss out? 
LINDSAY TISCH 
: No one especially not the punter. Here is an illustration of that. At the moment if we look at the bet type and put some money on for a win bet the current deduction is 15.5 percent. Under the proposed deduction with the passing of this amendment the deduction would be 14.5 percent. If we place a bet for a place which is 15.5 percent today under this proposal it will be 14.25 percent. In terms of dollars in the last financial year—2005-06—the amount of money that went through the totalisator was $1.4 billion in round figures. It was paid out at $1.1 billion but under this proposal $1.11 billion will be paid out. So there is an immediate increase to the punter. So this is an advantage. There was some concern of course that rounding down would in fact disadvantage the punter. Those examples show that it will not. 
We have to have some commonality with Australia because it is very easy to bet offshore. We have to have that commonality. We have to have the flexibility and these rules will provide that. What New Zealanders have to do and what this amendment does and why we are supporting it is to have the flexibility to meet the market. National supports this very important legislation. 
Bill read a second time. 
Sports Anti-Doping Bill 
In Committee 
Part 1 Preliminary provisions 
Hon CLAYTON COSGROVE (Minister for Building Issues) 
: I rise to take a short call on the Sports Anti-Doping Bill and I will just say a couple of things about this bill to set a bit of context for members. 
Sandra Goudie 
: Nobody’s listening. 
Hon CLAYTON COSGROVE 
: It is the Sports Anti-Doping Bill—not an “Anti-Dope Bill” as it would be in Sandra’s case. 
The CHAIRPERSON (H V Ross Robertson) 
: The member must use the member’s full name not a single name. There was also a personal reflection. 
Hon CLAYTON COSGROVE 
: I withdraw. 
The CHAIRPERSON (H V Ross Robertson) 
: Thank you. 
Hon CLAYTON COSGROVE 
: The Sports Anti-Doping Bill updates New Zealand’s anti-doping legislation so that the agencies and national sporting organisations involved in anti-doping activities in New Zealand are more easily able to comply with the World Anti-Doping Code. New Zealand does not require the Sports Anti-Doping Bill in order to implement the said code or convention as New Zealand is already compliant with these instruments. Instead the bill provides a more efficient and effective way for New Zealand to implement the code. However the bill is intended to assist New Zealand’s compliance with that code. 
The bill updates the responsibilities of the agency to reflect the requirements of the code. The bill also provides for the making of rules closely based on the code that will be able to be implemented by sporting organisations through their anti-doping policies and constitutions. Adoption or compliance with the rules is not compulsory under the bill. The bill itself imposes no obligation on persons; rather it sets up an anti-doping regime that is compliant with the code and easily adopted by sporting organisations. 
There is a question of who will be affected by the bill. The bill does not create a mandatory anti-doping regime. Although the bill provides for sports anti-doping rules these will not be mandatory unless national sporting organisations adopt them or require their members to abide by them. Adoption of the rules by national sporting organisations and requiring members to abide by the rules is a way of ensuring compliance with the code. 
I draw members’ attention to the Supplementary Order Paper that the Government is putting forward and I will run quickly through a couple of key points for members. In respect of the commencement date most clauses of the Supplementary Order Paper deal with the new commencement date of 1 July 2007. This date is intended to provide a fixed start date for the bill in order to give national sporting organisations sufficient time to amend their anti-doping policies while ensuring that the commencement of the bill is not delayed unnecessarily. 
In respect of the expanded transitional functions of Drug Free Sport New Zealand a delay in the commencement date would however prevent Drug Free Sport New Zealand from carrying out its new expanded functions under the code such as preparing the sports anti-doping rules and investigating the anti-doping violations of trafficking in prohibited substances. For this reason clauses 48 48A and 48B will commence on the day the bill is given the Royal assent. The early commencement of these clauses will allow Drug Free Sport New Zealand to continue to prepare the sports anti-doping rules and carry out its own investigative functions. 
In respect of clarification of the jurisdiction of the Sports Tribunal of New Zealand the remaining clauses of the Supplementary Order Paper are technical clarifications to ensure there is no question about the scope of the Sports Tribunal’s jurisdiction under the bill. Amendments to clause 3 clarify that the Sports Tribunal will have functions that are not related to anti-doping—that is hearing considering and determining other sports-related matters. This non-doping jurisdiction is continued by the bill. Finally the amendments to clause 38 clarify that the Sports Tribunal will be able to set its own procedures and practices for both anti-doping and non-doping matters. 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 I rise in support of the Sports Anti-Doping Bill. This is probably one of those rare moments we see in the New Zealand Parliament when there is pretty well universal support for a move that has been brought forward by various organisations. But the origin of this measure was a conference on sports anti-doping in Copenhagen in March 2003 where it was decided that there should be an international code to address what has become a growing problem in international sport around the world. It would be difficult to have a dissenting voice as far as that objective goes. The bill aims to provide the legislative framework under which New Zealand can implement the World Anti-Doping Code and do its part to address the global problem of doping in sport. 
The select committee brought forward a number of recommendations. We spent some time investigating the issue brought before us. I see that the bill’s first reading was way back on 13 December 2005. It was then referred to the Government Administration Committee. Submissions were due in by 3 March 2006 and the committee duly considered everything brought before it. The bill came back to the House in early October and we are yet to have its second and third readings. So those who are listening will hear that the bill has been through a thorough process. 
The committee considered a number of contentious issues. One of the contentious issues was the potential effect the bill might have on employment relationships between athletes and their various sports bodies as a result of the imposition of penalties on athletes who were caught cheating with drugs. That issue was based on the notion that the bill would make the World Anti-Doping Code compulsory. I assure the Committee and anybody who is listening that it will not make it compulsory; it will still be voluntary. A number of people were concerned about that matter and raised it with the committee. The bill provides certainty for compliance with the code but it does not affect the employment relationship of sports bodies with athletes and I think that that point needs to be cleared up. 
One of the most controversial points raised with the select committee and in fact by members of the select committee was in regard to whether there should be mandatory reporting to police when there was suspected or potential use of drugs. Of course that could include prescription drugs for injury or illness and on balance it was a pretty tough call for the select committee. In fact the members of the select committee spent some weeks going backwards and forwards on this issue with officials. On the one hand it seemed correct and sensible for it to be mandatory under the bill that all suspected drug use be reported and that would have been consistent with the objectives of the bill. But on the other hand and on further balance it was thought to be unnecessary to make that reporting mandatory under the bill for the simple reason that it was already possible under the Privacy Act and other legislation for such information to be provided. In fact someone who is part of a Government organisation and who does not report suspected drug use is a potential criminal in the sense that that person would be prejudicing the maintenance of law by any public sector or agency if the matter were not reported to the police. 
In other words it is important that New Zealand—with our proud sporting history—keeps a very high standard in that regard. The select committee decided on balance that the objective was achievable without having that provision in the legislation. The flip side of it was that if we did introduce that requirement then the voluntary submission to have the test in the first place would potentially dry up and we would end up ultra vires in relation to the intent of the bill. 
I am not sure whether we have that balance right quite frankly and I do not suppose we will ever know until it is tested. It will be interesting to see what international jurisdictions will do in regard to that issue. 
JACQUI DEAN (National—Otago) 
: 
 I support the Sports Anti-Doping Bill. The purpose of the bill is the laudable aim of “protecting athletes’ fundamental right to participate in doping-free sport”—the National Party supports that—and to “promote health fairness and equality for athletes world-wide;”. That is very laudable but I pause and wonder why the Government is promoting the purposes of this legislation on the one hand yet on the other seems to be terribly terribly remiss in addressing a drug problem in New Zealand which is affecting people within sports codes and also other walks of life. The Government is turning an absolutely blind eye to that growing drug problem in New Zealand which is affecting many many young New Zealanders. The problem is the use of benzylpiperazine-based drugs and the regulations on their use. It makes me wonder how the Government on the one hand can have such laudable aims yet on the other can be so terribly terribly remiss in doing something about benzylpiperazine. 
We had a rugby player from the UK a member of the North Otago team staying at our place. As part of that second division rugby team’s team building and learning about ethics he and his team were given a little pamphlet which unfortunately I did not bring. I wish I had because I would have tabled it in the House today. This pamphlet warned young rugby players—players in the rugby code in particular—about indulging in drugs and drug use. That pamphlet which was given to every rugby player in North Otago and possibly further afield had a list of drugs to avoid including benzylpiperazine or party pills. Why can we on the one hand have the Sports Anti-Doping Bill yet the Government sits on its hands and does absolutely nothing about an incredibly dangerous drug—in my humble view—benzylpiperazine? It just does not make sense to me. 
We know anecdotally that there is a drug culture growing in New Zealand—affecting all young people not just sportspeople—of party pills or benzylpiperazine. What is the Government doing about it? The Government is doing absolutely nothing about it. The Government has been told about this problem for months and months. I have called on the Minister for Sport and Recreation Trevor Mallard and in fact the Minister in the chair Clayton Cosgrove has expressed his concerns. I would be very interested to know how he can support this bill yet turn an absolute blind eye to benzylpiperazine. We have heard the rhetoric. The member has been full of plenty of hot air in his own electorate; why is he not calling on the Minister concerned with drug policy to tighten up the regulations on party pills? Why is he satisfied to sit back and let a drug problem grow in New Zealand? 
It is interesting that in small provincial communities in New Zealand we are encouraging young people to get into sport—rugby netball hockey; all the good healthy things—and at the same time those people can walk away from their rugby practice go into the dairy and see party pills for sale that contain benzylpiperazine. What kind of message is the Government sending? How can its members sit there and promote this bill—which National members will support—with the purpose of protecting athletes’ fundamental right to participate in doping-free sport when those same athletes can walk out of the changing rooms into the dairy and buy a drug that affects their performance? I ask those members to answer me that because I would dearly love to know. I would dearly love the Minister concerned with drug policy to finally wake up realise what is happening to young people in New Zealand because of drugs and tighten up the regulations around benzylpiperazine. 
COLIN KING (National—Kaikoura) 
: 
 It gives me great pleasure to rise and speak in support of the Sports Anti-Doping Bill. When one thinks about how we interface as a nation one finds that we certainly celebrate the principles and values around a good even contest. In fact as a nation our sportspeople perform equally as well as—if not better than—any others in the world. 
When we look at Part 1 of the legislation we see that clause 3(a)(i) is “protecting athletes’ fundamental right to participate in doping-free sport and in this way promote health fairness and equality for athletes world-wide;”. That is laudable as the very good member from Otago mentioned and may I take the opportunity to reinforce the comments of that member Jacqui Dean on the party pill problem. The current approach is sending out double standards and a mixed message to our young people. We cannot be complacent when we look at a bill of this nature. I must confess that it is very well-structured and very very consistent all the way through in defining its purpose. Fundamentally that is what Part 1 does. 
The bill talks about some interesting things. For the benefit of the public who are listening at the moment when we talk about anti-doping bills we are talking about people taking substances that will give them an advantage. It could be an advantage in their training and preparation for an event or it could be an advantage during the event itself. Two recent high-profile cases come to mind that sent a sense of great sadness as to the outcome of the events. One was the Tour de France where the first finisher has subsequently run into huge difficulties about the levels of chemicals in his body. Last night some of us had the pleasure of sitting down with Sir Richard Hadlee who was a great bowler; what comes to mind is the problems that have surfaced around the Pakistani pace bowlers. They too have to prove that they have not been assisted by their taking drugs of some nature. So one can appreciate just how important this bill becomes from the point of view of engaging in international sport. 
Sadly the criminals—the cheats—will constantly be moving forward and the bodies that are registered for the purpose of making sure that sports are clean and fair will have to do their utmost to keep up with them. So it is very important that we empower these bodies with what is necessary for them to be able to do that. When I reflect back on it—to bring up a very close-to-home example of having an advantage and actually winning because of that advantage—I think about the overspending of the Labour Party in winning the 2005 election. I was searching for a more sporting example but I could not find one. When we break it down we see that Labour members spent $14000 per electorate more than they were allowed to. That really is an example of what this bill is about because Part 1 refers to the importance of having consistency of standards. 
Part 1 talks about the structure for drug-free sports in New Zealand. There would be a board consisting of five individuals. It talks about “the Code” and for a while I was wondering what sort of code we were referring to. In fact we were referring to the World Anti-Doping Code 2003 as adopted by the World Anti-Doping Agency in Copenhagen on 5 March 2003. I believe that the origin of that code was in issues to do with the Olympics and we know that the Olympic movement is very much about fair play—which is something we certainly do not see when we look at the outcome of the misuse of taxpayers’ funds during the 2005 election. I am sure that that will have ongoing ramifications in the future as those people are held to account under the spirit of fair play which New Zealanders are very well known for. 
JOHN HAYES (National—Wairarapa) 
: 
 Thank you for the opportunity to speak this afternoon on the Sports Anti-Doping Bill. I think that sport has a value and an importance of itself and when we look at sport in the broader context we see it is clear that the values of sport are of massive importance to individual behaviour and also to our society. Sporting activities teach our children a sense of fairness and cooperation. Through sport our youngsters can play win make goals and set goals for themselves. They can also learn of the disappointment that comes with losing in a sporting activity and I think that experience provides them with an opportunity to do better next time. As for our society sport is an important element of all citizens’ lives. Sporting events bring us together particularly rugby and netball—whether provincial or international—as do events like the America’s Cup yacht race. They bring our communities together and sport plays a really crucial role in our society in doing that. 
Sport is also a business and often it is a big business. Sport generates large sums of money and it is also an industry. Sport plays a major role in expanding our economy and in providing employment. It contributes increasingly to the dynamic of economic growth as we saw after we won the America’s Cup here in New Zealand. There are many good aspects to sport that are essential for us as individuals. I think therefore that we need to protect and safeguard those aspects for the sake of our children for the sake of our industry for the sake of sportspeople and for the sake of us all. We are all stakeholders and there is a lot at stake. 
Increasingly the core values of sport are becoming subject to serious threat through the use of drugs—as my colleague from Otago Jacqui Dean pointed out—and it is pleasing that this bill is designed to protect the good from the bad and the ugly. The main danger we face with regard to sport in this country is cheating and I think that either one cheats or one does not. Cheating a little bit or cheating once in a while is cheating whichever way we look at it. So we either play the game or we do not. I am sure that every one of us has witnessed a dirty tackle an unjust rule or a one-eyed referee—or that is what we might have thought—and such experiences particularly if we had them as children give us a clear sense of what is right and what is wrong. We do not tend to forget the childhood indignation caused by injustice and cheating. 
Taking drugs in order to enhance sporting performance is cheating. Doping contains risks for the individual but more important it undermines the credibility of sport. Doping is indeed cheating—it is cheating fellow competitors and not least it is cheating oneself. Every child knows about cheating and also children’s exposure to drugs in schools is encouraging them to walk a dangerous path. Doping without a doubt is the most serious problem we confront. It is pleasing to see that the World Anti-Doping Agency has given us a worldwide instrument that Governments and sporting organisations can use in cooperating against that common fraud. Through the adoption of the Unesco International Convention Against Doping in Sport we now have the framework to address the issue. The legislation we are giving a second reading to today will enable our Government to contribute to that process. 
Accordingly I commend members of the Committee for joining forces in order to ensure good governance democracy the rule of law fairness and physical and moral integrity. The convention will apply to organisations and industry and it involves the media and civil society. We all must come together and work to confront the problem of doping in sport. Only through a set of commonly agreed principles can we ensure accountability in the wider sense. Government alone cannot address the challenges in this area; we must work together with all parties. The media in particular have a very important role to play in drawing to the community’s attention cheating and doping in sport. I believe that all of us must cooperate very thoroughly in this matter. It is really good to have the opportunity here this afternoon to play the game with unity in this Chamber. 
The National Party supports this bill. Thank you. 
Hon CLAYTON COSGROVE (Minister for Building Issues) 
: 
 I just want to take a short call. Firstly I thank Shane Ardern and John Hayes for their contributions. I especially thank Mr Ardern whom I know better—he knows a bipartisan moment when he sees one. 
I just want to address some of the usual political bile that was heaped upon the Sports Anti-Doping Bill by the member for Otago. She again tried to play politics with a bill that I think is pretty straightforward and pretty bipartisan as exhibited by her more mature colleagues Mr Ardern and Mr Hayes. She tried to say that on the one hand the Government was promoting this bill yet on the other hand it was doing nothing about a substance called benzylpiperazine and party pills. Somehow Ms Dean has become the Joan of Arc of this cause. I say to Ms Dean that before she was nothing but an embryonic twinkle in the eyes of her voters before the last election my good self and other colleagues who have experienced the scourge of benzylpiperazine in their electorates were on to this issue. About a week before the election a person called Mr Terry Brown from my electorate opened one of these scurrilous shops and a petition was then launched. I note that Ms Dean came to the battle a couple of days late when the war was won and tried to bayonet a few wounded grab a few political headlines and move on. 
She asked what the Government has done about benzylpiperazine so I will tell her. The Government has acted quite logically. We have a Minister called Mr Anderton as the chair of the Ministerial Committee on Drug Policy. He rated the drug R18 he killed off any advertising opportunities for the drug and he then assembled a medical experts committee to examine the substance. That medical experts committee—[ 
Interruption 
] I think Sandra Goudie and Ms Dean are on benzylpiperazine given the nature of their interjections. As he said in talking to the bill the medical experts committee will do a simple thing. It will act logically. It has conducted studies that once released I am advised will be informative studies far in advance of any medical studies known done or executed in the world. When these studies are released we will know more about benzylpiperazine than anybody else. Then as Mr Anderton has said if the members of the medical experts committee—those who have medical degrees and are charged with making these recommendations unlike Ms Dean who must be on benzylpiperazine—recommend that it should be banned and I hope they do he will ban it. 
The way to deal with substances and drugs that flow across our border is not simply to have a gut reaction. Although the drugs may be despicable on the face of it and I grant members that benzylpiperazine is exceptionally despicable it is logical to get the medical experts—those with a science background and a degree in medicine who know something about this subject—to examine those substances and make a recommendation. As I have said once this is done if the recommendation is to ban they will be banned. Ms Dean has turned this debate unlike her colleagues Mr Ardern and Mr Hayes—who made bipartisan sound logical and calm contributions to this debate because this is good legislation— 
Jacqui Dean 
: Don’t trivialise drugs. 
Hon CLAYTON COSGROVE 
: Well Ms Dean made a speech that was more about waving political pamphlets and slogans than actually dealing with the issue. She knows that the Government has a medical experts committee examining this. She knows that others were fighting this war far in advance of when she bounced into this House to grab a silly headline. She knows that myself and other colleagues are working with accident and emergency medical specialists like Dr Paul Gee and others who see kids who are full of the stuff being carried into Christchurch Hospital on gurneys. She knows Mr Anderton’s view and the rest. 
Unlike the National Party we act logically and we put up logical bills in the House like this one. All the squawking from the bantam hens over there—and particularly the orange one in the corner of the Chamber who could not even get a point of order right; that shows how many brains she has—will not make up for the fact that two contributions from National Party members to this debate were bipartisan and sound and one contribution from Ms Dean was silly and juvenile although not addictive. 
The CHAIRPERSON (H V Ross Robertson) 
: I call the honourable member Sandra Goudie. 
SANDRA GOUDIE (National—Coromandel) 
: 
 Mr Chairperson I really do appreciate that added honorific; thank you very much indeed for that. Once again I would like to commend the most excellent work done by my colleagues Shane Ardern and Brian Connell in supporting the Sports Anti-Doping Bill. We should all have zero tolerance to drugs—especially given that we have had some discussion around party pills. I just reacquaint the Minister with the fact that at the Government Administration Committee it was National members who asked the important question. I know this because I was there on the day—in fact it was my question. When the submitter—a manufacturer of these party pills—was sitting there at the end of the table I asked him what research he had done to assess the long-term impacts of party pills. Of course everybody was gobsmacked when he said “None.” So absolutely no research had been done about the impacts of party pills. 
Why was the Government not on to this issue earlier? Why was it not doing something about this earlier? What has it done since? Has there been any progress on demanding some accountability for those— 
Hon Member 
: What’s the answer? 
SANDRA GOUDIE 
: Jacqui Dean is certainly the answer. She is the white knight championing against benzylpiperazine pills. We say: “Let’s get rid of them; zero tolerance!”. Well done Jacqui Dean; she is a most excellent colleague. Her petition is a great move forward and I commend her. 
The Government Administration Committee had representations from a number of officials and various representatives. I mention the excellent work done by doping control officers in very trying circumstances. It is very important to acknowledge their role in the sports anti-doping arena because it is pivotal in keeping drugs out of sport. Their role is not always welcome; they interfere in the lives of athletes coaches and administrators but do so for a real and just purpose—that is to keep drugs out of sport. They do so with confidence and integrity and with the support of all members of the House I am sure. It is important to recognise the superb performance of New Zealand athletes in Athens and our gold medallists Sarah Ulmer Hamish Carter and Georgina and Caroline Evers-Swindell who have continued to support the New Zealand Sports Drug Agency in its mission to provide all athletes with an environment free of the scourge of drugs. We must have an attitude of zero tolerance. 
I wonder whether Ron Mark is awake. In one of his previous speeches on this bill he talked about me a lot so clearly my involvement has made a significant impact on him. He talked about National’s involvement on the select committee and wondered why we did not include a mandatory requirement that people taking illegal drugs be referred to the police. That can be done anyway so there is no need to make it mandatory for agencies or people to pass information on to the police to follow up. That protects those people from trying to cover up any situation where drugs might be involved. That is appropriate and I hope anybody who knows anything about somebody taking illegal drugs has the fortitude to pass that on to the police and uphold a zero-tolerance attitude towards drugs. I certainly do and would not hesitate. That is why I am such a strong supporter of Jacqui Dean’s opposition to party pills—which is supported by all of National—and the use of illegal drugs in any situation but particularly in sport. I recognise Sarah Ulmer’s efforts and acknowledge her appointment to the athletes committee of the World Anti-Doping Agency. 
For the benefit of some people who may be out there listening and be absorbed in the debate I want to expand a little— 
GEORGINA BEYER (Labour) 
: 
 I move  
That the question be now put 
. 
The CHAIRPERSON (H V Ross Robertson) 
: No I call Sandra Goudie. 
SANDRA GOUDIE (National—Coromandel) 
: 
 Thank you Mr Chairperson because I wanted to make the link between the Sports Anti-Doping Bill and the precursor to that and why National is supporting it so much. I hope my colleagues who have not had the opportunity to make their contributions will be able to. 
In explaining the World Anti-Doping Agency I inform people that it was established by the International Olympic Committee in 1999 with the sole purpose of eliminating doping from international sport. That is highly commendable and the agency is the fundamental vehicle for achieving this objective. That was finalised at an international conference in Copenhagen in March 2003. It was at that conference that New Zealand became a signatory to the Copenhagen Declaration on Anti-Doping in Sport. That was a good start and effectively provided the means for different countries to support the World Anti-Doping Code. To achieve the implementation New Zealand must recognise the code by way of legislation and that is the reason for the Sports Anti-Doping Bill before us today. 
In essence the code provides a series of rules that represent a framework to standardise and coordinate international efforts for the prohibition of doping. The code’s fundamental rationale is to preserve what it describes as the “spirit of sport” which it characterises by reference to a series of values that include fair play health and respect for rules and laws. At the heart of that code is the prohibited list—substances that if present in an athlete’s body constitute an anti-doping violation. In order to be included on the prohibited list a substance must meet at least two of the following three criteria: it must have the potential to enhance performance; it must represent an actual or potential health risk as of course they all do; and its use must violate the spirit of sport as all drugs do. So the World Anti-Doping Agency WADA—I am not sure whether there is any other way to pronounce that and perhaps the Minister in the chair the Hon Clayton Cosgrove might like to take a call and give us a pronunciation explanation— 
Hon Clayton Cosgrove 
: You’re doing very well. 
SANDRA GOUDIE 
: In summary although the agency’s stated objective is related to the elimination of doping in sport its powers allow it to go further and to prohibit athletes from using substances that violate the spirit of sport even where those substances are not necessarily performance enhancing. Although the agency must consult about the inclusion of any substances on the prohibited list its view on these matters is ultimately final and must be implemented by New Zealand as a signatory. That is a particularly important sentence to understand. I think it is important to take note of that. 
Actually speaking about consultation National members took great advantage of the opportunity to talk to one of the two submitters who talked to the select committee—there was huge interest in this bill! One of them raised a very valid point which National was quick to understand about the need to include athletes in the consultative process. The bill talked about sporting organisations or sporting bodies but not about athletes. We think it was a really positive step forward to ensure that athletes are included in the consultative process and the feedback was very very positive. I think the Government Administration Committee did a very good job in the way it addressed some of the concerns raised by the two submitters. 
However testing for the presence of substances may occur both in and out of competition. The prohibited list recognises this distinction and distinguishes between substances that may be tested for in different circumstances. The reason for this is ostensibly sensible. Certain substances have only a short-term effect—for example to raise an athlete’s performance for a period of hours during a race or a game—and would be objectionable if found during the period of competition but would not provide unfair assistance outside the competition. 
TIM BARNETT (Senior Whip—Labour) 
: 
 I move  
That the question be now put 
. 
RON MARK (NZ First) 
: 
 I was not considering taking a call but since the point has been raised by the honourable Sandra Goudie—[ 
Interruption 
] All members are honourable and some are more honourable than others I guess. I have listened to Ms Goudie’s comments regarding the Government Administration Committee’s majority decision not to require mandatory reporting to the police and the question I asked in the second reading is still left unanswered. Given that there are only six members on the committee—Mr Ardern Mr Robertson Mr Connell Mr Fairbrother Sandra Goudie and Dover Samuels; three Labour members and three National members—how is it that we did not get a unanimous decision that there not be mandatory reporting? Clearly someone in the National Party and I am assuming it was the National Party said: “By Jove! We should have mandatory reporting.” Clearly that person stood out on his or her own otherwise this report on page 2 paragraph 5— 
Sandra Goudie 
: Yes I said that. Read the  
Hansard 
. 
RON MARK 
: I say to Ms Goudie that she has had two calls and now she is trying to get a third by interjection. It sounds to me like she could be on some sort of performance-enhancing drug—but obviously not! Maybe she needs it. That paragraph if one cares to read it and I assume that one’s brain has not been addled by performance-enhancing drugs says: “The majority of the committee are satisfied …”. To get a majority on a committee that is split three to three between National and Labour someone in National had to agree and someone had to disagree. I know hardened law-abiding citizens who stand up for zero tolerance when I see them and my gut tells me Shane Ardern is one and Brian Connell is one. But I have a sneaking suspicion that up there in the Coromandel National has a slightly different view of life. 
It is possible that Sandra Goudie’s attempts to mitigate her vote with Labour is now what we are hearing. If Sandra Goudie did not vote and become one of the majority who oppose mandatory reporting to the police of athletes who use illegal substances—[ 
Interruption 
] She does not want to say. Maybe she should say. Maybe she should be clear and say: “I’m the odd person out in the National Party caucus. I come from the Coromandel and I have a different view of drugs.” I tell Sandra to just say it be happy with it because Labour agrees with her. 
Hon Member 
: Coromandel green. 
RON MARK 
: See Labour agrees with Sandra Goudie. But clearly I might be wrong so I am looking to hear someone clarify the situation for me. But my gut tells me and New Zealand First that Shane Ardern and Brian Connell do believe in zero tolerance for drug cheats they do believe in zero tolerance for people who enhance their performance with illegal drugs and that those members would be the types of people who would want to see a bodybuilder nabbed at the earliest instance and reported to the police for using illegal drugs not to have him pop up later as some P-crazed P dealer as was the case. 
Our argument would be to go for mandatory reporting because in that way we can nip it in the bud. That is zero tolerance. If one waits for the system to take its course one ends up with the situation we have just seen go through the courts. A bodybuilder in a sport that is riddled with drug abuse has finally been imprisoned for P dealing. He admitted to the use of anabolic steroids. If he had been picked up in the early stages and potted to the police right at the earliest instance one could argue—if those facts reported in the newspaper are true—that he would not have gone on to be involved in the criminal fraternity dealing with P as he subsequently was. We do believe in zero tolerance. We would say that the only regret is that the decision not to have mandatory reporting was upheld. 
SHANE JONES (Labour) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 71 
New Zealand Labour 50; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1. 
Noes 45 
New Zealand National 45. 
Motion agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 64 in the name of the Hon Trevor Mallard to clause 3 be agreed to. 
Amendment agreed to. 
Part 1 as amended agreed to. 
Part 2 New Zealand Sports Drug Agency 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 I rise once again in support of Part 2 of the Sports Anti-Doping Bill. I say in response to a couple of contributions that they were right; there was division within the Government Administration Committee. Certainly it was the select committee members themselves who pursued the issue of whether reporting to the police should be mandatory. On balance based on the fact that it is not mandatory in the first place to participate in testing the majority of the select committee decided that reporting should not be mandatory. Also under other legislation—the Privacy Act and various other bits of legislation—it is actually mandatory to report something and a Government agency is in breach of the law if it does not report something it knows is outside of the law. That is the reason why we came to that decision. 
The second argument that was brought forward which the majority accepted was that if we were to impose such a strict regime there would be less voluntary participation in the testing in the first place. [ 
Interruption 
] It is voluntary. As stated in the legislation ultimately one cannot participate in the sport if one does not agree to testing—that part is compulsory—but one is not under law required to submit oneself for tests. It is the code which is decided on and is administered by the sporting body that requires one to have the test. One is not required by the legislation— 
Ron Mark 
: This is in Clayton’s bill? 
SHANE ARDERN 
: Well “Clayton’s bill” is a very good choice of words I have to say. 
The CHAIRPERSON (H V Ross Robertson) 
: The member must use the Minister’s full name not just his first name. 
SHANE ARDERN 
: All right I will use the Minister’s full name. It is a “Clayton Cosgrove filling in for the Hon Trevor Mallard” bill. The member Ron Mark is pretty well on the mark. 
I thank the Minister in the chair Clayton Cosgrove for his contribution. He opened up the debate enormously. I was wondering what I could do as an Opposition member in terms of the debate when we totally support the bill but now I can debate almost anything I like. I know that will make your job much more difficult Mr Chairman but I will do my best to stay within the normal bounds of what is parliamentary. 
The area where I have a concern which is reflected in Part 2 is the late introduction of Supplementary Order Paper 64 which of course the Government Administration Committee did not have an opportunity to go through. As the chair of the select committee I do not want to be caught out by that so I seek an assurance from the Minister in the chair that clause 48B “Use of information and evidence gathered under section 48A(1)(a)” which is on the Supplementary Order Paper does not introduce something that is enormously outside of the scope of the original bill that the select committee examined. I do not think it does; I think the explanation the Minister gave is accurate and the measure tidies up some miscellaneous bits and pieces that the officials did not identify prior to the select committee looking at the bill. But I am anxious about that; I do not want that issue to come back as one we have endorsed when in fact we have not. The Minister may care to take a call to allay those fears. 
 The Government Administration Committee in the time-honoured tradition of wanting to make sure that we ended up in a solid position and with a fair description of what we were trying to achieve chose to change the name of the agency. The decision was a little bit controversial but overwhelmingly the support was there for that to happen so the name was changed. The select committee recommended that the name of the agency be amended from the New Zealand Sports Drug Agency to Drug Free Sport New Zealand a name that clearly stated what we were trying to achieve. So that was done and I congratulate the Government on accepting that. 
The other point that is useful to note is that doping is fundamentally contrary to the spirit of sport and puts at risk the ethical principles and education values embodied in the international agreements. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I rise also to speak to Supplementary Order Paper 64 put forward in the name of the Minister Trevor Mallard. I share the same concern that has been expressed by Shane Ardern about it because we have not had a chance to consider the implications of the changes. However if I look at the World Anti-Doping Code—and I just happen to have a copy here with me—I see that article 2.2 refers to the use or attempted use of a prohibited substance or prohibited method. Without reading the further detail of that on the face of it that looks fine. Article 2.4 relates to the violation of applicable requirements regarding athlete availability for out-of-competition testing including failure to provide required whereabouts information and missed tests. On the face of it that looks OK. Article 2.5 relates to tampering or attempting to tamper with any part of doping control. 
We could go through those articles bit by bit. For the benefit of anybody who is interested I say article 2.7 relates to trafficking in any prohibited substance or prohibited method. So the code does cover trafficking which I think is an interesting point and well worth including. It follows on from the zero tolerance concept. Actually in speaking about that I recall that John Hayes my most excellent colleague on my right raised the point that the Minister has actually signed into agreements before this bill has been passed. Some conventions have been signed into and it is quite extraordinary that the Minister has entered into agreements prior to the legislation being adopted. 
Having read out clause 48A and considered the issues in relation to it I have yet to read the rest of the clauses to see what sort of effect they will have. So I will reiterate the call from my most excellent colleague Shane Ardern that the Minister take a call actually go through the clauses on Supplementary Order Paper 64 and explain what the material changes are. I have explained the change in regard to clause 48A so he could skip that one. I looked at the change to clause 3 and I found no problem with that. It just sets out a bit more clearly what Drug Free Sport New Zealand is—the fact that it is an independent body. It also sets out quite separately that the tribunal is also an independent body and it sets out what each of those bodies undertakes. So on the face of it the change to clause 3 looks fine and clause 48A looks fine. 
We will have to work our way through the rest of the Supplementary Order Paper perhaps as the Minister takes a call. He could explain clause 48B “Use of information and evidence gathered under section 48A(1)(a). That I think is quite an important clause and should not be understated in any way. I would also like the Minister to take a call about clause 48 “Preparation and making of rules before 1 July 2007”. That is new. We are always a little concerned when rules are to be prepared and made so we require the Minister to get up take a call and explain why that measure has suddenly popped in there. He could explain the conditions and dates in that clause in relation to clauses 16 to 22. If the Minister would do that it would be greatly appreciated and we could then support that Supplementary Order Paper with a little more confidence. 
In talking further about this bill I see that these provisions are about the World Anti-Doping Code; they are all about what the World Anti-Doping Agency has in its code. The bill picks up on some of the more pertinent aspects of the code and with a zero tolerance to drugs and their use in sport—for the benefit of Mr Mark—I think that those particular parts of the Supplementary Order Paper are quite pertinent. I am running out here; I will let my colleague take over. 
Hon CLAYTON COSGROVE (Minister for Building Issues) 
: 
 I will just briefly address the point that Mr Ardern was asking about. Supplementary Order Paper 64 has been reviewed by the Ministry of Justice in respect of the New Zealand Bill of Rights Act. Clause 48A will allow Drug Free Sport New Zealand to carry out the investigations required under the World Anti-Doping Code. The Supplementary Order Paper does not go beyond what was set out in the bill but because the commencement date of the bill has been delayed clause 48A will allow the agency to exercise those functions in the interim period. 
CHRIS AUCHINVOLE (National) 
: 
 The Sports Anti-Doping Bill is a good example of a bipartisan bill and it is a very important one because so much of our international reputation hangs on the activities of our athletes. But I am very reluctant to impose responsibility on our athletes without sharing a reasonable understanding of the situation. 
I guess when I speak on this part of the bill—which I am very pleased to support—I have to reflect that to date my life has spanned an era from what could be termed pre - drug use to widespread drug use. I can recall that when I was at school and I am sure some of my senior colleagues on that side of the Chamber can remember a similar period we only ever heard about drugs. They were not part of our life in any shape or form particularly from the point of view of performance-enhancing drugs at a sports level. But we were keen on sports and sports are an intensive competitive business. 
 Fairness has to be established by rules. It is not a natural feature of sport. And the rules have to be equally applied. In the case of really good performers they were often gifted with what we call a natural ability. Natural ability was one of the main contributors to people having real success in teams representing their schools. I suggest that life has continued on that basis for the majority of young sportspeople and sports-minded people ever since. 
I remember some years ago when my wife and I visited an isolated township in the far north in Tai Tokerau where the local population has an endemic drug-taking problem—a legacy of the hippie period of the 1970s. We were invited to take morning tea with the local schoolteachers who were getting ready for the forthcoming term. They explained to us the difficulty they had in helping kids to avoid getting hooked on drugs and how useful it was to encourage them in sport. They had to do it by the time the kids were about 10 or 11 years old. I guess things go in full circle. Once heavily into sports of a competitive nature young athletes of today have to be encouraged to avoid becoming hooked on performance-enhancing drugs. 
I have never actually excelled particularly in competitive athletics in field sports and I make no pretence that I have. 
Hon Clayton Cosgrove 
: That would be right. 
CHRIS AUCHINVOLE 
: But I did have some success in competitive sword fencing. I do not know what sports the Hon Clayton Cosgrove has excelled in; I have not heard about it yet. No doubt he will tell us. But I have never come close to any level of excellence that would lead me to tip the balance in my favour by taking performance-enhancing drugs. 
When one thinks though of the effort that goes into the training of modern athletes and sportsmen and sportswomen—the endless runs the swims the cycling whatever it is—one realises the huge commitment on the part of individuals their trainers their managers and their families. The temptation to use drugs must be enormous particularly if others are doing it too. The only way to prevent drugs in sports is to apprehend those who use them and deal with them in a way that discourages others. The whole regime must have a robust ethical norm that all athletes and trainers can have confidence in. How do we do that? We do it through good legislation and effective agencies. 
I note that David Gerrard the Chairperson of now Drug Free Sport New Zealand formerly known as New Zealand Sports Drug Agency says in his report “When good men (and women) do nothing bad things happen …”. In making his report on the activities of the agency he is happy to advise that clearly good men and women in his organisation have been working very hard. The work is not easy. Doping control officers have a difficult time. It is a job of unpredictable responses and less than warm welcomes. Theirs is frequently a thankless task. However the measure of their crucial input is recorded in the annual survey of athlete satisfaction and this year it affirms the confidence the majority of athletes have in the integrity of the process. They might not like it but it is fair and it works. That is the important thing. 
The international code the World Anti-Doping Code can be put in place by the legislative effect of the bill. To have the legislative structure will permit Drug Free Sport New Zealand to do its job. National sporting agencies will be able to adopt the rules through their anti-doping policies and in ways that bind national and international athletes as well as officials. 
The question was put that the amendments set out on Supplementary Order Paper 64 in the name of the Hon Trevor Mallard to Part 2 be agreed to. 
Amendments agreed to. 
Part 2 as amended agreed to. 
LINDSAY TISCH (Senior Whip—National) 
: 
 I think at this time in the debate before we start on Part 3 it would be appropriate to report progress. I seek leave for that purpose. 
The CHAIRPERSON (H V Ross Robertson) 
: The member does not need to seek leave. I am now in the situation where I have to leave the Chair anyway. 
Progress to be reported presently. 
House resumed. 
The Chairperson reported progress on the Sports Anti-Doping Bill and no progress on the Communications Legislation Bill.  
Report adopted. 
The House adjourned at 5.56 p.m.