Clark David: Electronic Identity Verification Bill — In Committee 
Text is incorporated into the Bound Volume 
Clark David: Electronic Identity Verification Bill — In Committee 
[Sitting date: 13 November 2012. Volume:685;Page:6534. Text is incorporated into the Bound Volume.] 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 Part 2 of the Electronic Identity Verification Bill contains the majority of the actual implementation of this particular measure so I am very pleased to speak to Part 2 of this bill because my concern which I hope the Minister in the chair the Minister of Energy and Resources will be able to address is around the ability of the Government to implement this measure. The Inland Revenue Department computer system is something that has caused great public concern in recent times. There have been 32 reported breaches in the calendar year between September 2011 and September 2012. For over 600 people the breach was considered severe enough for them to be contacted and followed up by the Minister for Social Development. In those breaches 6300 people actually had their private details released and it is not clear yet why the Inland Revenue Department did not think it worth following them up why it should be that people should not be told that their privacy has been breached as a result of ineffective security systems as a result of errors in the department and so on. 
I want to say that Labour will support this bill because we support the principles behind it as were enunciated in Part 1 but in Part 2 the real question is: can this be enacted? Can these measures be enacted? In the Inland Revenue Department’s case we have a 20-year-old system. It is needing according to Mr Key a billion dollars spent on it in order to upgrade it to replace it and to bring it up to scratch. Mr English is on record as saying that $700 million of the asset-sales money will be spent on the system. Mr Dunne is on the record as saying “Don’t ask me any questions. Those decisions are going to be taken as a result of the Budget process.”—effectively saying “Nothing to see here.” I have serious concerns because this is a department under incredible stress and we are seeing bills now coming through the House that take backward steps. The Government says “We are implementing this in principle.” and then later on has to follow up with legislation that says “Actually we’ve realised we can’t implement these changes and we now have to change the goalposts. We have to move the goalposts to a place where we can put the ball through.” That raises a serious question about whether we should be considering this legislation now or whether it is actually premature given that it may not be able to be implemented in the way that is intended. 
I am deeply concerned about the breaches at the Inland Revenue Department and also those at ACC at Work and Income and at Novopay. I have certainly heard whispers around my electorate of other Novopay breaches that have yet to be publicly alerted so it is not over yet. I am sure there will be more breaches coming to light. When I became aware of the Inland Revenue Department breaches I did a quick calculation and realised that if the current rate of breaches continues in a little over a decade it will be one in 20 New Zealanders who have had their privacy breached by the Government—if the current rate of breaches continues. That is outrageous. It is absolutely outrageous if one in 20 New Zealanders has to put up with their private details being breached by Government systems that are inadequate that are not up to the task and that do not take seriously the trust that New Zealand citizens put in them. 
David Bennett 
: Come on David sit down. You know you’re telling rubbish. 
Dr DAVID CLARK 
: Mr Bennett on the other side of the House there is uncomfortable with these facts and figures and is wanting to put that on record. He should come across the floor and join a party where Davids can get ahead. I know his heart is in the right place but these are serious serious issues that we are raising. 
These are serious issues where four out of every thousand Kiwis have had their private details breached in the last 12 months and where one in 20 will have their private details breached if this is not addressed in the next decade and we see a Government that has no plan. In the case of the Inland Revenue Department the Government is yet to outline a plan. John Key said in February this year that it would cost a billion dollars to upgrade the Inland Revenue Department computer system. Now 9 months on we do not have a single plan in place. We do not have a credible timetable outlined. We have no idea how the Government is going to make sure those systems are secure. Now in front of us is a piece of legislation that talks about the electronic identity verification that should be in place. We know that this is a good idea. There is no doubt that having electronic identity verification in place is a good idea but can the Government actually deliver on it? That is the question that I am asking. 
The Inland Revenue Department to cite some further examples failed to return 70000 phone calls in the 2 weeks prior to the last GST filing period. 
Hon Ruth Dyson 
: What? How many? 
Dr DAVID CLARK 
: 70000 phone calls. 
Hon Ruth Dyson 
: A year? 
Dr DAVID CLARK 
: That was in 2 weeks. That was in 2 weeks I say to my colleague prior to last year’s GST return period. 
There are over a million unprocessed returns in that department and we have $7 billion in outstanding debt—$7 billion at the Inland Revenue Department in outstanding debt. It is little wonder that it has had a 33 percent turnover rate in the call centre in Wellington that handles many of these complaints. Those at the coalface are feeling the pinch because we have a Government that has not stepped up to the plate and that is not addressing the concerns raised by a computer system that was put in place in 1992. That is 10 years prior to Facebook that is prior to Google and that is prior to the internet as many of us know it. There are even members of Parliament who were not born then I think—oh no I might be getting a bit premature there. But this system is nearly as old as some members of Parliament. We have had a 4 percent drop in the tax take under the watch of this Government so there are serious serious issues in that department. This bill would say that that department has to put in place a system that implements a system of electronic identification. I am not convinced at all that this department will be able to do it. 
We also know that the Inland Revenue Department does not and cannot currently—and the Minister in the chair can correct me if I am wrong on this—reset passwords. It cannot even reset passwords electronically. If you have got a department that is struggling with issues as simple as that in terms of its computer system—John Key refers to it as a pig of a system a pig of a system. Those words are from the Prime Minister’s own mouth. Nine months on we do not have any idea how the Government is going to address that system. 
We have a bill with more aspiration in it but we see no progress. How can the confidence of the New Zealand taxpayers be restored? It is being shot to pieces—shot to pieces—by the breaches this Government is making: ACC breaches Inland Revenue Department breaches Work and Income breaches and now Novopay breaches. What we are seeing is a pattern. What we are seeing is a clear pattern. We have some talk about how these things are going to be addressed then often we have a retraction but we do not have any credible plan outlined as to how these problems are going to be addressed. New Zealand taxpayers give over their private details in good faith—in good faith—and good on them because people do need to pay their fair share of tax. They do need to sign up for the various Government services that are available. But they are getting nervous because of the inaction of this Government. So although Labour will support this bill because it supports the principles in it we hold very very deep concerns about the Government’s ability to implement these changes.