Volume 695 Week 62 - Tuesday 10 December 2013Text is incorporated into the Bound VolumeVolume 695 Week 62 - Tuesday 10 December 2013[Sitting date: 10 December 2013. Volume:695;Page:15339. Text is incorporated into the Bound Volume.]Tuesday 10 December 2013Mr Speaker took the Chair at 2 p.m.Prayers.ObituariesNelson MandelaHon BILL ENGLISH (Deputy Prime Minister): I seek leave to move a motion without notice in relation to the passing of Nelson Mandela.Mr SPEAKER: Is there any objection to that course of action being followed? There is none.Hon BILL ENGLISH: I moveThat this House express its sorrow at the passing of former South African President Nelson Mandela on 5 December 2013 aged 95. On behalf of the Government and the people of New Zealand I offer our condolences to his family and to the people of South Africa. Nelson Mandela was a positive force for change not only in South Africa but across the world. He was a man who during the course of his remarkable life made the transition from supporting an armed struggle against apartheid to becoming a joint winner of the Nobel Peace Prize.On the long walk that was his life he was faced with many difficult choices. As he grew in stature and influence he had to manage the expectations of his fellow South Africans from the poorest and most marginalised to the richest and most powerful. He had to balance the desires of his own supporters who had suffered so much with the expectations of the global community and most South Africans for a peaceful transition in their country. As an activist and as a political leader he had to face these challenges and dilemmas while remaining true to himself. Ultimately he made the decisions that mean that on this day leaders are gathering from around the world to pay tribute to a man who became a global symbol of determination perseverance and forgiveness.During his 27 years in prison he was a focal point for the fight against the apartheid regime but on his release he exhibited an inspiring ability to put his own hardships and sacrifice behind him. Where he could have chosen bitterness and revenge he chose instead forgiveness and reconciliation and his relationship with F W deKlerk was an example of this. After Mr Mandela was elected President in the historic 1994 multiracial elections he and F W deKlerk formed a Government of national unity and were jointly awarded the Nobel Peace Prize. The nature of Mr Mandela’s character enabled him to transcend the economic and political tensions associated with meeting the high expectations of the new South Africa. I along with other members present in the House today had the privilege of meeting Nelson Mandela in 1995 and we all experienced there his incredible ability to make you feel that the privilege of meeting was all his.The Prime Minister John Key has led a small group of distinguished New Zealanders to pay respects to Mr Mandela at his official memorial service in South Africa. We have conveyed to the South African Government the sympathy of the Government and people of New Zealand. Many New Zealanders added their voices and actions to the struggle against apartheid. Mr Mandela’s passing is an opportunity to acknowledge those New Zealanders. They have proved to be right. The conflict that occurred in New Zealand over sporting contacts with South Africa was as those New Zealanders asserted at the time about more than our right to watch sport.Nelson Mandela’s passing will cast a long shadow. His place in history is unassailable. We can honour his legacy by supporting South Africa to stay on Mr Mandela’s path of forgiveness freedom and prosperity.Hon DAVID PARKER (Deputy Leader—Labour): I am privileged to rise on behalf of the New Zealand Labour Party to pay homage to the wisdom and achievements of one of the world’s greatest leaders certainly in my lifetime Nelson Mandela. We pay our respects to a man who dedicated his life to fighting injustice. It is hard to imagine a more worthy recipient of the Nobel Peace Prize an honour that as the Deputy Prime Minister has already said was properly accorded him in 1993. Nelson Mandela’s long walk to freedom included an incredible 27 years of imprisonment from 1962 to 1990. Only a giant could endure that and then upon release pursue justice and reconciliation rather than revenge. Through the decades of his incarceration the black and coloured majority were subjugated to the interests of the white minority. They were second-class citizens in their own land. They suffered segregation and poverty. They had no right to vote fewer civil liberties and suffered egregious human rights abuses including murder.Mandela’s indomitable spirit was an inspiration not just to millions in South Africa but to billions around the world. The remarkable dignity and forgiveness that he displayed in rising above the wrongs of apartheid and the wrongs he had endured personally are truly the marks of a man of great spirit and humanity.Apartheid was an abhorrence to New Zealanders. The New Zealand Labour Party fought against it. We consistently favoured economic sanctions. We took a strong and leading stance against sporting contacts to increase pressure against the apartheid regime. Labour actively opposed the All Blacks having to send all-white teams. The Labour Government led by Norman Kirk in 1973 cancelled a tour to New Zealand. Labour opposed the 1981 tour which the Government of the Rt Hon Robert Muldoon actively sought and encouraged. Many of us here marched in protest and in support of Mr Mandela and his cause. It seems incredible that this lasted until the 1990s. It does not seem that long ago.A comment that Mandela made in Johannesburg in 2004 captures his humanity and his humility in a better way than I could do in words. He said: “As the years progress one increasingly realises the importance of friendship and human solidarity. And if a 90-year-old may offer some unsolicited advice on this occasion it would be that you irrespective of your age should place human solidarity the concern for the other at the centre of the values by which you live.” It is this love of humanity that we celebrate today. But we should be cautious not to lapse into platitudes. It is unlikely that he would appreciate fine words for their own sake.I would like to leave you with a quote from one of the speeches he made just a few years ago: “Overcoming poverty is not a gesture of charity; it is an act of justice. It is the protection of a fundamental human right—the right to dignity and a decent life. While poverty persists there is no true freedom.” If we are truly to memorialise Nelson Mandela we will do this with actions. Thank you.KEVIN HAGUE (Green): Nelson Mandela was not as some of the comments of the past several days would have us believe some anodynetwinkly-eyed grandfather. He was a gracious man considerate to all those he interacted with possessing a disarming sense of humour. He understood that breaking the cycle of retribution required honesty in order to reconcile for the good of future generations. But under the velvet there was steel. Nelson Mandela was a freedom fighter a man of great courage determination and uncompromising integrity. The apartheid regime was not merely racist and repressive; it was evil and murderous and it survived only through domestic barbarism and through the support of Western Governments including shamefully our own—sometimes particularly our own.The South African regime of the early 1960s understood all too well the power of Nelson Mandela as a leader of the struggle against it and it sought to crush this potencyentirely. It imprisoned him on an island and tried to completely suppress all images of him let alone anything he said or wrote. Yet in the act of this attempted burial it made him more powerful than it could possibly have imagined. Nelson Mandela became the symbol that united the anti-apartheid movement in South Africa and across the world. The apartheid regime imprisoned a man for 18 months for having the words “Release Nelson Mandela” on his tea mug at work but those words—that call—would become the clarion call for the entire world. This is a coffee cup that HART—Halt All Racist Tours—produced and we sold quite a few copies. It actually has a picture of Nelson Mandela on it. It is the last picture that we had at that time. It was taken in I think probably 1964 before he was imprisoned and it was a shock to see an old man walk fromPollsmoor Prison robbed of 27 years of his life. He rescued his country from spiralling into civil war and then set about forging a new nation based on the ideal of it being a place where everyone belongs—a rainbow nation. That ideal had been one to which Nelson Mandela dedicated his life and as he said it was one for which he was prepared to die if need be.That ideal is not yet realised and others must take up his burden more convincingly than some of his successors have done. In the year 2000 I was present at the closing ceremony of the International AIDS Conference in Durban. It had been a fraught conference dominated byThabo Mbeki’s denial of access to anti-HIV treatments based on his misplaced idea that HIV was not the cause of AIDS. Nelson Mandela used his speaking slot at the closing ceremony to comprehensively rebut Mbeki’s position and to skilfully unite the conference in a position on access to treatments that has saved many many lives. The other occasion when I had the privilege of seeing him in person was at a gathering of some from the anti-apartheid movement in St Matthews-in-the-City in 1995. Nelson Mandela had sought the opportunity to specifically thank the anti-apartheid movement in this country for our support and contribution in bringing justice to South Africa.If anything binds this country to Nelson Mandela and to his legacy it is the work of the anti-apartheid movement. I know that a number of members of this House took action to oppose apartheid and literally hundreds of thousands of other New Zealanders did the same. We took that action in defiance of our Government of the day which tacitly supported and lent comfort to the apartheid regime. Very often we took that action in defiance of the law believing that we served a greater good and I am proud of those actions. Now today I stand here not only on behalf of the Green Party but with a sense of those hundreds of thousands standing with me shoulder to shoulder arms linked to wish you well Nelson Mandela on your voyage to the stars. Nelson Mandela we fought for your freedom from the other side of the world and now we mourn you from here. We celebrate your life and we vow to keep alive your belief in redemption truth and reconciliation and good lives and a fair future for everyone.Rt Hon WINSTON PETERS (Leader—NZ First): Nelson Mandela had a truly remarkable life. He rose by ability from humble origins in a rural village to leading his country out of the apartheid era and becoming the President of South Africa. Despite his 27 years of imprisonments his courage humility forgiveness and compassion provided an example to the world and indeed created an image of him. One of his greatest achievements was to set up the Truth and Reconciliation Commission where victims of the apartheid era could tell their stories and perpetrators of violence could tell theirs. Although controversial the process was a crucial step towards healing South Africa’s deepest wounds. His skill in managing the transition from apartheid without widespread violence repression or economic collapse is an enormous legacy which we hope lives on to build South Africa’s economic and social peace and security into thefuture. That is the enormous challenge that we seriously wish South Africa is able to meet going into the future.TE URUROA FLAVELL (Co-Leader—Māori Party):Tēnā koe Mr Speaker kia oratātaukātoa e te Whare e tanginei kitērā ongātipua kaitērā taha o te ao. Epēneirawa te korero: “Katanuku katanuku katanuku. Katanuku tetokai te whenua katanuku.” Nelson Mandelae moe e te raiona otō whenua o te ao. Haere ā-wairua mainei kiarongo koei te kupuwhakamihii te kupuwhakamīhāi te rere o tekōrero kawhakaputaina etēnā etēnāi terānei kirungai a koe.E Koro ekīana te korero: “Kiri kawa ki te kupukiri kawa ki teteririkiri kawa ki terākau.” Ko koetērā tewhakatinanatanga otērā korero: “Tetokatū ki te moana taitimu taipari.” Ko koetērā Nelson Mandelaitukitukia e te tai e te hau e teua. E tekaiūrungi o te waka te wakaiputai teririitau kiutai terangimārie moe mai.Ko koetērāipereneii tewāmāra temāra o tewhakapono o tetūmanako o tengākaumāhaki. Ko koetērāihuhutineii tetarutaru o te nohowehe o tekaikiri o tepēhitanga o te tangata. I a koe te rangatiratanga otō whenuanāungā iwipakangaiwhakakotahiirungaanōi te aroha otētahi kitētahi.E Koroiputa koei tepūehuehu otōkāinga āi teotinga mai ko koetērāi nohonāi tetoka-ā-nukuarāi te paepae o te ao. Kotōkoingō nui kiawhaiwāhi te iwimangumangui rotoingāwhakahaere otōnaake whenua ā kia korerawarātau e nohoneiiraroi te korowai o tewhakahāwea o tekōhuru o tekaikiri.Mōmātou kongā iwi o Aotearoa itinei ko koe te reo karanga o tekotahitangai oraaimātauingā matekaikiriitēnei whenua.Waimariaanamātaui a koe Nelson Mandelaingārāi kitemātauingāāhuatanga katoa o te mana tangata. Kai tepērāanō hoki kongā iwitaketake o te ao.Kāreitua atu ki tewhakaiti ko koetērā.Ahakoarākoiatōhanga he tangatakauanuanu he tangatawhakaohoi te ihii tewehiwehii tewhakamīharo.Ipērārawa teāhuaitōekenga kirunga oTūrangawaewae tenohonga ongāKīngi Māorii tetau 1995. Kitakumōhio keitērā ongā marae tetipuiwaihotia maiai e koe heitohumaumaharatangamōtōhīkoi ki Aotearoanei.Ko te matekē eKōroaneimātau e tukunei ki a koe ā-wairua ewhakamīharoneiingāmeaikōkiritia e koei tewāi a koe etakatūanai temata o te whenuaēngari kai te aotonu kai Aotearoatonu akaikiri atohe apakanga.Koinei te mahi āētahi omātouitēnei WharePāremata hetohei tetohemō te tangata whenua kiteahuatanga o tekaikiriarā kongāwhāinga ongāpēhitanga atētahi kitētahi.Kāreanō kiaotinoatērāāhuatanga e Koro.Kārei a Aotearoa metōna kotahiēngarii te ao.Nō reira he paikē tekīi a koe tewhakakitengamō te whenuamō te ao.Koētahikuatutuki koētahi ka noho maihaiwhāingamāngāwhakatipuranga e haere mainei.Nō reira e Korowhakangaro aturā.Kua tae atu koe ki teahunga rua o te tangata.Kua nohongāTaru-o-Tura kirungai a koe e moe. Epēneianatētahirārangikōreroiputai a koei tetau 1994.[Thank you Mr Speaker. Greetings to us all the House as we mourn the loss of a colossus on the other side of the world. It is said: “The great rock in the land has crumbled.” Rest Nelson Mandela the lion of your country indeed of the world. Come here in spirit to listen to the congratulatory wonderful and flowing tributes expressed to you by each one who spoke before me today.Old One there is a proverb that states: “Short tempered with words short tempered in battle and short tempered with weaponry.” You encapsulate that proverb as well as the saying: “A rock that stands fast in the ocean despite the ebb and flow of the crashing tides”. Oh leader of the vessel that emerged through conflict and came ashore peacefully slumber on.It was you who worked and cultivated the garden of faith hope and humility. It was you who plucked out the weeds of living separately through racism and suppression of people. You had the sovereignty of your country; you united the warring factions based on the empathy for the other.Old One you rose up from the dusty and turbid environment of your village and at the end of it all you ended up as the rock of the earth on the global stage. Your greatest point was for black people to participate in the governance of their country so they would never ever live under the cloak of prejudice murder and racism.For us the people of little old New Zealand you were the voice that called for unity and why we survived the scorns of racism in this country. We were fortunate to have you Nelson Mandela; we witnessed all forms of people power. The situation is the same as well for indigenous peoples globally. That aside you were the epitome of humility; a person who inspired others and was held in awe and admired.You displayed those qualities in 1995 when you visitedTūrangawaewae Marae the home of the Māori Kings. As I understand it you planted a plant at one of the courtyards to mark your visit here to New Zealand.The problem really Old One is that here we are paying our respects to you spiritually and extolling the things that you addressed in your lifetime while racism protests and conflict remain in this country and around the world. Some of us here in this Parliament persist and debate on behalf of the people of the land in respect of situations relating to racism and the suppression of one over the other. It is not yet over here in New Zealand alone but globally as well. Therefore it is more fitting to say that you had the vision for the country and for the world as well.Some things have been achieved while some things remain for the generations to come to aim at. So fade away Old One. You have arrived at the two directional points for man. The Seeds ofTura are upon you sleep on. You uttered a statement in 1994 which goes like so.]In closing can I just take a quote from Nelson Mandela which may sum up today. He said in 1994: “Death is something inevitable. When a man has done what he considers to be his duty to his people and his country he can rest in peace. I believe I have made that effort and that is therefore why I will sleep for the eternity.”Kua ea tewāhi ki a koe Nelson Mandelae moe.[The part about you Nelson Mandela has been satisfied rest up.]Hon PETER DUNNE (Leader—United Future): History records the stories of many extraordinary men and women and many of those stories are either a little bit misted by time or embellished by the passage of time. We are all privileged to have lived in the same time as one of the greatest people in history Nelson Mandela. We do not need the story to be embellished or dressed up because we know the story we have now heard it frequently and our admiration for the account of events I suspect increases every time we hear it. The idea that a man who was so seized with a cause and imprisoned for such a long period of time in such harsh and intolerable conditions would then be released as an old man and bear his captors no grudge is one that many of us struggle to comprehend. How can it be? Yet we witnessed it—not just that day of the long walk to freedom in February 1990 but in his subsequent life right through to the time of his death last week.We saw alongside the wisdom and the generosity of spirit a man who also had a true sense of humility a remarkably self-deprecating sense of humour and an extraordinary ability to engage with people to give them that moment of time when they seemed to be the centre of his world and then to also inspire them to be loyal for ever after.I recall when he came to New Zealand in 1995 two events—firstly the day he came to this Parliament. It was a sunny Wellington day as usual. You could not move around this complex for people in the grounds. Every building nearby every balcony was thronged with crowds waiting to see the great man arrive. A couple of weeks later the Queen of England came to New Zealand. There were barely 200 people in the grounds to welcome her on that occasion. That to me spoke volumes. Nelson Mandela attracted the attention of New Zealanders not just those of us who had been part of the 1981 campaign but New Zealanders across the board who wanted to pay honour to his extraordinary achievements and to acknowledge his greatness.The second recollection I have from that visit was a dinner he spoke atat the Wellington Town Hall where he demonstrated that wonderfully self-deprecating sense of humour. He told a story about being in the Kruger National Park. Two stereotypical elderly female American tourists had accosted him and in an accent that I will not pretend to repeat they told him how much they admired the great little country that he had and this wonderful place they were present at. He thanked them and moved off. He said that he then heard one say to the other “Who was that?”. The other one said: “Oh I don’t know. He was probably one of the gamekeepers.” He as the President of South Africa could tell that story just to put everyone at ease without having to draw attention to himself.But I think there is one other important feature of his life and his approach that perhaps we have not paid sufficient attention to. We know of the man who struggled for years—a lifetime—to make South Africa the rainbow nation it is today. We know of the way in which for all of that time or a large part of it the white community in South Africa decried him as a terrorist and if anyone heard the interview this morning onMorning Report with FrancoisPienaar talking about his engagement with Nelson Mandela you would have got a real sense of that. But actually when you look at what Mandela was about he was not about attacking the institutions of the State. When he became President he became a firm upholder of the institutions of the South African State. It was about who controlled those institutions. It was about who controlled the law who controlled the courts who controlled Parliament and who controlled the economy. And the fact is that for so much of his life so many of his fellow countrymen were excluded from that process.It is a remarkable chain of events now taking place in South Africa. The memorial services—the fact that there will be three funeral processions over the next few days to allow everyone to participate—mark the sort of event that we could not contemplate occurring in the normal course of our lives. But it is the mark of the world’s fondness for respect for and recognition of the achievements of Nelson Mandela.All of us have our memories. All of us know the story. All of us wish the people of South Africa strength steadfastness and determination as they go through this period and as they face the future of their country. I think that as Nelson Mandela managed to unite a nation in the last years of his life and in his post-release period he will be an even stronger uniting force in his death. He will be a memory that will create a tradition that people will want to aspire to for the future. My colleague Te Ururoa Flavell quoted that quotation before about Mandela’s prescience of his own death. He will be able to rest contented and peacefully his long walk to freedom is over his journey is done his people are safe and his country is on the road to prosperity and to progressivity in the future.Motion agreed to.Questions to MinistersChild Poverty—Measurement and Government Initiatives to Address1.Dr RUSSEL NORMAN (Co-Leader—Green) to theMinister for Social Development: Will she set specific targets for reducing child poverty; if so what child poverty measures will she use?Hon PAULA BENNETT (Minister for Social Development): This Government has committed to four Better Public Services targets that will help children. They are reducing long-term welfare dependency increasing participation in early childhood education increasing rates of immunisation and decreasing the incidence of rheumatic fever and reducing the number of assaults on children. Added to that are targets related to the economy and jobs which of course have a direct impact on child poverty. There are a number of measures of poverty and the Child Poverty Monitor which was released yesterday itself also recognised the complexity of the issue and used a range of measures.Dr Russel Norman: Can the Minister answer the primary question which is will she set specific targets for reducing child poverty?Hon PAULA BENNETT: We already have.Dr Russel Norman: Can the Minister tell the House what are the specific measures of the targets for reducing child poverty?Hon PAULA BENNETT: As I have said child poverty is multidimensional and there is a multi-measure approach. In fact the Ministry of Social Development has a strong position in that no single measure can actually properly capture the different aspects of poverty and we therefore use the multi-measure approach. We are open and transparent in reporting that. In fact the information that was used for the Child Poverty Monitor released yesterday used all of the information that the ministry itself reports. Those reports show that it has been on a flat line for the last 3 to 4 years which considering the global financial crisis that we went through shows that we have been quite remarkable I think in keeping it there. But there is absolutely no doubt that we need to do more work and that is what we are concentrating on.Dr Russel Norman: Given that the Minister says that there are many measures of child poverty would she care to pick one of those measures of child poverty specifically and tell us what her target is for that measure of child poverty?Hon PAULA BENNETT: It would be quite easy for me to go to the Better Public Services target of 90 percent of 8-month-olds fully immunised by December 2014 and that 90 percent of 8-month-olds nationally have completed scheduled vaccinations. Also reducing the incidence of rheumatic fever by two-thirds to 1.4 cases per 100000 is a real target that this Government has set and has a direct impact and of course it is all about child poverty.Dr Russel Norman: Well I appreciate the Minister—Mr SPEAKER: Order! Just come to the supplementary question.Dr Russel Norman: Well can the Minister tell the House—aside from the targets she mentioned about immunisation and rheumatic fever which are health targets—what is one specific child poverty target that actually addresses the measures of child poverty as identified by the Children’s Commissioner?Hon PAULA BENNETT: The member raises in his question both measures and targets. What we have are multidimensional measures because of the complexity of the issue which we report on through Ministry of Social Development reports on householdincomes and which we saw in the report yesterday. So there is your answer on your measures. Another target that I can well and truly point to is us actually addressing the economy and making sure that we have more jobs and better-paying jobs for New Zealanders. Unless we get that right quite frankly we are not doing the best by those children who need us.Dr Russel Norman: Does the Minister believe that she has responsibility for the rates of child poverty and hence how does she measure the rates of child poverty?Hon PAULA BENNETT: I believe that all of us do.Dr Russel Norman: Without an official measure of child poverty—because the Minister has failed to provide one so far—how can she possibly know whether the policies she is promoting are working or not without some measure to determine rates of child poverty?Hon PAULA BENNETT: Well as I have stated there are a number of measures. They are reported on. The member himself can point to them and then hold the Government to account if he wishes to. Quite frankly Australia and Canada are the same as us and use multi-measures and do not have just one. Actually to use just one would not actually be getting into the depth of what is a very complex issue.Dr Russel Norman: Does the Minister believe that Mr Mandela was right when he said that overcoming poverty is an act of justice and hence her failure as a Minister in 5 years to overcome poverty means that one in four children is now still living in poverty and one in 10 children is living in extreme poverty? Is that a matter of justice for those children or are they still living with injustice?Hon PAULA BENNETT: I do not have responsibility for the first half but what I would say is that we actually take the care and well-being of those children incredibly seriously. We have a number of issues that we are actually addressing. It is not one simple one that will actually fix this. We have flat-lined over the last 3 years. We would like to do better than that and we will but at the moment what we are concentrating on are the actions that they need on the ground. I can talk about the $1.5 million that has gone intoKidsCan. I can talk about the food in schools that we are supporting throughKickStart to make sure that they have breakfast and lunch in schools. I can talk a lot about the microfinance scheme that we are getting up and running. I can talk about warrants of fitness for houses. I can talk about 240000 homes that have now been warmed up. I can talk about the extra bedrooms—Mr SPEAKER: Order!Economic Programme—Progress2.DAVID BENNETT (National—Hamilton East) to theMinister of Finance: What progress has the Government made with its economic programme in 2013?Hon BILL ENGLISH (Minister of Finance): The Government has made encouraging progress in its economic programme in 2013. The economy is building good momentum. It is generating more jobs which lift people out of welfare dependency and out of poverty. It is generating higher incomes and more opportunities. In the 12 months to June the economy grew by a relatively strong 2.5 percent. Updated figures for the September quarter will be issued next week and forecasters expect the annual growth rate to improve further in the second half of 2013. The growth in the economy is now broad-based across almost all sectors of the economy and almost all regions which means that many New Zealanders are beginning to benefit from that economic growth. The OECD is forecasting growth of over 3.5 percent in New Zealand in 2014 which will make New Zealand one of the better-performing developed economies.David Bennett: How have the stronger economy and improving business and consumer confidence in 2013 translated into more jobs?Hon BILL ENGLISH: It does take some time for more confidence and for employment and investment intentions to translate into jobs. However in the September quarter alone 27000 more New Zealanders had new jobs and the increase in jobs over the year to September was 53700—that is 53700 more jobs this September than in the previous September. Employment levels increased by 2.4 percent in that year and labour market participation increased to 68.6 percent. [Interruption]Mr SPEAKER: Order!Hon BILL ENGLISH: Regional employment data was reasonably strong with eight regions having lower unemployment than Auckland. Again that shows the broad-based nature of the economic recovery.Phil Twyford: Why is his Government trying to claim credit for the exemption of new builds from loan-to-value ratios and at the same time claiming that decisions on loan-to-value ratios are made by an independent Reserve Bank without any interference from the Government or is his desperate attempt to have it both ways just a symptom of a housing policy that has completely collapsed leaving massive uncertainty in the market place?Hon BILL ENGLISH: The Government has not tried to claim credit for a decision that was not the Government’s; it was a decision of the Reserve Bank. I think the Opposition is probably trying to claim credit for it even though it was a decision of the Reserve Bank. As the member will know from seeing what is happening on the ground in Auckland the Government’s policy of focusing on increasing the supply of houses on the ground in Auckland and in Christchurch is beginning to gather some momentum.David Bennett: How is the Government’s economic programme helping improve the fairness of the tax system and supporting those families most in need? [Interruption]Mr SPEAKER: Order! Before the Minister starts can we have a little less noise from my left-hand side of the House.Hon BILL ENGLISH: A particular feature of the Government’s programme through the recession has been firstly that we have protected the most vulnerable at all stages and secondly that income inequality has dropped slightly over the last 4 or 5 years despite the predictions of many that a recession and tax changes would make it a lot worse. So the Government has been able to demonstrate that with sensible and moderate economic management we can achieve a growing economy more fairness and protection for the most vulnerable.Hon David Parker: Was the asset sales programme a centrepiece of his economic programme in 2013; if so given that it has raised billions of dollars less than was projected and has resulted in the sale of shares to only 2 percent of New Zealanders rather than the broad spectrum that he previously promised why would New Zealanders have confidence in the rest of his management of the economy?Hon BILL ENGLISH: In answer to his first question no it is not the centrepiece of the Government’s economic programme but it has—[Interruption] It actually amounts to something like 2 percent of the Government’s total assets. However it has been a centrepiece of the Opposition’s criticism of the Government. Opposition members do not know what they are going to say after the referendum and when the asset sales process is over. What will the Labour Party then stand for if it is not against asset sales?David Bennett: What reports did he receive in 2013 supporting the Government’s economic programme and how is that programme supporting growth in certain sectors of the economy?Hon BILL ENGLISH: The Government of course understands that the credibility of economic growth will be measured by people other than the politicians. For instancethe OECD back in June confirmed that New Zealand’s macroeconomic policies strike the right balance between supporting a recovery from recession and ensuring sustainable medium-term growth. It noted our work in improving productivity to support long-term growth and it supported the Government’s focus on getting back to surplus. For an international body that has an overview of the economic policies of all developed countries and many developing countries that is a pretty reasonable verdict. Just yesterday Statistics New Zealand confirmed that the manufacturing sector is in good heart with strong sales volumes—numbers that indicate that perhaps there is not a crisis in manufacturing.State-owned Assets Sales—Outcomes3.Hon DAVID PARKER (Deputy Leader—Labour) to theMinister of Finance: How has the Government’s asset sale programme increased the confidence of “mum and dad investors” in capital markets and improved the standard of living for New Zealanders?Hon BILL ENGLISH (Minister of Finance): Yes I do believe it has increased the confidence of mum and dad investors in capital markets because tens of thousands of New Zealanders took part in those share sales and more of them will have the opportunity early next year subject to market conditions. When the Government confirmed the share sales programme as a part of its larger programme to lift New Zealand’s living standards we said it would help reduce Government debt increase opportunities for investment for savers and improve the companies’ financial performances. All of those things have been achieved and so far the Government has $4 billion in the bank to spend on other public assets. We are waiting to hear from the Opposition about whether it is so opposed to asset sales that it will buy the assets back. So far it has not committed to that.Hon David Parker: Does he agree that the partial sale of State assets to 2 percent of the population has increased the gap between the rich and the poor in this country; if not why?Hon BILL ENGLISH: Well no particularly since the main complaint about it is that those who felt they were wealthy enough to buy the shares are now less wealthy several months later which shows that the taxpayer got good value for those assets and investors need to take a long-term view.Hon David Parker: How can he stand up and seriously claim that forgoing half the revenue and the ownership of State-owned enterprises to 2 percent of the population is to the benefit of the country as a whole when the sales make the Crown’s income account worse every single year till the end of the forecast period?Hon BILL ENGLISH: Because what I have said is correct. Secondly if the Opposition believes that the Government would be better off owning the assets then it would commit to buying them back particularly if a majority of those who vote in the referendum are against the sales. I would have thought it is up to Opposition to take that referendum seriously and commit to buying the assets back.Hon David Parker: Would he still be begging the Opposition to buy the energy companies back in a desperate attempt to pump up the slumping share prices if the asset share programme had been a success rather than the failure it has patently been?Hon BILL ENGLISH: No we will be advising—not begging—the Opposition to abandon its policy around the electricity assets where it is the only political party in the world we can find that is promising to undo a competitive electricity market and go back to central control. The last time it happened was 1917 in the Russian Revolution but it actually has not happened since. We are very pleased to have completed three-quarters of the asset sales programme. The people of Christchurch will get a newhospital financed by the proceeds of those sales and they will be wondering what Labour and the Greens are going to do about buying back the assets.Hon David Parker: Given that only 2 percent of New Zealanders invested in shares and that the price of the shares for each energy company is now below the float price how does that build confidence in capital markets?Hon BILL ENGLISH: That is up to investors. The member cannot claim that those sales have widened the gap between rich and poor because as he has pointed out himself they bought the shares and they are now worth less so the gap between the rich and the poor must have closed.Manufacturing Sector—Performance4.Dr JIAN YANG (National) to theMinister for Economic Development: What reports has he received on progress in the manufacturing sector?Hon STEVEN JOYCE (Minister for Economic Development): The crisis in manufacturing continues to be rather hard to find. Yesterday Statistics New Zealand released its economic survey of manufacturing for the September 2013 quarter. The volume of total manufacturing sales was up 0.5 percent in the quarter and sales volume for manufacturing excluding meat and dairy which is a favourite barometer some less than disinterested observers use was up by 2.8 percent. This is the largest quarterly increase since June 2002. Sales for 10 of the other 12 manufacturing industries also rose. So I strongly urge those who like to talk the sector down to pick another statistic so it too may rise.Dr Jian Yang: What reports has he received indicating that the manufacturing sector is expanding?Hon STEVEN JOYCE: I have also received the latest BNZ-Business New Zealand Performance of Manufacturing Index. In October that was 55.7—the highest result for the month of October since 2007. New Zealand’s manufacturing sector has now been expanding for 11 consecutive months. All the five seasonally adjusted indexes within the overall Performance of Manufacturing Index were in expansion for October. I would like to congratulate the manufacturing sector on its determination its resilience and its innovation despite a tough world economy a high New Zealand dollar and constant negative carping from the New Zealand political Opposition.Dr Jian Yang: What is the importance of the high-technology and medium to high - technology industries within the wider manufacturing sector?Hon STEVEN JOYCE: New Zealand has a remarkable number of innovative companies in the high and medium to high - technology sectors carving out market share in tough international markets. Over the last two decades the high-tech sector has grown rapidly. Exports rose to $1.4 billion in 2012 which makes its growth trajectory faster now than the New Zealand wine industry. New Zealand has 16 companies in the top 100 of the Deloitte Technology Fast 500 Asia-Pacific list up from seven last year. The Government’s Business Growth Agenda is working to encourage business investment in research and development with initiatives like establishing Callaghan Innovation lifting research and development co-funding to $142 million a year plus the introduction of repayable funding for start-up technology companies.Hon Shane Jones: How much of the increase in manufacturing is construction-related manufacturing arising out of the Christchurch earthquakes; and if he does not know why does he come down to this House boasting about things that show that he is actually not on top of his portfolio?Mr SPEAKER: The Hon Steven Joyce—either of the two questions.Hon STEVEN JOYCE: Dear old Shane. I should table this for you Shane. This is the list of tables for each part of the manufacturing sector which shows that 10 out of12—not just the construction sector—have gone up. There is one person in this House who should do the work and his name is Shane Jones.Hon Shane Jones: Is he likely to table that paper in front of the 200 employees of Unilever who are about to lose their jobs and the large number of workers in the timber processing sector who as a consequence of not being able to gain access to logs are also going to join the unemployment queue with their friends in Rotorua?Hon STEVEN JOYCE: The reality about the wood and timber processing section of the industry is that actually it too has grown in the last quarter. Again perhaps the member would like to read these tables. For Mr Jones’ benefit the New Zealand employment market is a dynamic market with a large number of jobs created and lost every year. It is difficult when individuals lose their jobs. What is more important is that we attract new investment into new industries. That is what this Government is doing. That is what the Labour Opposition opposes.Child Poverty—Government Initiatives to Address5.JACINDA ARDERN (Labour) to theMinister for Social Development: Does she stand by her statement that “I do not think that anyone denies that there are children living in this country at a standard that we do not find acceptable”; if so what specific targets if any will she set in light of the Child Poverty Monitor released on Monday?Hon PAULA BENNETT (Minister for Social Development): I do stand by my statement and as I have said in answer to question No. 1 we have a number of targets that we think are helping to reduce child poverty and put them at the centre of our work. But in light of the Child Poverty Monitor which was released yesterday there was no new information in that. In fact all of the information was taken from the 2013 Ministry of Social Development household incomes report. So there was nothing new in it that changes what we are doing today.Jacinda Ardern: Which of her public sector targets will decrease the number of children living on less than 60 percent of the median income?Hon PAULA BENNETT: Well reducing welfare dependency would be one that would make a difference for those children. I think that the economic growth work is some of the most important work that will happen as long as we are getting businesses that are able to employ more people pay better wages and have better productivity. That is actually what counts the most. We want to see those children living in households with better incomes. The best thing that we can do is support the economy and support jobs so that that can happen.Jacinda Ardern: What will her Government do to address low wage rates in New Zealand given that 40 percent of the children living in poverty are being cared for by adults in paid work but who are still not earning enough to survive?Hon PAULA BENNETT: That is why we are maintaining Working for Families. We have also got the accommodation supplement of $1.2 billion 40 percent of which goes to low-income working families and we wish to continue that level of support for them. They can also access hardship assistance when they need to. We are also looking at what we are doing for budgeting services. But without a doubt I repeat that it is actually our economic agenda that supports businesses so that they have better productivity and can pay better wages which will make the biggest difference for those families.Jacinda Ardern: I raise a point of order Mr Speaker. I was very specific. I asked what her Government was doing to address low-wage rates not tax credits or redistribution.Mr SPEAKER: The member asked what the Government is doing to address low wage rates and the Minister responded with Working for Families the accommodation supplement and the economic agenda.Jacinda Ardern: Point of order Mr Speaker.Mr SPEAKER: I have ruled that that question has been addressed. I am happy to accept—Grant Robertson: I raise a point of order Mr Speaker. I find it very hard to work out how that addresses a question—Mr SPEAKER: Order! The member will resume his seat. [Interruption] The member will resume his seat. I have already given an explanation. I think the question was asked quite legitimately and it was addressed by the Minister satisfactorily.Grant Robertson: I raise a point of order Mr Speaker.Mr SPEAKER: Can I just clarify that if the member is disputing a ruling I have just made I will take that very seriously.Grant Robertson: I am trying to understand what the rules are in the House around the relevancy of answers and whether when someone asks a question about wages it is OK to talk about something in another policy area such as tax credits.Hon Members: Point of order.Mr SPEAKER: No I do not need assistance from either Minister. What I have determined—clearly not to the satisfaction of the member—is that the member asked what the Government is doing to address low wages and the Minister took the opportunity to talk about other programmes that she considers have an effect on a household under low wages. That is a satisfactory addressing of the question. If the member wants to ask a further supplementary question that is the way to get into the detail of it. It is not to argue that the Minister has not addressed the question particularly when I have ruled that the Minister has done so.Jacinda Ardern: What does she consider to be an unacceptable standard of living in terms of income?Hon PAULA BENNETT: I do not have an income level that I am here with but what I would say is that we have one of the most generous welfare systems in the world. I suppose you could look at it in Inland Revenue Department terms where it has a level of income but obviously what we think it is with the benefits system and that level of income is what we would see as a minimum.Jacinda Ardern: When will she finally accept that her public sector targets are doing nothing to address the core issue of child poverty that insulation does not mean that you have enough money to turn on the heater that immunisation will not stop you contracting an infectious skin disease and that giving money toKidsCan does not lift low wages; if so is it time to accept that everything her Government is doing is papering over child poverty rather than addressing it?Hon PAULA BENNETT: No I do not. In fact what we have seen in the last 3 to 4 years is that it has actually flat-lined and I think that it is remarkable when you think about the extreme conditions that this country has been in that we have actually managed to maintain that level of support for those children and their families. What we are seeing now is that real attention and you can see that it is turning round economically. I repeat as I did my question: do you want to know how wages are raised? It is that businesses can afford to pay employees more and the best way you do that is to support businesses and to actually put the right things—Jacinda Ardern: It’s not working.Hon PAULA BENNETT: Well actually it is working. There is absolutely no doubt about it that we will see those children being better off and in the meantime we will be targeting assistance to those who need it most.Sue Moroney: Why has her Government contributed to—in her own words—“children living in this country at a standard that we do not find acceptable.” by cutting in half the meagre incomes of over 2700 parents since 15 July alone because they did not meet work obligations such as travelling 40 kilometres to attend a monthly Work and Income seminar?Hon PAULA BENNETT: Yes we have obligations for people who are on benefits because the best thing that we can do is to support them to get off. If they cannot once a month actually make an appointment at Work and Income then they have very much no hope of actually getting a job. So yes we have clear expectations. We give them plenty of time to know when their appointments are coming up and we expect them to be fulfilling them. If they were putting their children first they would be there.Māori Affairs Associate Minister—Impact of Legislative Reforms6.Rt Hon WINSTON PETERS (Leader—NZ First) to theAssociate Minister of Māori Affairs: Does he stand by all of his statements?Hon CHRISTOPHER FINLAYSON (Associate Minister of Māori Affairs): No I do not. I once said that reforming Te Ture Whenua Maori Act which the Labour Government neglected to do could benefit the economy by up to $3 billion. In actual fact a recent PricewaterhouseCoopers study commissioned by the Ministry for Primary Industries has estimated that the economic benefit to the nation of this reform could be up to $8 billion over 10 years and could create over 3400 new jobs.Rt Hon Winston Peters: Does he stand by his statements that—and I quote him—“Access to the foreshore and seabed for recreation employment or simply for its own sake is a birthright. For all New Zealanders that should be protected in legislation.” and further that “equality is a fundamental bedrock principle of our constitution.”?Hon CHRISTOPHER FINLAYSON: I made those statements in my capacity as Attorney-General when working to reform the disgusting foreshore and seabed legislation. They are not part of my delegation as Associate Minister of Māori Affairs.Rt Hon Winston Peters: How can he still hold these views expressed in manifold positions as a politician and Minister when a minority is through the Marine and Coastal Area (Takutai Moana) Act given by birth sole development rights to all—[Interruption] Well this might be a joke “Big Ears” but it is not to New Zealanders. It is not to New Zealanders.Mr SPEAKER: Order! Can the member please—I know that he was responding to an interjection on this occasion. Could he just now start the question again so that we can get an answer.Rt Hon Winston Peters: Thank you Mr Speaker. How can he still hold that view expressed in numerous positions as a politician and as a Minister when a minority is through the Marine and Coastal Area (Takutai Moana) Act given by birth sole development rights to all New Zealand’s minerals apart from gold silver uranium and petroleum?Hon CHRISTOPHER FINLAYSON: Well the member has got the wrong end of the stick which is perhaps not surprising. I suggest he go to the letter from Dr Sharples to me dated 31 January 2012 where he set out my delegations as Associate Minister. Were he to do the right thing and put the question down to the Minister for Treaty of Waitangi Negotiations I would be very happy to answer that question.Rt Hon Winston Peters: Not a bad sidestep. Is it not true that iwi have been granted mana tuku iho or universal recognition—Hon Paula Bennett: Not your best work.Mr SPEAKER: Order! [Interruption] Order! An interjection like that is not going to help us with the order of the House. Would the member start his—[Interruption] Order! Would the member start his question again.Rt Hon Winston Peters: Is it not true that iwi have been granted mana tuku iho—[Interruption]—no it does not mean wide Paula; it means universal recognition—over the whole foreshore and seabed giving them priority over even the Department of Conservation and where does that leave the rest of New Zealand?Hon CHRISTOPHER FINLAYSON: Well as I said in the answer to the previous question he has got the wrong end of the stick. He should read the letter of delegation from Dr Sharples to me dated 31 January 2012 and he would see what my delegations are as Associate Minister. I am more than happy to answer any questions—Rt Hon Winston Peters: I raise a point of order Mr Speaker. I thought that he would repeat that same objection to my question—[Interruption]Mr SPEAKER: Order! This is a point of order.Rt Hon Winston Peters: —excepting he actually caught himself by the letter of delegation from Dr Pita Sharples. He is the Associate Minister of Māori Affairs and he should know exactly what Pita Sharples was asking for and under him got.Mr SPEAKER: Order! I have before me the list of delegations for the Hon Chris Finlayson as the Associate Minister of Māori Affairs and his answer is satisfactory. Question No. 7 Paul—Rt Hon Winston Peters: Supplementary question—no so fast.Mr SPEAKER: I am just ensuring that we are out of here by Christmas Day.Rt Hon Winston Peters: Well you will stay for as long as we take to get the truth—that is the fact of it.Mr SPEAKER: Order! The member can ask his supplementary question.Rt Hon Winston Peters: Is it not a fact—[Interruption] Relax boys. You are going to look far more nervous next year I tell you.Mr SPEAKER: Order! I will give the member one more chance to ask a supplementary question otherwise we are moving on.Rt Hon Winston Peters: Is it not a fact that legislation promoted by him and the Minister of Māori Affairs has empowered iwi to now veto applications by ordinary New Zealanders for resource consent under the Resource Management Act for areas over which he has granted customary title?Hon CHRISTOPHER FINLAYSON: This is rather tiresome. I refer the member to the letter of 31 January 2012 to me from Dr Pita Sharples where he set out my role and responsibilities as his Associate Minister. I would be more than happy to answer the question but he has got to do the right thing and ask the right Minister the question and not hide behind some vague fatuous question about statements and responsibility.Rt Hon Winston Peters: I raise a point of order Mr Speaker. That is a rather diverse and angry response. I never took the Judicature Modernisation Bill away from him and gave it to “Crusher” Collins; John Key did that and that is why he is so furious and angry. But back to this my supplementary question—Mr SPEAKER: Order! The member has just raised a point of order so if that point of order is now finished then I am going to say that it is not a point of order. Is the member now wanting a further supplementary question?Rt Hon Winston Peters: Most certainly.Mr SPEAKER: Oh great.Rt Hon Winston Peters: Why is this Minister putting so much time and effort into legislation and programmes of apartheid and separatism that put this nation’s very future at risk?Hon CHRISTOPHER FINLAYSON: I will try to not be provocative but can I suggest to the right honourable member that it would be very helpful if before he drafts a very lazy question he reads the statement of delegation.Rt Hon Winston Peters: I raise a point of order Mr Speaker. Either he can answer the question that I put to him or he can deny it but he cannot just deviate and do what he likes as is his wont to do.Hon CHRISTOPHER FINLAYSON: It is just not me in that capacity.Mr SPEAKER: The Minister has answered the question. What he said was that the way the question was phrased to him it does not come within his delegated authority. That is an answer given.Hon Trevor Mallard: That is not what he said at all.Mr SPEAKER: Well it is very difficult to understand quite what is right. I think that the easiest way forward—because it is close to Christmas—is that I am going to invite the member to ask his question again.Rt Hon Winston Peters: Thank you very much. Why is he putting so much time and effort into legislation and programmes that lead to apartheid and separatism and put this nation’s very future at risk?Hon CHRISTOPHER FINLAYSON: I have particular delegations given to me by Dr Sharples in a letter dated 31 January 2012. They include a specific responsibility in relation to Te Ture Whenua Maori Act. If he had asked me that question as Attorney-General I would have said that he was the one supporting apartheid by stopping Māori from going to court—something that was profoundly offensive.Medicines Subsidised—Revised Agreement and New Listings7.PAUL FOSTER-BELL (National) to theAssociate Minister of Health: What recent announcements has he received regarding newly listed medicines?Hon TODDMcCLAY (Associate Minister of Health): Merry Christmas to you. In line with Government policies for better sooner more convenient health care Pharmac has renegotiated an agreement to reduce costs for a number of medicines imported to New Zealand. This will mean a saving of more than $20 million over 5 years as well as the listing of new medicines for rare blood disorders and influenza and improved access to asthma inhalers. The savings made will free up resources that Pharmac and district health boards can use to purchase more health care services—a win-win for patients.Paul Foster-Bell: What benefits will be generated through this agreement?Hon TODDMcCLAY: More New Zealanders will benefit from the better health care outcomes that access to these newly listed medicines bring. Increased access to asthma treatment will benefit thousands including around 1200 children who will now need only one inhaler instead of two as previously to receive their treatment. We know that asthma is a significant cause of poor health particularly for children in New Zealand. The New Zealand Health Survey data showed that 14 percent of children aged 2 to 14 take medications for asthma. This announcement builds on recent decisions that will improve children’s respiratory health including whooping cough vaccines and influenza vaccines for under-fives with respiratory illnesses.Trans-Pacific Partnership—Outcomes and Release of Information8.JULIE ANNE GENTER (Green) to theMinister of Trade: Will he release the final text of the Trans-Pacific Partnership Agreement before it is approved by the Cabinet; if not why not?Hon STEVEN JOYCE (Acting Minister of Trade): It is important to note firstly that the Trans-Pacific Partnership is still under negotiation at this time. Should the negotiations be successful the Government would release the text after New Zealand’sinitial signature of the proposed agreement which requires approval by Cabinet. The Government will not be releasing the text before that point because the negotiations will not be formally concluded until the member countries have in fact signed the text. Once that negotiation phase is complete the Trans-Pacific Partnership as with all trade agreements will then go through the full parliamentary treaty examination process where of course the text will be available.Julie Anne Genter: Given that the Government will not be releasing the text before signing us up to the deal will he release the national interest analysis which spells out the advantages and disadvantages for New Zealand of this agreement before Cabinet approves it; if not why not?Hon STEVEN JOYCE: I think the member misunderstands the process that these things go through. She suggested that Cabinet will ratify the agreement; Cabinet will not. In fact Parliament ratifies the agreement. Of course the national interest analysis is laid in front of Parliament and Parliament debates a treaty such as this before it is ratified.Julie Anne Genter: Was Gerry Brownlee correct when he said that the Trans-Pacific Partnership agreement would give New Zealand a “$5 billion year-on-year boost to our export economy”—[Interruption]Mr SPEAKER: Order! I am sorry; I am going to ask the member to repeat that question. I am having trouble hearing it.Julie Anne Genter: Was Gerry Brownlee correct when he said that the Trans-Pacific Partnership agreement would give the New Zealand economy a “$5 billion year-on-year boost” given that the Australian Productivity Commission’s report found that trade agreements were usually oversold and failed to deliver the claimed benefits?Rt Hon Winston Peters: I raise a point of order Mr Speaker. You asked for the question to be put again. The member put it again and this time about five Ministers talked all the way through it. We could not hear what on earth she was trying to ask the second time round either.Mr SPEAKER: Order! Every member has a right to hear the supplementary question. If the member is telling me he did not hear it the second time I ask the members to please be quiet while we hear it for a third time without interjection.Julie Anne Genter: Was Gerry Brownlee correct when he said that the Trans-Pacific Partnership agreement would give New Zealand a “$5 billion year-on-year boost to our export economy” given the Australian Productivity Commission’s report finding that trade agreements were often oversold and failed to deliver their claimed benefits?Hon STEVEN JOYCE: Well I find Gerry Brownlee to be a very wise man and I would disagree with the Australian Productivity Commission on this basis: it is quite clear that the New Zealand - China free-trade agreement for example has been of huge benefit to this country; greater than was actually expected at the time. There has been a lot of talk in this House this afternoon about lifting people’s incomes and free-trade agreements are definitely one way in which that can be done and done very successfully.Julie Anne Genter: I raise a point of order Mr Speaker. The question did quite specifically ask—Mr SPEAKER: Order! The question was addressed—the question was addressed. If the member wants further supplementary questions she has them.Julie Anne Genter: Why is the Government continuing to rely on the figures sourced from the East-WestCenter a US Congress - funded thinktank to justify to New Zealanders the alleged benefits of the Trans-Pacific Partnership agreement?Hon STEVEN JOYCE: That horrible US Congress a subversive organisation—why would we ever rely on anything it ever said! The important point is that actuallythe negotiations have not been concluded so anybody’s estimate at this point is an estimate. Should those negotiations be completed—and for the sake of lifting wages and growth in this country we should all hope that they are—then there will be a national interest analysis that will be laid upon the Table in this Parliament and the Parliament will get to assess the value as calculated by the New Zealand Government bureaucracy. That is the way in which it should be done. In the meantime we are all talking about estimates because the agreement has yet to be finally negotiated.Julie Anne Genter: How can New Zealanders have confidence that the Trans-Pacific Partnership agreement will be a good deal for us when he will not release the national interest analysis until after we are already signed up to the deal? He is relying on figures from a thinktank funded by the United States Government and the major beneficiary of trade deals with the United States has always been multinational corporations based in the United States.Hon STEVEN JOYCE: I think we have all learnt something in that last supplementary question. The reality is this—I will say it again a little bit more slowly for the member—the agreement has not been negotiated yet. The agreement is being negotiated at the moment.Dr Russel Norman: What’s in it?Hon STEVEN JOYCE: Mr Norman nobody knows until the negotiations are completed. We have estimates from different groups which the member has. At the point where the negotiation is completed just like in every other Government that has been in this Parliament it will be laid upon the Table and actually it will be debated by this Parliament. There are not many days to go until we know whether this thing will be proceeding or not. At that point Parliament will get the opportunity to go ahead.Julie Anne Genter: I seek leave to table for the benefit of the Minister the Australian Productivity Commission analysis showing there is little—Mr SPEAKER: Order! Can I just clarify the source of the document? Is it available on the net to all?Julie Anne Genter: The Australian Productivity Commission report.Mr SPEAKER: I did not ask what the report was; I asked where the member sourced it. Is it available on the net to all?Julie Anne Genter: I do not think that the Minister—Mr SPEAKER: Order! Is it available on the net for members?Julie Anne Genter: Yes it is available.Mr SPEAKER: Yes it is.Hon Phil Goff: In the absence of greater openness and transparency around the negotiations—[Interruption]—when you have finished Nick Smith—what guarantee can the Minister provide—Hon STEVEN JOYCE: I raise a point of order Mr Speaker. Well my understanding is that the supposition at the start of that member’s question is probably creating disorder in the House—Mr SPEAKER: Order! And the best way forward—the member is right in raising the point that he does. I will invite the Hon Phil Goff to ask his question again and then the Minister will have the opportunity to respond to that question in the way he sees fit.Hon David Parker: I raise a point of order Mr Speaker. Were you ruling that that was a fair point of order? I do not see how you could.Mr SPEAKER: Order! I was saying to the member that the best way forward is for the Hon Phil Goff to be able to complete his question. I have no doubt that the Minister will have the ability to then address the question.Hon Phil Goff: In the absence of greater openness and transparency around the negotiation itself what guarantee can this Minister provide the House that the Trans-Pacific Partnership will not prevent New Zealand being able to legislate for the public good in areas like health and the environment and will not prevent Pharmac from negotiating to buy lower-priced and generic drugs?Hon STEVEN JOYCE: I completely reject the assertion at the start of that member’s sentence. The reality is that this Government has adopted an identical process—an identical process—to the one that was operated by the Labour Government. The member raises on regular occasions in public the New Zealand Council of Trade Unions as the one difference. The reality is that it walked out on being advised. It walked out and it has been invited by the Minister of Trade to come back any time it likes. The process has been identical to Mr Goff’s process. He is the pot calling the kettle black.Hon Phil Goff: I raise a point of order Mr Speaker. The question asked the Minister what guarantee he could provide about two areas. He did not even attempt—Mr SPEAKER: Order! If the member had asked just that question I might be able to help him. But he talked at the start of his question about the absence of openness and transparency. The Minister then responded to that part of the question.Hon Phil Goff: I raise a point of order Mr Speaker. That was not part of the question. That was setting out the—Mr SPEAKER: Order! [Interruption] Order! I invite the member to reread hisHansard. I heard it as part of the question.Child Poverty—Measurement and Government Initiatives to Address9.TE URUROA FLAVELL (Co-Leader—Māori Party) to theDeputy Prime Minister: Does he agree with the Children’s Commissioner that “Setting targets like we do with the road toll and with NCEA if we had that kind of commitment that legislation and plan then we’d see a year-on-year fall”; if so is he prepared to instruct the Ministerial Committee on Poverty to introduce the four child poverty measures released in the Child Poverty Monitor?Hon BILL ENGLISH (Deputy Prime Minister): First of all there are not any legislated targets for the road toll and the National Certificate of Educational Achievement (NCEA). Along with the NCEA pass rates the Government has set a number of targets directly relevant to the welfare of children. There is no need to instruct the Ministerial Committee on Poverty to introduce the four measures because the four measures that were published yesterday are public measures taken each year by the Ministry of Social Development and published so that anyone can monitor the progress of incomes. The final point I would make is that what is wrong with the commissioner’s proposal—or the limits of it—is that those measures of child poverty are static income measures. There is a lot more to relieving poverty than measuring static income such as for instance breaking the cycle of dependency on our welfare system through the parents of young children raising educational levels in the public education system for those who need it most—of which New Zealand has traditionally done a pretty poor job—enhancing mobility into the workforce through a growing economy and much more active support for many of those who find themselves caught outside the labour market. These are dimensions to poverty and its resolution that the Children’s Commissioner I am sure understands but certainly did not articulate in his report yesterday.Te Ururoa Flavell: What does he believe that the Prime Minister meant when he said about child poverty “So we had much higher levels then it went down then it went back up a bit” and how does the Minister the Prime Minister or anyone else know what the reality is if the Government refuses to adopt and monitor official measures of child poverty?Hon BILL ENGLISH: Well there is a misconception that there are no official measures for child poverty. If I can help correct that misconception the Child Poverty Monitor report published yesterday was a repackaging of existing official measures of child poverty. The Children’s Commissioner happened to pick the measure that shows the biggest number of those in child poverty when there are three other measures that show lesser numbers. But those are official measures. They are taken each year they are published and we are fully accountable for any implications people may draw from them. So the Prime Minister’s comments were based on those official measures reported by the Ministry of Social Development every year and actually he is correct. Child poverty rates did drop through the 2000s they rose a bit through the recession and now they are flat to dropping again which actually is a remarkable performance for New Zealand in the context of the global financial crisis and the economic mismanagement prior to that by the previous Government that caused recessions in New Zealand.Te Ururoa Flavell: Is the Minister concerned that the rate of poverty severity where households are both income poor and experiencing material hardship is twice as high for Māori and Pasifika children aged 0 years to 10 years than for the New Zealand population; if so will he be arguing for a substantial investment in having a living income and in expandingWhānau Ora?Hon BILL ENGLISH: Yes we do share that concern and are particularly concerned with what the member refers to as poverty severity and what is referred to in other situations as persistent deprivation—that is those families that are caught in a cycle of low income the effects of which are made much worse by social dysfunction and a very complex set of problems. So we are focused pretty strongly on that particular aspect of child poverty. With respect to The Living Wage Aotearoa New Zealand Campaign which is a proposition put forward that is voluntary for businesses and other organisations to lift incomes of course we want to see higher incomes and we support economic policy that will deliver higher incomes. I want to thank the member and his party for the work he has done onWhānau Ora on originating it and I look forward to further work with the Māori Party on expandingWhānau Ora because it has for the first time in quite a while the potential to assist the Government to deliver its support in an appropriate way to exactly the families that he refers to.Health Services—Affordability and Funding10.Hon ANNETTE KING (Labour—Rongotai) to theMinister of Health: What recent reports has he received on the affordability of health care for New Zealanders?Hon TONY RYALL (Minister of Health): I have received dozens of recent reports on health care nearly all of which have had an affordability element. One specific report I have received on affordability is that despite tight times this Government has increased funding by an average of $500 million a year over its 5 years in Vote Health. District health boards of course are often moving around resources to meet the changing needs of New Zealanders.Hon Annette King: Does he agree with the conclusions in the Child Poverty Monitor that of concern is the number of children whose visit to a general practitioner was postponed because of cost and is this why there have been 40000 hospital admissions each year under his watch of children aged between 0 years and 14 years with diseases of poverty includingbronchiolitis acute upper-respiratory infections pneumonia and skin infections?Hon TONY RYALL: On the issue of access to general practice this Government has invested I think about $30 million in bringing free after-hours visits to general practice up and down the country. Currently about 96 percent of New Zealanders under 6 can now go to the doctor for free during the day and after hours and this is making aconsiderable impact on the ambulatory sensitive hospitalisations of children in that age group.Hon Annette King: In light of that answer is he aware that the Child Poverty Monitor now backs up the findings of the recent New Zealand Health Survey which show that over 180000 children have an unmet need to primary health care of whom 43800 could not visit their general practitioner because of cost; if so will he increase the funding provided for primary health care for the poorest sickest children from the miserable $5.60 per child per year he announced in this year’s Budget?Hon TONY RYALL: The Government has increased the subsidies to general practitioners every year. The Government has also provided some extra funding for very low-cost access and will also be making a further announcement on additional resources provided to those practices. What I can say is that despite being Minister of Health for 6 years that member never delivered—Mr SPEAKER: Order!Grant Robertson: I raise a point of order Mr Speaker. The Minister was straying into material he is not responsible for.Mr SPEAKER: Order! I think the member makes a reasonable point. The answer is now concluded.Dr Paul Hutchison: What recent reports has he seen that call for more elective surgery to be a priority?Hon TONY RYALL: I have seen a couple of very very interesting reports. One is from the Opposition spokesperson on health calling for more money for older people for elective surgery to be the priority for Government spending and then 2 days later that same Labour spokesperson was beating another drum saying that actually the priority should be on children’s health spending.Hon Annette King: Does he agree with the statement by the Prime Minister about the cost of going to a doctor: “Oh well look in the end it’s called a market and if they decide to charge a lot more then probably someone will go down the road.” and does that attitude account for the fact that tens of thousands of children miss out on vital primary health care because they cannot “go down the road”?Hon TONY RYALL: The information I have is that we have increased our funding for primary health care by well over $160 million over a 5-year period which has gone into additional services and increased subsidies for general practice and other involvements in primary care and of course I always agree with the Prime Minister. This is a Prime Minister who has been strongly supportive of the average $500 million a year extra that has gone into Vote Health under his stewardship.Hon Annette King: Does he agree with the Child Poverty Monitor findings that there are marked ethnic inequalities for all the health indicators reviewed; if so why has he allowed many district health boards to actually reduce the funding provided to Māori primary health care NGO providers over the past 2 and 3 years at a time when poverty and sickness are so high?Hon TONY RYALL: The fact is that there are many indicators that will show that the Government is making progress in respect of reducing disparities. I look at one in particular and that is immunisation where as I have previously told the House in most of our district health boards—in fact over half of them—the Māori immunisation rate is now higher than thePākehā immunisation rate.Hon Annette King: I raise a point of order Mr Speaker. My question was whether—Mr SPEAKER: Order! I invite the member to repeat her question.Hon Annette King: Does he agree with the Child Poverty Monitor findings that there are marked ethnic inequalities for all the health indicators reviewed; if so why hashe allowed many district health boards to actually reduce the funding provided to Māori primary health care NGO providers over the past 2 and 3 years at a time when poverty and sickness are so high?Hon TONY RYALL: No because as I have pointed out the immunisation target which is not one that opponents of the Government like to talk about shows that despite 9 years of rhetoric and huge Budget increases Labour was never able to close the gap in 2-year-old immunisation rates and this Government has.Television Switch-over to Digital—TV TakeBack Programme11.CLAUDETTE HAUITI (National) to theMinister for the Environment: What recent reports has she received on the progress of the TVTakeback scheme?Hon AMY ADAMS (Minister for the Environment): I recently received an update showing more than 170000 TVs have been received for recycling. Following the successful TV TakeBack initiatives in the South Island and Hawke’s Bay over the past year the programme is now under way in the upper and lower North Island including Auckland. Through a Government subsidy people in these areas can now recycle their unwanted televisions for no more than $5 and I encourage them to do so.Claudette Hauiti: What impact has the scheme had on waste going to landfills?Hon AMY ADAMS: The programme which sees the Government partnering with a range of councils recyclers and retailers to provide a nationwide network of subsidised options has now diverted around 2700 tonnes of waste from going into our landfills. Televisions dropped off for recycling are disassembled with components recycled locally or sent to specialist facilities overseas. Televisions contain materials that can be harmful if released into soil or waterways such as lead mercury and phosphorous. Safe recycling takes away the risk of contamination and reduces waste to landfill and so far around 170 tonnes of lead have safely been recycled through this programme.Housing Affordable—Impact of Government Measures12.PHIL TWYFORD (Labour—TeAtatū) to theMinister of Housing: Does he believe he is doing a good job of tackling housing demand for those most in need?Hon Dr NICK SMITH (Minister of Housing): Yes because we are doing so much. We have passed two big housing bills this year. We have completed the insulation of 47000 State houses. We are adding 3000 bedrooms to existing State houses. We are now giving priority to families with rheumatic fever. We are funding 1100 new community social houses which is a record number. We are moving at pace to repair the 5000 State houses damaged in Christchurch. We have helped 3300 families through the Canterbury Earthquake Temporary Accommodation Service. We have built four temporary accommodation villages in Christchurch and we are building 700 new homes in Christchurch and 500 infill houses in Auckland.Phil Twyford: How can he claim his policies are working when the Child Poverty Monitor report shows that 18 percent of children are below the poverty line before housing costs are taken into account but a staggering 25 percent are below the poverty line after housing costs are taken into account or is it just their fault for being poor?Hon Dr NICK SMITH: I would firstly point the member to the Massey UniversityHome Affordability Report which shows that housing affordability in 2008 was significantly worse than it is now. I would also point to the measures this Government has taken whereby every single State house will be insulated by the end of the year. That is something to celebrate. I point out that this Government is giving priority—for the first time ever giving direct priority—to families at risk of rheumatic fever to have access to State houses as part of the Minister of Health’s programme to reduce by two-thirds the incidence of rheumatic fever. They are the things that will make a real difference to child poverty.Phil Twyford: How does he explain that the number of children below the poverty line before housing costs has fallen by 15000 since 2007 yet the number below the poverty line after housing costs has increased by 25000 during the 5 years of his Government’s housing policies?Hon Dr NICK SMITH: The first point I would make in respect of the poverty line is that it is set as a proportion of income. So if the income of the nation doubles somehow those people say that the basic income or definition of poverty shifts. That is not logical and shows it does not work. This Government is instead focused on the real things that will make a difference for families: getting children immunised insulating houses and providing national standards in education. They are the things that will make a real difference to children in New Zealand.Phil Twyford: Does he think that his housing policies have been a success when Government agencies are referring people to live in camping grounds and just this week a Christchurch woman with three children was forced to move into a tent in a public park; and how much more evidence does he need before he accepts there is a housing crisis and that his endless photo opportunities—Hon Gerry Brownlee: Tell the whole story. You’re a liar.Mr SPEAKER: Order!Phil Twyford: —will not solve the problem?Hon Clayton Cosgrove: I raise a point of order Mr Speaker.Mr SPEAKER: Order! I can anticipate but I will hear from the Hon Clayton Cosgrove.Hon Clayton Cosgrove: I believe you may have heard the comment that Mr Brownlee made. That was totally out of order.Mr SPEAKER: It is. I ask the Hon Gerry Brownlee to stand withdraw and apologise.Hon Gerry Brownlee: I withdraw and apologise. The gentleman was—Mr SPEAKER: Order! [Interruption] Order! The member will now stand withdraw and apologise and add no more before sitting down.Hon Gerry Brownlee: I withdraw and apologise.Grant Robertson: I raise a point of order Mr Speaker. [Interruption]Mr SPEAKER: I will hear first from Grant Robertson.Grant Robertson: On numerous occasions in the House you have threatened people on this side of the House with being removed for what Mr Brownlee did on the first occasion. He then when I stood up to take my point of order repeated the infringement. You must ask him to leave the House if you are consistent in your rulings.Mr SPEAKER: Can I just clarify: is that the point of order that the member rose to take? Then on this occasion I am going to ask the Hon Gerry Brownlee to withdraw from the House. [Interruption] Order! The member will just withdraw from the House.Hon Gerry Brownlee withdrew from the Chamber.Hon Dr Nick Smith: I raise a point of order Mr Speaker. When we were interrupted I had not answered the member’s question and I now ask for the opportunity—Mr SPEAKER: Well so much time has now gone by I ask the member to re-ask that question.Phil Twyford: Does he think that his housing policies have been a success when Government agencies are referring people to live in camping grounds and just this week a Christchurch woman with three children was forced to move into a tent in apublic park; and how much more evidence does he need before he accepts there is a housing crisis and that his endless photo opportunities will not solve the problem?Hon Dr NICK SMITH: It is not acceptable for a family to be permanently living in a tent although I could give numerous examples of when under the previous Government just that occurred. That was without 160000 homes being damaged in an earthquake and 14000 that are permanently lost. In respect of the family that the member refers to I visited her this morning. I am informed that she has been offered three homes: two from the private sector and one from the council. I am further advised that she has accepted the home that was closest to where her children are at school which should be welcome.Phil Twyford: How many days before the release of the Child Poverty Monitor report did Housing New Zealand remove the total number of people on the waiting list off its website and did he have a hand in this belated and crude attempt to hide the truth about his failed housing policies?Hon Dr NICK SMITH: The numbers on the waiting lists are a matter of public record. I do note for that member that for all his talk about a crisis in housing the actual numbers on waiting lists are very similar to what they were in 2008 at a bit over 4000. I would also note that if you look at this Government’s programme of work in respect of the massive investment of $2.9 billion on State housing and look in terms of this programme of work with the Auckland Housing Accord the record new number of houses being built and the record 1100 houses that are being built with community social housing providers it just shows how much is being done.Louise Upston: Can he advise the House of what other reports he has received on improvements in housing?Hon Dr NICK SMITH: The comprehensive measure of housing affordability comes from Massey University. I really would draw the attention of members opposite to that neutral measure of housing affordability which has shown that over the last 4 years there have been significant improvements.Hon David Parker: Is that for ownership or renting?Hon Dr NICK SMITH: The single factor that I would bring to the attention of the member who is interjecting is that when Labour left Government interest rates were over 10 percent. They are currently at 5 percent and that makes a huge difference to the affordability of housing.Urgent Debates DeclinedChild Poverty Monitor Report—Government ResponseMr SPEAKER: I have received a letter from Jacinda Ardern seeking to debate under Standing Order 386 the release of the New Zealand Child Poverty Monitor report and the Government’s response to it. The release of the report is a particular case of recent occurrence and there is ministerial responsibility for any Government response as the report deals with matters involving ministerial responsibility. The results show that the rate of child poverty has increased over the last 30 years. For there to be an urgent debate there needs to be a new development in an existing situation of significant importance in itself to warrant a debate being held. The test is a high one. The Government is taking a strategic approach to complex social issues and its initiatives will unfold over a period of years. I am not convinced that the release of this first Child Poverty Monitor in itself warrants the setting aside of the House’s business today. The application is therefore declined.Appropriation (2012/13 Financial Review) BillSecond ReadingHon BILL ENGLISH (Minister of Finance): I moveThat the Appropriation (2012/13 Financial Review) Bill be now read a second time.A party vote was called for on the questionThat the Appropriation (2012/13 Financial Review) Bill be now read a second time.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.Bill read a second time.Subordinate Legislation (Confirmation and Validation) Bill (No 2)Second ReadingHon ANNE TOLLEY (Deputy Leader of the House) on behalf of theLeader of the House: I moveThat the Subordinate Legislation (Confirmation and Validation) Bill (No 2) be now read a second time. The bill confirms and validates 24 orders or regulations made under nine different Acts. The bill must be enacted by 31 December 2013 to avoid subordinate legislation lapsing. The bill was introduced on 29 July 2013 and was referred to the Regulations Review Committee on 6 August. The committee asked the six relevant Government agencies responsible for administering the legislation to explain why confirmation or validation of the orders is warranted. The committee was satisfied with the responses it received and presented its report on 27 September recommending that the bill be passed without amendment.The committee regularly notes that the current process for considering Subordinate Legislation (Confirmation and Validation) Bills allows for only limited scrutiny and has recommended that these bills be introduced earlier in the year than has been usual in recent years. The Government was very conscious of this and introduced this bill in July with its first reading in August. The Government will continue to work to improve the process for considering this type of bill when we progress the next Subordinate Legislation (Confirmation and Validation) Bill in 2014. I thank the select committee for its thoughtful and prompt consideration of this bill. In particular I put on record my thanks to the former member the Hon Lianne Dalziel for her work over the years on this committee.There are 24 orders or regulations listed in the bill that are to be confirmed or validated. They have been made under nine different Acts. I shall provide a brief summary of each instrument confirmed or validated by the bill for the benefit of the House. Four orders made under the Biosecurity Act 1993 are confirmed. These relate to a levy on kiwifruit grown in New Zealand for export; amendments to two orders to refer to the new management agencyTBfree New Zealand; and changes to industry cost recovery for costs associated with the joint border management system. Second an order under the Civil Aviation Act 1990 updating passenger levies and participation levies payable by aviation operators to the Civil Aviation Authority is confirmed.Ten commodity levies are confirmed. These impose levies relating to peonies; apples and pears; Foveaux Strait dredge oysters;pāua; rock lobster; onions; potatoes; vegetables and fruit; avocadoes; and mussels oysters and salmon. Each levy is payableto an industry organisation to finance activities of benefit to the industry. Three orders made under the Customs and Excise Act 1996 are confirmed. Prohibitions regarding the importation of trout and trout products are continued. Rates of excise and excise equivalent duties imposed on tobacco products and alcoholic beverages are adjusted annually to reflect the movement in the Consumers Price Index. This bill confirms the duties that were imposed on 1 January 2013 and 1 July 2013 respectively. Regulations under the Gambling Act 2003 specifying the problem gambling levy rates for the period 1 July 2013 to 30 June 2016 are confirmed and one order for confirmation provides for registration and licensing of motor vehicles under the Land Transport Act 1998.Two orders made pursuant to the New Zealand Superannuation and Retirement Income Act 2001 and the Social Security Act 1964 are confirmed. One of the orders increases the rates of the young parent payment for a single young person with a dependent child aged 16 to 17 years and living with or being financially supported by a parent or guardian. The other order increases most benefits pensions and allowances to reflect a 0.61 percent increase in the New Zealand Consumers Price Index from the December 2011 quarter to the December 2012 quarter. It also increases the amounts of funeral grants payable under the Social Security Act in respect of people who die on or after 1 April 2013. The order also makes some further supplementary increases to the level of superannuation.One set of regulations made under the Road User Charges Act 2012 is confirmed. These regulations specify rates of charges for distance licences for road-user charges vehicles and in respect of additional weight carried by combination vehicles operating under an additional licence.Finally the bill confirms an order increasing war pensions lump sum payments and allowances in line with an increase in the Consumers Price Index. The order also makes further supplementary increases to the level of veterans pensions to honour the Government’s commitments in relation to the level of veterans pensions. Thank you.Hon MARYAN STREET (Labour): It gives me pleasure to rise to speak in support of the Subordinate Legislation (Confirmation and Validation) Bill No 2. I appreciate the comments of the Deputy Leader of the House and her reflections on the work of the Hon Lianne Dalziel in the Regulations Review Committee. She has indeed been a hugely important contributor to that committee. This sort of bill a Subordinate Legislation (Confirmation and Validation) Bill comes round once a year to the House and it is essentially designed to bring some parliamentary scrutiny to those items that would otherwise expire if the dates of their legislation were not validated or confirmed. In other words there would be a rate or a regulation that would apply up to a certain date then it would expire and if this kind of bill or measure were not put forward to the House then it would not continue. It is an administrative measure but it is a really important one in that what this House is doing by confirming and validating the subordinate legislation that we are addressing in this bill is actually confirming that the policy behind the intention of the regulations is actually still valid. So it would be possible for example if this House were so minded and the Regulations Review Committee had recommended differently for votes to be split on this issue because there might have been a debate over whether or not the policy still remained intact.This type of bill is something that is debated annually in Parliament. It is designed to prevent the lapsing of certain subordinate legislation. When this kind of bill comes to the House it goes to the Regulations Review Committee. The Deputy Leader of the House Tolley traversed some of the time frame for that: the bill was introduced in July of this year it was referred to the Regulations Review Committee at the beginning of August and at the end of September it was referred back to the House. I chair the Regulations Review Committee and I thank the members of the Regulations ReviewCommittee for their consideration of this bill. What we had to do was write to the six Government departments with responsibility for administering the orders and regulations covered in the bill and invite them to explain why the orders and regulations should be confirmed and where pertinent validated. We also asked the agencies why the confirmation and validation provisions were originally included in the Acts under which the orders and regulations were made. In every case I am pleased to report that confirmation or confirmation and validation was considered necessary by the departments to prevent the orders and regulations from lapsing and thus ceasing to be legally enforceable.The reasons for these confirmations and validations include things like alteration to the rates of benefits and allowances including such things as increases in war pensions as the Deputy Leader of the House outlined in her initial comments and the ability to prescribe fees and collect levies. The good thing about it is that we got the responses back from all the departments and I would like to place on record my thanks to all the departments who responded quickly and promptly to the requests from the Regulations Review Committee. We found no reason that the orders and regulations should not be confirmed or validated and on that basis I think the House can have some confidence that it is desirable to proceed with this legislation without any contravention.It is good to note the number of pieces of legislation that are actually impacted by this bill. The Deputy Leader of the House outlined particular instruments whether they be regulations or the things that the regulations applied to—the various orders and regulations that were considered by this bill—so I will not traverse those. But it is worthwhile to note for the benefit of people listening the range of pieces of legislation covered by this: the Biosecurity Act of 1993 the Civil Aviation Act of 1990 the Commodity Levies Act of 1990 the Customs and Excise Act of 1996 the Gambling Act of 2003 the Land Transport Act of 1998 the New Zealand Superannuation and Retirement Income Act 2001 the Social Security Act of 1964 the Road User Charges Act of 2012 and the War Pensions Act of 1954. This bill is administrative but it is also important that the House gets a chance to scrutinise this and to accept the Regulations Review Committee’s recommendation for it to proceed unamended.There is one final point I would like to make which is something that is mentioned in the Regulations Review Committee report. The Regulations Review Committee in October 2012 reported to the House on the Subordinate Legislation (Confirmation and Validation) Bill of that time 2012 and asked that such a bill should be considered earlier in the parliamentary year preferably on 1 August or as close to that date as possible. The Deputy Leader of the House said that the Government took that seriously and indeed it did. I want to register my appreciation of the Government’s willingness to move more quickly—in fact to introduce the bill on 29 July so in advance of 1 August and 1 month earlier than the equivalent bill in 2012. But we also encourage the House to consider carefully whether the streamlined procedure which was recommended by the Standing Orders Committee for revision bills might also be applied to bills seeking confirmation and validation of subordinate legislation. That procedure was discussed in detail in the October 2012 report. The Regulations Review Committee of 2013 still thinks that this procedure would make the scrutiny of bills seeking validation and confirmation of subordinate legislation more effective. We have written to the Standing Orders Committee drawing that discussion to its attention so that it may act on that in the future. I support the bill.IAN McKELVIE (National—Rangitīkei): It gives me great pleasure to take a short call on the Subordinate Legislation (Confirmation and Validation) Bill (No 2). It contains two or three issues very close to my heart: biosecurity the commodities levy and retirement in the future.Hon Trevor Mallard: After only 3 years?IAN McKELVIE: Retirement income I am talking about Trevor. I wanted to just make very brief mention of the retirement of the—Hon Trevor Mallard: Yet another announcement. The member’s hardly had time to make an impression. The member hasn’t made an impression.IAN McKELVIE: I must point out I am a better driver than that member. I noticed him very nearly cleaning up one of his Wellington citizens today.I just want to comment very briefly on the retirement from the Regulations Review Committee of our extremely valuable member Katrina Shanks. I know that when she leaves this House she will miss one thing in particular and that is her attendance on the Regulations Review Committee. I want to congratulate her on the part she has played in that. I think it is wonderful. I commend this bill to the House.ANDREW LITTLE (Labour): Like the previous member Ian McKelvie I too take great pleasure in taking a call hopefully slightly longer than the previous member’s on this very important piece of legislation the Subordinate Legislation (Confirmation and Validation) Bill (No 2). We can laugh and chortle and giggle away at these administrative and somewhat technical procedures but amongst other things I think they invite us to reflect on the regulatory process and the process of validation and confirmation.When we look through the list of regulations that call for validation there are some very important ones there not the least of which I think is the Commodity Levies (Paeonies) Order of 2012. Of course the Commodity Levies (Paeonies) Order relates to the need for those who are trading in the vast volume of flowers known as peonies to be levied for that—those at least selling more than $2500 worth in a year. I do not know how many peonies that is. It sounds like a lot of peonies. Those who sell more than that are required therefore to be levied and that levy is collected by none other than the very august institution known as the New ZealandPaeony Society Inc.—incorporated I see only in October last year.Hon Trevor Mallard: It’s called flower power.ANDREW LITTLE: It is a new form of flower power and I am most intrigued that the New ZealandPaeony Society should be established. I do not recall seeing it notified in theGazette anywhere or advertised. If only I had known I might happily have joined because I think this body offers not only the opportunity to collect a levy on behalf of the very many peony growers but indeed the opportunity to establish a fighting force a genuine flower power of a society which can advocate on behalf of all peony growers and indeed all peonies as needed. Most important it allows the New ZealandPaeony Society to conduct the relevant research that it is empowered to do under the commodity order. There is no other by-product associated with peonies. They are not like poppies for example where the dry seed can be broken down and used for other purposes. Peonies are a unique breed of flower. They are I think a perennial—or they could be annual. I have never quite understood the difference between the two but there is a yearly cycle to them which makes them fall under one category or the other.Hon Trevor Mallard: Where’s Maggie when you need her? The only time she could have been useful.ANDREW LITTLE: Perhaps the honourable member Maggie Barry will take a call and she will be able to enlighten us on just the importance of the continuation of the Commodity Levies (Paeonies) Order 2012.I just wanted to make the point that these commodity levies are very important. As we develop our commodity production base and develop our export capability and capacity in these new horticultural products then obviously the commodity levies play a very important role because they not only allow the relevant industry group—in thiscase the New ZealandPaeony Society—to collect levies but also give it the means to undertake very important research hopefully in collaboration with State organisations like Callaghan Innovation. I am sure that my learned colleague Dr Megan Woods will be interested to know that the New ZealandPaeony Society exists not only for the collection of levies but also for the conduct of research into the development of the peony industry peony strands and peony forms.Hon Trevor Mallard: Annuals die every year. All that is left is a seed whereas perennials are a bit like us—we go on forever.ANDREW LITTLE: Who would have thought after that interpolation that Trevor Mallard was an accounting teacher not a science teacher? But there we are. He has many strings to his bow.Hon Trevor Mallard: And I can use Google.ANDREW LITTLE: And he can use Google.So where was I? In this most important contribution at this most important time of the year—I do not take this lightly as we undertake this important task that has been blessed not only by the Deputy Leader of the House Anne Tolley but also by no less a powerful force than the Regulations Review Committee which Ms Tolley herself acknowledged has a very important role. It did so under the tutelage of Lianne Dalziel. It is presently under Maryan Street’s leadership and I think it is doing very important work—work that Ian McKelvie noted Katrina Shanks is going to miss extraordinarily. I know having seen her earlier today and congratulated her on her new and very important role in the funeral industry—not a dying industry but like the peony industry one with a great future—that she in fact enjoyed the time she spent on the Regulations Review Committee making the very important contributions she did including ensuring that this legislation the Subordinate Legislation (Confirmation and Validation) Bill (No 2) including confirming the place of commodity levies on the peony industry continues uninterrupted and remains continuous. That is important too.I note also that other commodity levies that are to be continued include the commodity levies on avocadoes. So the Avocado Growers Association will be able to continue to play its very important role in developing strands of avocados. I think the avocado is described as one of the other love fruits of the world. They also are now to be levied. Anybody growing avocados for sale not just domestically but for export as well is levied so that the Avocado Growers Association can continue its very important research work possibly also in conjunction with Callaghan Innovation maybe with theMinistry for Primary Industries maybe with other—Dr Megan Woods: Plant and Food Research.ANDREW LITTLE: —Crown research institutes such as Plant and Food Research and maybe withHortResearch. I do not know where it stands in the greater scheme of things. But we begin to see that if we take a piece of legislation like this we look at the detail of it and we unpick it we find an entire network of horticultural research innovation levy collection export development and growth. I think it means that in our nation with its commodity growers and their commodity levies on their produce we are in good hands. So on that basis I am quite happy again like Maryan Street to confirm Labour’s blessing on this bill.One other point I just want to make is that I note one of the other pieces of regulation that has been confirmed as well the Gambling (Problem Gambling Levy) Regulations. In a year in which we have had the debate on a very unfortunate piece of legislation a very retrograde piece of legislation indicative of a Government that is throwing caution to the wind when it comes to gambling and promoting a more destructive approach to gambling here we are being called upon now to validate or at least to confirm and to continue the Gambling (Problem Gambling Levy) Regulations 2013. Who would havethought that so early in the life of those regulations we would be called upon to confirm them? And who would have thought in light of the very fierce and very unfortunate debate and the circumstances of that debate we would be called upon today to confirm the continuation of a levy on casino operators to deal with problem gambling.But at least we have it. It really underscores the very point that I think Opposition parties were making. If we are going to have activities like gambling not only do we need to retain our right to regulate them but also we need to make sure that those who are in that industry are contributing responsibly and constructively to ensure that those activities do not cause any unnecessary or unforeseen community destruction and disarray. So it is good that those regulations are continuing like many others under this piece of legislation and we are quite happy to support it.STEFFAN BROWNING (Green): I rise to speak to the Subordinate Legislation (Confirmation and Validation) Bill (No 2). As with the previous speakers the Green Party supports this bill and the commodity levies are a significant part of it that comes to our attention. The first one mentioned here is the Biosecurity (Psa-V—Kiwifruit Levy) Order. That has obviously been very very important as that industry the kiwifruit industry suffered so significantly withPsa. We do need to look more deeply into the origins ofPsa and at what parts of the industry were involved with that how our biosecurity system allowed it in and how our biosecurity system maybe did not react to it quickly enough. It is great that we are seeing an improvement with kiwifruit now as there seems to be a resurgence in optimism in that industry as alternatives to the originally most effective fruit come along. Also there is a levy around bovine tuberculosis. That has been put to great use and there is a reduction in TB. So it has been shown to have been put to good use.One levy that I would like to reflect on is the Biosecurity (System Entry Levy) Amendment Order. Although we do need major improvements in joint border management it is very very good to see some redress to some of the border control cuts that have happened that those aspects have come back now and that we have got some improvement. The Minister for Primary Industries was out promoting those new dogs and some teams working on border control. They clearly do not go far enough.One concern that I have with this is that the Government at the moment seems to be throwing its arms up over two of the more recent incursions. One of them is one of theTheileria species or varieties or strains that is going through the North Island at the moment. It is something that could be looked at significantly more for eradication. And whether this levy is not adequate or whether the Government’s budget is not adequate at the moment that disease which causes anaemia in cattle is racing through and is expected to cover all of the Waikato by the end of summer while the Ministry for Primary Industries is saying that we are in the response phase. Do we need bigger levies for that? I am not sure but something has to give and we need to have a far better response so these sorts of things are jumped on so people are not sitting on their hands and so they are not doing reports while a disease that will probably become endemic in this country gets hold. The great white butterfly in Nelson—we are waiting to see from this response whether the industry is going to make a call and whether that butterfly is going to be exterminated and eradicated or not. It should be eradicated of course and efforts should be going on there. If these levies are not adequate and if the budget is not adequate something has to give.The levies carry on to the commodity levies. There are levies for peonies as has been mentioned and for pipfruit. These are put to very good use. I see inTheOrchardist magazine that I have got here that in fact it has a section called “Your levies at work”. Some of that is particularly good. There is stuff around biosecurity leadership Nuffield scholars and other things mentioned in there including pest control although some ofthe pest control is unfortunately supporting some pesticides that should be pulled. How the sector chooses to use its levy is up to it but it is absolutely critical that each sector is involved with levies. It is always disappointing when we see sectors that choose not to vote in a levy for their sectors where they could actually get abreast some of the issues that they have.The Commodity Levies (Foveaux Strait Dredge Oysters) Order will be something close to our hearts. That is an important one because the actual industry itself has damaged the benthos the sea floor in that area and there was damage consequently to the cod fishery there too. So again we hope that the industry will get in make very good use of its levy and look for ways that are a lot less harmful to its own fishery.There is another levy here for thepāua industry. It is very intent on improving management of that industry and looking at some breeding techniques and maybe seeding in there. That is another good use of a sector levy. The rock lobster people have got a great name and something that we can all look at is the very successful use of a levy there which apparently has got a very sustainable and well-managed fishery of the rock lobsters. The potatoes levies—that industry has got a major issue withpsyllid. Everybody’s potatoes here have more pesticides in them at the moment unfortunately because of this very difficult pest called thepsyllid. It is also through the tomato and capsicum industries. Because of the nature of it and the lack of good controls—apart from chemicals it seems—we are all having more pesticide residues in our food.Again that levy is being used to look for biological controls and for nets in some cases for some of the crops and hopefully will not only be a benefit to the industry in terms of saving the huge amount of money that it is spending on pesticides but also will be good for the rest of the country in terms of consumers.The mussels oysters and salmon commodity levies are ones close to my heart and to my friends in Marlborough. As we speak there is a visiting Scottish expert from the salmon industry in Scotland meeting with the people of Marlborough where it has been a major contentious issue—the salmon farming and the effects on the environment there. The Marlborough District Council with its regional council responsibilities never had somebody there with a marine biology background. So here we have major environmental effects some of which have been well documented in terms of what is happening on the seafloor under these salmon farms. It is in the public space there is no rental on it to the public and there is no money going from the industry to the local council to do research. So I am hoping that that levy of course on farmed mussels oysters and salmon to be paid for by the fish farmer will be very wisely used to ensure that their activities are actually way more sustainable than they are currently.I use as an example of that the fact that the Marlborough District Council doing what it could looked at each of the farms that are there in existence at the moment and each one of them had failed its consent conditions. The expert from Scotland did a peer review and said that two of them should be shut straight away and the others all should have reduced feed. Those are the real deep issues that we need to be looking at through these levies.We will support this bill. We hope that there will be more commodity levies extracted from different sectors that will help work on the issues of biosecurity and environmental management. But at this point we are pleased to see this bill progress through the House. Thank you.MIKE SABIN (National—Northland): That was an excellent contribution as to everything that the Regulations Review Committee is not about—that is policy. The member Steffan Browning has given a great dissertation on all the ins and outs of levies and commodities from the policy perspective but that is not what this bill the Subordinate Legislation (Confirmation and Validation) Bill (No 2) actually deals with.This is a perfunctory piece of legislation. It is very much a legislative process to ensure that levies that would otherwise expire do not expire. So the member may do well to actually remember what the function of the Regulations Review Committee is when he helicopters in there to battle away on his policy front because that is not a matter for that committee to deal with.Just very very briefly—the committee did look very closely last year at how we could actually trim back and rationalise as best we can the valuable time of this House in terms of performing this very important function. I want to commend the Government departments that have reported their contributions earlier to allow the committee to scrutinise the need for their legislation in this bill. That has meant that the Government and this House have been able to progress their work far more quickly and efficiently. I think that there are probably other ways that we can help provide efficiencies for the benefit of this House with this particular legislation.I will not take any more of the House’s time. I certainly commend the bill and the work of the members of the select committee in doing their best to ensure that these regulations are dealt with appropriately. Thank you.IAIN LEES-GALLOWAY (Labour—Palmerston North): I just want to make a short contribution on this Subordinate Legislation (Confirmation and Validation) Bill (No 2). As I am sure earlier speakers would have said the purpose of this bill is to confirm and in some cases validate subordinate legislation made under various Acts. In passing this bill the House is effectively approving the subordinate legislation specified in this bill and allowing it to continue in force. Essentially this lies around a series of levies and other matters that as Mike Sabin said in the absence of this legislation would not be able to carry on.Just some interesting points—the orders under the Land Transport Act refer to motor vehicle registration. I note that the bulk of motor vehicle registration is actually the accident compensation levy that motor vehicle owners pay into ACC. ACC recommended to the Government that it reduce the motor vehicle levy just as it made recommendations that the Government could reduce a range of ACC levies.Hon Dr Nick Smith: The member’s Government put them up.IAIN LEES-GALLOWAY: Well it was Nick Smith who put the ACC levies up when he created a phoney crisis in the Accident Compensation Corporation. He overcharged New Zealanders. He caused New Zealand taxpayers to pay far more in their ACC levies than what was necessary and the result was that this year ACC made a surplus of nearly $5 billion.Of course the reason the Government refused before now to reduce the levies that Nick Smith—who interjected on me—raised when he was Minister is of course that that ACC surplus contributes to the Government’s surplus and the Government has set itself a target of getting the books back into surplus by the 2014-15 financial year. It has failed to do that through economic growth. When New Zealanders saw that target they assumed that what this Government was planning to do was to grow the New Zealand economy grow the number of jobs and get more people back into work so that they are paying tax and that would be the way the Government would reverse the phenomenal amount of borrowing that has occurred since it took office. But it has failed to do that and so it has found all sorts of other mechanisms by which to artificially inflate the Government’s books and make it appear that the Government will have reached surplus by 2014-15.One of those is of course the ACC levies which Nick Smith put up. Why I reference that in this legislation is that—we are talking about the motor vehicle account—that was actually one that the Government decided it would not reduce. So although there will be some election bribes next year for the work account and theearners account—it could have happened last year but they have been put off until next year because that is election year—unfortunately the poor old motor vehicle owner will not get any relief there.This is an issue that I know does concern a lot of people because for instance if you own a motorcycle—I know the Hon Phil Goff is very interested in this issue—or if you own more than one motorcycle then you are paying quite a lot in your ACC levies. Many motorbike riders quite rightly point out that you cannot actually ride more than one bike at a time and therefore it might be inequitable for them to have to pay those extremely high levies. Certainly there was never any suggestion that motorbike owners would have their motor vehicle registration levy reduced even though some other folks would.One other really interesting idea that the Government is trying to push through—although it seems that it is now having to do a little bit more work to justify it—is this idea that if you are rich and you own a new car then you can pay less on your motor vehicle registration than someone who is on a middle income or on a lower income and who can afford only an older car as if that was going to incentivise people to buy newer safer cars. I mean it is just ridiculous. The fact of the matter is that with the income gap widening under this Government with more and more people finding it harder and harder to make ends meet there is no way on earth that they are going to go and buy the latest model Mercedes-Benz so that they can get a reduction on their ACC levy. It just shows you how completely out of touch with reality this Government actually is—that somehow having a lower ACC levy would incentivise people to head down to their nearest BMW dealer and buy the latest model car.This bill I know is simply subordinate legislation that allows certain things to carry on but it is important that although as legislators we pass this legislation we understand the implications and the variety of options that were in front of the Government when it considered this legislation. On a number of those options frankly the Government does get it wrong because it always puts its mates ahead of the interests of all regular ordinary New Zealanders.Bill read a second time.Third ReadingHon CHRIS TREMAIN (Minister of Internal Affairs) on behalf of theLeader of the House: I moveThat the Subordinate Legislation (Confirmation and Validation) Bill (No 2) be now read a third time.Bill read a third time.Taxation (Annual Rates Employee Allowances and Remedial Matters) BillFirst ReadingHon CHRIS TREMAIN (Minister of Internal Affairs) on behalf of theMinister of Revenue: I moveThat the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. The Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill is a bill that sets out to bring greater clarity to the tax rules and make them easier for businesses and other taxpayers to understand and comply with. The bill proposes clarifications to the tax treatment of employer-provided accommodation accommodation allowances and other payments provided by employers to employees to reimburse them for expenditure incurred. Where a person receives remuneration as part of their employment to cover expenses such asaccommodation meals and clothing it seems only fair that these items should be treated as the income of the employee because the employee benefits from them. However situations arise where the private benefit is minimal or hard to measure and the benefit is clearly not a substitute for salary or wages. The proposals in this bill therefore aim to provide practical rules to help determine where to draw the line between what is taxable and what is not.The main areas of concern addressed in the bill are employer-provided accommodation allowances and payments particularly when they are linked to business travel secondments and projects. There is a range of proposals dealing with accommodation and accommodation payments but in particular the bill proposes that accommodation and accommodation payments provided to employees who are required to work away from their normal workplace on secondment or on capital projects will be exempt from income tax under defined circumstances including an exemption for up to 5 years for people working on Canterbury earthquake recovery projects which is a very good initiative. In a similar vein an exemption is proposed for payments for meals on work-related travel for up to a 3-month period. A specific exemption is proposed for distinctive work clothing to match the outcome when clothing is provided directly by the employer. Associated with this an exemption is proposed for plain-clothes allowances when a person has been provided with a uniform as part of their employment but because of the nature of their current duties he or she is required to wear plain clothes instead. The proposal simply confirms current practice and the Government is keen to bring clarity to this issue.Turning to another matter the Government wants to ensure that innovation remains strong amongst New Zealand businesses. An obstacle to innovation is the business expenditure of a capital nature that is not immediately deductible for tax purposes and does not give rise to a depreciable asset so cannot be deducted as tax depreciation over time. Such expenditure is commonly referred to as black hole expenditure. Members might remember that this was first announced as part of Budget 2013 and it contributes to the Government’s aim of providing a more productive and competitive economy—Dr David Clark: Where’s the Minister of Revenue?Hon CHRIS TREMAIN: —that supports innovative businesses investment jobs and of course growth which I know that David Clark across the House is always interested in discussing in detail. The two broad areas of the black hole expenditure are focused on firstly certain company running costs and secondly the cost of applying for patents resource consents and plant variety rights.This bill also proposes changes to maintain the integrity of the tax system to ensure that everyone pays their fair share of tax. To that end amendments are proposed targeting taxpayers who have a disproportionately high level of debt funding in relation to their worldwide interest expenditure and taxpayers who can control relative levels of their debt funding and equity funding. These proposed amendments relate to the issue of base erosion and profit shifting by large multinationals and this is a priority matter. Different aspects of the rules relate to situations in which New Zealand residents have investments in non-resident entities which are called the outbound rules and situations in which non-residents have investments in New Zealand residents—namely the inbound rules. The rules also require taxpayers to determine which related entities are in their New Zealand group and in their worldwide group for the purpose of calculations. Changes are also proposed to the rules about New Zealand groups and worldwide groups following from the introduction of the concept of non-resident controlling groups.Also in the international tax area members may be aware of the United States legislation the Foreign Account Tax Compliance Act. This Act is due to take effect on 1July 2014 and it requires financial institutions in countries outside the US to report on certain US account holders directly to the US’s internal revenue service or face a 30 percent penalty tax on US-sourced income. The New Zealand Government is happy to contribute to the global effort to eradicate tax avoidance and evasion but it is also aware of the compliance cost of this requirement for New Zealand financial institutions. Negotiations are therefore under way to enter into an inter-Government agreement with the United States that would significantly reduce these costs. The provisions in this bill will provide the necessary laws allowing financial institutions to comply with the Foreign Account Tax Compliance Act and thereby avoid the 30 percent withholding tax on US-sourced payments.Dr David Clark: What will New Zealand be getting in return?Hon CHRIS TREMAIN: Well you can discuss that in your speech.The bill also addresses the tax treatment of agreements for the sale and purchase of property or services denominated in foreign currency—the foreign currency agreements—in order to reduce complexity minimise volatility and reflect economic reality. Amendments are therefore proposed that will require taxpayers using International Financial Reporting Standards to follow their accounting treatment for foreign currency arrangements. This means that the value of the property and the services and any interest included in foreign currency arrangements will follow their accounting treatment. Similar rules will apply to taxpayers not currently using these standards.Another matter of significance in this bill concerns tax law relating to leases and licences of land. It is necessary to ensure a consistent and coherent tax treatment of land-related lease payments and to remove distortions thereby improving business efficiency and fairness.Hon Maurice Williamson: How does the member know all this?Hon CHRIS TREMAIN: This is a comprehensive bill—there is no doubt. The main amendments include tax lease transfer payments that are substitutable for taxable lease surrender payments and lease premiums.This bill also includes proposed amendments that will help clarify the law so that charities that are removed from the register of charitable entities have a greater level of certainty about the tax consequences of deregistration—an important factor. The tax obligations for some of these entities have not always been so clear. It must be pointed out that the tax rules relating to deregistration have in the past been exploited by some in order to gain a tax advantage. The bill includes proposals to deal with this appropriately. One of the proposed amendments is intended to ensure that assets and income accumulated by charitable entities that are later deregistered are distributed for charitable purposes.The bill proposes rules to confer tax-exempt status on a small subset of community housing entities that provide housing assistance to low-income households. The amendments will promote homeownership for New Zealanders who would not otherwise be able to afford to buy a home. The new rules also set out that gifts of $5 or more that are made to one of these entities will qualify for donations tax relief. Clarifications are also proposed to the GST rules including the definitions of “dwelling” and “commercial dwelling” in the Goods and Services Tax Act of 1985. There is an amendment to the apportionment rules so that non-profit bodies can claim all of their GST input deductions other than on inputs that relate to the making of exempt supplies.Also a proposed amendment is included that “clarifies the policy relating to subsequent supplies of land or dwellings when input tax has been claimed requiring a wash-up calculation on the disposal.” There are amendments to clarify the tax treatmentof directors’ fees and the zero-rating of land and proposed amendments relating to residents and non-residents to the meaning of “outside New Zealand” to clarify “that for a natural person a minor presence in New Zealand that is not directly connected with the supply does not invalidate the rule.”As I said this is a comprehensive bill. It is proposed to give Every Home Global Concern Ltd and the Namibian Educational Trust donee status in schedule 32 of the Income Tax Act 2007. Monetary gifts to them may qualify for tax benefits. The remaining proposals in the bill set the annual rates for income tax for the 2014-15 tax year and make minor changes to the child support and Working for Families rules to ensure that they work as intended. The Minister of Revenue Todd McClay has no doubt been doing outstanding work with the bill. He has pulled this comprehensive bill together to ensure that our laws are routinely maintained in response to changing circumstances or good advice from the business sector and that efforts are taken to ensure that taxpayers understand exactly what their obligations are. This bill brings further clarity and certainty to our tax system and I am therefore pleased on behalf of Minister McClay to commend the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill to the House. Thank you.Dr DAVID CLARK (Labour—Dunedin North): Labour will support the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill going to the Finance and Expenditure Committee.David Bennett: Sit down then.Dr DAVID CLARK: Mr Bennett suggests that I sit down at this point but I will not because I have some reservations that I wish to express straight off the bat. We are supporting it going to the Finance and Expenditure Committee because we think that it is a bill that can be improved. We are hopeful that the Government will be willing to work with us on that despite the somewhat limp start that it has made here in this bill that we have before us.We know that many many areas of the tax law need either improving on or proper policing. Just this week we have heard that there is now a billion dollars in tax that is unpaid by self-employed people with hundreds—literally hundreds—of self-employed people owing more than $1 million each. [Interruption] I hear David Bennett asking how their debt has got that high. Well quite frankly it is because the Inland Revenue Department has not intervened early enough. It has not had either the tools or the resources to stop debt growing and to stop those tax bills rising. As a consequence that area of unpaid tax is now over $1 billion and rising which is a quarter of the Government’s asset sales programme. If we look at the complete amount of unpaid tax that sits on the Inland Revenue Department’s books—on the Government’s books—it is now twice the value of the Government’s asset sales programme. I will repeat that. On the Government’s books there is now twice the value of the Government’s asset sales programme in unpaid tax.This is a Government that has taken its eye off the ball. This is a Government that is not collecting the tax that is due. This is the very point that Mr Tremain raised at the start of his speech when he talked about fair tax payment and fair tax collection. But it also gets to the other point that Mr Tremain raised about growth in the economy. In fact we have recognised—and it is important to recognise from the start—that this particular Government has the worst growth record of any Government in the last 50 years in New Zealand. That is not helped by this bill. As it stands this bill is simply not supporting the kind of decisive change that would be needed to transform the economy to make it grow like it ought to in the situation that New Zealand finds itself in where primary produce prices are at record levels. New Zealand has had all of the opportunities in the world but seems to have lagged behind in growth. The unemployment rate has remainedhigh; it is still higher than when this Government took office. This Government has apparently been sitting on its hands when ordinary New Zealanders have been struggling.In recent days we have found that a number of other revelations have come out about the Inland Revenue Department and its stresses because it has not been supported by this Government. As I said at the outset the Government has taken its eye off the ball and so this is why we have got this tinkering. This is why we do not have a bill that actually addresses the big issues. The Prime Minister said nearly 2 years ago that the computer system in the Inland Revenue Department was holding back tax policy. The Prime Minister said in his own words that this computer system in the Inland Revenue Department was holding back the development of tax policy. Two years on—and $50 million spent on international consultants later—we have from the Government an in principle agreement to develop further business cases in order to one day hopefully address the computer issues which are becoming increasingly dire. That is a waste of taxpayers’ money I have to say—$50 million for an in principle agreement to proceed. This is something that the department was telling this Government 5 long years ago when it was first elected. Five long years ago—Andrew Little: Five years?Dr DAVID CLARK: Five years ago the department was saying that its computer system was on its last legs and that something needed to be done. Two years ago John Key finally caught up and said: “Yes something must be done and it is holding tax policy back.” Two years on and another $50 million later we have an agreement that in principle something should be done about it. And then we have the news this week of $1 billion outstanding in self-employed tax owing. The total amount of tax owed by New Zealanders that has not been collected is $8 billion—twice the Government’s asset sales programme value. That is embarrassing and those members opposite might well hang their heads in shame because this is an embarrassment to the Government.Then we have this bill before us which attempts to tinker with some of these things and attempts to tinker with the thin capitalisation rules which clearly and patently are not working. International companies now regard paying tax in New Zealand as something of an amusement. They pay as little as they like. They sometimes pay a little bit for show. But comparable companies with equivalent revenue will pay quite different amounts of tax whether they are listed on the NZX and there is transparency about their tax affairs and a requirement to pay a dividend and sort out the imputation credits that go with it or whether their head office is overseas in which case they tend to pay far far less tax with equivalent revenue flows. This Government has failed to address the issues of the day in respect of tax avoidance by multinationals and it seems to have very few ideas about how it is going to do that.It does not even have an estimate of the size of the tax that it is forgoing. Last week in the financial review of the Inland Revenue Department I asked the commissioner whether the department had an estimate of the tax forgone due to avoidance and evasion behaviour. The commissioner said that the department did not that it did not have the resources necessary to calculate that amount and that it has other priorities right now. I bet those other priorities are piecing the computer system together withsellotape andBlu-Tack. With $8 billion outstanding the department will be doing what it can on its little abacuses to work out how on earth it is going to collect that and the rebuild upon which it has spent $50 million on consultants has reached only the in principle agreement stage. This is disgraceful. This is absolutely disgraceful. More decisive action needs to be taken by this Government than what we find in this bill.In this bill we also have some legislation that has been very quietly kept out of the public eye up until now: the issues in response to the Foreign Account Tax ComplianceAct passed in the United States. That Act required all banks abroad to supply information on US persons. We are not clear exactly what the definition of “US persons” is. The banks do not actually yet know. The Inland Revenue Department has not defined exactly what a US person is. OnWikipedia it is defined very much in line with the surveillance legislation. So what we have here is the kind of thing we saw under the Government Communications Security Bureau Act where the Government is supplying information to the US at its bidding. What is it asking for in return? Nothing. That is what I hear—that is exactly what the Government is asking for in return. This Government is quite happy to hand over information on people with bank accounts in New Zealand but it is asking nothing in terms of tax transparency of the United States—absolutely nothing.This is a Government that seems to be sitting on its hands as far as protecting the New Zealand tax base is concerned. Tax transparency is something it has started to talk about now but there is absolutely no action on that front. Multinationals are choosing whether or not to pay tax. The Inland Revenue Department seems to have no real plan for tackling that issue. This Government has made no statements about the Foreign Account Tax Compliance Act other than smuggling it through in the innocuously named Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. It will require banks to supply information on anyone who is a US citizen—fair enough—on anyone who might have a US address on anyone who might have somebody carrying out transactions on their behalf in the US and also on people who were born in the US. Whether or not it thinks they have any kind of ongoing relationship with the US the New Zealand Government seems set on supplying their ongoing personal financial information to the United States and asking absolutely nothing in return.The Inland Revenue Department has at this stage no plans it seems to gather information on tax avoidance in New Zealand—that is being resident in haven situations in the US or abroad or that the US Government has knowledge about. It is simply rolling over and accepting that it will comply with that US law that it will demand that the banks conform without actually giving them proper guidance. The banks themselves are upset about the slow progress of the Inland Revenue Department the lack of guidance on those issues and the upset that this will cause to their customers who will now be giving away personal information they would not previously have expected to give away.This is a Government that is in turmoil in respect of tax collection. The outstanding amount of $8 billion is ringing in our ears. The Inland Revenue Department’s statistics were due yesterday on its poor performance on the dropping compliance in the tax system. We learnt in the select committee that the department is expecting to answer three out of four phone calls now and it is not meeting that target. It is not hitting the target of answering three out of four customer inquiries. That is an absolute disgrace. It is a department under pressure. It is a department that is not performing under a Government that has taken its eye off the ball.David Bennett: More lies—just lies.Hon RUTH DYSON (Labour—Port Hills): I raise a point of order Mr Speaker. Just at the conclusion of my colleague’s speech the member from Hamilton East David Bennett made an unparliamentary remark as an interjection and I would ask you to ask him to withdraw and apologise.The ASSISTANT SPEAKER (Lindsay Tisch): Well I did not hear that; otherwise I would certainly have intervened if there was an unparliamentary comment made. I will just remind members of Speakers’ rulings 42/1-6.PAUL GOLDSMITH (National): That speech from Dr David Clark had no discernible theme or coherency and I was struggling. One moment he was attacking theUnited States—I thought that that speaker was a friend of the United States—but the next moment everything was disgusting. I think that maybe one thing you could learn is that hyperbole on a regular basis sometimes waters down the effect of the nature of the speech.Labour’s approach to tax is to squeeze the lemon until the pips squeak and it showed that over its 9 years when Michael Cullen was the most rapacious tax-gatherer in the history of New Zealand. We have a different approach from—Dr David Clark: And we ran surpluses.PAUL GOLDSMITH: That is right. Yes you justhoovered up every cent and dollar of tax that was possible whereas this Government aims to raise the revenue it requires not through hiking tax rates but by ensuring that the existing tax bases are applied fairly.This bill the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill is about maintenance of the tax system and it is ultimately about building a more competitive and productive economy which is one of the National Government’s key priorities. It is only by lifting our economic performance that we can create jobs boost incomes improve living standards and provide the world-class public services that Kiwi families need.This bill deals with a large number of issues in relation to employee allowances thin capitalisation rules black hole expenditure deductions foreign account information-sharing agreements charities deregistration tax exemption for community housing schemes and a whole lot of minor matters. I want to touch just briefly on the thin capitalisation rules because this is an area that is of particular interest to the people of Epsom whom I have been talking to recently. Changes to the thin capitalisation rules will help ensure that foreign-owned companies investing in New Zealand pay their fair share of tax. We welcome foreign investors in New Zealand. In fact this country and this economy have been built on foreign investment but we expect everybody participating in the New Zealand economy to contribute their fair share. The thin capitalisation rules are designed to address the situation where non-resident investors can artificially load debt into their New Zealand investments to limit their exposure to New Zealand tax—a very old trick. However they currently apply only where one non-resident owns 50 percent or more of the New Zealand investment. That means that the rules apply to traditional multinational companies but not to other types of non-resident investors such as private entity investors and there are a lot of those in Auckland at the moment.This piece of legislation proposes amendments to extend the thin capitalisation rules so they apply to non-residents who act together when investing in New Zealand. I think that that will go a long way to strengthening the tax system. On that basis I commend this bill to the House. I look forward to it coming to the Finance and Expenditure Committee for a thorough investigation. Thank you.ANDREW LITTLE (Labour): It is a pleasure to take a call on the very important Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. The speech we have just heard from Mr Goldsmith is the typical old-fashioned National Tory grandee speech that we hear so often—that taxes are somehow evil dirty and filthy and that somehow businesses that thrive in an environment where they get good infrastructure good governance and an uncorrupt Government do not need to pay their way.John Hayes: There’s the old unionist.ANDREW LITTLE: John Hayes knows all about it because he is another champion of the old Tory cause—run down the State lower the taxes tell businesses the leash is off but still ply them with the goodies every time they get out. Well that is not the waya decent tax system runs. It is not the way a modern country runs. It is not the way you build a productive economy.John Hayes: You’re the communist in this House.ANDREW LITTLE: And here comes the catchcry: we are all communists. Yes well the last time we heard that was of course when we had the Cullen fund. Was the Cullen fund stealth by communism or communism by stealth? National cannot get over it. It cannot get over it when you have a Government usually under Labour that functions well like the last Labour Government which produced surpluses for 9 years which built up the Cullen fund and which allowed ACC to build up its investment fund. It was $11 billion; today it is over $25 billion. Those are State organisations backed by the Government backed by the State and they are providing the anchor-stone to this economy.The Government in office now could not do what it has done without the investments made the surpluses produced and the investment funds developed by the last Labour Government. That is the truth about the New Zealand economy today. It is in the shape that it is in and got through the global financial crisis because of the foundation—the firm foundation—laid by the last Labour Government which had a good coherent tax policy but more important had an Inland Revenue Department focused on tax collection tax gathering which is part of the platform of tax fairness. This Government does not care about tax fairness. It does not mind that large overseas-domiciled corporates get away with paying virtually nothing. They are happy to take our infrastructure happy to take our environment and happy to take our educated workforce but they do not want to pay their way and this Government thinks that that is OK. Well it is not OK. It is not OK and we need to make sure that we have a set of tax legislation some of the most complex and sophisticated that this House ever deals with that has as its underlying principle fairness—fairness to all taxpayers and fairness to all citizens as well.So when we look at this bill notwithstanding our support for it we want to know that this bill is part of a growing platform of fairness in tax policy and in taxation. I want to comment on a couple of aspects of it. One is about the employee provisions at least in so far as they relate to accommodation being provided for work to be done. It relates specifically to the growing requirement for the Christchurch rebuild to depend on people who come from outside Christchurch to do their work many of whom leave for the weekend and then come back—that is employer-supplied accommodation. The way this bill deals with that is to allow a tax concession or at least for it not to be regarded as an employee benefit and therefore subject to fringe benefit tax for a period of 2 years extendable to 3 years in the right conditions.I just want to make this point because the debate about employee benefits or at least benefits that employees get to enable them to do their job comes up periodically and the Inland Revenue Department has a funny sort of starting point in this day and age which is that it says that any provision to an employee that is related to doing their job—whether as in this case it is accommodation or in other cases it is a tool allowance or a meal allowance—is a private benefit. Well it is not a private benefit and that should not be the starting point. Once upon a time the starting point for the Inland Revenue Department would be that you are employed to do this job. You are working in unsociable conditions which is why you are being called to leave your regular home your family and the place where you have your roots and your connections to go to work in that location and you are being provided accommodation. There is no sense of private benefit in that at all just because you are getting a roof over your head a bed to sleep in and maybe a meal provided that does not make it a private benefit. You are there under the condition that you are an employee and you are fulfilling yourobligations to your employer. That is not a private benefit. That is fulfilment of your employment conditions.I hope that the Inland Revenue Department starts getting the lesson. It thinks that because you get these things provided by your employer somehow this is a private benefit. It is not. They are there on fulfilment of your employment obligations. Sure you might sign up to it. The nature of the labour market is that increasingly people in a more mobile workforce are prepared to travel longer distances and to spend time away from home many more nights a week away from home than perhaps was the case even 20 years ago. That is the nature of the labour market the dynamic labour market that I think even Paul Goldsmith referred to. But the quid pro quo for that is that when people are in employment arrangements that require them to be away from their home and away from their family the shelter that they get the roof over their head that they get the warm bed that they get to sleep in is not a private benefit. It is to enable them to do that job that the employer benefits from that the community in which that work is being done benefits from and that ultimately the New Zealand community benefits from. Let us stop seeing these things that are provided by employers to entice workers in to do work in different locations as somehow a private benefit. That should not be the starting point of the analysis. So we welcome the provision in this bill that allows there to be some tax concession for those people in the construction industry to be able to be accommodated to be given accommodation provision that is not then subject to taxation. That will be a benefit if not to the employee then certainly to the employer who would otherwise have to have paid that fringe benefit tax.The other point that I want to make too—and it really draws upon a point that my learned colleague Dr David Clark was making—is about the vast amount of uncollected taxation particularly amongst independent contractors. I want to make the point as well that this also reflects the nature of the labour market today in that a growing number of people are designated independent contractors but the reality is that a growing number of those independent contractors are given that status against their will not as part of their choice. In some cases they do not know it at all. I am dealing with a case of a worker who was employed as a conventional employee—that is what the employment agreement that he was employed under says—but when he was paid he was paid as an independent contractor. So the employer paid resident withholding tax but did not pay income tax as provided for under the income tax legislation as PAYE taxation. He has discovered after many months and having now received an invoice from the Inland Revenue Department that he is not the employee that he thought he was; he is an independent contractor. The employer has acted unscrupulously and I am now corresponding with both that employer the Inland Revenue Department and indeed ACC which was also the recipient of deductions—or has not been in this case. The deductions have not been deducted because this chap has been operating under an employment fraud for which there is only one party responsible and that is the employer.I suspect we will find that a significant chunk of that Inland Revenue Department debt against independent contractors will be against people who have not even known or do not even know that they are independent contractors and who are receiving invoices for taxes that they did not know that they were liable for. We need to address that issue as well. But it is good to see legislation that takes a sensible pragmatic and practical approach to these tax matters understanding that for a tax system to be credible and efficient it needs to have integrity as the basis upon which credible Governments in the First World such as we are and aspire to be have good tax systems underpinning them.GARETH HUGHES (Green): Kia ora Mr Assistant Speaker.Ngā mihi nui ki a koutou. Kia ora. I rise to offer a dissenting view on this bill the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill.It is a complex title for a bill. I do not think that many members could rattle it off. But let us call this bill what it is. It is a fossil fuel subsidy bill. What we see in this legislation are more handouts for one of the most profitable industries in the world. We see more tax breaks for the oil industry and for fossil fuel pollution in this bill. That is why the Greens are quite proud to be opposing this tax bill. We should simply be calling this the “Tax Breaks for Fossil Fuels Bill”. The Greens are opposed to it.There are many parts in this bill that we can live with and we support. The bill deals with a huge range of tax changes from police private investigators’ clothing allowance through to accommodation and tax rates paid for by Kiwi workers through to the enforcement costs of the tax regime many being changes we could support. But what the Government has done is it has snuck in a regressive and wrong economic signal change—that is to extend the tax breaks to fossil fuel drilling in New Zealand—and that is why the Greens are opposed to it. We cannot support further distorting fossil fuel subsidies that are putting at risk our climate and our environment but also putting at risk our economy. Our economy depends on a stable climate and our economy depends on the environment which is the basis of our prosperity.The scientific consensus is clear. When you look around the world extreme weather events are literally killing thousands and millions of people—according to former UN Secretary-General Kofi Annan—around the world we need to take climate change seriously. What we need to do is end distorting subsidies to fossil fuels. What we are doing with laws such as this is sending the wrong message. We are sending the message to the oil industry: “Keep investing capital in further drilling rigs. Do not invest your capital in low-carbon alternatives.” We are sending perverse economic signals and it is disappointing to see some of the parties supporting this in this House because this is not New Zealand’s future.For a generation that has grown up watchingThe Beverly Hillbilliesthis is the way the Government thinks about economic development. All it has to do is get lucky like Jed Clampett. I see the member Maggie Barry shaking her head but where is her vision for a prosperous economy and a richer New Zealand? Because all I hear is that this Government has got to give taxpayer handouts to the oil industry in the hope that it finds something down there and it does not leave too much of a mess.This Government likes to portray the Greens as not having any ideas but the fact is that all this Government is about is handouts for its mates—already one of the most profitable industries. It is not just the $5 million in tax exemptions for non-resident drilling ships as this “Tax Breaks for Oil Bill” contains; it is also $46 million in tax breaks in the last financial year alone according to the World Wide Fund for Nature. So here is an industry where the Government likes to bring out big numbers about all the GDP benefits we may see from oil drilling—in fact that is what the Inland Revenue Department advises us in the regulatory impact statement—but it is happening only because of all the taxpayer generosity.I have never heard a National member stand up and say: “I am the party for big oil. They are only going to come here with more generous taxpayer subsidies.” I do not want to see a New Zealand that subsidises oil drilling. I do not want to see a New Zealand that sends the wrong economic signal. What I want to see is a New Zealand that sends the right economic signals and sends the market the right signals to invest in the future economy not in a lazy gamble—aBeverly Hillbillies -style approach to economic development—a drill it mine it frack it approach as the former Minister of Energy and Resources Phil Heatley best epitomised.It is not just the Greens of course that are opposed to this bill; in fact it is Treasury. In the regulatory impact statement Treasury advises against it because of the precedent the bill sets but also because of the economic signal it is sending. What we want to see is not a Government that picks winners particularly in the polluting industry and that puts at risk the actual basis of our economy. What we do not want to be doing is picking winners in the oil and gas sector because what we do know is that we have got a much brighter richer future for New Zealand in clean energy. That is where the Government should be putting some of the leadership some of the attention and maybe some of the tax thaw when it comes to things like research and development tax credits. But instead it has got a platter full of $46 million in tax breaks for the oil industry and $25 million in free seismic survey data handed over. As one of the most profitable industries in the world which is risking our environment and risking our economy I do not think this industry this sector needs any more tax breaks or taxpayer generosity.What we need to be doing is orientating our economy towards the clean energy future. When you look around the world the trends are clear. More net international capital investment was invested in clean energy than in fossil fuels in 2011. At a time when China Europe and America are spending vast sums billions of dollars on clean energy the Government and the Inland Revenue Department through our tax settings are orientating our economy towards a fossil fuel economy. It is an old-fashioned approach to economic development that does not look at our strengths which is our innovation—the fact that we are two-thirds renewables and could easily be 100 percent. This is our brand advantage these are our strengths and this is where we need to be using our tax system to promote to stimulate and to provide leadership.This is just a small bill and a large number of supports subsidies tax breaks and laws for the industry by the industry that we are seeing by this Government. When you look around the world you see the OECD warning against more tax breaks for fossil fuels and contributing to climate change. It estimates that around the world we could be seeing $610 billion. So this $46 million is only a small component. For a little country struggling with major economic trends we cannot be orientating ourselves to the past to destroying the environment to the old fossil fuel economy. We need to listen to the likes of Treasury on this issue listen to the likes of the OECD and listen to our great entrepreneurs Kiwi businesses that are doing great work at the moment despite the lack of Government leadership despite all the laws and attention going to fossil fuels and despite the lack of an adequate carbon price.So this is our future. The Greens are going to keep championing for a fair go for Kiwi taxpayers a fair go for Kiwi businesses and a halt to the subsidies and the tax breaks and all the attention lavished on polluters. I think when we go to the electors at the next election they are going to want people who have actually got a plan—a plan built on innovation on our country’s strengths not on aBeverly Hillbillies approach to economic development. Kia ora.MAGGIE BARRY (National—North Shore): I rise to talk to this Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill which as with many measures this Government introduces aims to bring greater clarity and simplicity to a raft of tax measures. It is a comprehensive bill. It is all part of our big plan to build a more productive and competitive economy. It was interesting to listen to the last member who has just resumed his seat Gareth Hughes from the Green Party. He has finally answered the enduring mystery. Where do the Greens get their knowledge about oil from? At last we know. Jed Clampett andThe Beverly Hillbillies. Apopularist television show seems to be the source of all information and knowledge that that member was able to impart to the House which was not very much. A lack ofintellectual rigour would be a very polite and pleasant way of describing that member’s contribution.I think that when we look at various measures in this bill we see that it deals with distortions. These are the distortions that have been present in the tax system for a very long time—the current black hole as it is known and the tax treatment of certain items of expenditure which do need to be examined in more detail at select committee level. It is a bill that also makes some changes to New Zealand’s international tax rules and again they need to be gone through very carefully in the engine room that is the select committee. The Finance and Expenditure Committee which is the select committee that this bill will be referred to will I am sure have some robust debates if not from the Green Party then certainly from other members.The second group of changes that are mooted by this bill are changes that are intended to strengthen the thin capitalisation rules which will really be very useful because they will limit the debt that foreign investors are able to place into New Zealand and that has far-reaching consequences for the sorts of interest deductions that can be taken. Following consultation earlier this year because this is an omnibus bill that has been I suppose the sum of its parts—it has been consulted on widely—there have been a number of different views that have come into shaping it as it stands now. This bill will be setting out new tax rules for charities that have been removed from the register of charitable entities and give them greater certainty on their tax deductibility. These are some of the measures that this bill covers in its omnibus state.As with the chair of the Finance and Expenditure Committee I look forward to it being referred to the select committee. I commend this bill and its first reading to the House. Thank you.ANDREW WILLIAMS (NZ First): On behalf of New Zealand First I take a call on the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. In that respect New Zealand First with a great deal of caution will be supporting this bill to go to the Finance and Expenditure Committee because of the fact that we believe that it does need the light of day it does need comprehensive analysis and it does need widespread public submission on it.An up-to-date fair and effective tax system is fundamental to our democracy. This is a significant and complex bill that covers an extensive range of tax matters. The public must have their say on this legislation. New Zealand First will be closely scrutinising the detailed provisions of the bill. One aspect we will be paying close attention to is the inter-Government agreement with the United States on the Foreign Account Tax Compliance Act known as FATCA. We will need to have clear information on what is actually intended through this inter-Government agreement and how many New Zealanders are also affected as a result. We will be looking for answers to many questions—for instance has a comprehensive cost-benefit analysis been done on this inter-Government agreement? Just how will New Zealanders with US connections be affected? We will need to know in whose interests such an inter-Government agreement really is. Is it in our interests? Or is it in the real interests of the United States?We will want to know who has been consulted over the Foreign Account Tax Compliance Act aspects of this bill. Will New Zealand’s sovereignty be impacted in any way as a result of this legislation? Will New Zealand’s privacy and human rights legislation be affected in any way? Will there be snooping on citizens within New Zealand because they have some US connection and does this therefore open the door for monitoring or surveillance or entering into people’s private lives in New Zealand because they may have some connection with the United States? These will be some of the questions that we will be fleshing out and requiring the Government to answer.There are hosts of questions and the Minister of Revenue must be accountable for them. We do not want another situation where in years to come we find that there has been undue intrusion into people’s private lives as a result of a foreign country perhaps dabbling in our own internal affairs.Back in New Zealand in terms of this bill there are also implications in terms of employee allowances and employer-provided accommodation. Accommodation allowances and other payments provided by employers to employees in terms of reimbursing them is under scrutiny in this bill. Again we would question some of the rationale behind that and again this Government says that it is trying to reduce compliance costs and the costs of doing business in this country. But is it reducing compliance costs and is it providing the right message to businesses and employers and corporate New Zealand if this Government is going to go after staff and executives who are being remunerated or compensated for accommodation while undertaking their business? As we have heard other speakers say this is not necessarily a perk. It comes with the job. People travel on behalf of their companies on behalf of their organisations away from their families away from their wives their husbands their partners. It is not all glamour. Most of it is hard graft.For companies and employees to start being monitored in terms of whether that is seen as a private benefit it starts to again move into the area as the Government did earlier this year where it looked at bringing in a car-park tax for the Auckland and Wellington central business districts. Again it was found that the $18 million of revenue that the Government was going to secure from that particular tax was going to cost the companies something in the order of $30 million in costs to provide the $18 million of revenue to the Government. It was a total nonsense and the Government withdrew on that occasion. Again if this is going to create undue burden on companies to monitor accommodation and employer-provided accommodation while people are conducting their business will it be another situation where the costs simply outweigh the value of it to New Zealand business?There are a lot of aspects to this bill. It is quite complex. We look forward to it going to the Finance and Expenditure Committee and being drilled down into and all the various facets of it being exposed. Thank you.Hon KATE WILKINSON (National—Waimakariri): It is a pleasure for me to take a short call on the first reading of the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. This bill is the latest piece of tax legislation that is aimed at making the tax system fairer and simpler thereby strengthening our economy. An important aspect of that fairness is of course that taxpayers must be able to understand and comply with rules and it is necessary that those rules be cohesive fair and applied consistently. This bill will be welcomed by taxpayers and also by accountants.Speaking of accountants can I just take this opportunity to acknowledge and pay tribute to my parliamentary colleague and friend Katrina Shanks who is an accountant by trade. She is retiring from Parliament. Tomorrow will be her last day. She is on another journey. I wish her all the very best with her endeavours. It has been a pleasure working with her throughout her parliamentary career and I think that we as a Parliament will miss her.But back to the bill. I certainly commend the bill to the House and I look forward to its scrutiny at the Finance and Expenditure Committee.Hon CLAYTON COSGROVE (Labour): I note the—Hon Maurice Williamson: You can’t get better than that.Hon CLAYTON COSGROVE: No judge of character Maurice. Labour will support this bill the Taxation (Annual Rates Employee Allowances and RemedialMatters Bill as we normally do with these annual rates and other matters in respect of taxation legislation going to the Finance and Expenditure Committee.As others have noted much of this bill is uncontroversial. However there are a number of issues that should be examined in detail. I recall being on the Finance and Expenditure Committee for many years when like for all tax bills the Inland Revenue Department would come to us with the classic minor technical amendments. I am sure Mr Williamson’s eyes—with him being both a former Opposition member and also a Minister now—would light up with glee when officials would look at minor technical amendments. They were normally the ones where if you were smart—and I know that Mr Williamson is exceptionally so—select committee members would concentrate in great detail on those matters. How many tax bills do we normally do a year Minister? A couple of tax bills a year?Dr David Clark: Feels like more than that.Hon CLAYTON COSGROVE: As my colleague Mr Clark says it feels like more than that. The reason we do them is that we have some very smart individuals out in the market place who the moment you pass tax legislation find all sorts of wonderful things called loopholes to leap around. That is legitimate. I am not being derisory. That is not illegal tax avoidance; that is working within the rules. Then we need to come back to this Parliament and close loopholes and identify issues that the creative types in the tax and accounting world have come up with to minimise the negative impact on clients and their finances. Governments and Parliaments have to come back and deal with that.It is interesting that around 300 individuals owe over $1 million in income tax. I am mindful that it is—Carol Beaumont: Outrageous.Hon CLAYTON COSGROVE: It is an outrageous figure and I am mindful of this Government in respect of its priorities because we hear a lot about the small end of town. We hear a lot from Ms Bennett about the small end of town and how the Government is going to get tough with those at the bottom of the heap. There was a time that I recall when we took over from the previous National administration when we found that the Inland Revenue Department under the stewardship of one or other of the National Ministers was indeed in tax terms going after the small end of town because the whitebait—the small fish—were really easy to deal with and you could rack the numbers up. I recall that where there were small-business folk who had made a mess-up or a stuff-up in their GST or whatever suddenly all hell would break loose and the Inland Revenue Department would come around formally like the flying squad. There were penalties and interest and those business folk could not dig themselves out from under that trap.By the way I am not talking about folk who were contriving deliberately to break the law. These were—and I used to have a small business a hundred years ago—people who had made mistakes. There was no ability within the tax framework to actually come up with a solution. The default position from the Inland Revenue Department—as mandated to be fair to it by the Government—was to drop the hammer and put those people out of business. In fact I can recall that there was an individual in my patch who was exactly one of those people. His business had got behind in its tax because he had had a bad year. He got behind and he was subject to penalties. He fronted up he did not hide and he got his accountant to come to see me. There were penalties there was interest and there was whatnot. The choice that the Inland Revenue Department gave him at that time—and thankfully it has changed—was that basically it was going to put him out of business. What that would have done is on the unemployment benefit and the Inland Revenue Department would have got—I do not know—5c or 6c in the dollar.That was really fiscally smart because we would have ended up paying out more to those folks who were unemployed.Well we managed to get a bit creative and do what is now commonplace and that is a repayment plan. He wanted to trade out. He wanted to meet his responsibilities as a taxpayer and he wanted to meet his responsibilities to his employees as a business person and employer and trade out. The sword of Damocles was hanging over him because if he missed one payment the interest and penalties would drop on him from a great height. But he was OK with that because he wanted to do the right thing.The point I make is that he was an easy hit. When we hear Ms Bennett and others going after the small end of town what we do not hear from this Government of course is what it is going to do about the 300 individuals who owe a million bucks each in unpaid tax. Oh no no! I will tell you why. It is because those guys have the wherewithal to hide it get around the law and do a number of creative things and they are harder to get. It is harder to extract the tax owed from them from all the labyrinth of elaborate financial instruments at their disposal to minimise their exposure. It is complicated and costly to go after the big end of town. I say to the Government that theft is theft whether it is a hundred bucks from a beneficiary who screwed the scrum as it were or whether it is a million bucks from the guy in the Armani suit down on Queen Street who is illegitimately avoiding his or her obligations. It is theft across the board. I think that is the fairness with which Kiwis would see it. Theft whether it is a hundred bucks or a million bucks is theft from the taxpayer and people should be equally dealt with and made accountable and gone after.But that crew over there on the Government side have their priorities set on the small end of town and on the most vulnerable. That is not to excuse—and I put this on record and I might upset a few on my side—people who thieve from the taxpayers’ purse even if they are down the small end of town. That is not to excuse them. They have obligations in exactly the same way as all Kiwis do. But the priority of this Government is to go after the vulnerable and the big end of town—the boys in theZegna suits—well it will get to them when it can. I would like to see through legislation like this some emphasis to be rebalanced—some priorities to be rebalanced. I would like Ms Bennett to get up with the same vim and vigour as she exhibits when she is so proud of herself and her so-called achievements and make similar speeches about those down on Queen Street The Terrace and other places who may be a part of the 300. That is what I would like to see.But you do not hear those speeches. You do not hear them. It is too hard it is too costly and maybe just maybe they are some of the mates of those 300 on the opposite side of the House. I do not know—I will be charitable—but maybe they are. I do not hear too many Tory speeches coming from that side saying they are going to go after the 300. There is $300 million worth of tax that if recovered could make a difference to a lot of people. I do not know whether the Minister of Revenue to be fair to the Inland Revenue Department is telling his department to make those 300 a priority in the same way as Ms Bennett is out there swinging the axe on those at the other end of the street—the less fortunate and the more vulnerable but those who have an equal responsibility like all Kiwis. I do not hear about too many of those priorities.So I would ask the Minister when he takes a call in the next stage of this bill to tell us what priorities he is demanding of the Inland Revenue Department. Is he focusing on the big game the big fish and the big dollars—which could actually make a material difference—in the same way as his colleagues are concentrating on those who are the easy game? But you do not get as much money from them do you because they do not earn as much money. That is the big difference.So I say that we will support this bill going to the select committee and that there needs to be some real and decisive action about recovering money. I have sat on the Finance and Expenditure Committee—I have been on it for a while—and Dr Clark will rekindle my memory about the student loan bill. An inordinate amount of money was going to be spent by the Inland Revenue Department to put in place the measures in that bill. I know that Mr Hayes in the privacy of the select committee room mind you wrung his hands with frustration—and he knows I am telling the truth about him—and said it was a waste of time. The bill was not going to recover a few million bucks. The Inland Revenue Department was going to spend a lot of money to recover a few million bucks from students. I am not saying that you should not go after that money but again it is an issue of priorities. I know that Mr Hayes wrung his hands—not in public of course—and said basically that the bill was a waste of time. But I will keep his secret from his ministerial colleagues and his mates.I say to Mr Hayes that it would be good if what happened in private such lion-like behaviour and such guts was exhibited in public and in this House. I know he is going to take the next call so I wait with bated breath.JOHN HAYES (National—Wairarapa): Liars bloody liars—and who was it? I just want to make a couple of comments because there is a unanimity of view across this Parliament that this bill the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill is a very good piece of legislation. The only people taking exception are those who developed their economic understanding through that programme calledThe Muppet Show which was available on television to young people around the time Mr Hughes was a child.One other little thing I would like to say as an observation as I have been sitting here this afternoon in the House is just how the Labour Party has lurched to the left. It has the “Red Reverend” from Dunedin and it has its trade unionist Mr Little and those people—Hon Clayton Cosgrove: I raise a point of order Mr Speaker. You may anticipate my point of order. All members are referred to as honourable members by their correct names.The ASSISTANT SPEAKER (Lindsay Tisch): Correct and I will ask the member to withdraw that comment.JOHN HAYES: I withdraw that comment. I was not being specific but anyway the point I want to make is this. The sensible end of the Labour Party has been excluded from this debate and the reason is the left lurch that it has taken because of the support that the unions have given to its leader—David Bennett: They haven’t got a leader.JOHN HAYES: —no he is away at the moment—who is really supported by the union movement not by the party and his colleagues in this Parliament.We are concerned about one thing in this legislation and that is lifting this country’s economic performance. By doing that we create jobs and we help the little end of town to draw on Mr Cosgrove’s words. We will boost incomes we will improve living standards and we will provide world-class services that Kiwi families need.To answer Mr Cosgrove’s question about whether the Government will go after the big end of town what I think is very clear in this bill is that it focuses on the aspect of fairness in the tax system. That is taxpayers must be able to understand and comply with the rules and it is necessary for the tax rules to be cohesive to be fair and to be applied consistently whether you are at the big or the little end of town. This bill does that and I commend it to the House.The ASSISTANT SPEAKER (Lindsay Tisch): I understand that the next call is a split call. Carol Beaumont—5 minutes.CAROL BEAUMONT (Labour): I do not often get to speak on taxation bills so it is interesting to speak on the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. As others have said this is a bill that we support going to the Finance and Expenditure Committee. We have some reservations but clearly we can look closely at those matters in that select committee. There have been some very good contributions I have to say from this side of the House on this taxation bill.The previous National speaker Mr Hayes talked about fairness in taxation. We would all say that that was a good idea but unfortunately the Government’s practice to date shows no sign of looking at taxation in a fair way. What did we see when this Government was elected? We saw of course substantial tax cuts for the very very wealthy. What we are seeing here is that there are huge amounts of unpaid tax dollars. There is a billion dollars in tax going unpaid. Around 300 individuals owe over $1 million in unpaid income tax. How many wage and salary earners have unpaid tax? I will tell you. Probably zero—because they have to pay. It is taken out of their pay—PAYE. So we do not have a fair taxation system. Those who are on wages and salaries pay every single dollar that they have to.As others have talked about small-business people including as my colleague Mr Little talked about some people who do not even know that they are small-business people the so-called contractors often find themselves having difficulty with taxation issues and owing comparatively small amounts. That is not to say they should not pay them but they do not get away with having that sort of money unpaid. However at the other end of the spectrum we see very substantial amounts owed by a comparatively small number of people—as Mr Cosgrove calls them the big end of town. Actually these are matters that should be looked at by the select committee if we are serious about fairness in taxation.This bill I believe relates to matters formerly raised by Peter Dunne and will tidy up some of the changes the petty rules that were implemented under Peter Dunne—namely the tax on plain-clothes police officers and the accommodation tax on earthquake rebuild workers. So that sounds like a good thing to be doing. Also apparently the bill is related to the Foreign Account Tax Compliance Act of the United States something I do not know a great deal about. These are things that clearly the select committee will be able to work on. But I do think it is important to work on the matters that have been raised on this side of the House around where the emphasis is—on fairness in taxation. The Government would rather spend millions of dollars intruding on the privacy of solo parents who are under suspicion of fraud than chasing up people who owe millions of dollars. So let us get that issue on the table at the select committee and look at those things.I do find it interesting just to conclude that we have had a couple of members opposite talk about needing to have taxation reform so we can grow the economy and have more jobs and better incomes. Well there has been slight evidence of that. Forty percent of New Zealanders got no pay increase last year and we have just seen important research come out on child poverty in this country. So there are fine words but very little action.JULIE ANNE GENTER (Green): The Green Party stands for a clean green economy that works for all New Zealanders. We want to look after our land our water our air and our people and we can do this. In fact that is the way that we are going to have long-term prosperity—by looking after our national assets and looking after all of our people not just the ones who currently have all the money and all the power. We cannot support this bill the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill because it is extending tax exemptions for offshore oil exploration. The Government is granting tax exemptions to foreign companies to comeand explore our waters to make it easier for them to potentially find oil which is at the very best going to make us only a little bit of money for a very short period of time. I think that must be because this National Government is in complete denial about climate change and about the urgent need to transition to clean green alternatives which we could do if there was the least bit of Government support for it. But we have seen the National Government cut tax breaks for the development of clean green alternatives likebiodiesel. There has been almost no development in the biofuel area since National has come to power and instead it is handing exemptions to foreign-owned oil companies.It is hard to believe that in 2013 the Government does not have a better idea about sustainable long-term economic prosperity because we can have that. That is something the Green Party advocates for—smart tax policies that would support clean green businesses and businesses that are here in New Zealand. We are not even talking about New Zealand businesses here; we are talking about foreign oil companies while New Zealand businesses small businesses do not get any breaks from this Government. Why? Because they do not have the money or power to lobby the Government for special treatment. So time and time again we see the National Government giving breaks to certain big companies most of which are foreign-owned so that they do not have to compete and they do not have to innovate. We have seen that happen with Skycity and now we are seeing it with the oil exploration that is happening which not only is not smart because there is no long-term future for fossil fuels on this planet if we want to have a healthy stable climate for our children and grandchildren but also there is a very immediate risk to our “clean green” brand and our beaches. We saw how terrible it was when theRena was grounded—Lindsay Tisch: Order!JULIE ANNE GENTER: The Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill extends exemptions for foreign-owned oil companies to explore off our shores. I think it is important that the public understands the very high risk of a spill when we are talking about an exploratory well. There was only a tiny amount of oil that was spilled comparatively from theRenaon the beaches of Tauranga in 2011. If we had an accident like the one that happened in the Gulf of Mexico which was an exploratory well that was drilled at 1500 metres beneath the sea then that would result in huge economic damage.Looking at the regulatory impact statement it is pretty obvious who is dictating this policy to the Government. It states: “Targeted consultation has been undertaken with the [oil and gas] industry representative body.” which is the Petroleum Exploration and Production Association of New Zealand which supports making the exemption permanent. Oh that is a big surprise! The industry body supports making permanent tax exemptions. That is great! The Ministry of Business Innovation and Employment also supports it because it does not have any ideas for economic development other than digging up and selling off the family silver. Treasury was consulted and favoured the status quo of letting the exemption lapse so we see the Government ignoring the advice from Treasury that says “No you shouldn’t give tax breaks. One shouldn’t give tax breaks to certain industries. It is not consistent with the Government’s broad-based low-rate tax strategy.”So once again the National Government is acting in the interests of a few foreign-owned corporations risking our clean green environment and brand and privileging a few at the expense of sound advice from Treasury. Thank you.DAVID BENNETT (National—Hamilton East): I want to take just a short call on the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill. This bill is a good bill. It is good to see that the Labour Party is supporting it showing somereason there unlike the Green Party which is just in a dream land. For the members of the public who may be listening to this this is not a bill about oil taxation. It is an omnibus bill. It covers a lot of areas. I bet that every member of that Green Party came here on a plane today or drove here and they are not willing to walk the talk that they say. It would be lovely to see them actually do what they say instead of thinking they can have their cake and eat it at the same time.This is a good bill. It is needed. We look forward to it progressing through this House. Thank you.A party vote was called for on the questionThat the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill be now read a first time.Ayes104New Zealand National 59; New Zealand Labour 33; New Zealand First 7; Māori Party 3; ACT New Zealand 1; United Future 1.Noes16Green Party 14; Mana 1; Independent: Horan.Bill read a first time.Billreferred to the Finance and Expenditure Committee.Third ReadingsHon MICHAEL WOODHOUSE (Minister of Immigration)on behalf of theMinister of Consumer Affairs: I moveThat the Fair Trading Amendment Bill the Consumer Guarantees Amendment Bill the Weights and Measures Amendment Bill the Secondhand Dealers and Pawnbrokers Amendment Bill the Carriage of Goods Amendment Bill and the Auctioneers Bill be now read a third time.The bills amend the Fair Trading Act the Consumer Guarantees Act and the Weights and Measures Act. In addition the Door to Door Sales Act theLayby Sales Act and the Unsolicited Goods and Services Act will be repealed and their content incorporated into the Fair Trading Act. A new Auctioneers Act will replace auctioneers licensing with a new auctioneers registration regime. I want to thank the House and the Commerce Committee for the unanimous support these bills have received. The support reflects robust consultation and a shared view that we are delivering positive outcomes. Businesses will understand their rights and obligations and consumers will be protected if there is an issue with the goods or services they purchase. Thanks are also due to the former Ministers of Consumer Affairs who have also guided this work to officials and to the parties who submitted on the bills.The aims of these bills are to offer better protection to both consumers and businesses to bring consumer laws in line with the business practices of our times to ensure compliance with the laws is much more straightforward and to make enforcing the laws more efficient and more effective. These changes represent best practice in regulatory reform and will drive competition innovation and growth in our economy. Content has been updated across all consumer laws to keep pace with changes in the way businesses and consumers transact. Less well-known legislation has been consolidated into the Fair Trading Act where it will be more accessible to businesses and consumers. The laws will take into account typical day-to-day transactions such as making purchases from businesses online and self-service shopping which had not been considered when the laws were originally designed. The changes will also better align our laws with Australian consumer laws reflecting further progress on the single economic market agenda.New principles will ensure that ethical businesses are not disadvantaged when they compete with businesses that cut corners. For instance a new provision will requiretraders to be able to substantiate any claims they make as opposed to the Commerce Commission having to test the claim. New disclosure rules will also come into force around extended warranties so consumers know what sort of extra warranty they are buying over and above what they are entitled to under the Consumer Guarantees Act. These provisions not only protect consumers but also support honest business practices by ensuring that businesses compete on a level playing field.Businesses that are transparent about their claims and in their dealings with the public will not be disadvantaged. Thanks to the Fair Trading Act and the Consumer Guarantees Act consumers already know that they can rely on traders not to be misleading or dishonest and to supply goods that are safe and of acceptable quality. The Weights and Measures Act also has fundamental protections about receiving the right quantity of goods. By modernising and improving protections we will make the laws more accessible and improve consumer confidence. When consumers know understand and exercise their consumer rights competition thrives. This level of informed consumer confidence drives a healthy market place. Consumer confidence also supports innovation new products and new entrants into a market. We all take a risk when we buy something new or from an untried supplier. Our consumer laws help manage that risk for us so that we might be more inclined to buy a cutting edge product or trust information about new products.Business costs are also reduced when the law is accessible and compliance is easier to understand. As part of this process I acknowledge that legislation does not have all the answers. The bills resulting from the Consumer Law Reform Bill are underpinned by broad principles and by having principles-based law we avoid the need for specific rules for every type of transaction imaginable. The benefits of principles-based legislation will be enhanced by providing suitable and accessible guidance for consumers and for businesses. For example under the new laws traders will be required to identify themselves as traders when completing sales online. The law has broad definitions of “business” and “trade” but guidance information will clarify that anyone selling personal used consumer goods is not a trader and guidance will set out indicators for those who may be unsure. If you buy goods online in order to onsell them if you meet tax criteria or if you are required to register as a second-hand dealer you probably are a trader.Similarly the acceptable quality guarantee in the Consumer Guarantees Act remains principles-based. We cannot set different and detailed requirements for every type of good. In known grey areas such as reasonable expectations for the quality of second-hand vehicles guidance will be updated. What has changed is that the Consumer Guarantees Act will apply to all transactions when the bill is passed including online auctions. This closes a loophole where any good sold by traders to consumers in any bidding process has been exempt from the Consumer Guarantees Act. The change clarifies and simplifies the law and brings it up to date with modern trading practices.The majority of the changes that may affect the way businesses operate will take effect 6 months after Royal assent to give businesses time to review their practices if necessary. The new provisions on unfair contract terms have an even longer lead-in time of 15 months as businesses may wish to review their standard form contracts. Plain English communications public information and business guidance will be released by the Ministry of Business Innovation and Employment and by the Commerce Commission when the bill has been passed. General information about the changes is already readily available for consumers and businesses. I am confident that the agencies are ready to support the implementation of this bill and I commend it to the House.CAROL BEAUMONT (Labour): I rise to speak in support as we have done throughout of the consumer law reform process. The Consumer Law Reform Bill hasbeen split into six separate bills. I ask the question: why are consumers not a priority for this Government? Why are consumer rights not a priority? Why is protecting consumers not a priority? The time taken to update our consumer legislation is an absolute outrage but it is absolutely consistent with other Government behaviour that shows how out of touch it is with the life and the reality of the majority of New Zealanders who are doing it tough. It is hard out there and in tough economic times making sure that we have sound consumer legislation that protects consumers—that makes sure that they are not being ripped off by unscrupulous traders—is more important than ever. What has the Government done? It has sat on its hands for this legislation. It has been just unbelievable. It has actually taken a campaign to get this legislation through the House and we have supported it throughout. In fact I think every party in this House has supported this legislation. It should have been dealt with sooner.This is at a time when we know now that 265000 children are living in poverty—that is 25 percent of our children. Ten percent of them are living in extreme poverty and 40 percent of them are living in households with at least one working adult. Times are tough. Consumer legislation is important to make sure that people do not waste their money and that they are not ripped off yet this Government has taken so long to get this legislation through. In fact I could even talk about the consumer credit legislation in a very similar manner because that has also taken a completely unreasonable amount of time to get through this House—abject failure by the Minister of Consumer Affairs and abject failure by this Government.I just thought it would be good to get on the record what Consumer New Zealand said. This is a letter to the Hon Craig Foss the Minister of Consumer Affairs: “What has happened to promised new consumer protections? New Zealand consumers deserve better. Once we had some of the best consumer laws in the world. But they are now outdated and there are significant gaps in consumer protection. Consumers are being disadvantaged every day the Consumer Law Reform Bill is not passed. Traders can avoid the Consumer Guarantees Act by auctioning goods online or pretending to sell by competitive tender. Crucially the Bill will increase protections for people buying online and regulate extended warranties. It will also ban unfair contract terms outlaw unsubstantiated product claims and deliver much needed protections for door-to-door sales where unscrupulous businesses take advantage of consumers. Consumers have waited years for this reform. The Bill is supported by all parties in Parliament. Australia passed legislation to improve its consumer laws more than two years ago. Why is it taking so long here?”. Well that is a very very good question.Consumer New Zealand even went as far as asking whether there were vested interests that were delaying the passing of this legislation. I do not know whether there were or not but what I do know is that it just shows that ordinary New Zealanders families who are struggling are not the priority of this Government.Just to be clear about the time line there was a review initiated in 2009 and a discussion document introduced in June 2010. The Consumer Law Reform Bill was introduced to Parliament in April 2011 and its first reading was getting on for a year later in February 2012. In October 2012 it was reported back from the Commerce Committee. Just to note here that there was very good work done by that select committee—no question about that. It worked hard it made changes and it was getting good advice from officials. So that process went quite well. And then the bill languished for some time. So we had the report back from the select committee and the second reading—that was quite prompt—but then it languished for almost a year until we had the Committee stage last week. We cooperated with that. We said that yes we would cooperate with that as long as this legislation got through Parliament this year—hence here we are for the third readings in the second to last sitting day of this year. Buthonestly it is a disgrace to have a piece of legislation that is really important languish when our consumer law is out of date and does not reflect the reality of so many trading situations that consumers are now in particularly online trading and when you have support of everybody in the House and you do not get the legislation through. I have no words really to describe how appalled I am by that.It does provide protections and a number of them have been mentioned but I will give just a bit of detail. This legislation amends a number of Acts. The oldest of those is actually the Sale of Goods Act 1908 but also the Fair Trading Act 1986 the Consumer Guarantees Act 1993 the Weights and Measures Act 1987 the Carriage of Goods Act 1979 and the Secondhand Dealers and Pawnbrokers Act 2004. It also repeals a few Acts—the Auctioneers Act 1928 the Door to Door Sales Act 1967 theLayby Sales Act 1971 and the Unsolicited Goods and Services Act 1975—and incorporates them into the Fair Trading Act and the new Auctioneers Act. So it is a substantial piece of work—no question about that—and the protections it provides are really positive. As others have mentioned this is principles-based legislation which is sensible. It means that we do not have to regulate every particular circumstance.Some of the new rules that I do particularly want to mention are auction protection. Goods sold by traders at auction will now be covered by the Consumer Guarantees Act. That is the Act that says that goods have to be of acceptable quality and fit for purpose. Online traders will also be required to tell consumers that they are in trade. There will be clarity around extended warranties. That is particularly important. So many people end up unnecessarily getting and paying for extended warranties that merely repeat the protections they have in the Consumer Guarantees Act. There will be delivery protection. A seller will now be responsible for goods until they are delivered to the customer so they would have to replace a product damaged en route for example.In respect of proof of claims a company will have to demonstrate that it has proof before making advertising claims about its products. There will be stricter regulation of door-to-door sales. Shill bidding placing bids on your own auction to inflate the price—something I actually had not heard of before—will be an offence. The important thing—the really important thing—is that the Consumer Guarantees Act which is important will apply to all transactions between trades and consumers whether that be in a shop whether it be online or whether it be at a market. Those are some of the protections that are in this legislation and that is very positive.I do however want to say just a few more comments about why this is important. Apart from consumer protection having good robust consumer law is actually good for business as well. It is good because ethical traders—people who follow the rules—will not be disadvantaged by those online traders—The ASSISTANT SPEAKER (Lindsay Tisch): Sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.Sitting suspended from 6 p.m. to 7.30 p.m.CAROL BEAUMONT: As I was saying before the dinner break the legislation is not just going to provide protection for consumers important as that is; it is also going to mean that ethical traders—good employers and good business people who do the right thing—will not be undermined and disadvantaged by those who do not. That is a problem at the moment where people are slipping outside consumer regulation. So that is another important reason why we need this legislation.It also has the benefit of greater alignment with our Australian neighbours in terms of our consumer law and that is important. It has been a relatively close working relationship generally in the area of consumer law. So there is a number of reasons why this is positive legislation and I have outlined some of the major provisions. Once againI would ask though why consumers have not been a priority for this Government. Why has it taken so long? I ask absolutely the same question in relation to consumer credit law reform which has languished even longer. We first started looking at that in 2007-08. The Government deprioritised it supposedly to allow this legislation to be prioritised and then this has languished on the Order Paper as well. I think it speaks volumes about the priorities that the Government gives to consumers.My last point really is to say that to do this properly we need to make sure that people both businesses and consumers will be well-informed about the changes and it is important that we have material available in many languages. Thank you.JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand and speak on the third reading of the legislation arising from the Consumer Law Reform Bill. This is legislation that is bringing considerable change to this whole space. It would have to be known and recognised that consumers have probably had the best deal under any Government in these last 5 years when you think about the cost of imports you think about the cost of interest rates and such like. It has been a good time for consumers and perhaps a more difficult time for exporters even though our exports in this country have seen considerable increases particularly up into China bringing some great prosperity to this nation.The Consumer Law Reform Bill heard 93 submissions which we understand were heard not only here in Wellington but also in Auckland. It has brought about a significant change in a number of Acts. Those are of course the Fair Trading Act the Consumer Guarantees Act the Weights and Measures Act the Carriage of Goods Act the Sale of Goods Act and the Secondhand Dealers and Pawnbrokers Act. We have also repealed the Auctioneers Act the Door to Door Sales Act theLayby Sales Act and the Unsolicited Goods and Services Act with considerable changes in that first list of Acts that I read out. So the review of these consumer laws which commenced a number of years ago under the then Minister of Consumer Affairs presented proposals to consumer and industry representatives for the modernisation and reduction in a number of consumer laws. This review has been through a process that has not happened for about 20 years. So the changes that have taken place are very timely and very significant.One of the areas that we looked at is the term of an unfair contract and how that affects people in their dealings with business. A term is an unfair contract term only if it is declared to be such by the High Court or a District Court on the application of the Commerce Commission. This process would ensure that the Commerce Commission was given control of the enforcement of unfair contract terms. It is most likely that the Commerce Commission would be talking to firms out there that may be using unfair contract terms and see them comply prior to a declaration by the court. However it is good to see that the Commerce Commission has this area of jurisdiction because there have been in the past numbers of unfair contracts. For example a rent-to-own scheme included terms and conditions in its contracts to the effect that the consumer did not purchase the property but was granted a right to occupy the property under a 30-year instalment agreement. There were a number of contractual terms that would have been likely to have been regarded as unfair—for example the occupiers had to pay for any repairs that the investor company said needed doing and if the occupiers failed to meet a payment at any time in the 30-year period the agreement would be terminated. This is an example of an unfair contract. So this is one particular area in the consumer law reform measures that these bills and the series of Acts address that is going to bring a far better situation for consumers in our society.There is much to be said but I think I have said enough. This is great legislation it is going to bring some great benefits to consumers in New Zealand and I am very happy to commend it to the House. Thank you.Hon CLAYTON COSGROVE (Labour): Like my colleague Carol Beaumont has said we will be supporting this legislation arising from the Consumer Law Reform Bill. Consumer protection legislation is generally supported in a non-partisan way in this House. I know Mr Lotu-Iiga is nodding his head. He represents an area where like many parts of New Zealand there are particular vulnerabilities for consumers when dealing with others. I can recall as I said in a speech last week that when in my capacity as Associate Minister of Justice we reformed the whole of the real estate industry because like many industries 90 percent of those people are exceptionally good folks but in terms of consumer protection there was a percentage of those in that industry who preyed on the vulnerable. That is the case and this legislation deals with a whole series of sectors in a generic way in a number of pieces of legislation. It is important that consumers are protected.I did raise and note during the Committee stage that with consumer protection legislation it does not matter how many laws you actually pass there are certain folks in our communities who need an upgrade of financial literacy and an educative process that not only promotes the legislation but advises the most vulnerable folks in our community of what their rights are and of course of what their obligations are—but specifically their rights. I recall that we did not get an answer from the Minister—I think it was Mr Finlayson who was in the chair at the time who also happens to be the Attorney-General—during the Committee stage as to what process promotion and education programmes would be put in place once this legislation is put through. To date I think the record now would be that we have not got an answer.So I say to the Government that it simply would not be good enough to pass this legislation bang it up on a variety of websites and ask those good folks at the Citizens Advice Bureaux and budget advice services and other agencies to do the work for the Government. The Government through its agencies needs to go out and promote this legislation educate the masses as to what protections are contained within this legislation and how they are implemented and advise what rights people have and how they can use this legislation to protect their position because as I say there is no point in passing it if we do not promote it and educate and advise people of their rights.I make a couple of observations. The last speaker Jonathan Young talked about the legislation and its impact on unfair contracts. I recall in looking at the legislation in the Committee stage—and the previous speakers were going way back to some years ago when Lianne Dalziel was speaking on this—that there is the issue that has not been dealt with in this legislation in respect of unconscionable conduct. In the commentary to the legislation as per the Committee stage it was noted that although the Australians had implemented unconscionable conduct laws it was felt that in this legislation it would be omitted until such time as I understand it that a body of case law built up around the said unconscionable conduct and its definition. I note in the commentary on the then legislation that unconscionable conduct “applies where courts consider it unfair or inequitable (or ‘against good conscience’) to allow a party to enforce its contractual rights against another party who is detrimentally affected by an oppressive bargain.”—an oppressive bargain—“The Minister of Consumer Affairs invited the Commerce Committee and those making submissions on the bill to consider whether protections regarding unconscionable conduct should be added …” and it was felt as I say that it be omitted until a body of precedent was drawn up in Australia.But it also talked about oppressive contracts—about whether a contract was oppressive and therefore could be inflicted on another. I did ask the Minister in thechair in the Committee stage and it is worth repeating for the record—you may have been in the Chair Mr Deputy Speaker at the time—whether unconscionable conduct would include for instance the conduct of say one Hon John Archibald Banks. I know—before I am pulled up by you Mr Deputy Speaker or others—that we cannot talk about the detail of the grave grave and graphic difficulties that the Hon John Archibald Banks is in because he is before the courts but we do know the facts. It is interesting as to whether that is an oppressive contract where you have a “willing buyer willing seller” situation perhaps or whether a situation where money is offered to another and accepted—brown paper bags aside but not talking about any specific case—would be considered unconscionable conduct.Peseta Sam Lotu-Iiga: Come on.Hon CLAYTON COSGROVE: Sam Lotu-Iiga is a lawyer and so is far more qualified than my good self to commentate on this. I know that he is scratching away in the law books on the laptop as we speak looking up case precedent in the Commonwealth courts—or if he is not he should be—and I wonder whether he could advise us whether that example of conduct which we cannot talk about would be considered unconscionable and therefore where a contractual relationship exists and money is changing hands whether that could be considered oppressive. I would argue that in relation to the Hon John Archibald Banks we will know whether it is oppressive once the learned court has rendered a verdict.He may well be able to write a dissertation or Mr Goldsmith you know through striped sunshine might be able to add to volume one of Mr Banks’ autobiography with volume two. I am told that the Lord “Sir” Jeffrey Archer—the Lord “Sir” Jeffrey Archer—penned many a volume of literary works from within Her Majesty’s prisons over a number of years so we could be in line for another series of literary works from the Hon John Archibald Banks one who has been convicted of two crimes prior to the one that we talk about now. So that member may indeed want to consult this legislation in terms of consumer protection. Indeed Mr Dotcom might wish to consult this legislation to determine whether he has any consumer protection or rights that could be aided and abetted by this learned legislation.But to get back to the more substantive part given that we have traversed that little episode I note and other speakers have noted—and again I talked in the last piece of legislation earlier today with regard to taxation—this Government’s priorities. We note that this legislation was initiated after a review in 2009. In June 2010 there was a discussion document. These are all good processes. The bill was introduced into Parliament in 2011. Its first reading was in 2012 in February. It was reported back in October—blah blah blah—and here we are. These are all appropriate processes for a piece of legislation to go through. The message though that I have for this Government is that it has taken it an inordinate amount of time to get this legislation to the third readings which we are on today—an inordinate amount of time. Minister Foss and I believe Minister Bridges before him that well-known—Dr David Clark: Clamper.Hon CLAYTON COSGROVE: Clamper did you say Mr Clark? Yes Minister Bridges’ claim to fame was wheel clamping when he was an Associate Minister of Transport. With those two Ministers there is a pattern. Getting legislation through takes an inordinate amount of time with Minister Foss and the question is simply this: what is more important than providing people with rights and protections as they go about their daily business engaging in transactions? These people are often the most vulnerable. Many of us in the House have been around a bit—for some over there longer than for others. We have had a bit of life experience. We know what smells bad and what doesnot in terms of basic transactions. Other people do not have that benefit. Other people do not have—Hon Member: Give us an example.Hon CLAYTON COSGROVE: I was not including Mr Banks in that life experience I say to my colleague. But other people do not have that benefit. They are vulnerable and they need assistance and they rely on this Parliament to give assistance. So it has taken a number of years to get relatively straightforward legislation through and you have got to ask yourself: is it asset sales or is it consumer legislation? Is it deals with RioTinto—which could itself be called unconscionable because the taxpayer of course got nothing for the 30 million bucks? But that aside what is more important and where are the Government’s priorities?The Government is great of course at laying down the law for others but when it comes to consumer protection and critical pieces of legislation it can just toddle on wheedle its way down the path and take its time going through the process in Parliament. I submit that this is very important legislation. We will be supporting this legislation and there are probably other ideas that will flow from this. I hope that Ministers Foss and Bridges and others will lift their game and ensure that when there is the next round of consumer protection legislation it will be expedited and not dragged kicking and screaming through the parliamentary process.MOJO MATHERS (Green): I am pleased to be able to speak in support of the consumer law reform legislation. I think that it is extremely timely that this is one of the last pieces of legislation that we will pass in 2013 in the House before Christmas and that this law will be in effect by then—a law that will give greater protection to consumers. Several speakers before me have commented on the inordinate length of time that it has taken for this legislation to come through the House so we are very pleased to see it here.When I have spoken previously about this legislation I have spoken about the very strong support that we have for the fact that this legislation despite substantial opposition from major businesses has retained the unsubstantiated representation clause. I have talked about “greenwash” and about health claims and about all sorts of other claims that are being made about products without facts to back up these claims. I was just going through some of the submissions that the big businesses and so on have made against this clause and it struck me just how many had opposed this clause. They were arguing that they should not have to have evidence to back their claims. These were companies like Meridian Energy and Contact Energy banks such ANZ and Westpac and the Direct Selling Association of New Zealand the Association of New Zealand Advertisers Business New Zealand New Zealand Winegrowers and the New Zealand Food and Grocery Council. All of those really lobbied the Commerce Committee arguing that the current law provided adequate protection.The kinds of comments that they were making included saying that basically it would not take consumers much effort to go and look up whether their claims were true for themselves. It is absolutely ridiculous that consumers should have to go away and try to find out or work out for themselves whether claims on a product are true or not. It is just patently not fair on consumers to be expected to do that kind of extensive research. I would really struggle to do that for many of the claims that are made. Like many consumers I would like to be able to believe that when a company makes a claim on a product—when it makes a claim that it might be more effective at cleaning the carpet for example—you would expect that claim to be true. It is not actually physically possible to test some of these claims on your own account unless you rely on other groups that have done that research such as Consumer New Zealand and those sorts of groups.But I do want to single out that there were also strong submissions made supporting that clause on behalf of consumers. But at least one company did actually support retaining the clause on unsubstantiated claims and that was Mighty River Power. I would like to quote from its submission because I thought that it showed a very high level of corporate responsibility. It said: “Mighty River Power supports the proposed prohibition on unsubstantiated claims. We take great care to ensure that all of our claims can be substantiated. It is important to us from both a legal and a marketing perspective that consumers trust the claims that we make.” Fantastic—I just wish that all of the other companies had been as positive and as proactive about their statements as Mighty River Power was because that showed corporate responsibility.I was dismayed at all of the other submissions that were made by so many other companies arguing against that clause. I very much respected the Commerce Committee for withstanding that lobbying by all of those different companies and for leaving the clause in the legislation although we have amended it so that obviously untrue and exaggerated claims can still be made such as that a product might make you fly or something like that. There is now a straightforward simple expectation that you do not make a claim on a product unless you have some evidence to back that claim. And why is that so important? Because the status quo prior to this was that it has been up to the Commerce Commission to provide evidence that a claim is false. That is costly and time-consuming. Reversing the onus on to the company to provide evidence that its claim is true saves a lot of time and effort on the part of the Commerce Commission that would ultimately be a cost for the taxpayer. The Commerce Commission cannot investigate every claim and produce the level of evidence that is required to take it to court when claims are false. So by reversing the onus of proof it makes it much more straightforward. It is not like it is going to be a huge compliance cost—just do not make the claim. Do not make it if you do not have evidence for that claim.We were concerned that the Commerce Commission was not given the power it needed to be able to enforce unsubstantiated representation effectively. So we wrote to the commission and asked it whether the legislation contained sufficient powers for it to be able to enforce it. The commission wrote back and it said that yes it considered that it effectively does have sufficient powers—particularly since it can now request written evidence. The commission has information-gathering powers in the legislation that will give it assistance. We are hopeful that this legislation will work as it should on this clause. If it does not then we will obviously have to reflect on that further down the track as a body of case evidence appears.The other thing that it is very important to realise about this legislation is that it gives protection to consumers wherever they purchase a product whether that is online or offline. As we move into an age of more information technology it is incredibly important that consumers have that protection everywhere. Thank you.Peseta SAM LOTU-IIGA (National—Maungakiekie): It is a pleasure to take a call on this third reading of the legislation arising from the Consumer Law Reform Bill. This legislation reinforces the top priority of this National Government in the 5 years that it has held the Treasury benches. Economic growth jobs and prosperity are our No. 1 priority and this legislation supports that. Over 2.235 million people are employed in this country—more than ever in our history—and this legislation supports that growth and supports that prosperity by making out for fair trading in our work environment. It is about effective competition. It is about having the relationship between consumers and businesses—businesses that sell goods and services to consumers—and having a level playing field so that consumers are not abused by what are unethical practices by some businesses. We know that businesses create jobs and we know that they create economic growth but this legislation supports vulnerable consumers as my colleagueshave already pointed out tonight. It supports New Zealanders who need to be protected from unscrupulous businesses.What this legislation really does is update consumer law. For over 20 years it has been outdated and this Government has put in place reforms to modernise those trading practices. As we know online business and commerce has become almost the norm in today’s modern business world. These bills update a lot of the online transactions and online auctions legislation so that it better reflects the trading practices today.The legislation is also about giving consumers information in order for them to make informed decisions around their purchasing of goods and services. It really reinforces consumer rights it simplifies business compliance and it ensures protections are clear and accessible for all New Zealanders. That is why this legislation supports our economic agenda and that is why it supports common New Zealanders out there. That is why I support this legislation in this third reading.ANDREW WILLIAMS (NZ First): I take a call on behalf of New Zealand First. This is the third readings debate of what was originally the Consumer Law Reform Bill now split into a number of bills: the Fair Trading Amendment Bill the Consumer Guarantees Amendment Bill the Weights and Measures Amendment Bill the Secondhand Dealers and Pawnbrokers Amendment Bill the Carriage of Goods Amendment Bill and the Auctioneers Bill. There are now a number of bills that have split out from that Consumer Law Reform Bill. What better party than New Zealand First to stand in support of consumers? It is a party that has been in existence for 20 years standing up for consumers’ rights and the rights of New Zealand citizens and residents in terms of what they are rightfully owed. In this respect we do support this legislation. We have supported it throughout because they are bills that do ensure the rights of consumers—particularly vulnerable consumers consumers who may otherwise be put at risk. It ensures they are protected.In terms of the Consumer Guarantees Amendment Bill we note that it includes a surety around delivering guarantees so that particularly in the case of people buying over the internet—and increasingly more purchasing is being done via electronic means—there is a delivery guarantee and the recipients are not liable until they have actually received the goods and have signed for them. That is a good thing. It also means that in terms of quality there are rights of recall here. The Minister of Consumer Affairs can have compulsory recalls on products. Again that is a worthy inclusion because increasingly there is questionable quality of products as we are seeing more and more products coming on the market of questionable source of questionable quality and of questionable longevity in terms of their reliability. Again it is good that we have this option where the Minister can have compulsory recalls on products that may not be up to standard.I also note that in the Consumer Guarantees Amendment Bill it includes gas and electricity supply—so a guarantee that there will be an acceptable quality of supply of gas and electricity. It goes into all the various aspects of that to ensure consumers are provided with that basic provision in life—electricity and gas—that meets a quality supply situation.It is interesting in regard to that and I wonder how long it will take for many areas of New Zealand to have moreundergrounding of power. So many communities around New Zealand continue to have power supplied by overhead wires. Increasingly every time we have a major storm in this country we seem to see more and more power lines toppled by trees or other natural causes. More and more consumers are increasingly out of power for considerable periods of time in this country which is now quite different from areas in Europe and other sophisticated places such as the United States where power is increasingly underground and less susceptible to the elements.Some of the other parts of the Fair Trading Amendment Bill include provisions about false and misleading representation of goods and services. Again with goods being offered so often now over the internet and by electronic means we are not necessarily shopping physically and handling the goods. So this legislation does bring in a greater liability on the part of suppliers to not provide false or misleading representation about the goods. Also for unsolicited goods and services the responsibility lies with the supplier. If any goods and services are supplied that are not asked for by the recipient again the recipient has the right to return those if they are unsolicited. Also in terms of contracts this legislation tidies up some aspects of consumer contracts where in the past there had been a proliferation of all sorts of variations on consumer contracts. The legislation provides for the tightening up of consumer contracts to ensure that consumers are not subject to unwarranted and perhaps dubious forms of contracts.Also in terms of disclosure of trader status on the internet too often we do not know who the people offering products on the internet are. Often they are actually acting commercially but put themselves up as private individuals. Again they are perhaps moving goods through and not necessarily doing that with the right intent. Under provisions in this legislation there will be a requirement to disclose trader status. Unsafe goods are covered under the legislation as well so there will be greater certainty about goods that are provided. It will ensure that they are safe and not subject to any unknown problems when the person puts them on the internet or sells them through retail.It is also interesting to note that this legislation includes the Auctioneers Bill which is a little bit out on a limb in terms of this whole thing. In terms of auctioneering increasingly there are all sorts of things being auctioned and sold via the auction method. The Auctioneers Bill as a part of this legislation includes registration of auctioneers and tightening up of aspects of auctioneers—such as that they can be struck off and removed as auctioneers if they are not meeting the required standards. There is also a requirement for auction records to be kept by auctioneers for a period of 3 years to ensure that the records are obtainable and can be audited to ensure that the auctions were conducted correctly. The bill also includes aspects of vendor bidding. We are seeing increasingly more vendor bidding in many auctions. This bill tightens up areas of that so that vendor bidding must be disclosed and must be known to those who are participating particularly if vendors are bidding prior to any reserve being reached in the case of a property auction.Again those are all sensible things to bring into legislation. It tightens up a great many areas. If you look at all the bills there is a huge number and I have mentioned only a number of aspects of these various bills. But it is all to do with protecting the consumer providing greater protection in terms of their rights and ensuring that New Zealand residents and citizens are given far greater protection and that increasingly we are not being ripped off in our daily lives by unscrupulous traders vendors and others who would gladly take the money off you.So in that respect New Zealand First stands by this legislation. As we have said time and time again in this Parliament we are a party that stands by good policy that supports New Zealanders. In this case we see nothing at all wrong with any of the aspects of these bills. They are in support of good New Zealanders who are wanting to live a law-abiding lifestyle and be protected by the Government of this country. Therefore New Zealand First will be supporting this legislation.KANWALJIT SINGH BAKSHI (National): I thank you for the opportunity to speak on the third reading of the legislation arising from the Consumer Law Reform Bill. In reforming the legislation our primary objectives are to strengthen consumers’ rights to simplify business compliance and to make consumer legislation up to dateand more accessible and understandable for both consumers and businesses. There is little doubt in the mind of this National Government that this reform will help promote confident and well-informed consumers who demand high quality and make good choices. Each step that we take is good for everyone as reform drives competition innovation and growth along with jobs and the Kiwi lifestyle. It is my pleasure to stand and support this legislation.Dr DAVID CLARK (Labour—Dunedin North): Labour will be supporting the third readings of this legislation arising from the Consumer Law Reform Bill. We are glad to see it passing and we are glad that it has finally made its way through the House.I want to take up a point that was raised by Mojo Mathers in her contribution. She said that it was logical that the onus of proof should sit with the company that is making claims to consumers. I agree with the contribution she made in that respect. I want to expand upon it a little and talk about the concept of rational ignorance because that is one of the principles that underlie those consumer protections. Economists use the term rational ignorance to refer to the advantage that lies in being a consumer who does not have to research every single aspect of every single product that is consumed.It is far more efficient for the consumer and for society as a whole when common-sense rules apply and a consumer can rely on what is called rational ignorance. That is ignorance that is entered into in a rational way knowing that it is an efficient way of going about things and that is a wider good for the economy. When a product is claimed by a company to do a certain thing—I guess at the extreme end it might be a pharmaceutical product that claims to provide a particular remedy—it should not be the responsibility of every citizen to necessarily go and test whether that product provides that remedy or not. There are extensive trials that are undertaken on most drugs that are available today and it would indeed be almost impossible for any ordinary citizen to carry out the kind of testing that might give them full consumer knowledge of the impacts of any particular given drug.So in one respect even where there are substantiated claims that are researched by an individual consumer it is only up to a certain point that the consumer can be expected to understand and learn about a product. Generally most of us go about our day-to-day business relying upon the claims that are made for products and effectively understanding and rightly expecting that they will be true. So it is good that this law that we are passing today strengthens those provisions and makes sure that consumers can trust that the claims that are made are in fact substantiated and correct and that they can go about their business in a most efficient way.It is the same of course as what happens with Governments. Consumers—or in this case voters—vote a party into Government based on the claims that it makes and they trust that the Government will get on with what it is supposed to do or what it has said it will do. It is right that voters should expect that to be the case. And in fact we see that when Governments of differentilks do not live up to the claims they make then they of course get voted out. That is the mechanism that applies in that circumstance. But often too in terms of policy development Governments do things that were not signalled in advance. An obvious example that springs to mind is the increase of GST by this Government. That was not signalled in advance; it was something that the Government did once it was elected. People tended to react badly to that because it was not a claim that was clear and transparent beforehand.Iain Lees-Galloway: They said something quite different.Dr DAVID CLARK: I am sure that that will have consequences in due course for the Government. People will lose faith in it. Indeed as my colleague points out National did say something quite different. John Key said that he would not put up GST but then did.Another example would be retirement savings policy. Most ordinary citizens do not research every single aspect of retirement savings. They generally trust that the Government will plan ahead for their future. They elect people to make decisions on their behalf and they expect that they will be able to get their superannuation one day. We know though—those of us who have looked into the area more thoroughly—that in fact that is not possible under current settings. That is why in the Labour Party we are looking to have a consideration of whether the retirement age should go up. We are looking to ensure that KiwiSaver becomes universal so that people actually have full retirement savings policies. We would resume of course funds going to the Cullen fund to make sure that there is a fund there that can support the kind of retirement that Kiwis expect otherwise further down the track the New Zealand consumers of politicians’ actions are going to be very disappointed with what has happened over the years.I think that as politicians we are elected to make substantiated claims to make defensible claims and to allow ordinary citizens to apply what economists call rational ignorance—a sense of trust in the decisions that we make trusting that we will make the right decisions upon their behalf. So that more general principle that we are approving and supporting in this legislation should I think also be applied to the broader decisions that politicians make. I am arguing in that particular instance that we should have more rational policy around superannuation because that is what the voters expect. They expect to be able to have a dignified retirement but the current settings do not allow for that.Coming back to the principles in this legislation I guess the other thing that we are frustrated about is the amount of time it took to pass through. This legislation was initiated in 2009—4 years ago—and it is only now coming to its final stage. The Government has seemed more intent on getting on with other things like selling off assets than getting on with putting consumer protections in place or indeed collecting tax. We have just learnt this week that $8 billion is the amount of outstanding tax which is twice the value of the Government’s asset sales programme. This Government has been slow to repair the Inland Revenue Department’s tax systems. The Inland Revenue Department itself is a department under pressure and we see the effects of that as ordinary New Zealanders begin to wonder whether the Government really has a fair attitude to collecting taxation.Again with the slow passage of this legislation consumers could be wondering whether the Government really has it as a priority to look after them—to look after the ordinary man and woman in the street and their interests—or whether it is far more interested in doing deals selling off assets building casinos off the back of problem gambling and bailing out corporates like Chorus or RioTinto and asking very little in return. This Government does seem to be distracted. It does seem to be increasingly arrogant as to the will of the voters who put it there and of course we on this side of the House are picking up a different mood. New Zealanders are frustrated at the widening inequality. Although we are pleased that this legislation will do some small things in terms of putting a little plug in the dyke it is growth in inequality that will continue unabated even with bits of legislation like this in train.I guess Consumer New Zealand could claim a victory out of this legislation. It put pressure together with the Labour Party to make sure that this legislation was expedited to minimise ongoing harm. It did get there in the end. It did get there in the end albeit on a very slow path that saw it go through its various stages from 2009 to being passed only now. Substantial changes were made at the Commerce Committee and so the select committee must be congratulated on its hard work along the way. There were a number of details that were amended: clarification of the prohibition ofunsubstantiated representations prohibition of the use of unfair terms in standard form consumer contracts the requirement that contracting out of any Consumer Guarantees Act provisions be fair and reasonable increasing maximum penalties for breaches of the Fair Trading Act enhanced enforcement powers for the Commerce Commission and the removal of changes relating the Carriage of Goods Act to name but a few.There was also a wait-and-see approach adopted to unconscionable conduct. My colleague Clayton Cosgrove drew a link between that and some of the accusations against John Banks. I will not explore them here but all in all the legislation seems to be a step in the right direction albeit a very slow and belated one. Thank you.Dr JIAN YANG (National): I rise to take a very brief call on the third readings of legislation arising from the Consumer Law Reform Bill. Consumer laws in New Zealand are over 25 years old and have had few changes since they were enacted. This legislation is the Government’s effort to bring consumer law up to date with modern trading practices such as internet banking internet trading and self-service checkouts. The legislation represents the most significant change to New Zealand’s consumer law in more than 20 years. It will help promote confident well-informed consumers who demand high quality and good choices. This in turn will drive competition innovation and growth. I commend the legislation to the House. Thank you.Su’a WILLIAM SIO (Labour—Māngere): It is said that consumer legislation is an important contributor to building consumer confidence and ensuring that successful consumers are participating successfully in our market place and as consumers feel that confidence and are able to interact in the market place they are then able to contribute to a more productive and innovative economy whether it be that they are dealing with goods or services. That is the basis for why we need to have good consumer legislation.I have to say that this Government has failed on so many fronts to be able to provide that confidence to our communities. Well let me just give the other side some examples. This Government has presided over the worst ever economic period. It has presided over the worst economic record in 50 years the doubling of unemployment since 2008 the increasing numbers of Kiwis who have migrated one-way to Australia and we have a continual number—about 40 percent as recently released statistics show—of people working harder and longer but still having to face poverty. That is the result of this Government failing to provide consumer protection and failing to provide confidence to consumers throughout New Zealand.I think that in the last 5 years under this Government our communities—New Zealanders from the far north to the deep south—have continually been screaming at this Government and rightfully so demanding from this lot that they honour their promises made about mana-enhancing legislation their promises of creating 170000 jobs and their promises of providing a brighter future for all New Zealanders they said. Well sadly those demands those calls from our communities the calls for jobs the calls for a living income the calls for affordable homes and the calls for a better quality of life for all have seriously fallen on deaf ears. That is because the people’s issues—New Zealanders’ issues—have not been the priority for this Government. Its priority has always been big business its mates who—Dr Rajen Prasad: Crony capitalism.Su’a WILLIAM SIO: Yes crony capitalism is what my colleague here has said. Its big-business mates have demanded of this Government free unbridled growth and profits. This Government has not put people and the quality of living for all our citizens as its priority. It continues to look after itself and its mates at the expense of Kiwis and it has stopped listening to New Zealanders. It has become arrogant and out of touch.An example is really the series of bills that we are now debating at their third reading. Since this Government came into power the protection of consumers has notbeen its priority. The Government has sat on this legislation for a very long time—in fact from the beginning. What the Government did in the beginning though was to raise this legislation and attempt to pacify the calls from our community for better protection. But the facts remain. The Government has gone through several Ministers of Consumer Affairs to get to this particular point and by my own calculations it has had five Ministers of Consumer Affairs. That is a Minister every year. That is an indication that the consumer affairs portfolio has never been the priority for this Government.So yes it is about time that the Government brought this legislation to the House but sadly for many of the consumers who had huge expectations of this Government right from the start they are quite sorely saddened by the way that the Government has taken its time as an indication that the protection of consumers giving consumers confidence in the market place has never been its priority from the get-go. The Government’s priority has always been its big-business mates. Although my colleagues who have been on the Commerce Committee say that we do need to support this legislation and that there are some good things in the series of bills that is before the House I suspect that the truth of how this legislation provides protection or not to our citizens will depend on how those citizens receive these pieces of legislation.Let me remind the House that very recently—this week—there have been numerous media reports. I want to share with the House one report titled “Loan sharks rob desperate Kiwis. It says: “The head of the country’s biggest credit union has taken a swipe at loan sharks who he says are carrying out ‘legitimised robbery’ of unsuspecting clients. Gavin Earle chief executive of NZCUBaywide said loan sharks were causing despair among the vulnerable desperate and unwary in the community. Mr Earle who is based in Hastings said one lender was openly advertising a daily interest rate of 1.3 per cent per day. ‘That doesn’t sound like much but this equates to an actual rate of 475 per cent per annum. Even worse should you default on your repayments you’re hit with an additional penalty rate of 75 per cent per annum.’ Mr Earle said those rates were ‘fantastic’ if you were the lender but crippling if the borrower.”I do not know whether this piece of legislation is going to give confidence to our consumers to our communities particularly leading up to the Christmas period that there is protection. Some on the other side—I do not know—will hopefully be able to recognise that there are some serious problems that were raised by the community from day one in 2008. I do not know but if they were genuine and serious about taking consumer rights and consumer protection seriously then hopefully their piece of legislation is going to provide some of that protection as raised by Mr Gavin Earle of NZCUBaywide.A woman from Whangarei who got $4000 worth of electrical equipment on credit in 2009 has since paid more than $12000 for the goods and she still owes about $2700. This is an example of how people are getting themselves into debt and it has seen a huge increase in demand for budgeting advice services—not just in Whangarei but right through the length and breadth of this country of ours. I have to say that constantly we hear these stories and the Government has heard these stories from 2008 and 2009. The community will have every right to question whether the pieces of legislation that the Government has put before the House today are going to provide the kind of protection as raised by this particular report and provide confidence to our citizens out in the wider community.May I just finish off by saying that members on the other side laughed when I said that in the last 5 years things have worsened for many many communities. I want to say to them that the inequality has worsened and they have presided over that worsening period for people who have no choice and who are forced to try to make some of the most difficult decisions on the meagre incomes that they are earning. That is just notavailable to them through their lack of knowledge through their lack of resources through their lack of jobs and through their lack of income. I would point the finger directly at their Government. That is the Government that is responsible for the struggles that communities are encountering today.Bills read a third time.Arts Council of New Zealand Toi Aotearoa BillIn CommitteeDebate resumed from 3 December.Part 3 Miscellaneous provisionsThe CHAIRPERSON (Lindsay Tisch): When we were last considering this bill we had reached Part 3. The question is that Part 3 and this is the debate on clauses 19 to 27 and the schedule stand part.GRANT ROBERTSON (Labour—Wellington Central): Thank you Mr Chair for reminding us where we were up to in this bill the Arts Council of New Zealand Toi Aotearoa Bill. We are indeed on Part 3 which is the somewhat misnamed “Miscellaneous provisions” section of the bill because actually what Part 3 does is the guts of what is happening here. It gets rid of the Arts Council as we know it. That is what this part does.The first thing it does under clause 19 is protect all of the names of the bodies that it is about to disestablish. That is clever. Just in case anyone else out there might have wanted to establish for instance Te Waka Toi or a body of that nature to go on and do its good work the Government has stepped in and said: “No we’re protecting those names.” So that is what the bill does under clause 19.But then the bill gets to clause 21 which does the dirty work of this bill. It dissolves the two arts boards one of which is Te Waka Toi and the other of which is the Arts Council of New Zealand—Creative New Zealand as we know it today in its operational form—and the Pacific Arts Committee. It gets rid of those once and for all.For the Labour Party members of this House this is the crux of why we cannot support the bill in its current form. By dissolving Te Waka Toi and the Pacific Arts Committee the risk is run that those important parts of our artistic community will no longer receive the attention that they deserve. In earlier parts of the bill the Minister in charge of this bill the Minister for Arts Culture and Heritage has said to us: “Don’t worry. It’s all fine. It will be completely possible for the reconstituted Arts Council to be able to create a Te Waka Toi to create a Pacific Arts Committee if that’s what it wants to do.” He even said that he thought it might be quite a good idea. Well why on earth are we debating a bill that dissolves those organisations in Part 3? Because he said in this Chamber that it would be OK by him if those bodies were recreated and in fact he thought it would be quite a good idea.Tracey Martin: Less funding.GRANT ROBERTSON: Tracey Martin says to me that it is all about the money—follow the money. If that is the case and if that is the driving force of what is behind this bill from the Minister then that is very sad for arts organisations right across New Zealand.The last public event that I was at with the Minister was the Arts Pasifika Awards an absolutely fantastic night organised by the Pacific Arts Committee which was lauded for its great work. Sitting there and seeing the tremendous Pacific artists who were in front of us and whose ability to shine had been facilitated by the Pacific Arts Committee is I think frankly incredibly sad. But that is what clause 21 does. Itdissolves the arts board and essentially sets up the process for all of—what would happen in a normal situation—the property and assets and so on of the board to be redirected.Jacinda Ardern has Supplementary Order Paper 364 which covers this section of the bill and which asks for this clause—clause 21 which I am currently talking about—to be deleted. From our point of view that is the only solution we are now left with after various amendments that have been proposed in the earlier parts of the bill completely failed to gain the support of the National Government and its support parties. We are left now with wanting to delete clause 21 so that we can continue to have Te Waka Toi and the Pacific Arts Committee.It is worth having a brief reflection on the submission of the Human Rights Commission to the Government Administration Committee. I will assume that members may not recall the submission as it is dated 1 October 2010. That is when the Government was last—Darien Fenton: Why has it taken so long?GRANT ROBERTSON: Well that is a very good question. Why has it taken so long? The Minister has been unable to answer that because apparently the great urgency with getting rid of these boards has not taken place.In 2010 the Human Rights Commission raised serious concerns about the changes that were being proposed here. In particular it raised the fact that the potential loss of distinctive identities and practices of Te Waka Toi and the Pacific Arts Committee is potentially damaging. It said that it is possible that now that there is going to be a small number of representatives of those groups the dominant operating practices of the Arts Council will become the norm. What is being discussed there is the fact that by having the distinctive identities of Te Waka Toi and the Pacific Arts Committee it was possible for the decisions about funding for artists for those groups to be made in a way that was culturally sensitive and that was in line with the operating practices in those cultures. That has now gone and the new council will have to try to endeavour to find a way in which artists from those groups can continue to be supported. Why not just leave the bodies in place? It just does not stack up. If the Minister is completely prepared to see these bodies continue it just does not stack up for clause 21 to not be taken away.The Human Rights Commission raised a further concern which was one that was raised earlier in the debate by members of the Labour Party. That concern is around the fact that by removing the Pacific Arts Committee and having a council where there will be two three or maybe four representatives of the Pacific community the risk is run that that does not give broad representation from across different parts of the Pacific community. It is all very well to say that there will be three or four people at the table who will represent Pasifika people but we all know that across a range of different Pacific cultures there is nuance and there are different kinds of views. If there are two Samoans a Tongan and a Niuean who will represent the Tuvaluan and the Tokelauan communities? The beauty of the Pacific Arts Committee is that by having a broad range of people on that committee from different Pacific ethnic backgrounds we can ensure that we have the representations required. That is what the Human Rights Commission put to the select committee. It said that the council would have to work very hard to ensure that those communities are adequately provided for.Then there is the whole question of the way in which advice comes to the Minister and comes to Creative New Zealand about Māori and Pacific communities. I do believe that those people who will now end up on the Arts Council representing Māori and Pacific communities will have huge pressure on them to be able to be representative and to give advice. It is actually very unfair to put that burden on those people and to say that they are the representatives and the ones who have to carry the weight of theirwhole communities at that table. I simply do not believe that a justification has been put forward to the Committee by the Government for why it is that dismantling these bodies as we are doing under clause 21 is justified when we know that they provide effective advice they provide advocacy and support for Māori and Pacific artists and they ensure that funding goes directly to those artists from people who understand those communities. That is now going to be put at risk in my submission.So our view on this side of the Committee is that we would ask members to support Supplementary Order Paper 364 in the name of Jacinda Ardern to delete clause 21. We believe that is the only way that we can ensure that Māori and Pacific artists continue to be represented. The transitional provisions that are here continue on with the somewhat odd drafting in parts of this bill which we discussed in the debate on clause 2 where none of us were any the wiser about what those clauses meant. In this case the boards are being dissolved but we have a Minister who has told us that he would actually quite like them to continue. Well if that is the case National should support JacindaArdern’s Supplementary Order Paper and stop dissolving boards that it actually wants to carry on.RINO TIRIKATENE (Labour—Te Tai Tonga): Kia ora Mr Chair. Thank you for this opportunity to speak at the Committee stage of this bill the Arts Council of New Zealand Toi Aotearoa Bill. It is my first contribution on this bill. We are up to Part 3. I was just coming up to speed with the background to this bill and I was really very surprised at the delay in the passage of this bill. This bill was introduced 3½ years ago way before I was honoured to be in the House. It was way back in June 2010—3½ years ago—that the bill was introduced. It was reported back in November 2010 and here we are now in December 2013 and we are still plodding our way through the Committee stage. It has taken a very long time and I think that a question we definitely need to pose to the Minister for Arts Culture and Heritage is why there has been this length of delay because this bill has been around for a long time.I would like to just refer to the briefing to the incoming Minister dated December 2011. In that briefing Creative New Zealand says: “Creative New Zealand regards the passage of the Bill”—this bill—“as the top priority for 2012.” It says that this bill is the top priority for 2012. It continues: “The current hiatus in its passage makes it difficult for the current Council and boards to progress significant policy and structural initiatives as the implementation date for the new governance structure remains unconfirmed.” There we have it—a plea from Creative New Zealand to the Minister to get cracking and to make the passage of this bill a top priority for 2012. Here we are on the verge of passing through 2013 into 2014 and we still have not got this bill through. I think it is an injustice to Creative New Zealand and the arts sector of our country.Creative New Zealand also goes on to state in the briefing to the Minister: “Creative New Zealand and the arts sector are operating in a period of considerable change and challenge.” There have been considerable challenges for the whole arts sector particularly post the Christchurch earthquakes and right through to the present time given the uncertainty of the governance structure of the Arts Council. So against that background we come now to Part 3 of the bill which as my colleague Grant Robertson outlined is really the guts of this piece of legislation in that it deals with the actual expiry of the membership of what would be the former Arts Council and also the dissolution of the councils—in particular Te Waka Toi the Arts Council and the Pacific Arts Committee. Those are the key provisions in Part 3.I have had to do a bit of mental gymnastics because here we are in December 2013 but the commencement date for this piece of legislation which was amended by the Minister at the Government Administration Committee will be on 1 October 2011. So we are enacting a piece of legislation that will be enacted back in time on 1 October2011. As soon as it comes into force all of the decisions all of the board all of the activities and operations of Creative New Zealand are basically in limbo I suppose because back in time on 1 October 2011 effectively there was no board. Oh no—sorry it is 1 October 2010. That is the date on which this legislation will actually come into force. It is sort of making my mind go “What’s going on here?”.Can you imagine what it is like for those poor people in Creative New Zealand and the arts sector across New Zealand who have had to operate under such a twilight zone? It is a twilight zone they have been in for the past 3½ years of waiting for this legislation to go through. I am really surprised that the Minister has taken such a long time. We can contrast that with the rapid-fire Treaty settlement legislation that he has been firing at us left right and centre through to the Māori Affairs Committee. A tremendous amount of legislation has been going through that committee at an incredibly fast pace. Yet this most important piece of legislation for our arts community right across New Zealand has been languishing. I am very concerned at the length of time it has taken and the impact it has had on the operations which is given effect to in Part 3 of the bill.There are a couple of other points I would like to point out. I am really lamenting the loss of the beautiful name Te Waka Toi. My colleague Shane Jones who is the expert linguist knows that that is a poetic term—the arts waka for Māori. Yet what we are seeing in Part 3 clause 19 is that basically those names are off limits and cannot be used by anyone or anything. Not only that but nor can the names Arts Council and Creative New Zealand which was the trading name for the council be used. I do lament the loss of Te Waka Toi because those are iconic names iconic terms poetic terms in Māori Te Reo and now they are effectively off limits never to be used again unless there is a change to this legislation.Tracey Martin: Crazy.RINO TIRIKATENE: I agree with Tracey Martin. It is crazy. Looking at the creation of the committee I see that Te Waka Toi is now going to be four Māori representatives. No actually they do not have to be Māori representatives. They could be any person as long as they have some sort of artistic expertise in the Māori arts and crafts or culture and heritage areas. It could be any person as long as it gets the stamp of approval or it is run by the Minister of Māori Affairs—and that is pretty easy. You could put anything past him. He will give it the nod or he will not really care.Te Waka Toi is an iconic committee. It made a huge contribution to the Māori arts. There are Te Waka Toi scholarships and Te Waka Toi awards. Now I lament its dissolution under this legislation. And it applies not only to Te Waka Toi but to the Pacific Arts Committee as well. That representative group has close to 16-plus years of history of working with the arts sector.But what I am really disappointed about is the complete lack of representation for ethnic New Zealand. There is no voice for ethnic New Zealand on this new arts council body. Today we had a press release from Statistics New Zealand saying that New Zealand has more ethnicities than the world has countries. We are growing in ethnic diversity. Our population is increasing and changing all the way through. Yet that fast-growing demographic of our society has no voice on this arts council body.Those are some of the key aspects that I would like to draw to the Committee’s attention and hopefully the Minister will be able to address some of them. The delay in the passage of the bill and the effective dates and what that means in terms of how the whole Creative New Zealand group has been operating for the past 3 years have definitely been a disservice to this great organisation. Thank you.DARIEN FENTON (Labour): I have been waiting around for some time over the past few months hoping to take a call on this bill the Arts Council of New Zealand ToiAotearoa Bill. It has moved its way through Part 1 and Part 2 which I was really looking forward to talking about because I have a particular interest in the community arts sector.However now we are on Part 3 and as my colleagues have said this is the guts of the bill. This is the part where it guts the existing Arts Council and takes away representation from Māori and Pacific people and provides none for ethnic communities. What it isis a rationalisation a cutting down of the existing Creative New Zealand—or rather its new name. Creative New Zealand was a council with two arts boards each with seven members and it had a Pacific Arts Committee which was a committee of the arts board and Te Waka Toi. They are going to be gutted. I have to ask the Minister in chair the Minister of Justice: have we learnt nothing about representation about providing the voice of the different communities in our country particularly that of our indigenous people our Māori people but also that of the new people who are now growing in numbers—the people whom this Government likes to celebrate? National members turn up at all the ethnic events year in and year out. That Minister turns up and celebrates them yet National is not willing to give those people a voice on a tiny little board that has a small amount of money that it gets to distribute.The other concern I have about the gutting in this bill the shrinking that this bill does Minister is about what is going to happen to the community arts sector. It is a very important sector of our community—a very very important sector. My colleague Rino Tirikatene said that we were living in some sort of time warp under this bill because of the time it has taken for it to come through. I looked at that because it is quite interesting to look back and see who was on the original Government Administration Committee. We had a number of people who have moved on and are doing completely different things.Grant Robertson: Shifted off.DARIEN FENTON: Shifted off. The bill started out in August 2010. The select committee considered 15 submissions and the bill has meandered its way though this House. I think the start of the Committee stage was in March of this year. Here we are on the second to last sitting day before Christmas—Hon Maryan Street: December.DARIEN FENTON: —December—and we still have not got through this bill which was so important back in 2010 and had to be done.As I said Rino Tirikatene was talking about being in a time warp. I believe it and I have been told by many people in the community arts sector that they think they are living in a time warp. They have been living in a time warp since the time Labour was last in Government and I want to tell you exactly what they mean. I have a letter from one of the community arts groups in Devonport called the DepotArtspace. It has for many many years provided wonderful arts to the community but also an education programme for young people who want to be active in the arts. It has written to all Ministers and to the Labour Party an open letter to express its concerns for the parlous state of the arts and creative industries in the current political environment. It goes on to talk about its involvement as DepotArtspace for nearly 20 years providing services and facilities that support all creative disciplines from the visual arts to music literature performance film production and media. These kinds of organisations exist all over New Zealand but we are going to have an Arts Council that is shrunk down that is cut in half and that will have complete control over how the funding is distributed and I believe that smaller organisations like these are going to struggle for funding.The people from the DepotArtspace believe that the arts are a low priority under this Government despite the fact that the cultural industries contribute over $8 billion to the New Zealand economy and that 7 percent of the workforce is employed in the artssector. Cuts have occurred to every part of the creative sector and they have been especially noticeable in education and employment where aspirations to work in the arts are regarded as unrealistic. The truth is that this Government does not believe that people should work in the arts. It sees the arts as a “nice-to-have” and an add-on that is not a real job and so those arts graduates who may have incurred student loans to pursue a career in their chosen field are being directed to get a real job—a real job.Successful programmes we had under Labour like the Pathways to Arts and Cultural Employment programme have all but disappeared. The tertiary education sector is making significant cuts to courses and teaching staff. Fifty positions have been disestablished in the design and visual arts department at Unitec and there are possible closures in Northland particularly in Kerikeri andRāwene—areas where we need this kind of unique community arts more than ever an area where a lot of people have worked in supported and had funding provided through the old Creative New Zealand through the community arts programme which will be gutted under this bill.As we know of course the film industry is in dire straits—in shocking straits—after all of the boasting that has been done by John Key. In fact director Andrew Adamson says that the film industry is effectively dying when we have done so much to build it up. Then of course just to make it even worse community education funding was cut. That was about community art as well. That was about people learning to paint or to sing or to play an instrument. That has been cut with National dismissing arts classes as it did as hobby courses.So you can understand why we are concerned about this bill why we are concerned about Part 3 and why I have no idea why the Government under clause 19 of the bill wants to think it has ownership of names like Te Waka Toi and for that matter Creative New Zealand or any other name that it says resembles those names. Those names will be returned under a Labour Government and this legislation will have to be repealed because we will not enable this kind of protection of ownership of important names and particularly important names for Māori. Under clause 21 that is as Grant Robertson said where the arts boards are dissolved. That is where you see Te Waka Toi disappear and the Pacific Arts Committee disappear. That is where you see the takeover by seven people and the tokenistic appointment of people to represent Māori who do not even have to be Māori and the disappearance of Pacific representation.I think it is an appalling bill. I do not think it needed to be like this. It is clear from the time it has taken for this bill to wend its way through the House—3 years in fact—that this is not a vital piece of legislation that needed to be done. Looking at the timetable for submitters I see that that seemed to be pretty short. Arts organisations and others have certainly expressed to us their concern on many occasions about the direction this bill is taking and the consequences it will have for the voices of Māori Pacific and ethnic people in New Zealand; for people with disabilities; for children’s voices; for children’s arts houses and community arts centres; and even for wonderful organisations like our Auckland Art Gallery. All of those things are covered by the bill. All of them have the potential to be affected.Next time I see a member of the National Party at somewhere like the arts house in Takapuna or at an ethnic event I am going to be asking myself and perhaps saying on the side “How dare they? How dare they turn up?”—Sue Moroney: How very dare they?DARIEN FENTON: How very dare they? That is right. How very dare National members turn up and pretend that they celebrate and support the arts that they support representation and that they support proper funding—not control from the centre but the flowering that happens when communities are set free to be able to develop the arts and have their own voice around that? Also how very dare they assume that the arts arenot something that our children should aspire to learn and to have good real proper-paid jobs in? How else do we build the culture of New Zealand? How else do we have an identity? How else do we celebrate who we are? How else do we celebrate new people and new migrants who come to this country whom we are embracing? As Rino Tirikatene said there are more ethnicities than the number of countries in the world. I am really pleased to have a call on Part 3 of this bill but also very disappointed that I had to take a call and oppose this provision.CATHERINE DELAHUNTY (Green): I am happy to take a brief call on Part 3 of this very interesting bill the Arts Council of New Zealand Toi Aotearoa Bill. Clause 21 in Part 3 is what I want to address. I certainly do support Supplementary Order Paper 364 from Jacinda Ardern on this one because the Green Party opposes the dissolution of Te Waka Toi and the Pacific Arts Committee. We thought about this quite deeply because there is an argument to be made that everyone is better off sitting at the table. That is the argument that was made particularly for Māori—that it is actually high time that Māori art is recognised strongly enough in this country at this time and that the best representation and the most effective way to be represented is to sit at the table with the other members of the Arts Council rather than through Te Waka Toi. It was also argued that for Pasifika arts that was the case as well and therefore there was logic to dissolving those two committees. But on further investigation I have found that that was not how Māori artists felt. In the end it is not what the bureaucrats think; it is actually what the artists think. The artists were very concerned both in terms of Te Waka Toi and the Pacific Arts Committee about what they would lose.It is a very interesting idea because it is based on the assumption that if everybody is at the table somehow the table will be equitable and that having a voice at the table is better—in terms of the result and in terms of access to resources and recognition of your culture’s artistic contribution—than having your own group that you can identify with support specific artists with and lobby. We were open to the argument but that is not what we heard from the artists whom we discussed this with. They said that they valued Te Waka Toi and although the assumption is that tangata whenua are widely recognised in every forum and that they were going to be equally recognised on the main Arts Council that is not what those artists felt was in their best interest. They felt that it was still possible for their issues to be overlooked and their issues to be marginalised. And for the up-and-coming the emerging and the less well known they felt that they would not have this nurturing voice and this clearly identified body that they could actually work with.So I am thinking about young artists who are now making a success of themselves but who have really benefited from having a strong Māori arts focus in this country. I am very proud of a young man from my area Hauraki-Coromandel who just won the Bruce Mason Playwriting Award young JamieMcCaskill. Jamie was in my youth group when I was a youth worker and now he has just won the Bruce Mason award. We are all incredibly proud of Jamie. But Jamie writes about things like domestic violence. He writes about things like Māori in prison. It is not easy to be writing about these radical themes in this country unless you have got an Arts Council that has a very strong understanding of a very specific Māori voice that needs to be heard. We are not yet convinced that there will automatically be that nurturing if the Māori representation through Te Waka Toi is dissolved and it all becomes part of the one Arts Council.It is even more so with Pasifika. I think it was one of the previous speakers from the Labour Party who pointed out that there is no such thing as the Pasifika voice and that there is for a start Micronesia Melanesia and Polynesia and then within that there are a number of nations represented in our country now with large communities or smaller communities who are not prepared to be lumped in as just “the Pacific” andrightly so. They are still at a different stage of recognition and in all our statistics remain marginalised in many ways and they rely on and have relied on that Pasifika committee to be their nurturer their advocate their voice at the table and their clearly defined although never enough amount of money that comes their way. So these Pasifika artists and the people who have supported them are not at all keen on the dissolution of the committee.The Green Party came to the conclusion that clause 21 was counter-productive and that we wanted to support the maintenance of those two committees until the people say they do not want it. When the artists say—not when the arts administrators or the arts bureaucrats or the arts experts or the art buyers or the politicians say—“We feel we are best served by sitting at that table without separate committees.” we the Greens will change our mind about this and we will support that approach. But until that time we will continue to support the idea of these discrete entities. I would just like to continue briefly on the matter and say that these discrete entities have a whakapapa if you like. They have a tradition. They have nurtured and supported some of the most fantastic artists in our country and the people want that to continue to happen.So we are not able to support Part 3. We obviously had a critique of Part 2 when we were talking about community funding and community providers. We have had a critique of the bill on a number of levels. We understand the desire to rationalise and to examine the value of the way in which arts administration takes place. We understand that that was what was driving the bill and that is fair enough. But we do not believe that what has resulted is going to stimulate the grassroots and flax-roots art and the community art. There are two groups—and possibly there will be more; I would say that there will be more as multicultural demographics develop—that want to have someone who stands for them and them alone so that they can be strong at the main table. That is about power—it is always about power. And if power is going to work the arts are very much part of the expression of the different power relationships in this country just like many other laws that we talk about in this House. This is about power and we need the artists themselves to be able to have and keep their own bodies until they feel they are powerful enough to actually not need that kind of advocacy. Many times on many other bills I have heard people say: “Oh we don’t need this any more. We don’t need that because we’ve matured as a country and we’re all one people.” and blah-blah. Actually when it comes to money and when it comes to unique expressions of culture we have to be very aware of who still holds the power who is the dominant group and who gets marginalised.We are very clear about that in terms of this bill and we will support the Supplementary Order Paper to remove clause 21 because we do not think it is in the best interests of those arts communities. We have not heard that from the artists. So we will continue with our opposition to the bill because we think there is a better way and that better way is about asking the artists what should be done to restructure the arts community. If there needs to be change let us see what it is that the arts community thinks needs to be done because if we do not listen to the voices of those artists not only will the legislative regime be poorer but the whole country will be poorer. The whole country needs a fantastic diverse and unique series of voices and they need to decide how they are advocated for. Thank you.GRANT ROBERTSON (Labour—Wellington Central): I just wanted to pick up a point that Rino Tirikatene initially raised on the Arts Council of New Zealand Toi Aotearoa Bill. It is in relation to clause 19 “Protection of names”. As I stated in my earlier call this is the clause of the bill that means that nobody else is allowed to use any of the names listed in clause 19. It actually is quite clear what a protected name is and it is all of the names listed. Some of them are going to carry on. The Arts Council ofNew Zealand Toi Aotearoa is going to carry on and it is being protected—clearly because this is a bill that repeals the previous Act. Presumably there was a protection of names section.But where things go awry is where a name is protected but the board is being dissolved as in the case of Te Waka Toi because what the Government is effectively saying is: “We own the name Te Waka Toi.” It took me only a couple of minutes ofgoogling to discover that the phrase “te wakatoi” has actually been used as a name by a number of people over the years as my colleague Rino Tirikatene said. It is a poetical name—the arts waka. In fact it is the name of a couple of works of art. You can go to see one of them by Fred Graham in the Auckland Art Gallery if you like. It is the name of an exhibition that has been held previously. And yet the Government wants to come to the Chamber tonight and tell us that it controls Te Waka Toi. It controls it by dissolving it disestablishing it and saying that no one else can have the name. Well to me that is absolutely ridiculous and it is unfortunately typical of this bill because of as we discussed previously—and I will come to this in a moment—the confusing language around community arts councils in Part 2. None of us were actually clear by the end of it exactly what was happening with that. But by taking away the ability of anybody to actually use the name Te Waka Toi in the future the Government in my view has wholly overstepped its mandate and that is under clause 19(1).If we carry on down we come to clause 19(3): “No body other than a community arts council within the meaning of this Act may be incorporated or registered or may operate or carry on activities under any enactment or in any other manner under a name that includes the words ‘community arts council’ or ‘arts council’.” So the Government in clause 19(3) is banning the use of the term “arts council” unless it is as defined under this bill which as we discovered during Part 2 is completely meaningless and gobbledegook.But “arts council” is a term that will be applied in a lot of different ways. Once upon a time I was the trustee of something called the New Zealand Students’ Arts Council. Hekia Parata I think may once upon a time have been involved in the New Zealand Students’ Arts Council as well. Would we not have been able to call ourselves the New Zealand Students’ Arts Council because the term “arts council” is now apparently owned by the Government? It is protected by the Government. You cannot call yourself an arts council. I have just looked it up online again. We have got the North Taranaki Community Arts Council and the Motueka Arts Council. Are these people allowed to be arts councils any more? Unfortunately we were very unclear when we looked at clause 16 that it seemed possible that the Arts Council of New Zealand Toi Aotearoa could establish community arts councils in particular geographical areas.But it is not just community arts councils that the Government is trying to control here; it is the term “arts council” generally and that is what is written in clause 19(3). Nobody can in any other manner use the name “community arts council” or “arts council”. I am sorry to say that this bill once again I think either has created an unintended consequence or is a result of the Government overreaching in what it wants to do in this area. Clause 19 of this bill is now giving rise to significant concerns for me about the way in which the Government intends to control the usage of terms like “te wakatoi” and “arts council”.I simply do not believe that those people who provide arts services in the community who want to come together in different communities band together and create a body that helps develop artists in their area are now going to want to have to go through this bizarre process under clause 16 of this bill to establish themselves as a community arts council. Otherwise they are up for prosecution I presume if they decide to call themselves an arts council. It is a farce.This bill is the product of a Minister for Arts Culture and Heritage who has not stood up and justified it. He has got a bill he has been sitting on for years and now he brings it back to the House with a clause like clause 19 which quite frankly I think goes miles beyond his mark. [Bell rung]I will take another call here on one other matter and that is to return to clause 21 briefly. Just think for a moment about what this Committee is about to do. This Committee is about to vote to dissolve the Pacific Arts Committee and Te Waka Toi. I was at the Creative New Zealand Arts Pasifika Awards with the Minister a few weeks ago. JonathanLemalu received an award and Victor Rodger the playwright received an award. We had a stunning performance by a woman namedNatalia Mann who is a harpist. These are artists who have been fostered by the Pacific Arts Committee. They have been fostered by a group of people who understand not only Pacific communities but also the role of the arts. They understand the diversity of those Pacific communities.On that night the representatives of each of the different Pasifika communities got up and presented awards. We had representatives from Niue to Tuvalu from Tokelau through to Samoa and Tonga. They all got up there and that is the strength of that body. That is what is being dissolved tonight under clause 21 in the hope that two people—two people—sitting on the new Arts Council will be able to represent those communities. They will not. It is unfair on them it will put undue pressure on them and it will not lead to the kind of Pacific arts vibrancy that we would expect in New Zealand.Te Waka Toi has been responsible for encouraging all manner of Māori artists—Patricia GraceWīremuKaa Kiri Te Kanawa. All of these people have been recipients of awards and grants from Te Waka Toi which recognises the special place of Māori arts in New Zealand. That body is being dissolved tonight in the hope that four people—who do not have to be Māori—appointed by the Minister of Māori Affairs can come along and somehow represent that rich diversity of Māori arts as well.Part 3 of this bill is flawed. It is the part of the bill that dissolves organisations that have done a great deal for the arts in New Zealand and I believe that this is a very sad day indeed.Hon NANAIA MAHUTA (Labour—Hauraki-Waikato): I want to follow on from the comments made by my colleague Grant Robertson. He made some very good points. I would like the Minister in the chair Minister Collins to respond to some of those comments because I am sure that she would not be able to explain to New Zealanders just why Māori and Pacific people have been expunged from this bill the Arts Council of New Zealand Toi Aotearoa Bill. The significant contribution they make to the identity of New Zealand through arts and culture cannot be understated.But more important than that why is it that the name used by Te Waka Toi cannot be used elsewhere? It just does not make sense. The Minister sits in the chair silently. She does not take the opportunity to respond and to explain to those people in New Zealand who are very passionate about the arts sector why the name Te Waka Toi cannot be used again. Te Waka Toi is more than a name. It is more than an institution. It is about a whole evolution of people who have grown up and nurtured the arts specifically within the Māori community. I am thinking about Elizabeth Ellisin her stewardship of this space. I am thinking of TeAuē Davis who made a significant contribution in this area. I am thinking ofNgāhuia TeAwekōtuku. Again these are people who are passionate about arts and culture and heritage and who have contributed significantly to nurturing what that looks like over a period of time in New Zealand and nurturing young people within the arts space.When we think about building a national identity something that all New Zealanders can be proud of we know that it is Māori and Pacific cultures that contributesignificantly in this space. Why oh why is it Minister—if you can be bothered to take a call and respond—that Māori representation on this council has been reduced to four people and Pacific representation to two people? Do you expect the sector to be happy with that? “That is your lot. You make of it what you can and you do with it what you will.” I say that it is an insignificant step going forward in terms of how the Government proposes to I think infuse what is rich and vibrant about our place and Māori and Pacific contribution in the arts area.I want to reflect on some of the young artists who have been supported by Te Waka Toi. I think about writers singers and artists who have all received sums of funding to enable them to explore the potential of their art whether it be to contribute to an exhibition that is held overseas or to actually help them learn from other peoples other indigenous nations and go and share their talent. These are all spaces where Te Waka Toi has seen great talent. Young Māori artists have certainly been able to infuse their genre of art with other peoples and other cultures. So art is just as much about an internal reflection of who we are as an external connection to who we are and how we connect to the rest of the world.I think this bill is a step in the wrong direction. I think the fact that the limitation of the way in which Māori and Pacific peoples contribute to the arts sector is not progressive. I do not think it will help grow the amount of talent that we have in New Zealand in a positive direction. I really seek an opportunity for the Minister to just get up and respond to some of these calls.Part 3—specifically the provisions around protecting the names—just does not make sense. Why is the Government not allowing the utilisation of these names beyond the passage of this bill? There is still silence. The Minister refuses to take a call. Why have Māori been reduced to four members on the Arts Council when prior to that they had a council that was specifically dedicated to growing that talent under Te Waka Toi? No response. Why is it that the Pacific community has been reduced to having two members on the Arts Council instead of a sector that can actually grow the full vibrancy of the talent that it has? There is still no response from the Minister. This is simply not good enough. Can I say that this bill is a step in the wrong direction. I do not think it will grow—RINO TIRIKATENE (Labour—Te Tai Tonga): I would like to make just a brief contribution in this debate on the Arts Council of New Zealand Toi Aotearoa Bill. Just carrying on from my colleagues the Hon Nanaia Mahuta and Grant Robertson we have spoken at length about the travesty of the loss of iconic names like Te Waka Toi and Creative New Zealand and the fact that those names will be off limits. By extension this piece of legislation will create a single arts council the Arts Council of New Zealand Toi Aotearoa and it cannot be called Creative New Zealand. This is the body that funds the arts for Aotearoa. Surely the Government can think of a nicer name than “Arts Council of New Zealand Toi Aotearoa”.I would like to make a prediction. I actually think that there will be a new name that will be given to the Arts Council. I guess the same will apply to the Māori committee. The four representatives on that board who are there for Māori—they may not necessarily be Māori—will form a committee. I think it is a pretty sure bet that that committee will want to have its own name as opposed to just being a committee set up under clause 11 of the bill. So what we will see is a further rebranding exercise. There will be arebranded Arts Council and they will give it a flash name I hope something that is fitting of our arts community of Aotearoa. I am very sure that the four members of the Māori committee will also want to have a beautiful Māori name—Grant Robertson: Like Te Waka Toi?RINO TIRIKATENE: Exactly—it could be Te Waka Toi.It just shows you how redundant the provisions are. We know in practical terms that they will not be able to use these names but of course they will be creating their own trading name so that they can carry out their important mahi for the arts community. So I would just like to draw that point because I think it shows you how absurd this legislation is and how wasteful it is that we cannot use iconic names like Te Waka Toi. It is prevented. No person and no organisation can have any association with that name. As Mr Robertson said that already causes contravention around quite a large number of arts bodies right across Aotearoa who not only use that name but also use the other term “arts council”.I would also like to briefly go to the schedule. I actually think that this piece of legislation is very misleading. I alluded to this in my earlier contribution. It is misleading in the fact that the resulting Act will be called the Arts Council of New Zealand Toi Aotearoa Act 2010. Here we are at the end of 2013 going into 2014. We are going to be passing a piece of legislation from 2010 and it refers to that in the title clause. This piece of legislation was introduced back in the last Parliament.So what we are seeing here is that it is misleading. If you are going to go back 3 years why not 10 years? Why not 20 years? Why not 30 years? You could make up a piece of legislation and put any commencement date on it. I think that the commencement date really needs to be addressed because it is misleading to say that it started back on 1 October 2011 and that it is a 2010 Act. I mean I understand that that issue was considered by the Government Administration Committee but it really makes a mockery of the whole legislative process if we can put through legislation and then just say that it gives effect back in time to 2010—it is from 2010—and the bodies and the persons that were in those positions were no longer in those positions back on 1 October 2011.I think that it should be addressed. If the date is amended it just needs to be amended to what it is. We need to start the commencement date at an appropriate time which is when the legislation has passed. Of course we hope that it does not really get to that point because we are opposing this bill and—CHRIS AUCHINVOLE (National): I moveThat the question be now put.A party vote was called for on the questionThat the question be now put.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Motion agreed to.The question was put that the amendment set out on Supplementary Order Paper 364 in the name of Jacinda Ardern to Part 3 be agreed to.A party vote was called for on the questionThat the amendment be agreed to.Ayes56New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.Noes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Amendment not agreed to.A party vote was called for on the questionThat Part 3 be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Part 3 agreed to.ScheduleThe question was put that the amendments set out on Supplementary Order Paper 258 in the name of the Hon Christopher Finlayson to the schedule be agreed to.A party vote was called for on the questionThat the amendments be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Amendments agreed to.A party vote was called for on the questionThat the schedule as amended be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Schedule as amended agreed to.Clauses 1 and 2The CHAIRPERSON (Lindsay Tisch): I call Ross—Grant Robertson.GRANT ROBERTSON (Labour—Wellington Central): Oh! There is a Speaker’s ruling about that Mr Chair.The CHAIRPERSON (Lindsay Tisch): A deliberate mistake—Grant Robertson.GRANT ROBERTSON: No relation whatsoever—I will just put that on the record—none at all. I just want to speak briefly—no; a lovely man Ross—to clauses 1 and 2 and to unravel the mystery for my colleague Rino Tirikatene of the commencement date. The Ministers who have sat in the chair tonight have been rendered mute. Therefore they will not be standing up to speak to Supplementary Order Paper 258 in the name of the Hon Christopher Finlayson so I will help them out. The Supplementary Order Paper actually amends the commencement date to be: “This Act into force on the day that is 3 months after the date on which it receives the Royal assent.” It is probably a good idea that that amendment is on that Supplementary Order Paper because the current commencement date is 1 October 2011 and let us be honest this bill is not going to get the Royal assent until 2014. By that stage it would be 3 years out of date and to me that sums up an out-of-date and out-of-touch Minister who is responsible for this bill.Mr Finlayson has taken the time to come to the Chamber for previous parts of the bill and spread around a bit of hate on this side of the Chamber. We find it hard to understand because the Minister himself has made a good personal contribution to the arts of which he should be proud. [Interruption] Yes he has. He has actually made a good personal contribution outside his role as the Minister for Arts Culture and Heritage towards supporting the arts; he just cannot allow anyone else to make a contribution that gets recognised. In many ways the commencement date of 1 October 2011 sums up the Minister: trapped in the past—stuck somewhere between Beethoven and Neil Diamond for his preferred musical style. The Minister is trapped back in 2010 or 2011 when he had this bright idea to turn Creative New Zealand and the Arts Council upside down and to come up with this one body to rule them all on which there would be four representatives for Māori and two for Pasifika who will now be faced with a job that I believe is unfair to them to be part of this.So the amended commencement date gives 3 months to sort out all of this bill. I predict it is actually going to be quite hard work because despite the long period of time what we have learnt as we have gone through this debate is that the wording of the bill is particularly unclear in the area around community arts councils and I do not think that it is well understood. The Minister has told us that the committee that will get formed under clause 11 of the bill will effectively be Te Waka Toi anyway. It now cannot use that name or at least the name is protected under this bill. There is a lot of confusion and I believe that a commencement date of 3 months is actually probably not going to end up being quite long enough.I do not want to prolong the debate on this part too much but suffice to say that the slow out-of-touch Minister believes that we are in a golden age of the arts but if he was at the film awards tonight in Auckland he would be hearing all about how that is not true that artists in New Zealand are succeeding despite this Minister and his regime not because of it. This bill unfortunately is a sad testament to a very slow Minister who is shuffling the deckchairs within the Arts Council and failing to provide the support that artists in New Zealand need.DARIEN FENTON (Labour): I just wanted to speak to the title and commencement clauses of the Arts Council of New Zealand Toi Aotearoa Bill. I want to put on record how grateful I am to my colleagues Grant Robertson and Rino Tirikatene for enlightening us about the commencement date. It has left me sitting here pondering what would have happened if in fact this bill had gone through—if the Minister for Arts Culture and Heritage had not woken up and put in Supplementary Order Paper 258 which changes the commencement date. Clearly it is not going to be coming into force on 1 October 2011.I do note that the wording on the original bill would have sufficed. I am not really sure why the Government Administration Committee changed it although I am sure that there is an explanation somewhere. The original bill said in clause 2 that “This Act comes into force on a date to be appointed by the Governor-General by Order in Council and 1 or more Orders in Council may be made appointing different dates for different provisions and different purposes.” That would have sufficed. That would have got the Minister off the hook. But the select committee made a recommendation that it commenced on 1 October 2011 and the Minister has had to wake his ideas up and bring in a Supplementary Order Paper to this House.I was also interested in the history of this bill and why we are debating such a bill on the second day before the House rises for Christmas—why we are in the Committee stage of such a bill when this bill has been around for a very long time. So I looked it up and the bill was introduced on 25 June 2010. That is 3½ years ago?Hon Maryan Street: Yes. Almost to the day.DARIEN FENTON: Almost to the day. It had its first reading on 18 August 2010. It was then referred to the select committee. What is interesting is that then there was a very short time given for submissions—well probably 4 to 5 weeks. But there was a big push and a rush on. The select committee did its job and reported back to the House on 29 November 2010. The second reading was on 25 May 2012. Now here we are as I said right on the border of 2014 and we have this bill going through with amendments from the Minister because the bill should have actually been starting 2 years ago and clearly has not.It sat on the Order Paper from 22 May 2012 right through another year and a quarter before the Committee of the whole House began this debate which was on 24 September 2013. Again it languished for another 3 months until 3/12/13 when the Committee stage started again. Today which is the—what is the date today?Grant Robertson: The 10th.DARIEN FENTON: The 10th yes—another 10 days before we manage to almost conclude the Committee stage of this bill. So it is bemusing that we have these bills brought to us. I think the next one the Airports (Cost Recovery for Processing of International Travellers) Bill will be the same and actually has the same kind of history and I will be happy to talk about that as well.It has the same kind of history where we have the sort of languid Government that introduces things in a great hurry and has to have them happen and then leaves an organisation like the Arts Council or Creative New Zealand in a void for 2 or 3 years not really knowing what is going to happen—funding is dependent on it people’s jobs are dependent on it. People who are representatives on Te Waka Toi and the Pacific Arts Committee also will have been languishing and wondering when this is going to happen and trying to carry on as best they can in the meantime. This is not to mention of course all the community arts organisations which will have known that this is hanging out there that this has been here since 2010 and that there is going to be a big change. They will have been wondering as they do already how their funding is going to work out whether they are going to get enough funding whether there are going to be more cuts—as there have indeed been under this Government—and whether the arts will continue to be the low priority that this Government has made it. Thank you.A party vote was called for on the questionThat clause 1 be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Clause 1 agreed to.The question was put that the amendment set out on Supplementary Order Paper 258 in the name of the Hon Christopher Finlayson to clause 2 be agreed to.A party vote was called for on the questionThat the amendment be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Amendment agreed to.A party vote was called for on the questionThat clause 2 as amended be agreed to.Ayes65New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1; Independent: Horan.Noes55New Zealand Labour 33; Green Party 14; New Zealand First 7; Mana 1.Clause 2 as amended agreed to.Airports (Cost Recovery for Processing of International Travellers) BillIn CommitteeDebate resumed from 28 March.Part 1 Preliminary provisions(continued)DARIEN FENTON (Labour): Labour is supporting this bill. This is the Airports (Cost Recovery for Processing of International Travellers) Bill. Part 1 is mainly about the purpose the interpretation and the Act binding the Crown so most of Part 1 is taken up with interpretation of different terms used throughout the bill. The aim of the bill is to enable the Crown to recover the costs of aviation security biosecurity and customs for traveller processing from the operators of new or re-established international airports and international airports that sometimes request that travellers be processed in a non-routine manner.As I said we support this bill but this is yet another bill that has languished on the Order Paper. Interestingly—after the debate we had in the Committee stage of the last bill the Arts Council of New Zealand Toi Aotearoa Bill—this one was supposed to commence on 1 January 2011. So all this time when we could have been having cost recovery a 50-50 percent split between the Government and the providers we have been wasting time on a whole range of other things and the Government has let this bill slide. It was actually introduced on 9 September 2010 and had its first reading very soon after—the next week—so clearly the Minister in charge of the bill at the time thought it was very very urgent. It was referred to the Primary Production Committee and the committee reported back on 15 November 2010. Quite reasonably it reported back believing that the bill was going to commence on 1 January.I feel very sorry for those select committee members who did their job diligently considered eight submissions from groups and individuals and heard three submissions. What is even sadder about this bill is looking at who was on the select committee at that time. It gives you a bit of a time warp. It is another time warp—it is another time warp. We have some good members who are still in this House but there are others who are just a distant memory now. Sandra Goudie was on the select committee—Sandra Goudie. She was on the Primary Production Committee which considered this bill and she obviously did her job diligently because it got reported back very quickly. The Hon Jim Anderton—John Hayes: Who?DARIEN FENTON: The Hon Jim Anderton was on it as well.Iain Lees-Galloway: Quite a good campaign manager.DARIEN FENTON: Yes he was quite a good campaign manager actually. I am quite pleased that he has moved on and not worried about this bill. We also had Brendon Burns and Dr Ashraf Choudhary. He has gone too but thinking about the lastbill we were debating I know he was very concerned about the lack of ethnic representation at the time as well. He did his job.But it is interesting when you think that that is how long this bill has taken and it was so important at the time. What is even more interesting is that this bill has a very long history. It goes back to 2004 when there was policy development for the funding of passenger clearance services. That was overseen by the Ministerial Committee on Funding of Border Security under the chairmanship of the Hon Dr Michael Cullen the then Minister of Finance. The ministerial committee developed a set of proposals on how passenger clearance services at international airports could be funded and implemented and those proposals went out. They formed the basis of stakeholder consultation. There was a consensus reached among industry stakeholders that although there was no ideal option the agreed position reflected the best solution in terms of the principles that stakeholders were most concerned about.In 2005 the Government specifically considered the allocation of aviation security charges across airports. That was around about the time or maybe a couple of years after aviation security had been ramped up in New Zealand after the 9/11 situation in 2001. Some of us can remember the days when we did not have to go through security at domestic airports or regional airports. That had further consultation through another consultation process in 2006 which formed the foundation for a Cabinet paper and drafting instructions for a bill called the International Passenger Clearance Funding Bill.Then we got to 2008. What happened then? Well we know that 2008 was an election year but there was some more consultation on the proposals around the change and there was a lot more consultation. But anyway no bill emerged and of course we had an election. So all of those years of work of studying this issue disappeared. We got to 2009 and a National-led Government and it got the Customs Service to issue a consultation document to stakeholders for determining policy for restart international airports. So there was a whole new aspect added to that. That might be because we were starting to see regional airports operate as international airports. It really was not until 2010 as I have said that there was a bill that came to this House and that was called the Airports (Cost Recovery for Processing of International Travellers) Bill.The interesting thing about all that is that Labour did all the work. We did it very carefully. We consulted with stakeholders in a changing industry where there were new challenges where there were new international airports being developed where there were biosecurity challenges and where there were other Customs Services costs and additional costs emerging or being added on to the Government. I do find it interesting that we are yet again debating a bill that has been around for nearly 4 years the day before we rise for Christmas. I cannot help but think that either the Minister for Primary Industries has so little influence in Cabinet that he could not get this up the Order Paper—John Hayes: Not true.DARIEN FENTON: Maybe it is not true. You can tell us why. Either that or it was that dealing with biosecurity and aviation security issues were not a priority for this Government cost recovery was not a priority for this Government or I do not know it has just lost the plot. It is possible that the Government just lost the plot and it forgot about it. The Government has been around for so long that it forgot about this bill and then it went: “Oh goodness we had better get this out. We had better do something about it. We have got some issues around biosecurity.”Or another theory I have is of course we have had all this restructuring have we not of the Ministry for Primary Industries which is now something else. Oh no it is called the Ministry for Primary Industries and it used to be called something else. There has been a massive restructuring going on merging departments shuffling agenciesaround giving them new names and rebranding them. That has been a massive distraction. MAF Biosecurity New Zealand has been through two restructures under this Government and it is now part of the new Ministry for Primary Industries. We have had reports from the Auditor-General about the benefits of that merger and whether the investment in the biosecurity brand public awareness was being lost.Of course between 2008 and 2012 the Government cut 91 biosecurity officer positions and the number of dogs on activesniffer duty at Auckland Airport dropped from 20 to 13 over the same period. Yet as we know the number of international visitors to New Zealand has increased and the Government keeps boasting about that. Some of them have been coming in—a lot of them have been going out actually over the last few years since this Government. But the Budget in 2009 cut $3.5 million from biosecurity over 4 years and then in 2010 it cut another $9.5 million over 4 years.So to get back and address the purpose of the bill my point is that although the aim is laudable and the Labour Party supports the bill we believe that the Government has not put its mind to achieving the purpose of this bill. It needs to get on with it because the issues of biosecurity customs and aviation security come at a huge cost to the Crown. Any new international airport should have to realise part of those costs. We know that Rotorua and Invercargill have established international airports in the last couple of years. Is Hamilton an international airport?Sue Moroney: It was.DARIEN FENTON: It was—Hon Maryan Street: Once was in name.DARIEN FENTON: It once was an international airport—in name.Palmie is an international airport. Well we have got a lot of international airports per capita compared with the rest of the world and that means that we have to have very very good systems in place but they come as I said at a cost to the Crown. The purpose of the bill is laudable. Let us get on with it.Dr MEGAN WOODS (Labour—Wigram): It is my pleasure to take a call on the Airports (Cost Recovery for Processing of International Travellers) Bill and to build on the comments that my colleague Darien Fenton has been making. As my colleague set out the purpose of the bill and the aim of the bill is to enable the Crown to recover the costs of aviation security biosecurity and customs for traveller processing from the operators of new or re-established international airports or international airports that sometimes request travellers to be processed in a non-routine manner.What sounds like a very technical and very dry piece of legislation is indeed very important to our economy. In fact our tourism industry and our ability to bring goods safely across the border and to protect our own agricultural industry are crucial to our survival economically. This piece of legislation is an important part of the puzzle that puts that together.As we were wondering with the last piece of legislation we are somewhat perplexed as to why this bill has sat on the Order Paper for so long and why it has not come back before this House before the second day before we rise for the Christmas break in 2013. The history of this legislation which my colleague alluded to and it is worth returning to is that this is a piece of legislation that had its genesis in 2004 when the idea started to be kicked around by Dr Michael Cullen as the then Minister of Finance about how it was we were going to deal with these issues of how we recover the costs at newly established international airports in relation to aviation security biosecurity and customs and how we process travellers especially in a non-routine manner. Some work was done on that and as my colleague referred to we got to the election in 2008 and much of that work was abandoned. So circles were reinvented and we came up with a new regime.That piece of legislation then worked through the process and was sent through to the Primary Production Committee. As my colleague has alluded to a very august select committee it was too with some very fine members on it including my colleague Damien O’Connor who heard submissions on this bill when it first came before the committee in 2010. The committee listened to the submitters. I believe there were eight submissions that came before the committee about how this legislation needed to be dealt with. The committee listened and it went back and it did its work as a good hard-working select committee would do. It went back and it made the changes that were necessary to make this a good piece of legislation.But was this bill rushed back to the House? Was it something that was brought back by a Minister keen to get on with the job of making sure that we had the way in which we dealt with our borders securely sewn up? No unfortunately that was not the case. Like many other pieces of legislation this bill has been allowed to languish on the Order Paper by a Government that seems to let a lot of things languish on the Order Paper and not come before the House in a timely manner.Labour will be supporting this legislation because we actually think it is important. We are pleased to see it. We think it is not before time. We would have liked to see it earlier and I am sure my colleague Damien O’Connor who worked so hard on this piece of legislation would have liked to see it come back earlier to the House. We do support this bill because biosecurity and customs services come at a huge cost to the Crown and any new international airport should have to realise part of those costs.As my colleague Darien Fenton has alluded to we do have a very high number of international airports per capita in New Zealand. We already have a reasonably large network of airports where international travel can be carried out to and from. New ones necessitate the replication by their very nature of biosecurity and customs services and additional costs fall on the Crown. For a number of years this Parliament and the select committees within this Parliament have been trying to sort out fair ways that these costs can be shared between the various parties that will benefit from the establishment of international airports. As I said earlier we did propose a similar cost recovery scheme in 2004. However after consultation and discussion with many of the territorial local authorities with regional councils and with businesses we chose to reduce the cost recovery period for providing customs and biosecurity services to a new international airport to just 1 year. We were concerned. We were very concerned indeed that a longer time period—The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the honourable member but the time has come for me to—[Interruption] Order! You can be first up next year. The time has come for me to report progress.House resumed.The Chairperson reported the Arts Council of New Zealand Toi Aotearoa Bill with amendment and progress on the Airports (Cost Recovery for Processing of International Travellers) Bill.Report adopted.Sitting suspended from 9.55 p.m. to 9 a.m. (Wednesday)