Volume 697 Week 69 - Tuesday 8 April 2014Text is incorporated into the Bound VolumeVolume 697 Week 69 - Tuesday 8 April 2014[Sitting date: 08 April 2014. Volume:697;Page:16951. Text is incorporated into the Bound Volume.]Tuesday 8 April 2014Mr Speaker took the Chair at 2 p.m.Prayers.Questions to MinistersEconomic Programme—Policies and ResultsMAGGIE BARRY (National—North Shore):How good is the Government—[Interruption] How is the Government ensuring recent broad-based growth and good fiscal management is delivering higher incomes—Mr SPEAKER: Order! I’m going to ask the member to repeat the question.1.MAGGIE BARRY (National—North Shore)to the Minister of Finance: How is the Government ensuring recent broad-based growth and good fiscal management is delivering higher incomes and more jobs for families?Hon BILL ENGLISH (Minister of Finance):I am surprised the member had to ask because there is so much evidence for it. As the economy continues to build momentum and moves into broad-based growth there are signs that Kiwi households and businesses are starting to see the benefits. The economy as a whole grew by 3.1 percent—one of the faster growth rates in the developed world. Average weekly wages increased by 2.8 percent compared with inflation of only 1.6 percent. Over the past year 66000 more people got jobs and unemployment is coming down. The number of jobs listed on TradeMe is 21 percent higher than 1 year ago. The married rate of New Zealand superannuation which is a good measure because it is tied to the average wage has increased by $249 a fortnight or 28 percent since 2008.Maggie Barry: What indicators has he seen that confirm the economy is growing and that this is helping to deliver more jobs and higher wages?Hon BILL ENGLISH: The important thing about confidence measures is that they translate into investment and employment more jobs and higher incomes. The Westpac McDermott Miller Employment Confidence Index for March rose to its highest level since 2008. The survey found that more workers are reporting higher wages and households are reporting the highest job security in 4 years the highest job opportunities in 5 years and the highest reported earnings in 5 years. The latest ANZ Business Outlook shows that business confidence remains elevated. A net 67 percent of businesses are optimistic about their future. Building consents are also up by 22 percent in the year to February. Overall this suggests that broad-based growth is making a difference to households which have better job security and report a higher likelihood of getting higher incomes.Maggie Barry: What international reports has he seen that endorse the Government’s fiscal and economic programme?Hon BILL ENGLISH: It would not be that they are endorsing the Government’s programme so much as endorsing New Zealand’s very significant progress. Last week the IMF released its 2014 concluding statement on New Zealand. It said that New Zealand’s growth is “becoming increasingly embedded and broad-based” that “Business and consumer confidence is strong” and that the Government is on track to surplus. The IMF noted two main risks to the economy: a slow-down in our major trading partners and a price correction in the housing market. However it said that the Government’s fiscal management and the current monetary policy settings have delivered improved resilience against these kinds of shocks.Maggie Barry: How does the current economic and fiscal position compare with the one inherited by the Government in 2008?Hon BILL ENGLISH: It is considerably better. By 2008 Government spending had jumped by 50 percent in just 5 years and floating mortgage interest rates by 2008 were almost 11 percent a level of interest rates that certainly could not be tolerated by households these days. The 2008 Budget increased Government spending by $7 billion or by more than 12 percent. This left a deficit of $4 billion for the 2008-09 year and forecasts of never-ending deficits. Fortunately we are doing a lot better than that.Government Financial Position—Tax System Changes and Return to SurplusHon DAVID CUNLIFFE (Leader of the Opposition):Does he agree with the statement by John Key in October 2008—Mr SPEAKER: Order! Question No. 2.Hon DAVID CUNLIFFE: It is question No. 2—I am sorry Mr Speaker. [Interruption]Mr SPEAKER: Order! [Interruption] Order!2.Hon DAVID CUNLIFFE (Leader of the Opposition)to the Prime Minister: Does he stand by all his statements?Rt Hon JOHN KEY (Prime Minister):Yes and especially ones made by John Key in 2008.Hon David Cunliffe: Does he agree with the statement by John Key in October 2008 that if Labour had “in 2004-05 cut taxes New Zealand would be a lot better off now”?Rt Hon JOHN KEY: Yes.Hon David Cunliffe: Why does the Prime Minister believe that given that it would have reduced the fiscal surpluses run by the last Labour Government and left the country less well able to deal with the global financial crisis?Rt Hon JOHN KEY: Not necessarily. If Labour had made better policy decisions for the last 4 or 5 years of being in Government this country would be a lot better off. Instead it increased Government expenditure enormously it robbed New Zealanders of their own hard-earned dollars by overtaxing them it spent far too much money and it forced up interests rates. And we all know that under a Labour Government of the future interest rates will also go up quicker than they otherwise would do.Hon David Cunliffe: Speaking of tax cuts does the Prime Minister stand by his statement that his so-called tax switch of 2010 which overwhelmingly benefited high-income earners was fiscally neutral or does he agree with Treasury advice that it created a fiscal hole of more than $1 billion over 4 years?Rt Hon JOHN KEY: No I accept that it was both fiscally neutral and distributionally neutral.Hon David Cunliffe: Can the Prime Minister confirm that National has never yet run a fiscal surplus under his leadership?Rt Hon JOHN KEY: I can but I can also confirm that one is coming.Hon David Cunliffe: Why does the Prime Minister say that the fiscal surplus for 2014 will be “wafer thin” and does that reflect lower than forecast tax revenues from an unbalanced economy?Rt Hon JOHN KEY: No but the member raises a very good point on just how challenging it has been to actually get New Zealand back to surplus; how few countries in the world have done it; how it would never have happened under a Labour-led Government which wants just to spend money; how it would never have happened when New Zealanders were overtaxed with a capital gains tax; and how it would not have happened so easily when New Zealanders were having to work longer under more restrictions. The truth is that this is a National Government that is pro-growth and is getting the country back to surplus and this is an Opposition that is opposed to growth.Hon David Cunliffe: Why does the Prime Minister stand by his position that he wants to make this economy safe for speculators and why will he not have a capital gains regime like almost every other developed country in the world?Rt Hon JOHN KEY: We must be well and truly ahead of Labour because there is already a capital gains tax for speculation on property.Accident Compensation—Levies and Services3.CHRIS AUCHINVOLE (National)to the Minister for ACC: What announcements has she recently made in respect of the ACC levies?Hon JUDITH COLLINS (Minister for ACC):I have recently made a statement in respect of the substantial levy cuts for employers and workers. I note that from 1 April the average New Zealand working household can expect to keep about $211 extra each year small businesses will be around $180 better off annually and larger employers will receive on average a $6000 reduction. This reflects the excellent performance of the ACC scheme over the last few years. It is fantastic that this year Kiwis will be $387 million better off as a result.Chris Auchinvole: Does the levy cut reflect a reduction in service or benefits to clients?Hon JUDITH COLLINS: No. ACC is constantly working to improve services to clients. In recent years the corporation has made genuine improvements in the way it rehabilitates injured New Zealanders back to independence. ACC has announced an updated and expanded approach to its injury prevention work and is continuing to embed robust privacy practices and new technologies and processes to help it improve client service. It has recently announced better access and wider choice leading to better support for hearing loss treatment and the trial of a new sexual violence prevention programme in schools promoting healthier relationships. It is important that not only is the scheme financially sound but it is trusted to support Kiwis when they need it. I am very pleased to see that New Zealanders remain at the heart of everything that ACC does.Ministers—Confidence4.Hon DAVID CUNLIFFE (Leader of the Opposition)to the Prime Minister: Does he have confidence in all his Ministers?Rt Hon JOHN KEY (Prime Minister):Yes.Hon David Cunliffe: Does the Prime Minister have confidence in the Minister of Justice given her $29000 taxpayer-funded trip to China which included two meetings organised with her husband’s company without declaring them in a trip report or declaring a conflict of interest?Rt Hon JOHN KEY: Yes.Hon David Cunliffe: In that regard does the Prime Minister know the name and/or position of the Chinese border official who attended the dinner in Shanghai with the Minister of Justice last year?Rt Hon JOHN KEY: I do not know the name off the top of my head but I have seen the name in the report.Hon David Cunliffe: Does the Prime Minister have confidence in a Minister who described a $56000 donation to the National Party as being for “a charity”?Rt Hon JOHN KEY: I do not think any Minister has done that.Hon David Cunliffe: Does he stand by his statement that “if Mr Dotcom could prove Mr Banks was not telling the truth I think we all know what the consequences of that are. That would be that Mr Banks has lied to my office and no minister can enjoy my confidence if they lie to me but there is no evidence to prove that.” and that Mr Banks gave his assurance that he was not aware that Mr Dotcom had made the donation to his mayoral campaign?Rt Hon JOHN KEY: I hate to break it to the member but Mr Banks is no longer a Minister just in the same way that that member is very soon no longer going to be the leader of the Labour—Mr SPEAKER: Order!Hon David Cunliffe: Would the Prime Minister consider it possible to reappoint Mr Banks as a Minister given that the judge’s ruling released yesterday says that Mr Banks’ comments about Mr Dotcom were that “Well I wanted him to make it ah and I I told him he could make it anonymous.”—“I wanted him to make it and I told him he could make it anonymous.”?Rt Hon JOHN KEY: The member is asking a hypothetical question about whether I would reappoint anybody else. But I can say this: one thing I know is that New Zealanders do not like hypocrisy. If that member wants to get out there and—Mr SPEAKER: Order! That answer now will not help the order of the House.Hon David Cunliffe: Has Peter Dunne ever told him directly or personally that he did not make the draft Kitteridge report on the Government Communications Security Bureau available to a Fairfax reporter?Rt Hon JOHN KEY: I have not felt the need to directly ask Mr Dunne. I have relied on his public assurances just like I would like to rely on that member’s about who made secret donations through his trust.Biosecurity Management—Resourcing5.RICHARD PROSSER (NZ First)to the Minister for Primary Industries: Does he believe that New Zealand’s biosecurity preparations including Biosecurity NZ are sufficiently and adequately resourced to protect New Zealand from biosecurity risks?Hon NATHAN GUY (Minister for Primary Industries):Yes. As the member will know risk can never be eliminated from any system. That is why the Government has a comprehensive approach to biosecurity—pre-border at the border and post-border. An example of this system in action is the detection of two Queensland male fruit flies caught in biosecurity traps this year—one last week and one in January this year. This is a sign of the system working as it should and I would like to acknowledge both the Ministry for Primary Industries and the Whangarei community for their efforts with this response.Richard Prosser: Given that answer does he believe that the $1.6 million spent on the first fruit fly and potentially the same amount spent on the second fly just discovered would have been better spent on the biosecurity fence at the top of the cliff rather than on the fumble-catch ambulance at the bottom of it?Hon NATHAN GUY: Well that is a two-part question. It is very important that we do a very thorough response and follow international best practices which we are doing with this response similar to the previous response. This is because ultimately we would like to maintain our Queensland fruit fly - free status which is hugely important for the $4 billion horticulture industry in New Zealand.Richard Prosser: Is he concerned at the news that the Bio-Protection Research Centre at Lincoln University has had its Government funding cut? If so will he work with his Cabinet colleagues to have that funding reinstated; if not why not?Hon NATHAN GUY: That is separate from the Ministry for Primary Industries. That is to do with tertiary education. My understanding is that there has been an independent panel that has assessed that process. For me biosecurity is my No. 1 priority. That is why funding has increased every year since we took over from the Labour Government. Importantly we are focusing on the front line putting in more front-line quarantine inspectors 12 new X-ray machines and new dog detector teams as well.Richard Prosser: Does he consider the $182 million spent on biosecurity to be sufficient given that it represents less than three-quarters of 1 percent of the value of the $25 billion agriculture industry it is supposed to protect without which three-quarters of our economy would not exist?Hon NATHAN GUY: Funding is very important. It is my No. 1 priority as the Minister for Primary Industries because I have to focus on the front line because of our primary producing exporters whom we rely on in this country. That is why we are increasing our presence in front-line quarantine inspectors—another 125 in the last 18 months—why we have 12 new X-ray machines; why we have five new dog detector teams increasing to around 35; and why we also now have Government industry agreements where industry can partner with Government on preparedness and response.Richard Prosser: Does he consider forcing research institutes in this country to seek funding by gaining commercial work on behalf of other Governments because they are not funded sufficiently by this Government to be a prudent approach to biosecurity risk management?Hon NATHAN GUY: I have already addressed that question.Hon Damien O’Connor: Does the continual stream of biosecurity incursions under his watch provide enough evidence of his failure as Minister; or what will it take to prove that cut-backs in staffing and funding have undermined New Zealand’s biosecurity reputation and put our whole economy at risk?Hon NATHAN GUY: I am sick and tired of the rhetoric from the member opposite. What he does not acknowledge are all the incursions that occurred under the Labour Government and if that member wants me to run through them I will now: varroa painted apple moth didymo—the list goes on and on and on.Greenhouse Gas Emissions—Forecasts and Policies6.Dr RUSSEL NORMAN (Co-Leader—Green)to the Minister for Climate Change Issues: By what percentage will New Zealand’s net greenhouse gas emissions increase in the next 10 years according to the Ministry for the Environment annual report for the year ended June 2013?Hon TIM GROSER (Minister for Climate Change Issues):If we take that particular year we input into it the exact existing Kyoto accounting frameworks—even though they are under negotiation for a new long-term agreement—and we assume for the next 10 years that the current extraordinarily low carbon price will drive the emissions trading scheme the figure we get is 48 percent. If we change any of those parameters we get a radically different result.Dr Russel Norman: Can the Minister therefore confirm that according to the Government’s own statistics and own information New Zealand’s net greenhouse gas emissions will increase by about 50 percent in just 10 years?Hon TIM GROSER: No I can confirm that that is a projection based on the assumptions that we discussed in answer to the previous question.Dr Russel Norman: When the latest report of the Intergovernmental Panel on Climate Change calls for urgent action from all countries to reduce emissions in order to avoid the worst effects of climate change why will his Government’s policies drive up net emissions by 50 percent in a decade?Hon TIM GROSER: Well we shall have to wait and see. We are discussing the difference between a projection and an eventuality that we cannot foresee. The underlying point here relates however—let us repeat this once again—to the shape of the New Zealand forestry cycle which operates on a 28-year rotation cycle and at that stage in the late 2020s will be at its absolute height. After new plantings take place it will start to decline radically.Dr Russel Norman: Why when New Zealand is on track to be the worst-performing developed country when it comes to cutting emissions is his Government not doing more to bring New Zealand’s greenhouse gas emissions down?Hon TIM GROSER: New Zealand has been reducing its carbon intensity over the last 24 years by approximately 24 to 25 percent. We are becoming an increasingly carbon-efficient economy but our gross emissions may be increasing because our economy is growing and the population is growing. I am quite confident that if we follow the policies of the Green Party in some future Government it will certainly achieve lower emissions but it will be at the cost of higher unemployment and lower real wages for New Zealanders.Dr Russel Norman: When the Minister told TVNZ that “We’re not playing God on this. That natural process will determine what happens to adaptation of human beings …” is he seriously proposing that we just let climate change take its course leaving our key industries economy homes and precious species exposed and at risk?Hon TIM GROSER: The answer is definitively no. That is not what I said. What I said is that the Government needs to provide strategic advice based on good science—and we are going to spend about $100 million on this in the years to 2019—to try to move the country along to a sensible adaptation framework. But actually New Zealanders have got a proven record of adaptation to different sources of change. I could go through numerous examples. My belief is that New Zealanders are better equipped to adapt to climate change than any developed country that I can think of.Dr Russel Norman: Does he stand by his comment to Radio New Zealand National that we have plenty of time and how does he square this with other Governments’ responses to the Intergovernmental Panel on Climate Change report such as US Secretary of State John Kerry’s call for all countries to act dramatically and quickly to reduce net emissions?Hon TIM GROSER: We are conflating two different issues here. One is the question of the quantum of global mitigation that the planet is undertaking and that is not sufficient. In that respect I would absolutely associate ourselves with Mr Kerry’s statement. If we are talking about adaptation I continue to believe—because the evidence supports this—that New Zealand is extremely well placed over a very long period of time of 100 years to make the necessary adaptation provided we have sensible policies in place.Dr Russel Norman: Given that New Zealand is on track to increase its net emissions by 50 percent in the decade ahead according to the Government’s own reports which will make New Zealand the worst-performing developed country when it comes to cutting emissions has the Minister now dispensed with the policy of fast following and instead taken it upon himself to be a leader not in emissions reductions but in emissions growth?Hon TIM GROSER: The simple reality is that we are focusing primarily first of all on the first Kyoto commitment period and we are extremely confident that New Zealand will meet its international obligations. Beyond that we are focusing on the period to 2020 where we have put forward a unilateral commitment of minus 5 percent on 1990 levels which is considerably ahead of certain other developed countries. What happens beyond that is something we have not yet got a position on other than the aspirational target of 2050 when we aim to reduce emissions by 50 percent.Superannuation—Alternative Approaches7.Hon DAVID PARKER (Deputy Leader—Labour)to the Minister of Finance: Does he agree with the Infometrics estimate that the 1974 Super Fund would have savings of $278 billion if it had not been axed by the National Government and does he agree wages would be higher in New Zealand if we had those higher savings?Hon BILL ENGLISH (Minister of Finance):No but it is good to see that the member has gone from relitigating the 2005 election to now relitigating the 1975 election because actually it was voters who knocked that scheme on the head.Hon David Parker: Does he accept that Australia’s successful universal workplace savings scheme introduced a decade after National axed ours is why Australia owns its banks and ours and why Australians have higher wages?Hon BILL ENGLISH: No but I do know that two of the effects of it in Australia are that Australians have less money invested in businesses than New Zealanders—Grant Robertson: Rubbish!Hon BILL ENGLISH: —no it is true—and its rise in household debt directly parallels its rise in nominal household savings. But if the member believes he wants the Australian system he should be open with the New Zealand public that he is going to strictly means test national superannuation. There is nowhere in the world that has compulsory superannuation and universal national superannuation.Hon David Parker: Will the Minister now admit that National was wrong to vote against KiwiSaver which it now supports and to call the Cullen fund which it now supports a dog?Hon BILL ENGLISH: No but if the member is going to advocate what he calls universal but is actually compulsory superannuation he needs to explain what impact that will have on New Zealand superannuation. I think those who have been in this Parliament for a while will recognise that we have spent—what—20 years in vigorous discussion over the nature of national superannuation. It ended up universal because that is what the public wanted and Labour is now advocating the Australian scheme which involves strict income testing of national superannuation. I invite the member to announce that at the next Grey Power meeting he goes to.Hon David Parker: Is the Minister able to table any document from the Labour Party supporting his last lie?Mr SPEAKER: No—there is no ministerial responsibility at all for that.Hon David Parker: I raise a point of order Mr Speaker. The Minister was allowed to get away with misrepresenting Labour policy—Mr SPEAKER: Order! Now the member is using the point of order system to debate an answer that has been given. The member should use an appropriate supplementary question.Grant Robertson: I raise a point of order Mr Speaker. I do want to ask you how therefore it was possible that the Minister’s answer was in order. The Minister gave his answer and as is allowed under the Standing Orders Mr Parker then asked a supplementary question based on that answer. That is within the Standing Orders if the answer was in order which you appeared to rule it was so I cannot see why it would not be in order for Mr Parker to ask that kind of question.Mr SPEAKER: The question that was asked from Mr Parker to the Minister was quite in order. It effectively was “Will the Minister now admit that National was wrong?” and the Minister answered it very quickly by saying no he will not admit that. The member David Parker has now asked whether the Minister is prepared to table some Labour Party documentation. If the member wants that question ruled in order to settle the House down I will allow that question to stand but if the member gets a very political answer back he should not come back to me.Hon David Parker: Is the Minister able to table any document that he has received that proves the assertion he made in his last answer which was that the Labour Party is moving to a means-based superannuation when that in fact is not our policy?Mr SPEAKER: Order! It is quite a different question but carry on.Hon BILL ENGLISH: If I could find a coherent rational sensible Labour Party document on this matter I would table it. But I cannot so I will table the results of the 1975 and 2008 elections where these issues were litigated.Export Sector—Government Support8.IAN McKELVIE (National—Rangitīkei)to the Minister for Economic Development: What announcements has the Government made to further help New Zealand exporters succeed internationally?Hon STEVEN JOYCE (Minister for Economic Development):Last week the Prime Minister announced that Budget 2014 would contain funding of $69 million over the next 4 years for New Zealand Trade and Enterprise our trade organisation dedicated to helping Kiwi companies succeed overseas. The funding which comprises $55 million in new money and $14 million of reprioritised funds will mean a boost in New Zealand Trade and Enterprise’s presence around the world. It will add seven new positions in Greater China. It will boost its presence in South America with new positions in Brazil Chile and Columbia and create two new positions in the Middle East. Of course these announcements come on top of previously announced investments by New Zealand Trade and Enterprise Education New Zealand and Tourism New Zealand in the rapidly growing ASEAN region. These markets are all high-growth and high-potential markets for New Zealand exporters.Ian McKelvie: What else will the increase in funding allow New Zealand Trade and Enterprise to do?Hon STEVEN JOYCE: The funding increase will also enable New Zealand Trade and Enterprise to deal in a more intensive way with more companies. New Zealand Trade and Enterprise currently works with around 3500 companies and focuses intensively on around 500 of those. There are an increasing number of growing firms wanting a higher level of service as they seek to break into or expand in international markets. The funding increase that the Prime Minister announced will allow New Zealand Trade and Enterprise to progressively lift the number of companies it works with intensively from 500 to 700 over a 2-year period. Finally the increase in funding will also allow ongoing investment in its high-impact programmes in sectors such as health wine agribusiness information and communications technology food and beverage marine and aviation.Ian McKelvie: What other steps has the Government taken to help grow New Zealand’s exports?Hon STEVEN JOYCE: The Government’s comprehensive Business Growth Agenda contains a very wide range of initiatives to boost our international connectedness and exports. For example in the last year we have signed an economic partnership agreement with Chinese Taipei launched the New Zealand Story for New Zealand exporters and made significant policy and legislative reforms to grow New Zealand’s $2.6 billion international education sector. Budget 2013 contained funding of $158 million over 4 years for tourism initiatives for emerging and existing markets as part of the Budget’s internationally focused growth package.Supermarkets—Relationship with Suppliers and Minister’s Statements9.Hon CLAYTON COSGROVE (Labour)to the Minister of Commerce: Does he stand by all his statements?Hon CRAIG FOSS (Minister of Commerce):Yes and unlike the member’s colleague I am careful not to use political rhetoric and exaggerating language—Mr SPEAKER: Order! That will not help the order of the House. The question has been answered.Hon Clayton Cosgrove: Why did the Minister tell this House on 19 February 2014 that he was not aware of any documents produced by his office regarding the concerns around the conduct of supermarkets until they were raised by my colleague the Hon Shane Jones when on 29 January 2014 he met with Katherine Rich chief executive of the Food and Grocery Council who explicitly advised him of these concerns and he subsequently had his office draft a file note of that meeting and potential responses to questioning on the issue?Hon CRAIG FOSS: The specific allegations of Mr Jones of blackmail extortion and retrospective payments were raised in the House around the time the member there mentioned. I did run into Katherine Rich at a function with about 100 to 150 others. The specific issues that Mr Jones raised and talked about in the House for a couple of weeks under privilege were not raised.Hon Clayton Cosgrove: How does the Minister reconcile his answer to this House on 19 February 2014 in answer to a question from the Hon Shane Jones that “I am not aware of any documents prepared by my office regarding the behaviour of supermarkets towards suppliers.” when the file note he asked his office to prepare after his meeting with Katherine Rich on 29 January 2014 clearly stated: “Katherine Rich has raised an issue with the Minister around supermarkets using dominant-buyer position to put pressure on suppliers.”?Hon CRAIG FOSS: As I noted in my previous answer the issues that Mr Jones raised were specific to blackmail extortion and retrospective payments. The issues that were discussed very briefly with Katherine Rich at a function were about dominant behaviour which is section 36 of the Commerce Act in the context of a much larger discussion about all sorts of matters in the industry.Hon Clayton Cosgrove: I seek leave to table the said file note reference MBIE-MAKO-14354590 noting the issues raised by Katherine Rich—Mr SPEAKER: Order! I think that is sufficient—[Interruption] Order! I think that is sufficient information. Leave is sought to table that particular file note. Is there any objection? There is objection.Hon Clayton Cosgrove: Given that concerns regarding supermarket conduct towards suppliers were raised with the National Government by the Food and Grocery Council directly and in correspondence as early as 2010 why has his Government failed to take any action to date?Hon CRAIG FOSS: Those matters have not been raised with me directly at all thus my answers in the House to the allegations of Mr Jones of blackmail extortion and retrospective payments.Hon Clayton Cosgrove: My question related to the National Government of which the Minister is a member therefore I seek leave to table a letter dated 6 August 2010 from the Minister of Commerce to Peter Silcock the Chief Executive of Horticulture New Zealand dealing with the issues that Mr Silcock raised as per my question.Mr SPEAKER: Leave is sought to table a letter dated 6 August 2010 from the Minister to Mr Silcock. Is there an objection to that letter being tabled? There is objection.Hon Clayton Cosgrove: I think Mr Banks is practising his objections for court.Mr SPEAKER: Order! Ask the question.Hon Clayton Cosgrove: Does the Minister feel it is appropriate to refuse to answer questions in this House on 19 February 2014 regarding Progressive Enterprises because it is the subject of an ongoing Commerce Commission investigation but deems it appropriate to meet with Progressive Enterprises—the very entity currently being investigated by the commission—to carve out a face-saving voluntary supermarket code of practice that no one supports?Hon CRAIG FOSS: To the best of my recollection I have not refused to answer any questions in this House about these matters.Autism Spectrum Disorder—Funding for Support Services10.Dr JIAN YANG (National)to the Minister of Health: What recent announcements has the Government made about better supporting people with autism?Hon TONY RYALL (Minister of Health):Last week the Associate Minister of Health Tariana Turia and I announced that the Government is investing an extra $32 million over 4 years so that more people with autism receive support to lead full lives. Everyone with autism spectrum disorder is now eligible to be assessed for support services such as supported living respite and carer support. In the past some people with autism but with no other disability received support while others did not. This change means that people with autism now have the same access across the country.Dr Jian Yang: How many people will benefit from the new money announced last week?Hon TONY RYALL: I am advised that around 2800 people with a sole diagnosis of autism currently receive support services funded by the Ministry of Health. This extra funding will see the number of people receiving support increase by around 20 percent to 3400.Teachers—New Teaching and Leadership Roles11.CHRIS HIPKINS (Labour—Rimutaka)to the Minister of Education: Is she satisfied that the proposed creation of new Executive Principal and Expert Teacher positions has the support and confidence of school teachers and principals; if so why?Hon HEKIA PARATA (Minister of Education):Yes because when I visit schools every week they tell me so—they tell me so at airports and on planes at events and in communications to me and to my office—and because the evidence in New Zealand and internationally affirms this direction including the critical acclaim it got from experts at the International Summit on the Teaching Profession 2 weeks ago. But there is lots more work to do.Chris Hipkins: What evidence did she rely on when determining that a successful school principal could be removed from their school for 2 days a week without that having an impact on the success of their own school?Hon HEKIA PARATA: The policy intent and parameters are set out in the Cabinet paper that was made publicly available the day we announced that investment. We also announced that a working group would be put together to work through the details including the specifics around the appointment of executive principals. The evidence supports the direction of explicating excellence across career pathways distinguishing between executive principals and principals.Hon Member: What?Hon HEKIA PARATA: Perhaps I should explain—differentiating excellence.Chris Hipkins: I raise a point of order Mr Speaker. I was not asking—Mr SPEAKER: Order! I know the point the member is going to raise. On this occasion I think the question has been addressed but I can understand why the member is not satisfied. I will allow the member an additional supplementary question.Chris Hipkins: Thank you Mr Speaker. What evidence did she rely on when determining that a successful school principal could be removed from their school for 2 days a week without that having an impact on the success of their own school?Hon HEKIA PARATA: The first thing in answer is: those decisions have not been finalised yet because we are consulting with a working group from the sector. The second answer to that is that we already have the situation in New Zealand where principals contribute to the system beyond their school and are out of their school for the periods that that requires.Chris Hipkins: Will the principal of a school that is being overseen by an executive principal be primarily responsible to the executive principal or to their school’s board of trustees?Hon HEKIA PARATA: The proposal is actually for the executive principal to be focused on an achievement challenge or a set of achievement challenges across a community of schools. It is not proposed that it is a hierarchical position to which the existing principals report.Chris Hipkins: I raise a point of order Mr Speaker.Mr SPEAKER: If the member is raising a point of order as to whether that question has been addressed on this occasion it has been.Chris Hipkins: All right. Well I will move on to the next one. Will a principal of a school that is the subject of an executive principal be primarily responsible to the executive principal or to their school’s board of trustees?Hon HEKIA PARATA: As I have already indicated principals of existing schools will retain their accountability to their board of trustees. The proposal for the new roles is to work on achievement challenges across a community of schools. It will not displace and is not proposed to displace the existing employment relationships.Chris Hipkins: Will the executive principals remain primarily accountable to the board of trustees of the school that employs them; if not to whom will they be accountable?Hon HEKIA PARATA: Subject again to the caveat that we are continuing to work with the working group on the design details of this policy because we are consulting I say that it is expected that a group of those boards of trustees of the community of schools will be the authority to whom the executive principal reports.Chris Hipkins: Will school boards of trustees have the final say on whether or not their school is placed under the oversight of an executive principal; if not what role will that board of trustees have in that decision?Hon HEKIA PARATA: For the third time it is not proposed that schools be placed under the oversight of the executive principal.Health and Safety Workplace—Petroleum and Coalmining Industries12.GARETH HUGHES (Green)to the Minister of Energy and Resources: Is he satisfied safety in the petroleum industry is adequate given there have been two fires at installations six uncontrolled releases of hydrocarbons 15 events that saw emergency response plans activated one well integrity issue and three incidents with the potential to cause a major accident in just the past eight months?Hon SIMON BRIDGES (Minister of Energy and Resources):We have to remember that this is an industry with inherent risks. This Government has worked hard to bring New Zealand mining safety to world’s best practice. I am satisfied that our regime is at that standard but there is no room for complacency.Gareth Hughes: Well how can the Minister stand by his repeated claims that we have a world-class petroleum regime now that he has admitted that actually safety is not good enough in the industry?Hon SIMON BRIDGES: I think it is important to understand the difference in the level of reporting required under the new petroleum regulations that came into force in June last year. Under the old regulations an operator was required to report only incidents of serious harm and complete failure of essential equipment. In comparison the new regulations have been significantly widened to provide for the mandatory reporting of all dangerous occurrences. I am confident the new system is working as intended and that this will help lead to long-lasting sustainable safety improvement in this sector.Gareth Hughes: Is he satisfied that safety in the coalmining industry is adequate given there have been dozens of incidents like at Spring Creek Mine where a fire caused poisonous carbon monoxide to be pumped underground then 3 days later it happened again and then it saw dangerous levels of methane accumulate in 2000 cubic metres of that mine?Hon SIMON BRIDGES: Yes and for identical reasons to those that I have just given in relation to the petroleum sector. We really overhauled the system in terms of the law and the regulations. We set up WorkSafe New Zealand and the High Hazards Unit within it with significantly more resourcing. The reporting that is required now is significantly greater as is absolutely right because we want to know every potential incident and that is reflected in the figures that the member is asking about in his questions.Gareth Hughes: Given that the petroleum and coalmining industries are dangerous not only to the environment and to the climate but also to people when will the Minister stop rolling out the red carpet to these industries and instead invest in cleaner safer investments for New Zealand?Hon SIMON BRIDGES: I do not have any red carpet.Urgent Debates DeclinedBiosecurity Incursions—Queensland Fruit FlyMr SPEAKER: I have a received a letter from the Hon Damien O’Connor seeking to debate under Standing Order 386 the potential biosecurity hazard raised by the discovery of a second foreign fruit fly in Whangarei. This is a particular case of recent occurrence involving ministerial responsibility. However the response of the Ministry for Primary Industries to the discovery of the fruit fly in Whangarei is ongoing. The big hurdle to get over in an urgent debate application is whether the matter has reached the stage where the business of the House should be set aside. The test is a high one.A further discovery of a fruit fly has been reported and ministry staff have been deployed to monitor the controlled area. Information available suggests this is a new find unrelated to the incident in January. Some restrictions have been placed on the movement of fruit and vegetables to minimise the risk of fruit fly being moved out of the controlled area. Although public confidence in New Zealand’s biosecurity system is important I am not convinced that I would be justified in setting aside the business of the House today on the basis of this particular incident. The application is therefore declined.Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman):I raise a point of order Mr Speaker. I appreciate your decision. I would just like to get some guidance. How many fruit fly incursions—Mr SPEAKER: Order! The member will resume his seat. The last time he raised this matter he equally questioned my decision. I invited him then if he required an explanation as to my decision to come and see me. I repeat that invitation but I do not appreciate him challenging my decision today.Land Transport and Road User Charges Legislation Amendment BillIn CommitteePart 1 Amendments to Land Transport Act 1998DARIEN FENTON (Labour):Labour is very happy to help the Government on the passage of this Land Transport and Road User Charges Legislation Amendment Bill. There is no doubt that in speaking to Part 1 the Government needs our assistance with this bill because of the mess that it has created going right back to when this road-user charges legislation was reviewed. It was passed in 2012 but debated in 2011. I remember—and I have recalled in several contributions I have made to the House—speaking to the first reading of this bill under urgency last August in 2013. It seems to be a very unfortunate trait of this Government that whenever we are talking about anything to do with roads either it is a mess or it is about putting petrol tax up and hitting the people who are struggling out there in the pocket.But as I said Labour did warn the Government way back in 2012 when this legislation was passed that the regulation-making process in this legislation that would allow the Minister to sign it off without public debate would cause problems and that indeed is what happened. What we told the Government then was that it broke the basic democratic principle that there should be no taxation without representation. There were no final numbers available for scrutiny in advance of the 2012 bill being passed into law. The actual changes were apparently going to be set by officials at some later date—and I will get into what did actually happen—and there were a number of submissions suggesting that this regulation-making power was outside the role of legislation like the 2013 Road User Charges Act and that in fact it broke that basic principle of good lawmaking.Indeed what happened was that a mess was created. The Road User Charges Act turned out to have some minor anomalies that this bill seeks to correct. Apparently they affect only a small number of vehicles and their owners. But what happened was that the Minister tried to pass a regulation that would allow this particular issue to be resolved through regulation. The Regulations Review Committee did a very good job of scrutinising those regulations. It recommended to the House back in 2012 that the regulations be disallowed because the Government had not followed the process. It had allowed excessive regulation-making decision-making that was outside the comfort zone of this Parliament and in fact of the tradition of this Parliament.The Minister then did something unprecedented by reinstating the regulations in 2013.Andrew Little: Nothing would surprise us from this Government.DARIEN FENTON: Well that is true. Minister Gerry Brownlee did not surprise us with that but he reinstated those regulations and that was an unprecedented process in this Parliament. He reinstated these regulations. Off they went to the Regulations Review Committee again and what did the Regulations Review Committee say? It said that the regulations were outside the parameters of good lawmaking in this Parliament and that they should be disallowed. So twice the Government has tried to sneak through the regulations that are proposed in this bill—the “minor” reform the “minor anomalies” with the road-user charges—using its regulation-making power. Thank goodness for the good chairpersonship of Charles Chauvel who was the chairman of the Regulations Review Committee at the time when it made the first disallowance and then also the Hon Maryan Street another hard-working member who was on the ball and actually recommended to this House that these regulations be disallowed. That is why we ended up in this House under urgency in August 2013 with the Land Transport and Road User Charges Legislation Amendment Bill.It is interesting when you think about what we could be doing if we were not having to waste our time doing this. The bill talks about “minor anomalies” with the Road User Charges Act. There are many more anomalies than this minor anomaly with the Act and I wanted to take the opportunity in the context of Part 1 to talk about some of those because they are anomalies that have been around for some time. Take the anomaly of light diesel vehicles—those under 3500 tonnes—whose owners have to pay road-user charges. People up and down the country who have light diesel vehicles who have purchased them because they want to contribute to sustainable transport in New Zealand are having to purchase road-user charges in addition to purchasing their vehicles. This issue has been raised time and again as road-user charges have been debated in the Transport and Industrial Relations Committee and time and again the Government has turned its back on those people who use light diesel vehicles. These are not freight vehicles. The Government has turned its back on those people and said: “We’re not interested in that. We would rather try to sneak through regulations to deal with the issue of fast tractors and other farm vehicles.” That is one anomaly and I would say that it is not a minor anomaly; I would say that it is a major anomaly.Another anomaly that has come through at the select committee when we have talked about road-user charges is the issue of road-user charges on motorhomes and campervans. I have had a number of older people ring me in the last little while since the road-user charges changed. They tell me they are paying for 11 tonnes when their vehicle is actually only 7 tonnes. Somehow with the changes that were made under the Road User Charges Act they are paying $50 more a year. We are talking about retired people on minimal incomes on restricted incomes who have bought a campervan or converted a van into a holiday bus and who are now finding that they cannot go on holiday because first they are not earning enough money because it is really really tough out there and second $50 is a lot of money for them. That is a minor anomaly. Maybe it is a major one because I certainly know that the Motor Caravan Association has been to our select committee and expressed its concerns about this on a number of occasions.In Part 2 I will talk a little bit more about some of the anomalies because there are some particularly bad ones that I have come across in the adjournment that I want to bring to the attention of the Committee. But I would say that Labour is supporting this because we think it is the right thing to do. It is the right thing to do to correct anomalies when they are made. It is just a pity we have to waste House time on doing this—House time on something that was urgent back in August 2013.David Bennett: You don’t have to; you can sit down. Sit down.DARIEN FENTON: David Bennett might not think it is important to debate these issues properly but actually the Labour Party does think it is enormously important.The proposals under this bill are to exempt fast tractors—which I found quite amusing really—tractors that operate over 40 kilometres per hour on the road from road-user charges and subject them to an annual charge in lieu of road-user charges to cover the costs they impose on the road network. The bill proposes to exempt all unregistered vehicles—that is vehicles exempt from registration or not required to be registered or operating under trade plates—from road-user charges and apply to them an annual charge as well. That is all very reasonable. It should not have been missed out in the first place. The Minister should not have tried to sneak this through by way of regulation and he should not have tried to trick those on the Regulations Review Committee by reinstating the disallowed regulation and tried to sneak it in that way because he made a mess he made a stuff-up and here we are in this Parliament debating Part 1—Andrew Little: Expensive time.DARIEN FENTON: At great expense actually—great expense. Those who drive fast tractors will be looking forward to having this legislation go through. It actually should never have happened in the first place. Thank you.JULIE ANNE GENTER (Green):I rise to speak on the Land Transport and Road User Charges Legislation Amendment Bill Part 1. The Green Party is supporting this bill and the principal changes that it is making which establish an annual charge in lieu of a road-user charge for some vehicles that are exempt from road-user charges and create a new regulation-making power to exempt from road-user charges vehicles that are not required to be registered. That is an obvious amendment that was overlooked when the original legislation was passed. The principal legislation was the Road User Charges Act 2012 which was a major overhaul of the road-user charges scheme which was passed in 2012. The Green Party can support these minor changes. We do think it is unfortunate but it does happen with the overhaul of a system as complex as our road-user charges system that there would be oversights and there would be things to rectify that would come back to this House and we can understand that. What is important is that it is following the principle of user pays and so it makes sense that if there are vehicles that are not using the road they should not have to pay road-user charges. That makes sense.But there are some missed opportunities obviously both with the principal legislation and this amendment bill to further rectify anomalies in the legislation—for example those using light diesel vehicles which Darien Fenton referred to. Those passenger vehicles are actually being charged perhaps a little bit too much given that they have greater fuel efficiency and that we want to incentivise greater fuel efficiency in our passenger fleet. Road-user charges are a way of applying fees in an economically rational way that will incentivise the purchase of vehicles that are going to be more efficient. So that is something that we could have looked at that was not looked at. Instead we just provide an exemption for fast tractors which are not usually using the road and exemptions for unregistered vehicles which is fair enough.One of the things that came about as a result of the principal legislation the Road User Charges Act 2012 is that the total contribution to the National Land Transport Fund from heavy commercial vehicles using diesel has now actually declined significantly whereas the contribution from petrol vehicles—passenger vehicles by and large—has increased. It used to be closer to a 50:50 split; now it is getting down to only about a third that is coming from these heavy vehicles. I suppose there is some cause for concern that at a time when we are allowing bigger and heavier trucks on the road which has consequences in terms of road maintenance and the requirement for ratepayers to invest in stronger bridges and what not there is a bit of a subsidy going on.We do want road freight to be as efficient as possible and the current system probably is not getting that outcome.One of the rationale for the changes to the road-user charges system was that we could increase compliance and reduce avoidance. So by and large the contribution from heavy commercial vehicles and trucks has declined but the argument was that there would be increased compliance. In fact from the financial review we saw that was not the case. So there is about the same amount of avoidance of paying road-user charges from what I can tell from the documents from the ministry and the New Zealand Transport Agency as there was before but by and large the road freight industry is paying less in its contribution to our national transport budget. Of course this cannot continue infinitely. Unless we invest in alternatives to the roads we are going to have a problem in the future of funding the transport budget because this Government has got some pretty ambitious plans to spend billions of dollars on just a couple of really expensive motorways that do not actually carry many of our freight tonne kilometres or many of our passenger trips.The Government’s decision to spend most of the transport budget on these few motorways and in particular to debt fund some of them as it is proposing in the case of Transmission Gully which is to be funded from private debt means that New Zealanders 20 to 25 years from now or even 30 years from now will still be paying back the money that was spent by this National Government on one motorway that carries you know a tiny percentage—less than 1 percent—of all vehicle trips in New Zealand. That is not a rational use of transport budget.But what is concerning is that we have seen that vehicle kilometres travelled on our road network have declined or sort of stalled since 2006. Vehicle kilometres travelled particularly by passenger vehicles have declined per capita. They have stagnated overall. This is a phenomenon that has been observed in other countries comparable to New Zealand. Australia the United States Canada and all other OECD countries really are seeing the same peak vehicle use and because of that we are having less revenue coming into the National Land Transport Fund than we anticipated. Over time we are going to have a serious funding shortfall between what the Government wants to spend on very expensive motorways what the Government needs to spend to maintain our existing road network at a high standard and ensure that it is safe and the amount of money that we actually have coming in from petrol tax and road-user charges.What is inevitably going to happen if the Government does not reprioritise its spend and cut some of the more superfluous spending and hopefully not take on this additional billions of dollars’ worth of debt to fund one particular project that has a very poor business case is that future Governments are going to have to put up road-user charges and the petrol tax. It is ironic that at a time when there is declining demand for our road network we are spending so much money on new redundant projects that are going to put us into debt and we are then going to have to raise money afterwards and charge people even more for the use of the roads while they are using them less. This is not a rational policy outcome in my opinion.Although the Green Party is happy to support this bill we think New Zealanders need to be aware that in the future we are going to be seeing increases to the petrol tax and increases to road-user charges to fund this National Government’s outrageous plans to spend billions on a few very low-value motorways. It is going to be bad for the country and it is going to be bad for road users most of all. I have said this to the Road Transport Forum and I have said it to the Automobile Association. This Government is not spending petrol tax dollars and the road-user charges money in a way that is best for road users. I think it has been very easy for the Government to make the claim that because it is spending money on roads it is good for road users. But if we take a rational analysis of it and take an objective look at where the money is going what the benefits are going to be and whether or not it is actually going to benefit freight or road users then the answer is that it is not.In the future we could have higher petrol prices and higher diesel prices and at the same time while people are looking for alternatives to the roads so that we can move our freight at a lower cost and avoid the high cost of diesel and while passengers are looking for an alternative to sitting in traffic in Auckland for example because they need to get to work and there has not been the investment in the passenger rail network that was needed they are going to have to be spending even more because we will be paying back the debt on Transmission Gully. Thank you.DENIS O’ROURKE (NZ First):New Zealand First has expressed concern about a number of amendments to road-user charges made during this term of Parliament. The Land Transport and Road User Charges Legislation Amendment Bill seeks to correct some of the stuff-ups made so far. We will support the bill on that basis as far as it goes. But there are many more stuff-ups that are not being addressed at all in this bill. One is some of the provisions of the 2012 amendment Act which made many changes to the road-user charges system. New Zealand First then had and still has concerns for the 22000 motorhome owners registered with the Motor Caravan Association although the total number affected is of course many more than that. We have similar concerns about the horse trucks that have been caught by those changes and which should have been exempt from the 2012 regime.Vehicle operators in those categories justifiably oppose having their road-user charges increased—mostly doubled and in some cases trebled—because of new bandwidths and maximum permissible on-road weight charges when their weight is constant and in most cases considerably less than their maximum chassis weight. There are a great number of motorhomes that are built on a chassis that have a greater gross vehicle mass rating than the actual on-road weight of the motorhome. The changes made in 2012 which we think should have been corrected as part of this particular stuff-up’s correction bill result in the owners of these vehicles being required to purchase road-user licences for a greater laden mass than the actual laden mass.The purpose of road-user charges legislation is to continue the road-user charges system by imposing charges on heavy vehicles and certain other vehicles for their use of the roads that are in proportion to the costs that the vehicles generate. We believe that there should be a provision to enable motorhome-type vehicles which are never likely to operate at near the maximum permitted laden weight to be assigned a road-user charge weight that would be sufficient to cover their actual laden mass. An example is a motorhome with a gross vehicle mass of 12000 kilograms but an actual on-road mass of 8500 kilograms. Under the 2010 road-user charge their charge was $120.24. Under the 2012 changes the owner is now required to purchase a road-user charge licence for 12 tonnes at a cost of $246.26. That of course is an increase of $126.02 or over 104 percent which we think is outrageous.The requirement to have all heavy vehicles operating with a road-user charge licence to cover the maximum permissible laden mass as the lesser of the rated gross vehicle mass or the vehicle’s dimension and mass—rule 2002—has resulted in some excessive increases in costs to the owners such as that I have already mentioned. The greater percentage of private motorhome owners in New Zealand are retirees. These people have limited income and in many cases will not easily be able to absorb such large increases in their costs. This bill should have included a provision to allow motorhomes to have a road-user charge licence weight allocated that covers the actual on-road mass of the vehicle. The current regime which captures motorhomes and horse trucks and hugely increases their road-user charge liability is grossly unfair and should have been addressed as one of the Government’s many stuff-ups where road-user charges legislation has been concerned.Although this bill is supportable as far as it goes New Zealand First places on record our strong objection to the way motorhome and horse truck operators have been treated—not even considered as part of these amendments which we think they should have been.ANDREW LITTLE (Labour):It is a pleasure to take a call in the Committee stage of this very important piece of legislation the Land Transport and Road User Charges Legislation Amendment Bill. This bill has a unique characteristic to it and that is that as a transport bill from this Government it makes some sense but that is about the only redeeming feature of it. It is here because of a failure of process and a failure of the integrity of process by the Minister of Transport—not only the current one but the previous one—that has caused this House to have to devote time to use its legislative powers to correct the previous piece of legislation and the regulatory failure of the Minister. It is important—and that is the reason why Labour will support the bill—that the costs of heavy vehicles to the taxpayer as the primary funder of our roading system are properly shared and met and collected. So this bill plays a very important role in ensuring that that small number—but nevertheless a very important category—of heavy vehicles that do not spend a lot of time on our roads and that would otherwise be exempt from road-user charges do in fact face a levy to properly reflect the burden that they place upon our roads and the cost to the taxpayer of maintaining them to the extent that these vehicles cause undue wear and tear or indeed any wear and tear. That is a good thing and for that reason we support the bill.But underlying this is a more serious proposition that this Government still does not get and that is that not only our roads ought to be properly funded but the funding that is collected or is derived from these user charges is properly and fairly distributed across our roading network because that is not the case at the moment. As my and there is a vast array of roads—thousands of kilometres of roading—that gets no attention at all.David Bennett: State Highway 3.ANDREW LITTLE: I know that David Bennett understands that because he is an electorate member and his electorate is very close to and indeed comes at the end of one of the most important roads in this country and that is my very favourite State Highway 3—the northern route out of Taranaki. It is the northern route out of Taranaki which takes you up the beautiful roads the beech-laden roads out to the north before you get to Awakino Gorge just after you have come down the winding Mount Messenger. The road on Mount Messenger could be rerouted could be set in a more stable area and could save the taxpayer with a bit of upfront investment now. If we managed these new road-user charges under this bill it could enable us to fund a better road on Mount Messenger.Actually that is a dangerous part of State Highway 3 but the most dangerous part was exposed not 2 weeks ago in a tragic accident on State Highway 3 on another very unstable part of the road where a large rock and cliff face fell from the road and crushed the front passenger in a vehicle travelling up it. On a sunny and otherwise pleasant day the passenger and the driver in this motor vehicle met a dreadful fate. That was on State Highway 3 and that illustrates the problem. Questions will be asked and an inquiry is under way as to what happened in that particular case and whether enough money has been spent on monitoring the unstable roads the very important roads but the unstable ones like State Highway 3. The question will be asked as to whether roads like State Highway 3 receive the due attention that they ought to get not because of where they are and the fact that they may not carry the same amount of traffic as the southern motorway in Auckland but because they are unstable and they are in difficult areas. They may well service an area of an important population which is the people of Taranaki and New Plymouth but they are in difficult areas. They are roads that are difficult and costly to maintain but nevertheless they must be maintained. So this bill is important because it starts to signal that at least when Parliament gets hold of an issue like this we as a whole in Parliament can see that we need to make sure that the levies that are collected are properly collected and properly reflect the wear and tear and the burden placed upon the road by different users. The next big challenge—and really a challenge that only the Government can meet—is to make sure that it is properly spent.CAROL BEAUMONT (Labour):It is a pleasure indeed to speak to the Land Transport and Road User Charges Legislation Amendment Bill in Part 1 of the Committee stage of this bill. The purpose of this bill is of course—as others will know but just for those listening—to amend the Road User Charges Act to enable regulations to be made exempting road-user charge vehicles that are not required to be registered from road-user charges. Most of the vehicles that are exempt will make very little use of roads and make a sufficient contribution to the cost that they impose on the road network through the vehicle licence fee. In fact the first part of this bill Part 1 amends the Land Transport Act 1998 to enable an additional fee for certain road-user charge vehicles. So that provision is essentially making that additional fee payable in respect of all road-user charge vehicles that are operated on roads and that are exempt from paying road-user charges. That additional fee is to be treated as land transport revenue for the purposes of the Land Transport Management Act. It is meant to be set having regard to the extent of the use of the vehicles on the road and the likely cost that the vehicles will generate when they use that road.This is important and I do not want to relitigate the history but it is an interesting bill this one. We support it. I mean getting the legislation clear and getting it right is important. However it has got an interesting history which I did comment on in my second reading speech so I will not go into it here. The fact of the matter is that we are fixing up a bit of legislation to get it right and that is fine. The actual amendments to the Land Transport Act in Part 1 as I said make sense.But one of the issues that we have got is a question of strategic transport direction. That is what I want to talk about. This is about revenue we collect from vehicles using roads and making sure that it is done in a fair manner that makes sense. But we do need to think about what we are doing overall with our transport system. Our transport system is fundamental both to ensuring that people can get from A to B as they need to but also to ensuring that goods and services can get from A to B as we need them to and it is a significant part of our economic system. We need legislation that makes sure that the costs are shared clearly and equitably but we also need to make sure that this transport system that we have actually enables our economy to grow and that it serves the people of this country.The question we really have is about the revenue being generated from the fees that can be set under this part from road-user charges generally and from petrol tax. All of this is about income that is generated that can then be used on land transport. How that is used is I think a point of great political significance and one on which we have a very significant difference with the Government which has essentially concentrated its thoughts almost exclusively on roads of national significance. From our perspective we need to think about the rail network being the backbone of our transport system. We need to think about local roads as part of the infrastructure that is essential in terms of regional development.I think that whole strategic transport direction question is a really important one which the Government across the Chamber fails to take account of. In fact even in question time today—and I raise this point even though it was not a transport issue—illustrative of this problem was the fact that the Government will not deal with any of the hard questions. We were talking about issues of superannuation about money to invest in New Zealand businesses and about the extent to which we use the income we generate and the money that we need to invest in our businesses and how we do that. Honestly the answers to those questions around superannuation today were a disgrace. Likewise we need the money that is being generated through our road-user charges—through the fees that are flagged in Part 1 of the bill—to be used in a much more strategic manner than the current Government is using them.Members on this side of the Chamber will as I have said be voting for this bill. We do think that transport and getting it right in the transport portfolio is critical and we understand the need to correct the mistakes that have been made. But we think that the Government is going in the wrong direction.Part 1 agreed to.Part 2 Amendments to Road User Charges Act 2012DARIEN FENTON (Labour):I am happy to take a call on Part 2 of the Land Transport and Road User Charges Legislation Amendment Bill. I think it has been an interesting discussion from the Labour and Green members of the Committee who have made a contribution to this debate by reflecting on what our transport system should be and how we use most effectively the fees that are taken from freight vehicles and others in road-user charges but also how we use the National Land Transport Fund and the money that goes from petrol excise tax into a special fund—which Labour actually did; it is called hypothecation—to build a transport system that is fair to everybody and that takes into account users of all modes of transport and that makes sure that people can get about and get to work can get to school can get to amenities and so on. That is why we see in places like Auckland where I live such a huge focus now on public transport.It was very interesting to be at the event the other day where the electrification was turned on—the member Julie Anne Genter was there too—and to see John Key turn up for it. John Key turned up and Gerry Brownlee and a whole lot of National Party MP hangers-on for this great event about electrification. I was bemused by that because actually it was a Labour Government working with the Greens in 2007 that initiated and funded electrification of the rail.Hon Annette King: Who was the Minister?DARIEN FENTON: Who was the Minister then? Well it was the Hon Annette King. It was a fantastic decision and I was very very proud to be there. There was not one bit of recognition the other day from that Government of that and also not one bit of recognition from the Government that it was Labour that did the double tracking in Auckland so that we are going to have a rail network in Auckland in the future once the Government gets over itself and funds the City Rail Link as well.The whole transport portfolio the transport policy is really important to everybody in the country. But this bill as I said is correcting a small anomaly and I want to go back and talk about another one that I encountered during the adjournment. Out in the country out in the regions travelling around the rural roads you can see it everywhere you go. This Government has sucked up funding through its roads of national significance its gold-plated highways to nowhere and regional roads and rural roads are missing out. Councils up and down the country are up in arms because the Government is reviewing funding assistance rates funding which is the funding that helps them keep their local roads in order. They are very worried because what it means is if the funding review comes out like it has been looking like it will it is going to cost ratepayers a whole lot more.But for me the most interesting visit I had was to the East Coast to Gisborne the other day where I met with some truck drivers. I know that the Road Transport Forum likes to think I am anti-truck. I am not anti-truck; I am pro - truck drivers because I think they have got a really hard job. Those two truck drivers drive forestry logging trucks. They are driving them day in and day out because forestry is booming on the East Coast. They are driving these huge rigs that they pay half a million dollars for and they are driving them on shocking roads because this Government is ignoring the funding that is needed in rural areas like the East Coast for secondary roads and it is putting those drivers to work on unsafe roads. The roads are rutted. They are unsealed. They fill up with mud. Trucks slip and slide everywhere. The culverts overflow.The forestry industry infrastructure has been neglected. It has been neglected by this Government yet the Minister sitting in the chair at the moment the Minister of Labour knows the consequences of ignoring safety in the forestry industry. He knows the consequences of that yet on one road there have been two deaths in the last 6 months—two accidents killing forestry logging drivers. I talked to these guys I met. These are hard-working guys. They are owner-drivers so they own their own businesses but they are really upset. Their comment to me was “We pay something like $53 million in road-user charges in this area. We see nothing of it—we see nothing of it.”Every day they tell me there are 10 near misses on that road. It is not just the forestry logging truck drivers at risk; a bus was run off the road the other day—it is other drivers on those roads. It is really really dangerous and as I have said forestry is booming on the East Coast and it is going to continue to grow as more trees come on line. So I cannot understand why the Government is not on to this and is not doing something to repair its critical neglect of forestry roads—in particular secondary roads—and why it has embarked on a funding review for regional councils when regional councils are so worried about how they are going to get their goods and services out and how they are going to keep their drivers safe and their road users safe. It is the same in Northland—it is the same in Northland. The mayor up there has been raising this issue and we have had no answers.Labour has an answer—Labour has an answer. We announced our forestry policy 2 weeks ago and we also announced that we would put back in $200 million of funding for critical regional roads in the forestry industry. So we have an answer for those truck drivers. They know that Labour believes that their lives are worth standing up for and doing something about and believes in helping them earn a living helping a town like Gisborne flourish helping it come along and helping this whole forestry industry which is so critical to our country. And of course we want to see value-add as well so it is not just logs coming out of the forests and to the ports.So I think there is an anomaly. There is an anomaly in road-user charges where this Government does not take into account the issue of the sole truck driver in Gisborne driving his half-million-dollar rig. Actually some have been split in half. That is how bad the roads are—their tyres split. The Government does not take that into account. It listens to the big boys. So when you have submissions on road-user charges you hear from the Road Transport Forum and others but it is not often that a lone truck driver driving on dangerous roads actually gets to have any say or gets heard by this Government. So I challenge those members to go to Gisborne meet the same drivers I did get in their rigs go on those roads and see how they feel about it and how dangerous it is and how scary it is. It is not just as I said those truck drivers who are paying their road-user charges and are keeping their trucks up to scratch as much as they can. It is not just them; it is the other road users who are also at risk.We have to take responsibility for it. This is a problem with the road-user charges system. The Government is neglecting rural roads and regional roads and our road-user charges system will not be sufficient until the Government understands that we have got to have a fair share of the National Land Transport Fund that goes not only to cities but also to regions which are so critical for our future.Simon O’Connor: Like Whangarei—that new bridge.DARIEN FENTON: Whangarei—go and talk to them in Northland absolutely.Simon O’Connor: The new bridge.DARIEN FENTON: A new bridge—but the forestry roads are shocking. People are driving off them. I have someone who rings me every morning—who lives on State Highway 1 and says “There’s been another truck gone off the road Darien.” You start monitoring it.Mike Sabin: Every morning?DARIEN FENTON: That member should start monitoring it. Government members do not like it when we—Carol Beaumont: Hitting a nerve.DARIEN FENTON: Yes hitting a nerve. You do not like it when Labour stands up for the drivers for truckies. They do not like that—they absolutely do not like that.So as my colleagues have said we are supporting Part 2 of this bill. The legislation needs to be fixed. Of course we are supporting the bill. It is a waste of time that we are having to do this. I would much rather that we were spending our time in this Chamber doing something for those hard-working forestry truck drivers those logging truck drivers who are putting their lives on the line every day to help their families and to help the economy. I would rather we were doing something about that and that instead of those members shouting across the Chamber from the other side we were putting our heads together in the Transport and Industrial Relations Committee and coming up with a solution because this is dangerous work.Mike Sabin: I’ll tell you what the solution is: keep Labour from the Treasury benches. That’s it right there.DARIEN FENTON: Pardon?Carol Beaumont: Take a call.DARIEN FENTON: Take a call. That is a good idea—that is a good idea. So as I said I am pleased to support this bill.The CHAIRPERSON (H V Ross Robertson): I call the honourable member Julie Anne—[Interruption] Have you finished? [Interruption] I call the honourable member Julie Anne Genter.JULIE ANNE GENTER (Green):I have to strongly agree with the contribution just made by my colleague Darien Fenton. Part 2 of this—[Interruption]The CHAIRPERSON (H V Ross Robertson): Order! I am sorry to interrupt the member. It has been a convention in this place for a number of years now that when people who do not have the floor interject on each other that is not in keeping with the custom of practice of this House. I urge members to remember that.JULIE ANNE GENTER: Thank you Mr Chair. I have to strongly agree with the contribution just made by my colleague Darien Fenton on Part 2 of the Land Transport and Road User Charges Legislation Amendment Bill which amends the Road User Charges Act.I think that for the benefit of members in the Committee today there is probably a little bit of background that needs to be explained about how the road-user charges system works. Central government spends about $3 billion a year on transport through the National Land Transport Fund. Most of that revenue comes from petrol tax and road-user charges. As I said earlier about a third of it comes from road-user charges—that is the contribution from heavy vehicles trucks and commercial vehicles using diesel. They contribute about $1.1 billion which goes to the National Land Transport Fund. Petrol tax is about $2 billion a year. What is often overlooked when people say that roads are paid for by users is that actually that is not entirely true. Local roads are 50 percent funded by ratepayers. Ratepayers pay $1 billion which is spent on transport. So the overall transport infrastructure funded by Government is about $4 billion—$1 billion from ratepayers. It is worth noting that about 50 percent of all vehicle kilometres travelled happen on local roads so it is quite a big proportion that is subsidised by ratepayers.But what is really overlooked when we talk about the economic benefit of our transport system is the huge cost to households and businesses to use the infrastructure that is being paid for with their tax dollars. Taxpayers are paying $4 billion a year. That is being spent mostly on roads mostly on a few State highways. The largest share is going to go on a few State highways which carry a tiny proportion of all vehicle trips over the next 10 years. A large portion is going to be to pay the interest on the debt that we use to fund those projects. That is going to go on for about 25 years. But what is really overlooked is that households and businesses are spending at least three times that much just to use the infrastructure that is being built with their tax dollars. Households spent about $11 billion on fuel and vehicles last year. If we included the cost of businesses—the money that they put into their vehicles—I am sure it would be even more than that.So when we talk about what is the most economically efficient way to reduce transport costs in New Zealand minor improvements to the roading network probably are not the best way to make those savings because households and businesses have to spend well over $11 billion a year just to use the infrastructure. All of that money goes overseas because we import all of our vehicles and all of the fuel that we use to run them. Even if we did find some oil offshore it would not be used in our cars and trucks because we have light sweet crude oil which we export and we do not have the capacity to refine it. It would not be the highest-value use of that fuel.I suppose what the Green Party is saying is that a more rational approach to transport investment that would actually get better bang for our buck is to invest in the modes that have been underinvested in and that benefit not only the people who use them—the people and goods that go by rail or by passenger transport whether that is by bus or by ferry or the people who walk or cycle. If you do all of those things then you get better use of your road network but you also save money on the other side because you save the money that households and businesses are having to spend to use the road network.Unfortunately it was the National Government that decided not to reopen the Napier-Gisborne line—Shane Ardern: Yeah but who closed it?JULIE ANNE GENTER: Well it was the National Government that closed that line.Shane Ardern: No no no.JULIE ANNE GENTER: Yes that is what happened. We have enormous potential to invest in our rail network which would result in quite substantial regional economic development and reduce some of the very very high inter-regional transport costs that we have here in New Zealand. The reason why we should use the transport budget to pay for that is that it also benefits road users. At the moment when we evaluate the benefits of investing in a State highway we look at the safety benefits and we look at the wider social and economic benefits. But when we look at KiwiRail we say “Well you’ve got to fund all of your infrastructure investment simply from the return that you’re making from your freight business.” That does not make sense. The usage—Shane Ardern: A billion-dollar subsidy upfront was pretty good.JULIE ANNE GENTER: It is not $1 billion a year; it was only $250 million a year. The Government is not investing enough in the rail network and that is a missed opportunity because it impacts our road network. Making it possible for some logs and some dairy products to move more quickly and more frequently by rail takes huge heavy trucks off our roads reduces the amount of money we have to spend on maintaining those roads increases the safety for people who are driving in their cars on those roads and benefits our exporters because it reduces their costs of getting their products to market.So it would make a lot more sense to take some of that enormous capital expenditure that is going into a few very low-value motorway projects in peri-urban areas which do not even carry that much of our exports and invest some of that in the rail network all across the country getting regional economic development increasing the safety of those roads improving the maintenance of those roads and also improving congestion. If we invest for example in the City Rail Link in Auckland we can get a lot of commuters off the roads. That frees up the roads for those people who need to travel by car whether they are a plumber or a builder and who have to get around by road at peak time. The best thing for them is if we can get hundreds of thousands of cars off the road and we can do that by improving our passenger rail. Since we have already invested in electrification it makes sense to build the City Rail Link because that actually doubles the capacity of the entire rail network. It means we can get 5-minute frequencies which makes rail that much more attractive for people who are using it to get into and around the city and who do not need to use a car. Once the western ring route is opened there will be alternatives for freight. The last thing we want to see is that road clogged up with commuters who are trying to get to houses that are being built way out of the city. That would not be good for road users. It is not good for freight.So what the Green Party says is that we want an economically rational investment in our transport fund. We have to keep in mind that the way we use road-user charges does not need to be on new roads. Spending money on expensive motorways with low benefit-cost ratios is not the best use of road users’ money. In fact investing in rail is in some cases a better use of road users’ money because it has a better impact on the overall economy and the transport system whether that rail is for passenger services or for freight in our regional areas. So there are lots of opportunities. This bill makes just some tiny technical changes. The overall direction that the Government is going on transport is wrong. It is actually to tax and spend—that is the approach that the National Government is taking. It is borrowing taxing and spending the money in ways that are not going to benefit taxpayers are not going to benefit the economy and are going to cost New Zealanders for decades to come. That is a very serious concern.CAROL BEAUMONT (Labour):In rising to speak on Part 2 of this bill the Land Transport and Road User Charges Legislation Amendment Bill—Part 2 contains the changes that amend the Road User Charges Act—I just want to identify a few of the elements that are in Part 2. There is provision in Part 2 around the situation where people are required to have a distance licence as part of their road-user licence where the vehicle concerned is used outside the terms of its road-user charges licence and the question around what defence there is in that situation. The Transport and Industrial Relations Committee in dealing with this has suggested an amendment here to clause 6A in Part 2 inserting new sections 9(4A) and 9(4B). This is around “reasonable excuse”—the amendment “gives guidance to operators and to enforcement authorities as to a particular circumstance that might constitute a ‘reasonable excuse’ without otherwise altering the effect of the provision”. So that has been done in Part 2 where it sets out what happens in the situation where the vehicle does not have the correct licence for the type of road-user charge vehicle that it is. So that is one of the elements of Part 2.Also in Part 2 are the provisions in clause 12 around an offence provision relating to breach of conditions associated with section 40 of the Road User Charges Act. That is in the situation of a “light RUC vehicle operated almost exclusively off-road”. That provision is outlined. It adds an offence provision new section 40(7) to support the enforcement of conditions associated with exemptions granted under section 40. The proposed penalties have been set out to be commensurate with penalties associated with other offences of similar seriousness. There are a number of minor technical amendments that are covered off in Part 2 as well. One of the provisions is to clarify one part section 57(1)(a) by putting the word “user” after the word “road”.This is a clarification to try to tidy up. Again as I commented in Part 1 Labour does support this bill. It is fixing up some matters that do need to be fixed up. It did have a rather tortuous history to get us here.But the real question—and it is one that Darien Fenton and Julie Anne Genter have both raised here—is how all of this relates to any coherent strategic direction for transport in this country. The fact of the matter is that this is an area where the Government is taking a very piecemeal approach. I thought it was a very interesting suggestion that Darien Fenton made actually in her contribution on Part 2 because in fact we do have the Transport and Industrial Relations Committee. What a fine opportunity in fact for that select committee particularly to deal with questions of logging trucks and the types of roads that they unfortunately have to use causing serious accidents and being part of the horrendous health and safety problems we have in that industry. So there is a question of the types of roads and transport used and the failure in fact to make greater use of rail—for us to use rail more effectively especially along the main trunk—and to look at that in conjunction with the conditions of work of people working in the forestry industry. I think that is an exceptionally good idea. I think it is one that the select committee should take up.Of course the chair of the select committee David Bennett happens to be in the Chamber. I am sure that Mr Bennett will want to jump up and agree with us on this matter—agree with us on this very good suggestion made by Darien Fenton which is a serious suggestion. It is not a joke. This is a real problem we have. It is a problem in this industry that could be serving this country a great deal more. We could be doing a whole lot better with the forestry industry and with products from the forestry industry. We could be creating better jobs safer jobs jobs that pay people for a decent standard of living and creating added value in our economy. This is an opportunity to look at an industry that is very important for this country and to make sure that not only is it providing decent and safe work for the people who work in it but also is ensuring that we can use forestry and the wood products from it to ensure that we have better jobs throughout our economy; that we add value to logs and end up with products that we can get far higher prices for.Labour has outlined a strategy for the wood industry—a strategy that sees us moving from the situation where we currently cut down trees create logs put them on trucks and sometimes on trains and take them and export them offshore as logs. What does that add? As Ms Fenton has outlined we have an industry that is very very dangerous including for the truck drivers who drive those trucks on those forestry roads. We need to invest more in those roads to get logs off safely and to use our road-user charges and other funding of land transport to do that rather than funding some of the roads of national significance. But we also need to look at getting those logs and doing things with them. This is the sort of strategic approach that we need in this country to create better jobs to create greater wealth for this country so that we can ensure that that wealth is then distributed fairly.All of these things are completely beyond the scope of understanding of members opposite. Strategic decision-making is clearly not something that the Government is willing to do. Piecemeal approaches generally hands-off approaches are what it does best. It is not focused on issues like creating decent work for New Zealanders. It is not focused on a strategic approach to transport that makes sure that the transport system serves the people of this country and the businesses and the jobs that they create. This is something that is completely foreign to members opposite. I would note that in discussing this bill we have yet to have a contribution from a member of the Government. It would be very good for them to get up and talk about this bill. I would really urge David Bennett the chair of our select committee to get up and talk about the very good suggestion that has been put on the table today by Darien Fenton about us looking in a collaborative manner in our select committee at issues related to both transport and employment in the forestry sector. Thank you.Part 2 agreed to.Clause 1 agreed to.Clause 2 agreed to.The Committee divided the bill into the Land Transport Amendment Bill (No 2) and the Road User Charges Amendment Billpursuant to Supplementary Order Paper 428.Bill to be reported without amendment presently.Industry Training and Apprenticeships Amendment BillIn CommitteePart 1 Amendments to principal ActThe CHAIRPERSON (H V Ross Robertson): The question is that Part 1 stand part. It is a debate on clauses 4 through to 23 and includes schedules 1 and 2.Dr MEGAN WOODS (Labour—Wigram):It is useful that we have come to the time to debate this bill in a very detailed way as we go through the Committee stage of the Industry Training and Apprenticeships Amendment Bill because the reason why Labour opposes this bill is really in the detail. So let me set out very clearly the two reasons that Labour opposes this bill. Both of these reasons are contained in Part 1 of this bill—specifically in clause 15 of the bill. The major problem with the bill as we see it is the proposal to allow organisations other than industry training organisations to be directly funded by the Government to organise and undertake industry training. That is our first major concern. Our second major concern with this piece of legislation is the proposal to remove the skills leadership function from our industry training organisations and what that is going to mean for the sector. We have some very real concern about what that will be.So if we have a look at clause 15 of this bill this is where a lot of the problems for us are embedded. It is also where a lot of the problems that the many many many submitters who came to the Education and Science Committee and voiced their opposition to this bill and their concern with this piece of legislation focused their attention. We have spoken at previous readings of this bill about how we had submitter after submitter from a range of organisations come in and tell the committee that this was not a bill that was going to fulfil the purposes that it set out in its purpose statement to do—that this was not a bill that was going to enhance industry training in New Zealand and add to the environment that we have.If we have a look at clause 15 and the proposal that persons other than industry training organisations may receive funding for industry training this is nothing more than this Government’s privatisation agenda in the education sector. This is rolling out privatisation into our industry training sector and siphoning out bits of money. Does the industry want this? No. The industry came and very clearly told members at the select committee that this was not something it saw as adding anything to how we deliver skills training in this country.So direct funding is going to bypass industry training organisations and introduce competition. The tender process is already under way even before we pass this legislation I note.If we take one example to consider how this legislation is going to play out for a given industry there is a very large player in the aged-care sector that is currently tendering to have direct funding under this legislation and to be something other than an industry training organisation that delivers the skills training. The danger here is that what we are going to have is delivery of skills training that suits that business rather than suiting the industry as a whole. It will be training that is directed at one particular business. Some people might say that there is no problem with a business training to suit the needs of its business but the problem for us is that this is using public money to do it. It is not simply a private organisation deciding that it is going to do some professional development with its workforce and train those people to suit the needs of its business. This is using industry training money that can potentially be put into the business of one person.The other major problem that we have with this is that private providers of industry training can cherry-pick the businesses that they deal with. We heard very clearly from the submitters who came to us at the select committee that one of their major concerns about this is that small and medium sized enterprises would miss out under this model and that private providers of industry training would go to the very easy business model of dealing with large organisations. Business-to-business costs would be much lower and it would be a much cleaner business model for them to deal with. But when it came to the very real need to be delivering industry training for our small and medium sized enterprises we heard that this is not going to work. On this side of the Chamber we believe that denying good industry training and good skills training to our small and medium sized enterprises is not a way forward for a better New Zealand.We know that so many of our young people are entering small construction firms small manufacturing businesses—all kinds of smaller organisations—with say fewer than 50 employees. Actually yesterday I had the good fortune to visit one of these construction companies in the Wigram electorate and I talked to the owner about what it needed through skills training. What it needs is a very clear plan of what skills training is and a strategic direction from the Government not a continuation of a privatisation agenda as in clause 15 of the bill which inserts new section 11A in the principal Act.We also have some further concerns about clause 15. It is not just concern about removing the ability to have direct funding going solely to industry training organisations; there is also the skills leadership role that industry training organisations currently fulfil. Under new section 11A in clause 15 what we have is the industry leadership function being withdrawn. Call us old-fashioned but on this side of the Chamber we think that industry has a role to play in determining what skills are needed by industry. We do not believe that the Government is the sole best person to make that decision. Government members of the select committee thought that they were much better placed to make decisions about what the needs of industry were in terms of its skills training than those who are on the ground working in the industries trying to build the houses trying to run manufacturing companies and trying to run aged care facilities. But no this is a Government that is so arrogant and so out of touch that it does not believe that those on the ground working in these industries should be funded to play a part in determining what skills are needed in this country. That produced a great deal of concern to us—as well as no need to cry over spilt water now that I have spilt mine.The concerns about Part 1 did not even stop with clause 15. Some other very real concerns were brought to us by the National Council of Women about what this legislation is really missing the opportunity to do. We have some woeful figures in this country around women’s participation in many of our trades in this country. The National Council of Women came to the select committee with a very elegant solution. It just asked for the word “women” to be included in a priority group of people who could receive skills training. Would Government members listen to that? No they would not. They are not willing to do anything to address the very real gender gap—and therefore pay gap—that we have because of our skills training.So for us on this side of the Chamber it is a real disappointment that the Government has not taken the chance to further enhance our industry training sector. In fact it has just pursued its ideological commitment to privatising our education system. Not content with charter schools and public-private partnerships and the tendering out of levels 1 and 2 funding within our polytechnic sector the Government is now seeking to fund money out of the public purse and into private companies through our industry training sector. This did not come as any great surprise to us because on this side of the Chamber we know that this is a Government that has no real commitment to apprenticeship training and skills training. It is a Government that has cut funding. It was a National Government that gave up on apprenticeships in the 1990s and that was yet another of the things that the Labour-led Government of 1999 had to reintroduce.We on this side of the Chamber have a real commitment to skills training and apprenticeships training. We certainly would not have done what this Government did and leave the bulk of the $42 million allocated for the Skills for Canterbury training sitting in the bank for 2 years while our young people went untrained. There is nothing in this legislation—there is nothing in this bill—that is going to turn that round. There is nothing to signal that this Government has a renewed commitment. Instead what we are seeing is a continuation of a walking away from the Government’s need to really back the fact that the way for New Zealanders and New Zealand to get ahead is for us to have comprehensive and good skills training in this country.I want to hear the Minister in the chair take a call and tell us why it is that the National Government does not think that industry should have a role in skills leadership. I would also like to hear from the Minister in the chair why it is that the Government thinks that despite what industry and all the players in the sector have told us private providers are better placed to deliver the training.The CHAIRPERSON (Eric Roy): I call Grant Robertson.GRANT ROBERTSON (Labour—Wellington Central):It would appear you have only one option Mr Chair.The CHAIRPERSON (Eric Roy): I’m looking forward to it.GRANT ROBERTSON: Thank you; so am I. I want to pick up from where my colleague Megan Woods was although perhaps not in the spectacular water display that we just saw over here and talk about the two main concerns that the Labour Party has about Part 1 of the Industry Training and Apprenticeships Amendment Bill. In order to do that it is important for those watching to remind ourselves what the purpose of industry training is and why the Government funds it. Essentially industry training organisations since they have been developed have had three main roles. Those roles have been to set the standards for industry training to organise industry training and administer industry training and to ensure that the skills leadership function that is so desperately required in our workforce planning is undertaken.What does skills leadership mean? What skills leadership means is working to identify where the skills needs are in a particular industry and ensuring that we have programmes and courses that match up with those skills needs. Under this piece of legislation that third of those industry training jobs has been taken away from industry training organisations. It was a remarkable thing in the Education and Science Committee to be presented with a sort of nihilistic view of the world—some sort of anarcho-syndicalist view of the world—that skills leadership would just happen that it would just occur and that no one would need to be in charge of it; it would just magically happen and some Government agencies would do some things and other industry groups would step up to the plate. That was one of the things we heard.Well that is just nonsense. From my point of view and from the Labour Party’s point of view industry training organisations are the peak bodies of industry. This is the place where we can learn the most about what is required in the future in terms of skills. Yes by all means Government departments have a role in making sure that they are feeding into that exercise of saying what the next wave of skills are that are needed in industry but the leadership role in that surely must come from the industry itself.It was as my colleague Dr Woods said very odd for us on the Labour Party side to be told by the National Party members that the Government should pick this up when we were saying no no actually this is where industry should be leading. Industry knows best what is needed in terms of those skills. So we are very disappointed to see that in Part 1 of this bill the skills leadership function disappears from the role of industry training organisations.We are disappointed that we cannot support this bill because there is no doubt that there was and has been a need for industry training organisations to recalibrate themselves. Over a period of time a number of them had grown to such an extent that they perhaps were not servicing the exact needs of their industries were not servicing the needs of the businesses within the industries and certainly were not always servicing the needs of trainees. People were complaining that they were seeing a lot of flash cars being driven by industry training organisation staff but not the outcomes on the ground in terms of delivery of training. We accept that there was a need for some rationalisation of industry training organisations and that has happened. Businesses have now bought back into the model so it seems very odd to bring a piece of legislation to the House we believe that breaks that up. Just as things are getting better the Government comes along and makes some quite fundamental changes that are contained here in Part 1.On the Labour Party side of the Chamber we strongly support industry training. It is so critical as part of the lifelong learning and the build-up of skills that make for a productive economy that we have as many workers as possible engaged in industry training and a system that organises that in a way that meets the skills needs and allows people to develop their own skills and get transferable skills that can take them from one business to another and be recognised for that with qualifications. All of that is good. All of that is in the bill but then it is broken apart by the two key clauses here: the removal of the skills leadership function and the opening up of funding for industry training to non - industry training organisations. Those two clauses are the reason why the Labour Party cannot support this bill.When we look at the regulatory impact statement that has been provided for this bill it is quite instructive. It talks about why the Government funds industry training. It says: “The availability of common transferable qualifications and a training organisation considering the needs of the industry as a whole is akin to a ‘public good’ which is unlikely to emerge without government intervention particularly in industries with a high proportion of small firms.” That is the nub of the matter. That is the reason why industry training is funded by the Government—not because an individual business needs to train its workers to do the particular jobs. That is the responsibility of an individual business and it will—and in most cases does—go about doing that. What industry training says is that we want a broadly skilled workforce that can move from one business to another and from one industry to another with recognised qualifications and skills that are transferable.That is actually what the regulatory impact statement says yet the Government in new section 11A opens up the funding of industry training to non - industry training organisations effectively to individual businesses. It says to them that they can go off and do this. Every single submitter bar one which I will come back to said that they did not believe that this was the way to go. We had the remarkable situation of the Contractors Federation sitting down at the table—in fact I think the speakers were still standing up when they said it. They said that they agreed with everything that the Council of Trade Unions had just said. What the Council of Trade Unions had just said was: “Do not do this. Do not break up industry training. Do not effectively privatise industry training because getting those transferable skills those skills that are for an industry not a specific business is important to our future productivity. It will also fundamentally undermine the industry training organisations themselves.”In that quote from the regulatory impact statement I mentioned the reference to the fact that need for Government intervention is “particularly in industries with a high proportion of small firms.” It is the small firms that will miss out under this process because it is the small firms that will be left behind.Dr David Clark: Why does National hate small businesses?GRANT ROBERTSON: A big firm goes off and decides to run its own industry training but small businesses will be left with increased costs to keep their industry training organisations going and there will be further burdens on them as small businesses. My colleague Dr Clark knows from his travels around the country talking to small-business people that they are already struggling and here will be an additional burden. Here will be an additional cost. That is another problem. Not only will we end up with training that is not industry wide but business specific but it will also undermine small businesses and increase their costs.There is already flexibility for employers to move from one industry training organisation to another. They are not stuck in the industry training organisation they are in now and we have seen quite a bit of that in recent times. The argument that this opening up of industry training under new section 11A somehow or other will lead to increased flexibility is just plain wrong. The flexibility is in the system already.The only organisation that came to the select committee and said “Yes we think this might be OK.” was Business New Zealand but it would be fair to say that Business New Zealand’s endorsement was a little on the lukewarm side. It in fact told the committee that it was not opposed to the idea. It said that it was “cautiously supportive” but it wanted to make sure that the approach was “independently evaluated to ensure that it results in learning outcomes linked to industry needs”. That is what it said. Business New Zealand was worried that this opening up of industry training to individual businesses would mean that we would not have industry-wide skills and qualifications. Business New Zealand does not really like this either. That is the truth. Every other submitter—from the Contractors Federation to the Council of Trade Unions Careerforce the Amalgamated Engineering Printing and Manufacturing Union and the National Council of Women—said there is no justification for opening up industry training to be funded to individual businesses.It is hard to escape the view that it is simply in this bill as part of a wider agenda of privatisation be it charter schools or be it public-private partnerships. It is all in the same direction and it is the wrong direction. We want a strong public education system that delivers skills training and education that is applicable right across the board. That is why the Government should fund these things. We support strong funding for industry training and apprenticeships but under this bill and under this part of the bill that is consistently undermined.It seems remarkable that in trying to consolidate and improve some bits of industry training if this bill passes in the form that it is in now it will fundamentally undermine industry training. I challenge the National Party members on the other side of the Chamber to get up and tell us why industry training funding should be delivered to specific businesses to deliver training that is only relevant to them. Why should we not have a situation where we fund as a Government only skills that go across an industry rather than specific businesses?Hon Dr NICK SMITH (Minister of Conservation):I am pleased to take a call on the Industry Training and Apprenticeships Amendment Bill firstly to make the point that Labour members should hang their heads in shame in respect of their record on industry training. You see when National came to Government less than 50 percent of the people who were undertaking apprenticeships had acquired 5 years later any qualification or credit from their programme of work—less than half. I make no apologies for being part of a Government that is about reforming industry training to make sure it is of quality and to make sure it is not just about bums on seats which was the driver of policy under the previous Government.The speaker who just resumed his seat Grant Robertson has got this ideological block about any organisation other than a public body being able to provide training. We differ. Can I give the member an analogy. Can I give him an analogy. In my community in Nelson we have an institute called the Cawthron Institute. It provides excellent science. But Labour policy said it had science being done only at Crown research institutes not at the Cawthron Institute. It is this Government that says no we will provide funding to the Cawthron Institute on exactly the same grounds as to a Crown research institute.Dr Megan Woods: That’s not true.Hon Dr NICK SMITH: Dr Megan Woods has said that is not true. Let me be very clear: under Labour there was no capacity funding for organisations unless they were a Crown research institute.The Cawthron Institute was the Cinderella of the science community until we came into Government and said no it is about the quality of the science not who owns the bricks and mortar. When it comes to industry training our Government simply says that we should contract to provide industry training from whoever can provide quality.Let me give an example. Many members of this House will have been to the Westport Deep Sea Fishing School. It is an outstanding institute. It provides training for people in the most important industry in my area. We have ideological opposition from Labour members who say: “Oh no no no. Because it is not owned by the State we cannot provide it with funding for training.” We say that that is an ideological block that is a nonsense and that we should be able to provide funding to organisations that provide training based on the quality of their programmes not on who owns the bricks and mortar. We apply that to our science policy. We apply that to upper tertiary education we apply it to trades training and we apply it to science because we are a pragmatic Government that is about getting the best results for the Kiwi taxpayer and we are not going to let ideology get in the way of what makes sense.DAVID CLENDON (Green):I am pleased to make a few comments on what could have been a very good bill and a bill that the Green Party actually supported at its first reading to the Education and Science Committee because we saw some good things in it. Unfortunately there are two deal-breakers in the Industry Training and Apprenticeships Amendment Bill for us and I think we share the concerns of the Labour Party.I was interested to hear just now from the Minister in the chair the Minister of Conservation. He seems to be conflating opposition to this bill with opposition to the private provision of education science and much else. That is clearly nonsense. I mean yes most certainly we support the public tertiary sector. We also see a very legitimate place for private training establishments and the Cawthron Institute an organisation with a splendid history and hopefully an equally splendid future. What we push back against is the unnecessary privatisation of services that are better located within the public sector meaning you get an unreasonable level an unfair level of competition. We are seeing this with the push to contract out the provision of education such as we have seen at Unitec and we are now seeing in action at Lincoln University.To return more specifically to this piece of legislation as I said we would have been happy to support it but for these two issues that have been identified one of them being the removal of the skills leadership function. It is interesting to note that the 30-odd submissions to this legislation were for the most part supportive but were almost universally opposed to the notion that skills leadership should be left to who knows whom. There seems to be a pious hope embedded in this legislation that somebody somewhere will pick up the ball and indeed in some industries that may be the case.The Building and Construction Industry Training Organisation was very strong on the issue. It made the very valid point that within its industry within building and construction something like 90 percent of apprentices are trained by companies with fewer than 20 employees and in many cases fewer than 10. It is simply disingenuous to think that companies and businesses of that size of that scale are somehow going to collaborate to provide skills leadership in any sort of meaningful way. It is actually going to make the task of the Government and all of those various groups that collectively want to direct and ensure that we have a good sense of what skills are required in the future—what are the best training programmes and mechanisms to put in place—much more difficult if they are not to have that reliable feedback.Initially as I said when we first saw the bill we thought: “Oh that’s interesting. They want to take skills leadership away from the industry training organisations.” We thought that it would be interesting to see which agency which mechanism and by what means the Government was seeking to improve leadership. Sadly disappointed we were when we discovered that in fact no—it was just being left to somebody out there. As I said there is this pious hope that somebody some organisation will both be willing and critically be able to provide leadership within whichever industry it may be at the moment.The other issue of course is the matter of public funding being directed to single companies to single organisations. The point has been made that even Business New Zealand which is typically quite pro-business and quite pro the private sector gave very very qualified support—qualified to the extent that it asked the very sensible question: “Well if not the industry training organisations then who?”. That question has clearly not been answered in this legislation; nor has it been answered I would hazard to suggest by the Minister in the chair’s last contribution.There is Supplementary Order Paper 426 in my name which would seek to remedy the two issues that the Greens have with this legislation and that I believe our Labour colleagues share. It would seek to reinsert the provisions that assign skills leadership responsibility to the industry training organisations where it ought to rest and it would delete the section that allows public funding to go to private entities. Even with the best will in the world a private organisation—a company producing whatever goods or service—would inevitably tailor the training and the education it provided to the needs of its specific activity. It is the nature of business—it is human nature indeed—to be a little bit self-interested and it is difficult to imagine a situation where a private provider of that sort could actually be relied upon to deliver the breadth and depth of skills awareness information ability and so on that is really required of people coming into the trades.CHRIS HIPKINS (Labour—Rimutaka):I want to begin by just responding to one or two of the comments that Nick Smith made in his earlier contribution about completion rates because that is something that I spent some time in a previous life looking into. If anyone should be hanging their heads in shame about that it should actually be the former National Government in the late 1990s which established the industry training system in the first place. Actually the genesis of all of that was around the original passage of that legislation and the desire of Bill Birch who was the Minister in charge at the time to basically say to industries no matter where they were: “Anyone can have an industry training organisation. Set up your own industry training organisation. We’ll slosh all this money around.” That effectively is where it all started.By the time it had reached its kind of peak of growth there was some work that needed to be done but there was another area—which was a design flaw again—that the previous National Government was directly responsible for. It was that when people enrolled in programmes in many cases they enrolled in those programmes never with the intention of completing them because they only ever wanted to do a part of the programme in the first place. But the funding system was so inflexible that a business that wanted someone to study a particular area which say might have been a health and safety area had to sign that person up with an industry training organisation for a whole programme even if it never wanted that person to do the whole programme. It was a design flaw.So what we found industry training organisations doing for example was that over time they moved to establishing limited credit packages which they were able to fund and which allowed businesses to target that investment more strategically and that did lead to people being more inclined to complete those limited credit packages than to complete whole qualifications. So it was actually a fault of the system that was designed and implemented by the previous National Government. So before Nick Smith says that anyone should be hanging their heads in shame he might want to actually get his facts right and consider who it is who should be hanging their head in shame because actually Ministers in the previous National Government were the ones responsible for designing that entire system.I worked in the industry training sector. I worked under contract for a couple of large companies in the oil and gas industry that used New Zealand’s industry training framework—Grant Robertson: Big oil.CHRIS HIPKINS: —big oil that is right—to provide some of the training needs for their staff. I am very concerned that some of the provisions in this bill will create significant loopholes that first of all will allow the Government funding of industry training to be exploited by large multinational companies. Rather than creating workers who are equipped for the New Zealand workforce it will actually create workers who are equipped and ready for the export market—basically to go and work elsewhere within the multinational corporation’s areas of operation rather than being able to move seamlessly throughout New Zealand. The New Zealand Qualifications Framework is designed to ensure the portability of qualifications within New Zealand. We have this system so that if someone is doing structured on-job industry training for one large employer and they receive qualifications as part of that they should be able to take those qualifications down the road if they go and get a job with another employer. It is one of the great virtues of our system—its qualifications portability.However if you take a large industry like the oil and gas industry increasingly what I found when working in that industry is that the large companies are far more interested in portability within their company’s operations than in portability across the country. So they were saying: “If we have got an oil rig here in New Zealand we do want someone to be able to operate that but we also want them to be able to operate an oil rig run by our company to the same standard somewhere else in the world. We do not really care whether they can operate something else in New Zealand for a different company.”They were interested in supporting their companies’ own interests not the interests of the employee necessarily and certainly not qualification portability.One of the reasons I raise that and I am concerned about that is that the wording in this bill around whether or not the training being delivered and being paid for by the Government has to be part of the Qualifications Framework is incredibly sloppy. The businesses delivering training under this bill will have a lower standard of compliance with the Qualifications Framework than what an industry training organisation has to have. So effectively what we could end up doing is subsidising corporate training for large corporate companies that is not aligned to the New Zealand Qualifications Framework and that is purely in the interests of that company not in the interests of the individual employee who is receiving the training. Ultimately that is not a wise or a prudent use of New Zealand taxpayer funding. If New Zealand taxpayers are going to be putting money into industry training it should not be purely for the benefit of a large corporate company which should be paying for that training anyway.One of the areas where we could see this happening quite a bit is around the provision of health and safety training. Businesses should be providing health and safety training to their employees anyway. That is part of the cost of their doing business. What this bill does is it allows large corporates large companies to say: “Well we have to do health and safety training anyway so let us get the taxpayer to pay for it.” rather than them paying for it. They should be paying for that. That is part of the cost of their doing business and actually what this bill effectively amounts to—and we should not be surprised because it is a National Government bill—is that it now creates another loophole. Big businesses predominantly can basically get more money out of the taxpayer for doing what they should be doing anyway.It is yet another example of the National Government throwing potentially huge volumes of taxpayer money at large corporates. That is effectively the loophole that this bill creates. Otherwise why would the Government as it is doing in this bill create a lower standard of compliance for a business delivering industry training to what it creates for an industry training organisation? No answer from the Government. No one on the Government side is willing to even speak about it. There is simply no justification for it because the Government knows that this is creating another rort. This is opening up another loophole that can be totally and utterly rorted.Dr Megan Woods: Like a charter school.CHRIS HIPKINS: Like a charter school as Dr Woods is saying. The second question I have among many is: who is going to now take over the function of skills leadership for an industry if an industry training organisation is not going to do it? This is actually a big challenge for New Zealand. We have been really really bad in New Zealand’s history particularly our recent history of matching training and education to the actual skill needs of industry and the actual workforce needs that we have out there. One of the reasons that industry training organisations were given this leadership role in determining what skills industry required is so that we could get more strategic investment so that we would not fund people to train in a whole lot of areas where we did not need them to be trained and so that we could actually target the investment into the areas where we needed it. And who are the best people to make those decisions? It is the industry itself through the industry training organisation.But the industry is going to have competing interests. If you take an industry that is dominated by large corporates—and the oil and gas industry is the one that I am most familiar with—the players in that are going to have competing interests. There needs to be some way of reconciling those and that is actually one of the core roles of an industry training organisation. It is basically to get the big players together and say: “Well across the industry this is what we think the skill needs are going to be in the next 10 to 20 years and this is how we are going to make that real and how we are going to deliver on those things.” The Government taking that function away from industry training organisations begs the question of who is going to do it. Because if the industry training organisation is not going to do it and there is no guarantee that anyone else is going to pick up that responsibility the end result is that the taxpayer—the good old Kiwi taxpayer—will end up forking out a whole lot more money for training that is potentially in the longer term completely irrelevant.We could end up training more people in areas where they are unable to get work or where the scope of their work is so narrow that when they leave the job that they are in at the moment they are unemployable by anyone else. That is something that the New Zealand taxpayer should not be forking out for. If a company wants to train an employee for a specific niche role in its business it should pay for that. The New Zealand taxpayer should be paying for transportable portable skills that can work across industry in a number of businesses that actually give people choice and opportunity. Narrowing it down so that industry training can be specifically targeted to the narrow interests of one individual business is not a prudent use of the taxpayer’s funding. It is a corporate subsidy—nothing short of that. That is wrong. If we are funding industry training and we should fund industry training it should be for the benefit of those employees and for the benefit of New Zealand as a whole. It should not be seen as a taxpayer subsidy to one individual company.That is the loophole that this bill creates and it does that in two ways: by allowing businesses to be funded directly rather than through the industry training organisations and by removing the skill leadership function from industry training organisations that helps to ensure that those skills that people are being trained in are portable and are what the whole industry needs rather than what one individual player within that industry needs. So those are some of the reasons why the Labour Party will be voting against this.TRACEY MARTIN (NZ First):Kia ora Mr Chair. There are two sides to the Industry Training and Apprenticeships Amendment Bill. One is the apprenticeships side and the other is the industry training side. Just to be clear some of the rhetoric that has gone on in the Committee today has made it sound as if when young people are in industry training—actually I take that back. It is not just young people and that is one of the positives in the bill. One of the positives in the bill is that the same amount of support will be provided to all apprentices so we are pleased to see the ageism around apprenticeships being taken away. But young people and people in industry training also gain a debt. They also have to pay a certain amount to gain the industry training whether it be in hairdressing or in building or whatever. The industry training organisations’ services although subsidised by the State are not 100 percent free. That needs to be made clear because it sounds as if this is all just an argument about a Government gift and it is not an argument about a Government gift.Some of the changes that were made to the industry training organisations previously—and this is the end of a long period of change for the industry training organisations—were around minimising the industry training organisations getting some clarity for both employers and young people in apprenticeships and industry training and their families and ensuring that the qualifications they were gaining had value out there in the market place across the board. And therein lies one of the major concerns about this shift or the proposal in this bill to hand industry training money to business. That is a complete contradiction to the controls around making sure that we can quantifiably say that the qualifications that those apprentices and industry training individuals gain are quality. We start to lose that ability to truly say that they are quality because as my colleagues from the Labour Party said there are lower criteria a lower threshold for those businesses. It is relatively silent actually with regard to those criteria.It is very very interesting that none of the proponents for the ability for industry to be funded in this way came to the Education and Science Committee to submit—not one. One has to ask oneself why that is. Is it because it is actually not that important? Or is it because actually they knew they did not have to? Is it because they already knew that it was going through anyway and that it did not matter whether it was supported or not—that the Government was just going to put it through? Why did those in industry not then bring their voice and add the reasons why they wanted it? Not a single one did. You have to ask yourself then why if nobody came and asked for it it is still here. Why when most of the submitters said: “This is a problem and we don’t recommend it. This is of concern to us.” did the members of the National Party on the select committee just shrug their shoulders and say: “Oh well why not?”.There has never been any argument put forward by the Government members on the select committee as to why this needs to be there. It did come out of a review—absolutely as did many other steps that have been taken—but there was no support in the submissions and yet from those members there was just a shrug of the shoulders and: “Oh well never mind we will do it.” That is exactly the same response that the Government members on the select committee had to charter schools—“Oh well why not?”. New Zealand First is not confident that that is a good way to create legislation—“Well why not? Let us just do it anyway whether or not we need it. Let us do it anyway whether or not industry wants it.” We are in a dilemma around that. The Minister in the chair might be able to answer it or perhaps one of the members from the Government benches on the select committee could stand and answer that question. Why exactly is it still in the bill? To date those members have not been able to answer that.I think the comments Nick Smith made with regard to apprenticeships industry training and so on and so forth were very interesting. He gave the impression that the Opposition is opposing the bill because it does not like any money to go to private training providers. Obviously anybody who has spoken to any of the Opposition members—and believe me many many many people in education are speaking to Opposition members as we move towards the election date—will know that private training establishments are strongly supported by the Opposition parties and that there is much discussion going on around their role in training. That is just to make sure that that little sound bite from the Minister does not stay out there in the ether because that is certainly not the case.The other point that New Zealand First would like to make with regard to this particular bill is probably the lost opportunity here. There are continual contradictions with the National Government in the way it deals with anything to do with education actually. In this bill on the one hand you have a large subsidy for industry or businesses if they want to tap into the education dollar and train people specifically for their specific industry as opposed to on the other hand the Government supporting vocational pathways—supporting that there should be a generalised education pathway towards the vocations and that it should be wide so that young people people in this sort of training can change through companies as we go forward. We all know that the whole area of employment is going to change and we cannot pick winners and losers in this environment as we move forward into the 21st century.But the other thing that has happened is that on the one hand we have got this subsidy for large business now being written into the bill and at the same time small and medium sized business—and we have heard it before—still have a financial barrier to taking on apprentices. A hairdresser for example who wants to take on an apprentice has to pay $500 a year—$500 a year—for every year that that hairdressing apprentice wants to be there. How do the small and medium sized businesses in rural communities that want to participate with the educational advancement of their young people and the educational and economic development of their areas manage? It may not sound like much but how does a single hairdresser who works in a sole-chair outlet in their small town and who wants to support a young person into industry training or an apprenticeship cover that fee? It would be our suggestion that rather than subsidising big business there was an opportunity in this bill to take away some of the financial barriers to small and medium sized businesses so that they can support their communities.The Government would argue that the industries should have skin in the game. The industries do have skin in the game. The industries have skin in the game on the boards of the industry training organisations and in the setting of the direction around the skills which comes now to the setting of the skills standards and the removal of the name of anyone to be responsible for it. If there is nobody responsible whom is the Government going to hold accountable? If there is nobody’s name on that job whom will the Government hold accountable? At the end of the day somebody is going to do it but if nobody is identified as that somebody you cannot hold them accountable. You cannot take their funding. You cannot say they should have done it. You cannot do anything. You have to put a name on it and then through accountability measures you make them responsible.You might have picked up that New Zealand First will not be supporting the bill. There are some very smart things in this bill and it is a shame that the two things—and New Zealand First will be supporting the amendments on David Clendon’s Supplementary Order Paper 426. We ask that the Government consider supporting them also and then there would be agreement across the House. They are amending the two small yet very important things in this bill that New Zealand First cannot support.CAROL BEAUMONT (Labour):Like my colleagues I am rising to speak in opposition to this Industry Training and Apprenticeships Amendment Bill. I have to say like a couple of people who have mentioned this that this is a lost opportunity. I just want to explain before I speak specifically on clause 15 of the bill—and particularly in relation to new sections 11A and 11B around industry training organisations and also persons other than industry training organisations receiving funding for industry training—that the reason this is a missed opportunity is that we had a real chance to get a bill that dealt with something as important as industry training and apprenticeships to have support across the House. That would have been I think a very important signal.In some regards this is one of the key structural problems in our economy—the skill shortages that we have in trades and technical areas—and the fact is that we have high unemployment especially for young people at a time when we are having to import people into Christchurch to rebuild that city because we do not have enough skilled tradespeople. When there is a change of Government and we get a real building programme going in Auckland for affordable housing we will have the problem of a shortage of tradespeople to do that work.That is a really important structural problem in our economy. It is absolutely disgraceful that we are not dealing with that and we could have. There was an opportunity with this bill to get real consensus on something as important as industry training and apprenticeships. I think the public of New Zealand want to see this issue sorted out because people know that it is important in our economy to have the people who can do that skilled work. It does not necessarily require them going to university to get a degree but it does require them going through what is a time-tested and very very worthwhile process and that is an apprenticeship—an apprenticeship to get a skill that is really important and valued in our country. But in fact what we have done here is miss that opportunity. We have missed that opportunity.As others have said we will be voting against this bill. The Government will force through a bill that actually potentially undermines those important needs that I have just outlined. Our first reason for thinking that that is an issue of concern is this almost I think ideological provision. So instead of industry training organisations being able to get about and do their job we are going to enable funding to go to others to do this. Who will those others be? Those others will be large businesses. They will not be small businesses and they will not necessarily be delivering the industry training that we need delivered which is to provide people with the sorts of skills that are transferable—the sorts of skills that we need across a whole industry and that are not specific to a particular business.When the industry training scheme started I was on the board of an industry training organisation and at that stage that was clearly what happened with the funding. The funding came in and it basically went out to the larger businesses in that industry to do training that actually in all honesty they should have been doing themselves—business-specific training.This industry training and apprenticeship money is not to do the training that businesses need for their own specific needs. That is a cost of doing business as is health and safety training. Those things actually pay real dividends to a company. There is no question about it. Any good employer knows that if you invest in training and if you teach people what they need to do you will get better outcomes. Productivity will rise. There is research evidence after research evidence on that.But the question here is what are the things that are particular to that individual business and what the things are that we need for people who are going to be tradespeople in a particular area. What are the things that they need to have that will mean that they can operate at that business at another business at a different business again? That is the question here and by providing the opportunity for particular companies to get funding to do industry training we think there is a real risk there that what will in fact happen is business-specific training. It is yet another example of the commitment to privatisation. So we are very concerned about that provision in new section 11A set out in clause 15.In some ways ironically—before I go on—this is undermining what has actually been some reasonably good work in terms of reviewing industry training. We have not been ideologically opposed to the need to look at how industry training organisations have operated. We have said: “OK yes there are things that need to change.” and there has been some work done there. Industry training organisations have gone through a significant period of restructuring and are well tooled up potentially to go forward here but now ironically the Government is legislating to undermine their ability to do their job. That seems just absolutely ridiculous.The funding—just to summarise—going to those specific businesses potentially benefits individual large businesses at the cost potentially of small businesses. It will undermine the good work that has gone into restructuring and it potentially means that we do not deal with the real industry skills needs that we have in this country.This leads me nicely into my second point and the second major concern we have had which is about removing the skills leadership role of industry training organisations. It is almost like there is a pathological opposition across the Chamber to being strategic or to planning for anything. It is like somehow the invisible hand will tell you where there are skills shortages and what the needs going into the future of a particular industry might be. Well actually that is an absolute nonsense. We do need to collaborate at an industry level and to get together to say what the emerging trends in this industry are what the changes to technology that are happening in this industry are what we are seeing in terms of the people coming into the industry and whether we need to broaden the pool of talent that we are accessing—and I am going to come to that point in a minute. But that happens at an industry level not an individual business level and that skills leadership role for industry training is being taken off industry training organisations. That is just a complete and utter sham and a nonsense.We have skills shortages. I absolutely challenge somebody opposite to stand up and tell this Committee that there are not major skills shortages in this country. I know that none of the members opposite can do that because we know it to be true. The public know it to be true and to do something about that we need to be strategic and we need to plan.I do have to mention one particular thing that my colleague Dr Megan Woods touched on and it was that under new section 11B “Obligations of industry training organisations” one of the obligations is to “have regard to the needs of Māori and other population groups”. It is critically important that we deal with the absolute gap that there is in industry training and that is the lack of women in industry training. When 1 percent of the trainees in building and construction are women and it is 6 percent in infrastructure and 7 percent in electrical supply there is a problem here. As was mentioned the National Council of Women came up with a very sensible suggestion about dealing with this which could also have been part of this bill and that was to put women specifically in there as one of those targets if you like. We are talking about the majority of the population. We are therefore reducing the opportunities available to women but this is also meaning that businesses are not necessarily accessing the full pool of talent.Supposedly the Government strategy is to have greater economic independence for women. Rather than paying our aged-care workers what they are worth and dealing with pay equity the strategy of the Ministry of Women’s Affairs is that women will move into higher-paid roles and get better incomes that way—including in non-traditional jobs like those in trades and technical industries. Well that has been a resounding failure and an opportunity to really push that in this bill has been missed.I think again if we are looking at ensuring that our economy has the trained people that we need in those trades and technical areas but also flipping it over if we are making sure that people in this country have an opportunity to get good-quality skilled work that provides a range of opportunities for them and their families then there is a real problem here. There is a real failure to address that in this bill.COLIN KING (National—Kaikōura):I move That the question be now put.GRANT ROBERTSON (Labour—Wellington Central):I am sad that the contributions from members of the Education and Science Committee on the other side of the Chamber have been so limited today because they heard the same submissions that we did on this side of the Chamber. I want to come to a couple of matters that have not been covered yet by speakers. In particular I want to talk about clause 9 of the Industry Training and Apprenticeships Amendment Bill which talks about training contracts and apprenticeship training agreements being part of employment agreements. I want to mention that in this stage of the debate because it was raised as a concern by a number of submitters who came to the select committee that we would be limiting in some way or another the ability of people who were volunteers or people who were contractors to be part of apprenticeship training or industry training.I want to make sure it is on the record of the House that officials were very clear with us that that was not the case and that there was no limitation here. What it effectively means is that whatever the employment arrangements in place with an employee that is where we will find the arrangements for training. That is essentially what they said. It is very important because a number of industry training organisations that are involved in the training of both volunteers and contractors appeared before the committee. We heard from the Primary Industry Training Organisation that there are a large number of contractors within that industry who have very important training needs—health and safety type training needs but broader training needs as well. This bill still allows for the training to be a component of the agreement that they have to perform that task.Equally this also applies among volunteers. There is actually some very important work being done in terms of search and rescue training at the moment that involves volunteers and we would not want a piece of legislation passed in this House that would unintentionally limit in some way or another the ability of those people to get that training. We have been assured that new section 3 in clause 9 does not do that and I wanted to make sure that that was on the record of the House.The other area that caused quite a lot of controversy from the submitters was around the role of the New Zealand Qualifications Authority alongside industry training organisations. This is covered in numerous clauses in the bill but the one that I want to refer to is one that the committee amended and that is new section 13 in the bill as set out in clause 16 and in particular on the expanded role that the New Zealand Qualifications Authority has. The heading of new section 13B is “Qualifications Authority may prescribe quality assurance requirements”. This caused concern. There was a feeling among industry training organisations that the New Zealand Qualifications Authority already had a fairly stringent oversight of the industry training organisations and that this would move that from being about the quality of the training that was being arranged and about the quality of the standards that were being set more to the point to being about governance. They questioned why the authority should have that increased role.The committee picked up on this concern—and I want to pay tribute to the chair of the committee Cam Calder because he picked up on this concern particularly—and new section 13B has been amended by the select committee to ensure in section 13B(d) the ability of industry training organisations to acquire and to maintain New Zealand Qualifications Authority approval for programmes or training schemes and consent to assess students and that the governance arrangements for this can be part of the New Zealand Qualifications Authority’s work only where it is relevant to those skills standards and that organisational training. So it is not carte blanche for the New Zealand Qualifications Authority to wade into an industry training organisation and say that it thinks the organisation has got the wrong number of people on the board or that it wants to change the governance arrangements. But rather where it is relevant to the standards setting and to the organisation of training that can be a matter that the New Zealand Qualifications Authority is interested in.From our point of view on the Labour Party side of the Chamber—and I think this goes for Green and New Zealand First Party members as well—that satisfied us that the concerns that were being raised about the authority’s role had been met.None of us wants the New Zealand Qualifications Authority to be overreaching here and making life more difficult for industry training organisations. What we do want is taxpayers—who are paying money for industry training to be organised and for skills standards to be set—to know that that money has been well spent. The New Zealand Qualifications Authority does have an important role in that so we want to maintain that role without increasing it and enhancing it. I thought it was important to make sure that those two points given that Government members seem not to be interested in their own bill were put on the table.I want to return though to a little bit more detail around the skills leadership function because I think it is important given that this is something that has been in place for more than 20 years now that this role is there for—JAMI-LEE ROSS (Junior Whip—National):I move That the question be now put.The CHAIRPERSON (Eric Roy): The question is that the question be now put. Those of that opinion will say Aye; to the contrary No. A party vote—the Clerk will conduct a party vote.GRANT ROBERTSON (Labour—Wellington Central):I raise a point of order Mr Chairperson. I think there is a process here. I am not sure that anyone had actually called for a party vote. There is a process that we go through—The CHAIRPERSON (Eric Roy): So the member does not want a party vote?GRANT ROBERTSON: I do want a party vote but you did not actually ask for one.The CHAIRPERSON (Eric Roy): Well exactly. Now we will conduct one.GRANT ROBERTSON (Labour—Wellington Central):I raise a point of order Mr Chairperson. I do not want to be pedantic but there is a process in this House for how we call for party votes and I think it is important that we stick to that process at all times because if we vary from it that can cause confusion. The process—say in this case when we went one way and the Government members went the other—is that you would normally then ask whether there should be a party vote. I just ask that we stick to the process.The CHAIRPERSON (Eric Roy): I acknowledge the member’s point of view and I acknowledge the energy that was put into the “No” call. I looked across and said “Party vote” and then proceeded to call it because I presumed that would be the case. If that has caused offence I apologise. But I think my perception was correct and that a party vote is required—Grant Robertson: Yes it is thank you.The CHAIRPERSON (Eric Roy): Thank you. We will now have a party vote.A party votewas called for on the questionThat the question be now put.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; 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 426 in the name of David Clendon to clause 11 be agreed to.A party votewas called for on the questionThat the amendment be agreed to.Ayes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Noes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Amendment not agreed to.The question was put that the amendment set out on Supplementary Order Paper 426 in the name of David Clendon to clause 15 be agreed to.A party votewas called for on the questionThat the amendment be agreed to.Ayes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Noes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Amendment not agreed to.A party votewas called for on the questionThat Part 1 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Part 1 agreed to.Part 2 Amendments to Education Act 1989GRANT ROBERTSON (Labour—Wellington Central):Part 2 of the Industry Training and Apprenticeships Amendment Bill is essentially three clauses that amend the Education Act. It is not a particularly long part but it is an important part because this is the bit where we move on from the previous way in which these industry training and apprenticeships have been managed. It is important that when we are doing so we look at the history of what was good about industry training and apprenticeships under this legislation and ensure that we are not changing it in such a way that it undermines the purpose of industry training.The biggest issue here when this was debated round the Education and Science Committee table was the question of fees and the payment of fees for the registration of industry training. There was a concern raised by several submitters that the fees that were being paid may increase and may become significant enough that they would impact on trainees themselves. Clearly we do not want to see that. We want to make sure that industry training remains as open as possible to all those who want to undertake it. That is covered by clauses 25 and 26 which amend aspects of the Education Act around the way in which registration fees will be set and how they will be paid.It is important to note that when the New Zealand Qualifications Authority comes in to undertake quality assurance activities—and this is in clause 26 of the bill—those fees do not represent a huge burden upon the industry training organisations. Several of the industry training organisations and related bodies that came to the select committee were concerned that there was the potential for this to become a very open clause. We were again assured by the officials that that would not be the case.It is a concern for a lot of people that the New Zealand Qualifications Authority performs an important role in our system but equally is perceived I think by many people as merely coming along and extracting money from those organisations rather than providing a huge amount of value. It is important in this case that there is absolute transparency around what it is that the authority is doing and why a body might be paying fees to it as they are required to under clause 26 of this bill.We heard from submitters that they were concerned that often the New Zealand Qualifications Authority coming in and working with them was some kind of tick-box exercise. It was some kind of simply filling in a form and that was enough. There has to be more than that in terms of added value from the authority’s involvement with industry training organisations. There needs to be a sense that the authority is supporting the delivery of high-quality training through the setting of high-quality standards. That is the purpose.If the authority comes in and has conversations like that with the bodies that are paying fees to it then there will not be any grudge held about paying that fee. The problem arises where the industry training organisations feel that they are simply part of a bureaucratic exercise that is about filling in forms and the authority does not seem to add value. The concern that was expressed to us in the select committee about Part 2 of the bill was what the added value is here from the New Zealand Qualifications Authority. It was a little disturbing I think to see the level of cynicism among a number of those representing industry training organisations about the authority and what it would do. I think we have to take that cynicism seriously.As I said in my earlier contribution by no means do I believe that industry training organisations should be without scrutiny by the New Zealand Qualifications Authority. It is a large amount of taxpayer funding that is going to industry training organisations and even more concerning would be when this money was directed to individual businesses under the clauses that have just been passed. That would be of even greater concern and we would need the authority in there making sure that there is a level of quality assurance available. That is what the fees are paid for under clause 26. We want to see as much transparency as possible in what the authority does so that those fees can be justified. It is important that the authority take heed of the things that were said about this during the select committee process.We do believe that the fees are justifiable because the authority is performing a service but it must be able to show the added value there and unfortunately—Dr MEGAN WOODS (Labour—Wigram):I just want to pick up on where my colleague Grant Robertson left off in terms of Part 2 of the Industry Training and Apprenticeships Amendment Bill specifically clauses 25 and 26. As my colleague has raised this is the part of the bill where the Education Act is amended and the fees are set. I just want to consider what some of the submitters came and talked about. They talked about how it was that those fees were going to be utilised. My colleague Grant Robertson has set out very well what the function of and the relationship between the New Zealand Qualifications Authority and the industry training organisations is. I think we heard some very considered responses to what that relationship is how these fees that are gathered under Part 2 of the bill are going to be used and what the regulatory concern about that is. In fact it would be fair to say that part of the concern that we expressed in relation to Part 1 of the bill in terms of how it was that non - industry training organisations were going to be able to have access to the direct funding that had previously been solely for industry training organisations is actually about the lack of regulatory compliance and the lesser amount of regulatory requirement that is there for non - industry training organisations.Returning to Part 2 and specifically what this bit of the legislation is doing I think one of the most powerful statements was when we had one of the industry training organisations come to us and talk about the nature of the relationship between an industry training organisation—Careerforce in this case—and the New Zealand Qualifications Authority. It talked in a very compelling way about the need for a partnership between these two organisations. My colleague Grant Robertson has already talked very eloquently about the need for there to be this scrutiny and transparency of our industry training organisations and I do not think that is something we would ever question but I think that one of the things that we are seeing is that the industry training organisations really had a considered way in which they were going to work in with the authority.I think another very compelling submission we heard on this was from the New Zealand Council of Trade Unions which had some very interesting things to say about the legislation. As we have already talked about in the debate on Part 1 of this bill the other aspects of its submission are something the Contractors Federation agreed with absolutely wholeheartedly. The council talked about whether or not “the Bill provides that the NZQA can set quality assurance requirements ‘without limitation’ in respect of the management operation and governance of ITOs. These provisions come on top of requirements already in the Act in respect of governance and other matters.” The council considered that that was a step too far. Its main concern was that this provision represented a tipping point for industry training. Given the significant restructuring of industry training organisations that has already occurred and that we have seen over a number of years the new performance standards that are in place for industry training organisations the reduced funding and now a major review that in many ways some of the changes that we are seeing in this legislation are coming out of there is a risk that the visibility of industry training organisations as an organisation is now under threat. That is what the council argued.It was in this context that the council proposed that the quality assurance aspect that role of the New Zealand Qualifications Authority should be less burdensome for the industry training organisations should have less discretion and should not duplicate or extend quality assurance requirements that are already provided for in the Industry Training Act or through the role of the Tertiary Education Commission. So in the rush to open this up and let other players in there is a real danger that in the words of the Careerforce submission we are going to lose that partnership that we really need to be seeing between our industry training organisations and the New Zealand Qualifications Authority.If we are going to have quality skills training in New Zealand and if we are going to have quality apprenticeship training in New Zealand I think all of us in this House agree that there has to be some rigorous monitoring of what that teaching is—as with any part of our education system—and that there are standards. We need to be assured that people who are undertaking that education are being taught according to that standard and that there is a monitoring authority. It is simply the way in which we prefer to see education run in this country. But it is not clear what role the New Zealand Qualifications Authority will have in respect of quality assurance in relation to the funding agreements of the non - industry training organisations. I think that that is something that is a real concern for us and something I would like to hear a Government member take a call on.The CHAIRPERSON (Lindsay Tisch): I will call the other doctor Dr David Clark.Dr DAVID CLARK (Labour—Dunedin North):Very kind Mr Chair. Thank you for the call. Of course we should reiterate that Labour opposes the Industry Training and Apprenticeships Amendment Bill. A lot of the reasons come down to the fact that this is privatisation by stealth effectively of the sector. It undermines the quality assurance that we have become used to. It undermines the industry training organisations’ restructure which is being bedded in. To my mind Part 2 really does get to that issue when it comes down to the annual registration fee and the prescribing of quality assurance requirements. This is the nuts and bolts this is where rubber hits road and this is where we ask what the value-add of the New Zealand Qualifications Authority is where we ask whether the regulatory oversight is adequate for industry training.Let us ask ourselves what would happen if there was no fee. What would happen if there was no quality assurance in the sector? I think what we all know is that that would not be a desirable situation for New Zealand. We already witness a lack of workforce training. We see it in Christchurch where there is a real skills shortage for an urgently needed rebuild—a lost opportunity. We see it in many places around New Zealand. I myself think of Dunedin where we know that only 45 percent of the nurses who trained last year were in positions where they could further train and get their practical skills training because the Government did not have in place a channel for them to carry on in their studies. They did not have work placement. That tells you that this Government has not got a priority on proper workforce training with pathways into the workforce. Likewise with medical students—280 medical students trained for 100 places we are told. There are some real pipeline issues and they are not being looked out for by this Government. It is kind of letting everyone sign up and the market decide at the end.Well that is not working because young New Zealanders are following their passions and they do not always have the necessary information to make a decision about what the future workforce needs are. It is a role of the Government to assist with that process to make sure that New Zealanders are training for the future benefit of this country. That also means that they are then appropriately trained to make the most of their skills so they earn a decent living to better their own lives and the lives of those around them. Here in this bill we have the assurance that there will be a fee charged and we have the assurance that there will be some level of industry oversight but we need to ask whether that is adequate.We on this side of the Chamber contend that this move that is going ahead really is not adequate. It is not forward-looking enough. We have seen it in the track record of the Government with the drop in the number of Modern Apprentices over the last 5 years and the 37 percent drop in the number of industry trainees. Can you have any vision for a better education sector and for a better future for New Zealand and can you have the kind of opportunity for all New Zealanders that Labour would want if you do not have a proper industry training organisations sector? This bill unfortunately is a step backwards because what it does is remove the skills leadership function from the purpose of the industry training organisations. Without that skill leadership function without that oversight nobody really is looking at the bigger picture.Labour is committed to ensuring that New Zealand does have the skilled workforce it needs and we are committed to making sure that the shortage of skilled tradespeople in New Zealand is addressed and that means investing in apprenticeships and industry training. That means making sure that this annual registration fee is going the right way as the funding that comes out of the sector to support quality assurance and support appropriate workforce training—that it is directed in the right area.The question I posed at the beginning of my contribution was: what if there was no fee? What if there was no quality assurance? This is the track that we seem to be heading down and that is the concern that I have. I am concerned that if we do not have proper oversight and if we do not have a skills leadership function we will end up in a situation where we have loads and loads and loads of some professions that are more accessible and of which we already have too many. We know for example that in New Zealand we train far too many hairdressers. We need hairdressers. Hairdressers are good people. I do not need a hairdresser—Grant Robertson: Some of us do.Dr DAVID CLARK: —but many people do. But we need only so many hairdressers and there has got to be skills leadership around choosing just which people we need.CAROL BEAUMONT (Labour):Part 2 of the Industry Training and Apprenticeships Amendment Bill is obviously a very small part of what is a very significant bill. As I added in my earlier contribution I believe this is a very significant bill and one that is a real lost opportunity one where we could have had real consensus about something as important as industry training and skills in our country which are vital to provide decent jobs and vital to ensure our economy works to its best capacity. In Part 2 we are looking specifically at amendments to the Education Act 1989. There are only three clauses there: clause 24 which actually states that “This Part amends the Education Act …”; and clause 25 which empowers the New Zealand Qualifications Authority to make rules “prescribing quality assurance requirements for industry training organisations”. That bit was actually amended following the work of the Education and Science Committee. The select committee amended clause 25 to introduce into section 253 of the Education Act the necessary authorisation for the New Zealand Qualifications Authority to charge an annual fee to industry training organisations. That was important I think to cover the costs of issuing quality assurance improvement notices in addition to covering other costs. That change was recommended from the select committee work.Clause 26 amends section 254 of the Education Act to empower the New Zealand Qualifications Authority to charge fees for quality assurance activities undertaken in accordance with its function under the Industry Training and Apprenticeships Act 1992. The important thing here—and I was not a member of the select committee so I did not get to hear all of the submitters on this. But what I do understand is that the relationship between industry training organisations and the New Zealand Qualifications Authority is important and none of us in this House I am sure would dispute the requirement for robustness and the requirement to ensure that we do have good quality. We want to have a very robust high-quality industry training system. In fact ironically the recent review has actually led to some good improvements—improvements that we acknowledge needed to be made.We do believe this bill overall particularly in allowing funding to non - industry training organisations namely large businesses to deliver industry training has the potential to undermine that good work and the robustness and the quality of our industry training system. But the relationship between industry training organisations and the New Zealand Qualifications Authority is an important one as is quality assurance as is mentioned in this part.One of the things I would be interested in knowing and I am sure the Minister in the chair the Minister for the Environment would love to clarify this for me is how these provisions around quality assurance apply to the non - industry training organisations that will be providing industry training because as I have said this bill opens up industry training effectively privatising it so that individual businesses will be able to be funded to deliver so-called industry training. What I want to know—and it may already be clear to those who were on the select committee and if that is so please excuse me. If the Minister could take a call—because there has been an absence I have to say an absolute absence of Government members commenting on what is a very important bill—and please let me know how these quality assurance provisions will apply to non - industry training organisations providing industry training.The other thing I guess is whether they will be subject to the same fees if these provisions do apply. Will they be subject to the same fees that are flagged up in these clauses 24 to 26 here in Part 2? I am hoping the Minister will feel moved to get up and comment or perhaps a member opposite who was on the select committee might be able to answer my question for me. We are disappointed to be in the situation of opposing this bill. We had supported the bill to select committee because we did see there was an opportunity here to work on improving industry training which is so vital to our economy. There are such major skill gaps at the moment. We really did want to see an improvement in this space but unfortunately the Government in its wisdom has gone with two measures that are absolutely of fundamental concern to us: the privatising of industry training and the removal of the skills leadership role for industry training organisations.A party votewas called for on the questionThat Part 2 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Part 2 agreed to.Schedule 1A party votewas called for on the questionThat schedule 1 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Schedule 1 agreed to.Schedule 2A party votewas called for on the questionThat schedule 2 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Schedule 2 agreed to.Clauses 1 to 3GRANT ROBERTSON (Labour—Wellington Central):I want to talk about both clauses 1 and 3 in this particular set of calls that I want to make here. The first is that we on this side have focused as is our job on the bits of the Industry Training and Apprenticeships Amendment Bill that we oppose and therefore the reason we oppose the bill as a whole. But I do want to talk about something where the Government has made some changes that impact on the title of this bill and also on clause 3 “Principal Act”.Actually this bill repeals the Modern Apprenticeship Training Act. The Labour Party is actually very proud of the introduction of Modern Apprenticeships when we came into Government at the end of 1999. The reason that we are proud of that and why I think we should note it today as this bill repeals that Act is that in the 1990s the system of apprenticeships that New Zealanders had come to know over many decades was dismantled by the then National Government. It took away the idea that many New Zealanders had experienced that you would come up through an industry—it was often in those days a Government-run one like the railway workshops or somewhere like that—and you would learn your trade. You would become an apprentice you would get the skills that you would then take into your later life you would add a lot of value to your community and you had a career.We were proud of the fact that when Labour came into Government in 2000 and had seen the destruction of that apprenticeship system through the 1990s we said enough was enough. We brought in the Modern Apprenticeships scheme. We tried to put it in the context of that old value of learning a trade getting an apprenticeship doing the hard yards and then going off and working perhaps for yourself or for another business. We took that into a modern era. We said there would need to be a range of different apprenticeship options for young New Zealanders and thereby we created the Modern Apprenticeships system. Over 15000 people went through that Modern Apprenticeships system in the first 8 years of that decade. The Labour Party knows that those 15000 New Zealanders received high-quality training within the New Zealand Qualifications Framework and got their start in their chosen career.But we also acknowledge that having done that it was time for a review of that system. The incoming National Government mucked around for a couple of years and did not do much at all. It was a critical period to be mucking around in because it was the period in which we had to deal with the Christchurch earthquakes. But then after that the Government finally got its act together and brought in the New Zealand Apprenticeships scheme which brings together all of the different types of apprenticeships there are. That is what this bill establishes.I think it is important to note that the Labour Party does support the idea of New Zealand Apprenticeships. We like the idea of a more coordinated process. We like the idea that the pastoral care aspects that were so critical to Modern Apprenticeships are now seen right across the board in the tertiary funding that the current Government has put in place. So the Youth Guarantee scheme is an example now of the idea that you cannot just set someone off on an apprenticeship and hope for the best. That is now understood. That is what lay behind Modern Apprenticeships—the idea that you would have a coordinator somebody who was responsible for making sure that the training actually took place and the young people involved appreciated that. That is now understood and shared across the board.But we also accept that in the changing employment market that we now have apprenticeships are not just about those aged under 24. That is what Modern Apprenticeships were targeted at. So we actually agree with the idea of broadening that out. My colleague Carol Beaumont has already mentioned the lack of women in industry training and apprenticeships. One of the ways of breaking through that is to lift that age barrier or get rid of the age barrier and say that women who may need to retrain and go into a new area could do that through an apprenticeship-based system. That was not possible under Modern Apprenticeships; it is now possible under this new legislation.I think it is important to put that on the table. It is inherent in the proposed title of the Act the Industry Training and Apprenticeships Amendment Act because what it does is repeal the Modern Apprenticeship Training Act and changes what was called the Industry Training Act 1992. I want to put on the table that there are aspects of this bill that we do actually support. It would have been nice to be able to say we support this whole bill because there are those aspects that we thought were good but we could not do that because this bill fundamentally undermines the Act that it claims to amend in clause 3 the Industry Training Act. The essence of the Industry Training Act the principal Act under clause 3 is that that Act is about organising industry training across an industry not providing funding for individual businesses to do business-specific training.Why should the Government fund that? We have not had a single Government member stand up in this Chamber today and say why they are fundamentally changing the nature of industry training with this legislation. Why would a Government that is supposedly all about fiscal discipline and looking after the taxpayer decide that it is a good idea to provide funding for industry training to people who are not industry training organisations or to businesses who may well simply train for their own skills? Even Business New Zealand the greatest ally of this Government came to the Education and Science Committee and said it was not sure about this. It was “cautiously supportive” but said there needs to be a review really quickly to make sure that industry training money is not going into activities that businesses should be doing themselves.And then we again wondered why the Government would fundamentally undermine the Industry Training Act in clause 3 by taking away one of the three core responsibilities of industry training organisations which is skills leadership. Skills leadership is vitally important in the role of industry training because it is business identifying the skills needs that are out there. One of the main reasons we decide to fund industry training is to ensure that we are looking ahead. What are the skills that are needed in the future? Under this bill we have a situation where no one is responsible for skills leadership. Is that not an amazing thing? The Government has brought a bill to the House to make nobody responsible for looking ahead to what skills New Zealand needs. How absolutely ridiculous short-sighted and without any strategic plan.Tracey Martin: Typical.GRANT ROBERTSON: As Tracey Martin says it is typical. It is typical of a Government that cannot see past today.What we need is industry training organisations doing more work in terms of skills leadership. We heard from Careerforce a very high-functioning industry training organisation about the fact that it had sat down with Health Workforce New Zealand the Government’s body for finding a strategic way forward for the health workforce to identify the needs of those health care workers who are often forgotten: the people working in rest homes the people providing in-home care. They need training. They are looking after our grandparents and our parents. They have been left out too often when industry skill plans are developed. So Careerforce has been right in there with Health Workforce New Zealand providing that skills leadership. That is gone under this bill. It is gone. It is now no one’s responsibility. But the officials came and said that the Ministry of Business Innovation and Employment is going to be doing a lot of work and it is going to be talking to industry. This should be industry-led. Why is the Government saying it wants no one to be responsible and the Ministry of Business Innovation and Employment will have a little bit more of an oversight? It is not good enough and undermines the very purpose of industry training.So in two hits—the opening-up of funding for industry training to non - industry training organisations and to specific businesses and in taking away the skills leadership function—very sadly this bill is wrongly titled. It is not the Industry Training and Apprenticeships Amendment Bill; it is the “Privatisation Agenda Bill”. It is furthering the privatisation of education this time in the industry training sector. Steven Joyce the Minister for Tertiary Education Skills and Employment who is responsible for this bill has an ideological commitment to privatisation. He does not know why it is a good idea in this instance he is just doing it just as is being done right across the education sector. It is wrong. Education is primarily a public good. We all benefit from it. We should all have a role in making sure it is a quality system. We should all have a role in making sure that the taxpayer funding is being well spent.This bill goes in the wrong direction it undermines industry training and it is fundamentally flawed. I wish we were voting for it because I believe that apprenticeships and industry training represent a key part of our future productivity and wealth as a nation but we cannot vote for a bill that is driven by such narrow-minded ideology and that takes away one of the core parts of industry training and skills leadership. The Labour Party will be opposing this legislation.Dr MEGAN WOODS (Labour—Wigram):I would like in this call to address clauses 1 2 and 3 in reverse order. I want to pick up where my colleague Grant Robertson left off in acknowledging where this piece of legislation the Industry Training and Apprenticeships Amendment Bill sits within the tapestry that is the history of industry apprenticeships and skills training in this country. I think that it is a big missed opportunity as we have been saying throughout our speeches on this bill at every reading. We have really missed an opportunity to add something to that history. We are immensely proud of what the Labour-led Government coming in in 1999 did in terms of reinstating apprenticeships training in this country because it is so critical to us being the country that we want to be and the country that we can be.I do notice—if I flick very briefly to schedule 2 which lists out the consequential amendments to the principal Act that is referred to in clause 3 of the bill—that one of those pieces of legislation that is amended is the Maori Housing Act of 1938. I just want to acknowledge the proud history we have in this country of Māori trade training and how that has been such an important part of our history. What we did during and after World War II in terms of training a workforce and producing a stock of good houses for this country is something that we can rightly be proud of.Grant Robertson: Someone ought to write a thesis on this.Dr MEGAN WOODS: My colleague tells me that someone should write a thesis on this. As I referred to in other readings of this legislation this was the subject of my PhD thesis. It is an area that I am incredibly interested in. It has shown me the potential of what a well-crafted trade training scheme can be and this is not it.What we have heard about from submitters on this bill if we are thinking about the Acts that have gone before it and about the legislation that we are amending here today is the lack of pastoral care that this bill contains. What we know from history if we do look at history is that pastoral care is absolutely critical to the success of any apprenticeship training scheme. We know that the success of the Māori trade training scheme of the mid-20th century was as much about the technical skills that the largely young men were able to gain in terms of framing and plastering and all those kinds of things as it was about the matrons in the hostels who were absolutely critical to the success of those schemes. The fact that the Government is passing legislation that completely does away with the emphasis on pastoral care is not something in which I can have any faith that we are enacting a piece of legislation today that is going to stand us in good stead and set us up with the kinds of skills and apprenticeship training that we need to be the kind of innovative country we need to be in the 21st century.I said I was going to do it in reverse order so I will talk about clause 2 of this legislation. Of course I note the commencement date of this legislation in terms of the Act coming into force on the day after the date on which it receives the Royal assent. What we do know is that already the tender process for the privatisation of training has occurred. We already have four tenders in for non - industry training organisation providers of skills training. I spoke in the debate on Part 1 of this bill about seeing a large health-care provider that is one of these tenderers—surprise surprise—and that we are in real danger of having business specific training put in place rather than industry-specific training. That is something that is absolutely critical. It is critical when we are using public money when we are spending taxpayer funding that we are doing stuff for the industry good and we are doing stuff to make New Zealand a better place not subsidising what a large corporation would otherwise pay for itself.What we are doing here today is shameful. We are taking money away from the public provision of industry training which is the absolute underpinning of the economy that we have in order to be in the 21st century and putting it into the pockets of private businesses which will absolutely leave out small to medium sized businesses. What we are seeing is not the small to medium sized enterprises that are already tendering before this legislation has its commencement date under clause 2. What we are seeing are large corporations. Small to medium sized enterprises are going to be potentially left behind in this. In Labour we want to back our small to medium sized businesses. We do not want to back just the big end of town. The fact is that we had businesses come to us at the Education and Science Committee and tell us that this bill was going to be to their detriment because there is a Government that is absolutely content at looking after its mates and backing the big end of town and that is absolutely shameful. We are in danger of undermining our skills in industry training in this country because of ideological commitment on the part of this Government in an absolute blinkeredness to anything but big business. Well small businesses mean something to the New Zealand Labour Party. They always have and they always will.David Bennett: Oh yeah right—get real.Dr MEGAN WOODS: The fact is that that member sits there and chirps but never takes a call. He will sit there and pipe up from time to time but when business came and told the committee how detrimental it was going to be there was not one murmur from the Government members on that committee. I would like to hear a call from a Government member on that committee that addresses small to medium sized businesses are going to fare under this legislation. So rather than just the squeakings of that member over there perhaps we could have a substantial contribution.Before I conclude I want to turn to clause 1 of this bill—the title. I think one of the very interesting things that a submitter came to us and said was that it is debatable whether the bill could include the words “industry training” if other organisations can qualify for funding in this way. The very substance of this legislation belies the title of this bill. The Industry Training and Apprenticeships Amendment Bill perhaps does not seem apt when in our minds this is a piece of legislation that undermines what industry training is about. It undermines the industry good that we need to be looking to when we are spending public money. It is a simple transfer of public education money into the pockets of corporations. It is a continuation of the privatisation agenda.So I would like to suggest some alternative titles for this piece of legislation. I think that the “Privatisation of Education Act (Part 3 Hot on the Heels of Private-Public Partnerships and Charter Schools) Bill” could be a more apt name for the piece of legislation that we are debating in this Committee today. I think that if we were not going to go there Government members might like to consider an amendment that goes along the lines of the “Ideological Blinkers of This Government Bill”. That would perhaps be a more apt name because this bill is all about this Government’s commitment to privatisation in our education system and not about visionary thinking about what is going to make a better country a better economy and what will equip our workforce with the necessary trades skills and education that are required for us to go forward into the 21st century.We on this side of the Chamber know that if we really are going to address inequality in this country then having robust industry training robust apprenticeships and good skills training is absolutely critical and this legislation is doing everything it can to undermine it. I find the name of this bill the Industry Training and Apprenticeships Amendment Bill a little absurd given that all the players involved in industry training came along and told the Government that the bill was not going to work. It seems a little like it is a piece of irony that we are in this Chamber debating today. I would like to have a Government member take a call and tell us how it is that this bill is supporting industry training because in our mind all this is doing is undermining industry training. To give it that title in this legislation is nothing short of shameful.Why does a Government member not take a call get on their legs and justify their position? Why is it that the Government thinks that it can run industry training and that industry’s voice should be silenced? So perhaps that is another name that we could give this bill—the “Government Knows Better Than Industry Training Bill”. That would be another contender for my alternative title of this legislation. It is a sad day that we are not here today debating a piece of legislation that is going to enrich the tapestry of a history of industry and apprenticeships training in this country and that we are about to pass a piece of legislation that is going to undermine it.CAROL BEAUMONT (Labour):I rise to speak on clauses 1 2 and 3 of the Industry Training and Apprenticeships Amendment Bill as well. I think that the title is important. I do want to acknowledge the point that Grant Robertson said which was that including the words “and Apprenticeships” in the title is a good thing. But the fact of the matter is that another irony about this bill is that on the back of reviewing industry training on the back of some really hard yards that have been undertaken by industry training organisations to look at how they need to function to go forward and provide industry training and apprenticeships that we need as a country—that we desperately need as a country—what is happening with this particular bill will undermine their ability to do that. It will undermine the “industry” bit of industry training. That is the irony here because instead of industry training organisations providing industry training we will now have corporate training. We will fund as Dr Woods has said and we will put public moneys into organisations other than industry training organisations to provide industry training.The fact of that is what that will lead to is not industry training but training that will be relevant to the particular business that is undertaking it. We know what that looks like. That will be training that is specific to the particular ways that that business operates and the particular needs machinery and technology that it uses and not to what is needed across the whole industry. The real risk for the people undertaking the training is that they will not end up with qualifications that they will be able to take with them in the industry. They will end up with qualifications that are narrowly focused on particular businesses.I do think it is absolutely vital that people understand what is being suggested here because we know and we would all agree that there are real skills shortages in this country. Labour has long been a party that stands for skills training and that stands for apprenticeships because we understand and know as do most New Zealanders just how vital those trades and technical skills are. How important are they for our manufacturing industry? How important are they for us in terms of building and construction or infrastructure development for example? Those are some of the areas where we have got massive skills shortages. We need industry training and apprenticeships to fill those skills shortages. That is supposedly what this bill is about. There was a real opportunity and it has been missed. I think that is a crying shame.In 2008 when this Government came in there was a skills strategy in place. There had been work undertaken. It had involved industry. It had involved Business New Zealand. It had involved the Council of Trade Unions. It had involved various Government agencies—the Tertiary Education Commission the Ministry of Social Development—and a whole number of people looking at what was needed for skills across all of our industries. What was the first thing that the Government did with that? Well it chucked it out. Then it said: “Let’s not bother meeting any more to talk about these things. Let’s not talk about a skills strategy for this country.”This bill could have provided an opportunity to strengthen industry training and apprenticeships. We could have had some consensus on that. I would urge the Minister or any of the members opposite who know about this bill to explain why that opportunity has been deliberately missed. Why is it that instead of strengthening industry training organisations and instead of asking what we need as a skills strategy at an industry level across the whole country we have a bill that undermines industry training organisations that starts a path of privatising industry training and removes the ability of industry training organisations to provide a leadership role in their industry? Why? Nobody across the other side of the Chamber is willing to answer any questions in this. It is just appalling. This is vitally important for our country.JAMI-LEE ROSS (Junior Whip—National):I move That the question be now put.SUE MORONEY (Labour):Thank you for the opportunity to take a call in the Committee stage to talk about clauses 1 and 2 of the Industry Training and Apprenticeships Amendment Bill. I particularly want to start my contribution by talking about the commencement date of when this Government is planning to do something about industry training and apprenticeships. The sad indictment on this particular Government is that we have got in front of this country right now the example of this Government’s appalling track record on taking industry training and apprenticeships seriously because right now Christchurch is largely being rebuilt by immigrant labour.David Bennett: Oh what a lie!The CHAIRPERSON (Lindsay Tisch): Order! The member cannot say that.SUE MORONEY: Well David Bennett does not seem to have visited Christchurch to see for himself but it is largely being rebuilt by immigrant labour. Many of them are Irish. You know I have got nothing against the Irish—I am of Irish ancestry myself—but actually those should have been jobs being held by all of those New Zealanders who are sitting on the scrap heap of the dole queue instead. [Interruption]Well here we go. The Government has finally woken up. It has finally woken up 3 years too late. It had 3 years to actually be training New Zealanders to rebuild Christchurch. That is the opportunity that was missed. It is an absolute indictment on the lack of strategy from this Government for having a thorough industry training and apprenticeship approach and strategy. If it had had that then it would have listened to the Labour Party which within 2 months of that earthquake started begging the Government in this very debating chamber to actually bring in industry training and to add to the apprenticeships in order to prepare for the rebuild of Christchurch. The Government ignored those calls.Now we have got the building industry screaming out to the Government—still 3 years later—saying that it is 5000 apprentices short of what the building industry needs. That is the track record of this Government. In its sixth year of Government it has got rising unemployment—certainly in the Waikato region it has been rising.David Bennett: No it hasn’t. That’s not true.SUE MORONEY: Well there we go again. David Bennett does not even know the unemployment figures from his own region.The CHAIRPERSON (Lindsay Tisch): Order! It is not about unemployment.David Bennett: Prove it.SUE MORONEY: Well the member wants me to prove it Mr Chair. Am I allowed to respond? If he goes and looks at the last quarterly figures released by the Waikato region they increase from 6.1 percent to 6.8 percent.The CHAIRPERSON (Lindsay Tisch): Order! This is not about unemployment; this is about industry training.SUE MORONEY: Well thank you Mr Chair. I was just responding to the member opposite but I will now focus back on the bill itself.What this bill does is yes some useful things. As some of my colleagues have said it is a shame that we cannot support the bill in its entirety because there are one or two things that it does that are useful. Sadly as this Government is wont to do it has got privatisation at its core. It has also got the narrowing down of what we are trying to achieve in terms of people’s education and is that not a theme from this Government as well? It has done that with compulsory education as well as industry training now. It has taken a very broad concept that gives people a very broad set of skills that they can apply across industry or across different careers and different things that they might want to pursue in their lives—that is what the compulsory education system is supposed to help with. Both with the compulsory education system and now with industry training the Government has taken the approach of narrowing things down.In this bill it is doing it by not requiring the bodies that take care of this area to be industry wide. It can be just an employer. What we start to get is the narrowing of skills that are actually going to be imparted to people as a result because although an employer might have specific skill needs for their particular business they will not be necessarily engaging in preparing those people for a skill base that is to be used right across their industry. I can see that a couple of the members opposite are quite interested to learn that this is a bill that is going through in their name that does this.MARK MITCHELL (National—Rodney):I move That the question be now put.A party votewas called for on the questionThat the question be now put.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Motion agreed to.A party votewas called for on the questionThat clause 1 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Clause 1 agreed to.A party votewas called for on the questionThat clause 2 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Clause 2 agreed to.A party votewas called for on the questionThat clause 3 be agreed to.Ayes64New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1.Clause 3 agreed to.Bill to be reported without amendment presently.Social Security (Fraud Measures and Debt Recovery) Amendment BillIn CommitteePart 1 Substantive amendmentsSUE MORONEY (Labour):It is a pleasure to rise and speak on Part 1 of the Social Security (Fraud Measures and Debt Recovery) Amendment Bill. Can I say at the outset that with many many reservations the Labour Party is supporting this bill. Part 1 is where the substantive amendments take place. But I do want to at the outset put on record our unease with what this bill does represent. It is one of those bills—and Part 1 with the substantive amendments I think demonstrates this—where the Government has been all too quick to bring out measures designed to make it look like it is harsh on beneficiaries. This bill is another one of those. This is about welfare fraud measures and debt recovery.But the fact remains that if the Government was actually serious about fraud measures and debt recovery it would go after tax fraud first and foremost because that is where the vast amount of fraud actually happens in this country. Basically the facts speak for themselves. Relationship fraud amounts to around $20 million a year. The Inland Revenue Department estimates that tax discrepancies amount to over $1.2 billion a year and that annual tax fraud is about $140 million at an absolute minimum. So I want to say at the outset that although fraud in terms of the welfare issue is not acceptable—and that is why the Labour Party is supporting this bill—it is dwarfed absolutely dwarfed by the tax fraud that goes on yet we are not taking the same sorts of measures.In Part 1 the sorts of measures that are being taken by the Government are around ensuring that the spouse or partner of someone who has committed benefit fraud is also captured and can be held accountable for that fraud. I listened very carefully to the submitters who came for the Social Services Committee hearing on this bill. There were not very many of them but what they had to say was really important and worthwhile listening to. I was concerned about some of the gender impacts of Part 1 of this bill.We did have a number of women’s organisations that came forward to support the bill. What they said was that quite frequently in their experience although the beneficiaries themselves were female and often sole parents actually they believed that sometimes those women had been forced into committing welfare fraud by their partners. It was not their idea at all. It was an aggressive partner or maybe even sometimes a violent partner who was coercing them into committing this welfare fraud. So it was interesting to hear that sort of gender perspective on Part 1 of the bill. Those women’s organisations were saying that actually they thought that women were unnecessarily shouldering the responsibility for welfare fraud and that often it was their partners who were actually instigating it to start off with.We did agree with those organisations but we also agreed with the Law Commission when it came and raised issues with the select committee around the burden of proof because effectively what this bill does and it does it in Part 1 is that it does not have a very high level of the burden of proof—of whether the partner or spouse of the beneficiary who has committed the fraud was actually at the forefront of that or not. This is a new precedent that is being set by this law and that is what the Law Commission came to discuss with the select committee. It told us of its unease about it.The Labour Party shares that. In fact we said so in a minority report on the bill—that we have some major reservations about it. We are concerned about the departure from the general principles of criminal law that a positive act is normally required to ground criminal liability. This bill for the first time does not require that to be established. There is no requirement for it to be a positive act—that the person actually was an instigator of it. Rather it just says that they needed to have either knowledge of or a failure to report another’s offending for it to be covered under this bill. That is normally insufficient to ground criminal liability. But this bill changes all of that and we are concerned about the precedent that it sets.I will say again that we will probably be a little less concerned about the precedent that it sets if it was actually applied equally. But as this Government is inclined to do it actually wants to take harsher measures against people who are more vulnerable and for people who are committing corporate tax fraud it really does not seem that bothered about them. So it has got loopholes for Africa about what corporate people with lots of resources can do in the area of fraud but when it comes to people who have not got so much then it seems to want to clamp down on them very very hard. I think it demonstrates the—I am not allowed to use that word. I am just trying to think of the word that I can use. The one I wanted to use begins with “h” and I cannot use it. It demonstrates the I will call it ironic approach—let us say—of the Government where it does seem to pander much more to people in our society who have a lot. Let us be frank. The Government is tailoring a lot of its bills and a lot of its policies to help out the people at the wealthy end of the spectrum but it is very very harsh when it comes to people who are at the lower end of the spectrum and this bill reflects exactly that.Just coming back to the issue that was brought forward by the New Zealand Law Society—I should say I think I made an error before saying it was the Law Commission but it was the New Zealand Law Society that brought this issue before the select committee. We do accept the argument by the New Zealand Law Society that in the absence of a positive act which would normally provide grounds for criminal liability the justification for making partners and spouses criminally liable is not apparent. Labour would support amendments to this bill for new provisions that are aligned with the advice from the New Zealand Law Society. So we hope that in the course of this debate we will have a debate around amendments that would actually deal with the issues brought forward by the Law Society because they are important issues.They are important because they not only set a precedent but also in the context of this bill deal with people who are down on their luck. Let us be quite frank about this. People who end up relying on welfare payments to keep them going are down on their luck. People who are committing corporate tax fraud cannot normally be described as being down on their luck. Normally they actually have got a lot of opportunity a lot of options in front of them and what they choose to do is to act fraudulently. There can be no excuse for that whatsoever yet the Government stands completely soft on that level of offending.There is a lot of discussion in this part of the bill about who spouses are and who they are not. There are a lot of discussions and definitions that actually help us to try to make decisions about whether they are captured by this bill which will become an Act or not. But the reality is that we do not have nearly the same amount of liability when it comes to other fraud measures and it is certainly the Labour Party’s view that if we are going to go down this track then we want to be consistent about it. We do not want the cherry-picking that this Government is so well-known for where it is favouring people with lots of resources and rolling out the good old beneficiary-bashing whenever it is in a spot of trouble.That certainly has been the habit of this Government. We have had in just the last week the Minister for Social Development deciding that she is going to release information that would give New Zealanders the impression that loads of beneficiaries are off sunning themselves at Club Med every week. That is another level of benefit fraud that is being committed I think is what she is trying to say. Was it not interesting—and a couple of the provincial newspapers have picked this up—that it was actually irresponsible of the Minister to release that information without divulging all of the information? For example of the people who are beneficiaries who have travelled overseas in the period since July we have no idea how many of them are still away—JACINDA ARDERN (Labour):It is my pleasure to give a contribution on the Social Security (Fraud Measures and Debt Recovery) Amendment Bill. I really concur with the preliminary statements that were made by my colleague Sue Moroney expressing our reservations over this bill generally. I do recall though from the last debate having some discussions with people who heard our contributions and absolutely agreed with the position we had come to but then wanted us to elaborate in a little more detail what elements of this bill did persuade us.There is one in particular that I want to highlight that really does come under Part 1 of this bill. As my colleague Sue Moroney has already articulated currently when we are talking about relationship fraud in particular the status quo means that if that fraud is detected the burden of debt recovery often sits almost entirely—because of the way the law is drafted—on the woman in the relationship. That is where it almost entirely sits and that is due to the fact that often a relationship fraud case involves a couple claiming what was a domestic purposes benefit or a sole parent payment when they were not sole parents but were in a relationship of some description. That is often the basis of that form of fraud and it is most often the woman who is then bearing the burden of paying that fraud debt back when as my colleague has said there are situations—and they were raised with us at the Social Services Committee and also in meetings with groups like even Women’s Refuge if I recall—where those women had often been in violent manipulative situations where a lot of pressure is being placed on them to commit that fraud and then they are left essentially carrying the can. That is something where we are quite happy to see measures introduced that allow that to be apportioned more fairly when another individual has not only been implicit but actually has taken on a role much more overt and put pressure on that individual to be complicit in that fraud. So that is a particular element of the bill that we do see as being not only reasonable but helpful.Having said that our major issue remains the lack of equity in the way that we continue to treat welfare fraud versus tax fraud. We have already tracked and discussed the fact that we are talking relative to one another about roughly $20 million a year for some major aspects of welfare fraud versus fraud within our tax system—tax discrepancies that are up to $1.2 billion a year and annual tax fraud of $141 million as an absolute minimum. So if we are debating measures that are as broad as these—and some of them we were absolutely uncomfortable with in terms of the level of broadness—and if we are discussing them here why are we not currently at the same time discussing similar measures through a bill under the name of the Minister of Revenue for instance? In fact Labour even tried to extend via as I recall the Business Committee the scope of the committee to be able to consider whether these measures should be fairly applied when tax fraud debt is being recovered where an individual or a spouse ought to have known that tax fraud was being committed within their relationship and whether or not their partner was engaged in a business enterprise or what have you. Where tax fraud was being committed and they ought to have known why are these rules not being applied to them? It is a question we will continue to raise. I know that the Minister in the chair the Associate Minister for Social Development Chester Borrows has particular views on it. I would love to hear his contribution.But coming to Part 1 and extending this debate out a little bit on our belief that it is the inequity of the way we are treating fraud that is a major sticking point for us we know that for instance the penalties in this bill will not be evenly applied. How do I know that? We have the research that tells us that. Dr Marriott at Victoria University has done extremely important work in highlighting the inequity of our system. Between 2008 and 2011 for instance 22 percent of tax fraud resulted in custodial sentences. This is relevant because this bill of course talks in Part 1 about extending penalties and the ability to prosecute. So 22 percent of tax fraud resulted in a custodial sentence versus 60 percent of benefit fraud. Sixty percent of benefit fraud cases resulted in an individual landing in prison. You might say that the value of that fraud may have been higher. Not so. The research tells us again that the average value of tax fraud where a custodial sentence was used was $800000; the average for benefit fraud where a custodial sentence was applied was $67000. So if we know that there is an established inequity that is something that I would have thought the Minister would be interested in keeping an overview of because so much of this bill and so many of the rules in this bill leading up to the point where the rules are applied in court and a sentence is handed down are actually handed down at the discretion of the chief executive and it is whether or not discretion is being used fairly across our system as well particularly when it comes to recovery of debt.Recovery of debt is covered in clause 9 which amends section 86. It says that it is the “Chief executive’s duty to recover debt in section 85A”. We had a discussion at the select committee—when I was there in the very very beginning before I unfortunately then left—about how it is up to the discretion of the chief executive as to what level of debt is pursued and whether or not that was reasonable. I have seen letters from Work and Income seeking repayment of a cent—of a cent. So in the suggestion for instance in a case where there might be some rational rhyme or reason or some error that has occurred but it might be determined to be fraud on behalf of Work and Income what we are now being told is that there is a duty for the chief executive to pursue it unless they use their discretion not to. My concern is that I do not believe that discretion has been appropriately applied in the past. Again there is some research to back this up.From a 1-year period from 1 July 2011 to June 2012 for instance if we look at the Inland Revenue Department we see that it wrote off 50 percent of interest penalties and penalties due to overdue tax amounting to $374 million for 1 year. It wrote off 50 percent. It wrote off $435 million in core debt. That represented 11 percent of the entire collected amounts owing. The Ministry of Social Development in contrast wrote off $8 million. That represents 2 percent of its collected debt. So we see a real disparity there again in the use of the discretion of those two departments. I would be extremely interested to know—in fact I asked—whether we could have a comparison of the two obviously different sets of criteria applied by these two departments as to how they make a decision to write off debt penalties and arrears. How do they make that decision? What discretion is used? Is there greater discretion for the Inland Revenue Department than there is for the Ministry of Social Development? No one on this side of the Chamber is denying that when fraud is committed it should be pursued and debts should be paid. But we are also saying that should apply to tax. If there is going to be some discretion in the system let us make damn well sure that it is applied fairly. Time and time again we have seen on this side of the Chamber that that has not occurred when it comes to who are sometimes our most vulnerable members of society. So yes of course fraud is wrong. Of course it should be pursued. We are simply seeking equity in our system and we know from the evidence that has been prepared that it does not exist currently.Whenever you build discretion into your system you are going to have further issues. Currently this bill under Part 1 does include significant amounts of discretion. Sometimes that is very useful. If you do not want to collect that 1c of debt yes you want to use your discretion to make sure that is not happening. But currently it seems that the discretion is not being used in a common-sense way and that is what members on this side of the Chamber are seeking.Hon CHESTER BORROWS (Associate Minister for Social Development):Thank you for the opportunity to speak in respect of this bill the Social Security (Fraud Measures and Debt Recovery) Amendment Bill. I thank the Labour Party members for articulating where they are standing on it and for confirming that they are supporting the bill albeit they have said that they are doing so with some reservation. That was not clear for some time because what we had was that on the day the bill was introduced the leader of the Labour Party voted for it but then said that if Labour is elected into Government it would repeal the bill and it would quash it. So I guess it is nice to have the spokespeople from the Labour Party giving some indication to their leader as to which way he should be voting in respect of this bill. If he is going to change his mind I guess I would ask that the Hon David Cunliffe comes down to the Chamber and tells us that he is going to do that. I also appreciate the way in which members across the Chamber have engaged with my office in respect of the preparation of the bill and the indications that they gave. I had very meaningful discussions with Jacinda Ardern and Jan Logie and also with Tracey Martin the Māori Party and others in respect of the bill.It is also important to point out what we are discussing here. We have heard a number of figures quoted comparing for instance tax debt with welfare fraud. Really as they have been quoted—tax debt in the billions of dollars and welfare fraud at $23 million—we need to just acknowledge that you are sort of comparing apples with elephants there. When we talk about billions of dollars of tax debt established we are talking about overdue tax debt—in other words overdue taxes that have not been paid. A portion of them will be fraud a portion of them will just remain unpaid—as frequently happens within business—and a portion of them will be penalty payments which are not attached to fraud.But when we talk about $23 million in benefit fraud that is fraud that has been established from actual people who have been prosecuted. It is estimated that the average welfare benefit overpayment is established at about $1.2 billion. So you could make a comparison between the established overpayments from welfare being $1.2 billion and the estimated overdue tax being about $6 billion—about five times as much. Then when we start looking at the energy that the Government is putting into recovering that debt it is important to note that we spend about four or five times as much on recovering tax debt as we do on welfare debt. We have put a lot of new money into that. Since we came into Government for instance we have taken the budget up about four times to $138 million of new money in 2014 spent on chasing tax debt. We are operating from a baseline within the welfare budget.I think it is important to make that comparison. Obviously as listeners would have heard the assertion has been made time and time again that the Government is more interested in chasing after welfare debt than tax debt. The energy put into recovering tax debt and the money put into recovering tax debt is well in excess—in fact it is nearly five times as much—of what we are spending on welfare fraud. More and more of those people are being prosecuted and hundreds of millions of dollars is being collected each year from those who are ripping off the tax system. It is very important to note that.Another important issue has been raised around partnership crime. The fact is that when you are talking about new provisions that will criminalise the behaviour of the partners of beneficiaries it is important to recognise that this crime can be committed only by two people in a relationship which separates it somewhat from other crimes where we also use a recklessness type of criminal liability. For instance if someone is receiving stolen property or receiving property known to be obtained by a crime such as run-of-the mill fraud then their recklessness about whether or not that was obtained by a crime is their criminality. Although it is true to say in respect of welfare crime that we have not seen this recklessness aspect of criminal liability applied before in respect of living off the proceeds or benefiting from the proceeds of fraud it is not true to say that this is novel and this is new.Another good point has been made in respect of women living in abusive relationships and the fact that they have been manipulated or forced into committing crime. I can see where the fears are in respect of that. Largely the victims of this type of crime are women. But it is also important to note that the findings of the court have been—and I have made this point previously during questions around the proposals of this legislation—that a woman in a violent relationship is not in a relationship in the nature of marriage which would make her liable to benefit fraud. I just need to restate that.What that means then is that if two people are living in a violent relationship the woman is usually the victim in that violent relationship. If for instance she was accused of committing a benefit crime and it was obvious from that investigation—or she made the allegation and it was substantiated—that she was continuing to live in that violent relationship because of pressure being put upon her by her spouse then she would not fall within the definition of living in a relationship in the nature of marriage which would make her liable under these provisions. We are doing everything we can to ensure then that a woman caught in a violent relationship and being manipulated by a partner who is going on to live on the benefits of welfare crime cannot actually be held accountable in that system.But I would contend quite strongly that this law is about fairness. As it sits at the moment we have a situation where if a woman and a man are living in a relationship and she is receiving a benefit and he has done anything at all to promote the gathering or the obtaining of that benefit—for instance by filling in a statement that they are not living in another relationship giving social welfare investigators another address for where he is living telling lies etc.—he can be charged as a party to that offence now. The criminal liability and the debt travel with him and her equally. But if that partner—generally male—just stays dumb about it and does nothing but quite happily continues to live in that home where he is paying no rent and is contributing nothing to the household but taking the profits of that welfare crime he cannot be touched.What this change in the law does is say that if he lived in that house and he knew or should have known but was reckless as to whether or not his partner was in receipt of a benefit then he is going to carry the whole of that debt as she carries the whole of that debt—they carry it equally—and also the criminal liability for that.I do not believe that there is a person in this Chamber who does not think that that is fair—who does not think that that is fair—and so that is why out on the streets and across the organisations we have spoken to most people are largely supportive of this.What we do have though is the mantra which keeps going back along political lines I guess that says National will favour only those who are rich and will always step on those who are poor. We have heard it so often before we can recite that in our sleep. But the fact of the matter is this: on this day in this Committee we are talking about welfare fraud and in respect of welfare fraud we are going to be fair. Firstly we are going to be fair. Those who choose to vote against this will have to account for that when they go to the public on 20 September.JAN LOGIE (Green):I rise to speak to the Social Security (Fraud Measures and Debt Recovery) Amendment Bill. I want to just pick up on some of the points that Chester Borrows has just been making. I would like to speak maybe a bit later about that point that this is all about fraud when in actual fact it is not; it is also about debt recovery and debt recovery from some of the poorest people in this country. This bill will require the State to recover money that was lent to those people advanced to those people for just the basic essentials of life. We oppose that and are quite happy to oppose that because to us that does not meet the principle of fairness that I believe that most New Zealanders uphold. We are quite happy to oppose that.I want to speak now though to an aspect of the bill that is rather more complicated—and we have a rather more complicated perspective on it—and that the Minister was also covering. This is the recovery of debt from a partner of a beneficiary when that debt has arisen from fraud and they knew—or they knew there was a risk—that they were benefiting from that fraud. Initially the first proposal of this bill required the partner to know the precise entitlement or the nature of the excess amount but this requirement has been removed in this iteration of the bill effectively broadening the scope of it. It is also creating a criminal offence specific to spouses or partners so that it is an offence for them to know or be reckless about knowing whether they are benefiting from a beneficiary’s fraud.There were not that many submissions on this bill—only 13 in total. Some did raise concern around this aspect of the bill on two key points. One is that the changes to make partners and spouses criminally and civilly liable have the potential to increase risks of domestic violence and I will address further the Minister’s comments in relation to this. I know from having worked in Women’s Refuge that the threat of dobbing in a woman for receiving the DPB is a real dynamic in violent relationships. This bill has the potential to reduce that dynamic in the relationships because you are not going to threaten to dob somebody in for something that you may be held accountable for. So that has a very real appeal to me as does that sense of fairness. If somebody is benefiting from an income then it seems fair that there is some kind of joint liability around that but I guess it is just that we do have concerns that it is not that simple and this bill is not necessarily the answer to that problem.We would have much rather seen a collaborative response of the Government going out to say Women’s Refuge and consulting in the first place around how this system is operating at the moment for victims of domestic violence. We know that the courts do not see violent relationships as being in the nature of marriage so therefore technically victims of domestic violence should not be held accountable for a debt in that scenario. However that is not the experience that we are hearing about consistently from women who have been through the system and who have been investigated by Work and Income for fraud.I do thank the Minister for engaging in a conversation around this and enabling us to meet with officials and to talk with them about the debt and fraud investigation process. What we heard from them is that they actually have a fairly high threshold for what they will consider a violent relationship. Also some of the evidence they use for allegations of fraud is untested and includes accusations that have come from partners through Child Youth and Family which it just treats as fact even though it has not been investigated or upheld. This means that currently women now are being subjected to these fraud investigations basically through vexatious complaints by their partners and that might not go away with this process. We certainly have very real concerns about the way that the process is working for victims. When the threshold for acknowledging a violent relationship is as high as it is at the moment that leaves a very significant risk for victims of domestic violence as the process works at the moment.The Salvation Army asked that the debt recovery process be undertaken in a way that ensures the safety and integrity of both partners. Similarly the Beneficiary Education Advisory Service asked that the risk of domestic violence be taken into account when making partners liable. We are yet to be convinced that that thinking has been done. All we have heard from the Minister and the officials is that there is a system in place that acknowledges that and they talk about the court ruling. That is not matching the experiences that we are hearing about from women in the community and we do not have confidence that there are enough protections in place to be able to protect those who need it.We believe that the Government needs to develop a policy or a legislative response to problems based on the experience of women and beneficiaries who have been affected that also involves Women’s Refuge to ensure that the approach is fair and also ensures the safety of all involved. We are saddened that the Government seems to have prioritised this legislation over a comprehensive considered and safer approach but we are certainly open to talking more with the Minister about options for maybe having the investigation process audited by Women’s Refuge to make sure that it is best practice in order to make sure that if we are going ahead with this process—and it seems by the voting that we are—that we are doing everything we can to protect people through that process.I will just speak a little bit more too about the point of this creating an offence. Other concerns were raised by submitters that it is unnecessary and that there is little likelihood of a fine of $5000 being paid by people who are on the lowest incomes in this country. When you are struggling to buy a loaf of bread $5000 is a pretty unimaginable amount of money and it is pretty unlikely that that is going to get paid. So then the jail sentence I guess will come in at that stage and we also have concerns around what that is going to mean for our kids. Those kids may lose their parents because of an attempt by those parents to put more food on the table because the benefit levels are so low. That to us does not really meet the sense of justice and fairness that we expect most people in this country uphold.Again I would like to echo the Law Society’s concerns regarding joint and several liability which means that both parties will be liable for the whole debt should both parties be accountable for the debt arising from the fraud. The society believes that this may lead to unfair or disproportionate outcomes. In its view liability should be shared on the basis of attribution of benefits as per the Criminal Proceeds (Recovery) Act. This was dismissed through the select committee process in part due to the cost and potential increase of reviews and appeals. Well the Green Party believes that it is essential that our laws are fair proportionate and open to appeal. Those principles for us override any potential slowing-down of the process through legal wrangling. I think most people would prefer to have their rights upheld rather than necessarily have an efficient system from the Government’s perspective.Finally I do want to speak again to that point around the fact that this is not dealing with just fraud. This bill is also dealing with debt recovery and taking away the ability of the State to waive debt.Su’a WILLIAM SIO (Labour—Māngere):Thank you for the opportunity. When I look at the Minister for Social Development and her Associate Minister—very good-looking Ministers and I like them—I am reminded of what the people of Manukau say to Cam Calder when he is out and about. Cam Calder is of course retiring. He is one of 16 National MPs leaving the ship. When the people of Manukau see Cam they say: “Cam you are such a nice guy. You’re such a nice guy but we hate your party because you represent a party that is just heartless when it comes to dealing with people who are down and under.” I look at the regulatory impact statement here and I tell you as a responsible member of the Opposition that the intent of this Social Security (Fraud Measures and Debt Recovery) Amendment Bill is an intent that most people would support. No one in their right mind agrees that fraud is a good thing—no one in their right mind agrees that fraud is a good thing. In fact anyone who commits fraud whether it be in the benefit system or whether it be in our tax system should be pursued and should face the law.But here is the difference from how we in the Labour Party would do things. Although the National Party is intent on politicising this—beating people into hardship beating people who are on the benefit beating people who do not have jobs beating people who are earning the unemployment benefit because they cannot get a job beating people who are single parents and beating people who are on the sickness benefit or the disability benefit—is content to do that sort of thing we are not. The Labour Party will not do that. There is a way of dealing with these things. You have got to implement a culture that recognises that these people have rights—rights that ought to be protected; international rights that are protected in the international arena—and this Government is taking New Zealand in a very very different direction.Let me just take you through a few things and make some responses as I go. The two most common ways people fraudulently claim a benefit according to the regulatory impact statement are firstly failing to declare employment and wages received often by continuing on a benefit after starting work. As much as we want people to be in jobs what is missing here is that when people who are down on their luck for one reason or another have been earning an income they actually need to be supported through the transition period. That is not what is happening here. If you want people to get into jobs we have got to pay them a decent living wage.Hon Maryan Street: That’d be a start.Su’a WILLIAM SIO: That is exactly right my colleague Maryan Street.Hon Tau Henare: What do you mean “we”? When did the Labour Party start paying?Su’a WILLIAM SIO: That is the Government. That is a very good start my colleague Maryan Street says. The second reason is failing to declare a relationship particularly if the relationship starts or resumes while at least one partner is receiving a single or sole parent rate of benefit. The direction that this Government is taking does not recognise the complexity of relationships. It would be interesting for the public to know just how many relationships are in and out of the doors of this building. Do you get my meaning?This Government does not recognise the complexity of relationships and the hardships that many solo parents go through particularly single mothers who have young children to fend for. You saw yesterday how the Duchess of Cambridge walked out of the plane clutching baby Prince George trying to fix her hair. She left everything else to the wind—do you know what I mean—because her priority was baby George. The priority of single parents is their children. They are not going to worry about trying to call up Work and Income to let it know about the circumstances they are facing. Many of those circumstances are private affairs that they do not want to convey to a Government department that is just plain heartless. That is the culture that has been injected by this Government into our system of support for those who are needy.Here is another statement in the regulatory impact statement: “Other ways people fraudulently claim a benefit include incorrectly claiming the wrong number or type of dependants claiming multiple benefits”. In the community that I live in we speak one hundred and—different languages. I cannot remember how many languages but there are 160 different ethnic groups in that community. Their first languages are not English. The Ministry of Social Development under this Government does not seem to recognise that in the Aotearoa New Zealand of 2014 first languages are not English. The ministry needs to recognise that miscommunication and language difficulties are a significant barrier when you are following a form that has big words in the English language. The ministry does not recognise that. The true extent of fraud that the Ministry of Social Development does not detect is impossible to quantify. I will give you some cases that the regulatory impact statement mentions: 10735 cases were investigated resulting in 2139 cases of overpayment. Out of those 2139 cases of overpayment 714 cases were prosecuted.Here is the picture. The Government is painting every person on a benefit as if they were criminals. Based on the 10700 cases investigated 2000 cases were found to have been overpaid and 714 cases were prosecuted. This is lousy politics here. This is a political stunt. I know why the community hates this National Government. It is because it is heartless and it continues to beat people down when all they are asking for is decent jobs higher salaries and to be respected and treated with dignity. Like I said I like the Minister for Social Development. She is young and she is beautiful but the community does not like her politics. She has become the face of this Government and most people thought that she was going to be a nice person who would recognise the hardships. But she has pulled up the ladder of the support that she once got. She is denying every other single parent that kind of support which our State has a responsibility to provide.So I want to say this to her and to the Associate Minister who is ushering this bill through. He said earlier that this is about fairness; it is not. Yes it should have been about fairness but this is really about beneficiary bashing. I say shame on this Government—shame on this Government—for consistently doing this. Every time the polls go down on National’s side—and it has been trending for quite some time—it whips up some emotion from their supporters by pointing the finger at the most vulnerable of our communities. All I can say is shame on the Minister—shame on the Minister—who is ushering this bill through and shame on that Government.I reckon Tau Henare is doing the right thing along with 16 other National Party MPs.They are abandoning this Government. As a westie he does not want to associate himself with a Government that is heartless and does not care about hardship and how hard it is for those who are unemployed those who are receiving a benefit—I see you shaking your head—those who are single parents those who are doing it tough to support their children and young people those who are sick those who are needing health care and requiring support through our social security system those who are disabled those of our young people who are unable to get jobs and educational training and those who are widows. Those are the people who have been lumped together in the way that this Government is treating beneficiaries. I say we will show this Government what we think of it come 20 September 2014.Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First):I rise on behalf of New Zealand First to speak to the Social Security (Fraud Measures and Debt Recovery) Amendment Bill in the Committee stage. It would be fair to say that the days when people used to say: “Trust us. We know what we’re doing.” have long gone. It is very hard to support anyone who comes up with the same phrase or a similar statement given the fact that it could create difficult situations for others. It is not always so for the same person who actually said it but it is always so for others especially when it comes to benefits. This part of the bill Part 1 focuses on the essence of fraud when that occurs and the other part that is also important. At the same time the bill caters for efforts towards recovering debts. New Zealand First believes that those knowingly and purposely taking advantage of the welfare system should be held accountable for their actions and they should be made to actually show that they are accountable to the taxpayers of this country. At the same time we believe it is important to ensure that we understand the possible circumstances people may be in when they contemplate fraudulent behaviour.Some of the reasons may include No. 1 sudden redundancy or the inability to secure employment. We all know that there are not enough jobs out there at the moment. Let us be clear also that there are not enough jobs because National has not invested enough effort to create jobs for the wider population of New Zealand. No. 2 is changes to family circumstances and that means in the areas of death or relationship breakdowns. Death is something that is uncontrollable but a relationship breakdown is often a result of both parties being unable to agree on a number of areas. Although some might carry on to become good parents or good people others will respond violently. It will often lead to domestic or family violence. No. 3 is unstable relationships where either mum or dad would not like to move in and there is a sense of insecurity for both partners both parties. This is where both parents do not want to be tied to one particular person’s perspective. Most of the time one of the parents is either a gang member or a drug dealer. There are also situations where the mother could be involved with other kinds of job options like prostitution.No. 4 is that huge debt poor financial literacy and a lack of budget management skills or management experience can also be major contributing factors. There is quite a large number of people in this category. These people may have become parents early in their lives or did not necessarily finish their education in order to be able to secure better jobs and therefore they will often find themselves unable to translate or interpret various kinds of legislation especially when it comes to budgeting and spending benefits from the social welfare department. No. 5 is that in some cases serious alcohol and drug abuse or addiction could also be contributing factors. On the other hand there may be mental illness involved. Those are circumstances that are very hard to judge. Legal highs can definitely send someone’s mind completely mad regardless of what the legislators may say.It is important to point out again that relationships are never simple or straightforward particularly for people in broken homes. I heard the Associate Minister for Social Developmen Chester Borrows talk earlier tonight about relationship breakdowns and in particular how the woman in a violent relationship is not liable for the man’s fraud. I want to challenge the Minister in this instance. Often we talk about the situation being that the man is always the violent partner when in some cases women could be the violent partners in a relationship and therefore the father could end up being the victim in any situation. There is that ongoing perception. We need to actually look at shutting down or getting rid of the barrier that is allowing us to think that women are always supposed to be the victims and men are supposed to be the violent partners. The bill must be sensitive to these situations. The changes must be seen to be supportive of either the man or the woman—depending on who it is—who may be in a violent relationship and enable them to make the right decision. In the first reading the Hon Chester Borrows gave an assurance that those in violent relationships will be given fair and serious consideration and that is really good to hear.The Social Services Committee’s report if I can say so stated in terms of amendment to the debt recovery provision that: “We believe that this would ensure that the amendment did not undermine the general public law principle that decision-makers must take all relevant considerations into account.” This is a part of the actual select committee report that we thought was quite useful for us to accept. It goes on: “It would also alleviate any concerns about the legislation breaching New Zealand’s international human rights obligations by ensuring that matters pertaining to such rights could be taken into account where necessary.” I have discussed this bill with a number of our community leaders and a number of our local residents. As you would know a large number of our people in my area Manukau East and South Auckland and also some in Porirua could be in this category and could be affected by this legislation.Welfare fraud is something New Zealand First does not take lightly. In fact it is completely intolerable. Welfare fraud is a crime often committed by people for their own benefit at the expense of taxpayers but the vast majority of beneficiaries are honest people who do the right thing. New Zealand First is mindful that this is not such a clear-cut issue. Despite the bill’s best intentions it still poses huge risks to people in genuine need of welfare assistance. The bill must be accurately targeted towards those who are abusing the system and this is where we have to be careful that we are not pulling up the people who are trying to survive in this current environment where the cost of living is so high and they could be bullied into getting funds from Work and Income when they are not supposed to. It is absolutely vital that New Zealand welfare reaches the people who actually need it rather than those dishonest people who would continue to take what they are not entitled to.I believe that the bill will go a long way towards assisting those who are in real need of support. It is also important that we acknowledge that the savings that reached $109 million in 2012-13 were welcome but there is also $120 million that is still owing to the Ministry of Social Development. Is that going to be taken on board? Are we going to give that some consideration? However we must be mindful that two-thirds of welfare fraud is not relationship fraud. In fact a lot of money is lost in administrative blunders. That comes down to staff and the way they manage their responsibilities in the actual Work and Income offices.If the Government persists in taking this hard-line approach to sorting out our welfare system then it must indeed ensure that there are enough jobs and so on to actually allow beneficiaries to find a way out of the quagmire that is welfare dependency.We must also acknowledge the idea that most New Zealanders would not cheat the system if they felt like they did not need to. Most of them are actually honest if they are in a situation where they do need assistance from the Government. The deeper social problems that rely on the welfare system and rely on welfare fraud ought to be recognised. Sadly there are no jobs and many families are struggling to save the 20 percent deposit for a house at the moment so it is up to us to ensure that our people actually get support.POTO WILLIAMS (Labour—Christchurch East):It is my pleasure to take a call on the Social Security (Fraud Measures and Debt Recovery) Amendment Bill which is about fraud measures but it is also about debt recovery—the recovery of debt from our most poor and vulnerable and the recovery of debt from beneficiaries who actually owe their most significant amount of debt to the Government. It is very interesting that we are talking about recovering debt by the Government when it is actually looking at recovering debt from those who owe the Government the most.We supported this bill with some grave reservations. The reservations we talk about are really around the principles of general law. I want to talk about a couple of specific clauses within the bill itself. However I do want to frame my discussions around one or two principles. The principle of the New Zealand Law Society that many of my colleagues have already talked about—and I want to quote what was said—is that “in the absence of a positive act which would normally provide ground for criminal liability the justification for making partners and spouses criminally liable is not apparent.” So we are taking a departure from the general principles of criminal law. Normally a positive act is required to ground that within criminal activities. So what we are in essence saying is that the person who has actually committed the crime—the responsibility for that crime has actually shifted to another party. I do not know of any other legislation—perhaps my colleagues can help me on this—where in the committing of a crime the responsibility is actually held by another party. Perhaps that does exist; perhaps it does not. But I do not believe that we are talking about something that is consistent with the principles of criminal law.I am pleased that the Associate Minister for Social Development is back in the chair because I wanted to say that it is lovely to see you again Minister Borrows. We have seen you a bit in Christchurch recently along with other Government Ministers and Government MPs. I wonder whether that is because Christchurch is of course one of those touchstone places where the Government realises that it has actually done a terrible terrible job and it is sending the troops in to actually try to recover some of that. It is lovely to see you again. I have seen you quite a bit over the last few weeks.I wanted to comment on something the Minister said around fraud—that it is all about fraud. What I want to question is how much of the actual investigation is around fraud when a large component of what is found is actually administrative errors by the Ministry of Social Development itself. We are talking about quite a significant percentage of error. When we are talking about this percentage of administrative error that occurs we are talking about having the right paperwork within the right time frames and signed in the right coloured ink. We are talking about barriers that are put in the way for beneficiaries to actually find and have access to benefits that they are actually entitled to under legislation. They are entitled to these benefits. However we put all sorts of barriers in their way. When we as the administrators get it wrong they are the ones who have the penalty and I do not think that is right. It is another example of us vilifying the beneficiaries and actually as my colleague puts it beating our beneficiaries yet again.There is no clearer example of this Government being out of touch with what is happening with beneficiaries than—I do not know whether many of you saw the news reports on Sunday of the Young Nats ball where we had the Auckland Action Against Poverty outside protesting. There was this fantastic shot of the Young Nats on the balcony sipping their champagne while they were looking down at the protesters. I mean that is classic “Let them eat cake.” is it not? So here we are with this Government completely out of touch with what is happening with our most poor and our most vulnerable.I want to go to one of the specifics of this bill and that is recovery from the spouse or the partner. I know that there is some debate over what is the definition of partner or spouse. I have not actually seen it clearly articulated. I would like to know what defines a partner or spouse in this type of environment. I know that this has been part of the debate in the past. However we are talking about people cohabitating within the same space within the same house. Who is actually going to define what is a partnership or what is a spousal relationship? Are we going to leave that to the ministry? More forms I guess and more tests.Many of our colleagues have already spoken about the issue of domestic violence in relation to this bill and said that those people—women particularly—who are impacted on by domestic violence will be able to provide a test and then will not be responsible for the recovery of fraud debt. I remember a member across the House speaking about this the last time we were talking about this particular bill. Well here again I want to know who is going to administer this test. What is this test going to look like and will it require the further filling in of forms? Will it require affidavits to be supplied by the women concerned and who is going to be responsible for that? Is it going to be Work and Income which we know by its very culture is very caring and very concerned for our population! I would hate to think of vulnerable women turning up at Work and Income to disclose domestic violence to some of the folk who we have working within our Work and Income environment. I think that is actually an appalling way to treat people.I want to talk about new section 127A inserted by clause 12 regarding a “spouse or partner … knowing or being reckless about whether it is obtained by beneficiary’s fraud”. Here I want to quote my learned colleague Jacinda Ardern when she spoke during one of the readings where she said: “this spouse can still be found liable if they ‘ought to have known’ that they were in receipt of a benefit fraudulently. That is quite a hard test and so it was probed to quite a high degree”. I understand that the Social Services Committee came away with two questions: to what degree the test could be applied to other forms of fraud and whether it should be. I do not think that we have heard sufficient evidence or had sufficient discussion on whether we should be applying this consistently across the whole environment when we are talking about fraud. I want to go back to my initial statements about the general principles of criminal law and the shift of responsibility from the person who actually perpetrates that criminal act to another person and whether we are talking about a real shift in our legislative thinking because who is to say who may not be in danger of falling foul should we want to use this particular principle in another piece of legislation?So just in summing up I would like to know about how we are going to get through this process of disclosure whether there will be organisations that work with vulnerable people that will grapple with the notion of disclosure and whether when they are working with people and these disclosures happen we will require people such as our social workers and our support staff to then disclose the criminal behaviour of people whom they work with. This particular piece of criminal law has the opportunity to impact on many many other pieces of legislation and I for one do not think that is right. Thank you.MAGGIE BARRY (National—North Shore):I move That the question be now put.A party votewas called for on the questionThat the question be now put.Ayes71New Zealand National 59; New Zealand First 7; Māori Party 3; ACT New Zealand 1; United Future 1.Noes49New Zealand Labour 34; Green Party 14; Mana 1.Motion agreed to.Part 1 agreed to.Part 2 Consequential amendments and application savings and transitional provisionsSUE MORONEY (Labour):Thank you for the opportunity to speak on Part 2 “Consequential amendments and application savings and transitional provisions”. The intent of this part of course is to go about the implementation of the clauses that we have just been debating. So this is the part of the Social Security (Fraud Measures and Debt Recovery) Amendment Bill that will bring about what we on this side of the Chamber think is quite a precedent-setting issue around not having that high bar of proving criminal liability when it comes to being involved in social security fraud or being involved in the part payment of debt that has come about from someone being in receipt of a benefit.I think as some of my colleagues quite rightly pointed out that actually the fraud and the debt parts should be treated quite separately. I thank Jan Logie for raising that in the Part 1 discussion. Obviously when it comes to social security debt can actually and often does—and this is something I am hearing about on a daily basis now—come about because of a mistake that has been made by the department itself by Work and Income. Quite frequently that is the case that I am certainly hearing about on a daily basis now in my role as the spokesperson for social development for the Labour Party.So these consequential amendments and the transitional provisions are actually very important because we are transitioning to a situation that is unprecedented. I heard what the Associate Minister for Social Development Chester Borrows said in his contribution to the Part 1 debate. He does not believe that there is a great precedent being set here but that certainly was not the view of the New Zealand Law Society. I think it was quite right in bringing forward its concerns about how these amendments to a range of other Acts of Parliament and these transitional provisions are actually a departure from what we have had before. Its concern in particular was the departure brought about in these consequential amendments to other Acts of Parliament that will for the first time—so the society thought and we agreed with it—lower the bar of proof that a person was actively engaged in committing the fraud or accumulating the debt because remember this bill deals with both.When Work and Income does overpay someone that person may not know about it. Can we really expect the person in a relationship with them to know about a mistake made by the department? That is what this bill is actually saying we ought to transition to under Part 2. The transitional provisions will actually transition to a place where the partner of the person who has been overpaid because of a mistake made by Work and Income does not even have to know. We would not even have to prove that they knew there had been an overpayment as the fact that they have benefited from that overpayment would be enough with regard to their criminal liability. That I think is quite a departure.So we are transitioning in Part 2 to deal with issues of welfare fraud and welfare debt but the Government despite its protestations is not taking a consistent approach when it comes to tax fraud. I think that is completely wrong. It is completely wrong that we have got a Government that is prepared to—Hon Paula Bennett: You can’t keep saying that.SUE MORONEY: Well Minister I can keep saying it because it is the truth. The truth is that these measures here in this bill are not being taken with regard to tax.Hon Paula Bennett: That’s not the truth.SUE MORONEY: Where is the bill? Where is the bill that actually takes these same measures against people who commit corporate tax fraud?Hon Paula Bennett: Considerably more is spent collecting tax than it is doing this.SUE MORONEY: Well all the Minister can talk about is how much this Government spends. I would rather that Minister spoke about how much work this Government is doing on finding jobs for these beneficiaries instead of actually attacking them all the time. That is what the Government should be spending its time doing and should actually be focusing on. I would welcome much more transitional provisions that were actually transitioning beneficiaries into jobs. That would be real relief actually. Unfortunately what is happening is the opposite. This Government instead of focusing on getting people off benefits and into jobs and actually helping to create those jobs is instead putting all its energy into trying to deal with welfare fraud as if that is the big issue—as if that is the big issue.Of course none of us accept any level of fraud particularly when it is fraud that is against the taxpayer—and that is both tax fraud and welfare fraud by the way. Both of those measures are fraud against the taxpayer. No one in this House accepts that that is OK. But I would much rather that this Government and that Minister put their energy into actual social development because that is what the name of the portfolio is and into developing people’s opportunity to be socially engaged and were not spending all their energy on this area here which is all about proving that people who are welfare dependent are actually the bad guys—that they are the bad guys and the job of the Government is to catch them out. Well look that is a small part of what the Government should be doing but the big part of what the Government should be doing is actually helping people get off benefits and into work. Sadly not enough effort is being put into that area but an awful lot of effort is being put into blaming beneficiaries and an awful lot of effort is being put into trying to make it seem as if welfare fraud is the big bogey that this country faces. This is not the big bogey that this country faces.However I want to put it on record again that the Labour Party is supporting this bill because we do not accept that fraud against the taxpayer at any level is acceptable whether it be tax fraud or whether it be welfare fraud. So we are supporting it on that basis. We were also very much swayed as I said when I spoke on Part 1 by what women’s organisations had to say about the gender impacts of welfare fraud. Having heard the submissions we think and we do strongly believe that this will actually make it more equitable where there is relationship fraud that is being committed. Part 2 deals with the amendments to other legislation that will help to bring this about. It should be that if two people have been benefiting from that fraud then there should be more equality in what they pay in restitution towards that. So we absolutely agree with that. We think that that should be more equitable. We believe that women who are in these situations—which as we said before could very well be violent situations—should be protected as well. That is important and this bill does go some way towards that.But let us not imagine for a minute that this bill addresses the big problems that this country faces the big problems that could have been resolved if this Government had been working in the interests of beneficiaries rather than just trying to trip them up and attack them at every opportunity.If this Government really had the interests of beneficiaries at heart then we would not have largely immigrant labour rebuilding Christchurch at the moment for example. That is something that the Government should have had its eye on. It should have been training people and it did not. It failed to do that. It would rather focus on the fraud measures in debt recovery from beneficiaries instead.I am going to conclude this speech by saying that the Labour Party will support the provisions in Part 2 as we did in Part 1 but we urge the Government to not just take the simple way out with this. The Government may feel that it is OK to attack beneficiaries and actually put these measures on them but we want to see some equity in this. We want to see the provisions in Part 2 and Part 1 applied to tax fraud and particularly to corporate tax fraud as well. Thank you.JACINDA ARDERN (Labour):There is considerable debate in this Committee on the Social Security (Fraud Measures and Debt Recovery) Amendment Bill as to whether or not more resource is applied in the recovery of tax fraud or even debt versus welfare fraud or debt. Of course the scale of one is significant versus the scale of the other. Anyone who is in employment is covered by PAYE. People have more contact with tax requirements than with welfare payments. But even taking that into account scale in and of itself actually justifies why we should be putting significant resource into ensuring that everyone is paying their dues when it comes to tax. The point has even been made by Dr Marriott at Victoria University that “More resources were applied to collecting welfare debt than tax debt”. Here is that statement again. After the comparative work that she has done between the two she says: “More resources were applied to collecting welfare debt than tax debt”. As much as the Government wants to claim that that is not the case that is what was produced by the work of Victoria University. So not only do we know that the scale is larger; we also know that the penalties you are likely to incur are going to be higher.For instance you are more likely to get a custodial sentence if you are convicted of welfare fraud than if you are convicted of tax fraud even though on average tax fraud where a custodial sentence is being applied amounts to roughly $800000 versus $67000 when it comes to welfare. There is inequity in our system right down to the amount of resource applied in recovering debt and we should all be interested and concerned by that. All fraud is wrong. All fraud in some way affects taxpayers because it is all coming from the collective pie. All of it should be pursued. That is what we are highlighting—that it should be that all of it is pursued and with equal vigour. Our point is that it appears that not only is there a disparity but actually the penalties that apply are different. The degree to which you will get some kind of discounting on arrears is likely to be different and none of that strikes us as being fair. We are discussing in Part 2 some of the ways in which the Ministry of Social Development has the ability to recover debt.We know though that a taxpayer can apply for financial relief via the Inland Revenue Department. You will find that that is rarely the case when it comes to welfare. And I want to add overpayment—not just fraud but overpayment—because that is a frequent occurrence in our system. The ability to seek financial relief is somewhat limited. You will be paying down regardless of the amount that you owe. There will be a deduction applied almost always if there is an overpayment directly from the next benefit payment you receive. When your discretionary income is incredibly low that has a significant impact. I am not just talking about fraud here; I am talking about the recovery sometimes of the Ministry of Social Development’s own mistakes. As my colleagues from the Green Party have pointed out overpayment often occurs without any mischievousness on the part of the beneficiary. It occurs simply because of the way our system works.Let me talk to that point briefly. We know that many of the recipients of welfare payments in this country are working but that they simply do not earn enough to survive. They might be in precarious work working a few hours a week which is then topped up by the Ministry of Social Development. They might have a job where one week there is work and another week there is not. Many of us will have seen cases like this before. In those cases an individual is required at the end of the week on a Friday to call Work and Income on the phone line and report in how many hours they have worked. Obviously to anyone who has worked on a payslip system—like when I was back in the old supermarket—there are delays. You would not get your payslip with how many hours you had worked that week and what your pay was until some time after. So we are requiring Work and Income clients to make a best guess of the hours that they perceive that they worked and they call that into Work and Income.That does as you can imagine lead to some potential discrepancy and it was I believe the reason that when the Inland Revenue Department and the Ministry of Social Development recently started sharing information you suddenly saw this increase in what they determined to be discrepancies. “Discrepancies” is a word I want to highlight. It was at that time presented by the Government as the Government having discovered all of this new fraud in the system—not so. Simply what it had discovered was the inefficiency of our own systems. It discovered that someone who calls through and says: “I believe I worked 6 hours.” actually may have worked 7 hours. They may have worked 5 hours but that extra hour was not counted not registered over time. Discrepancies like that are not an uncommon thing. They are not deliberately fraudulent. They are just different errors perhaps even on the part of payrolls. But it all shows up as something that the recipient then needs to be if a calculation is based on those hours either topped up if there was an inaccuracy or something paid back—and it happens. When that however is calculated it gets lumped into overpayment and is then deducted from the beneficiary’s future payment.You can see how this occurs. It all gets lumped in together. When that happens people pay it back. That is how the system works but there is often little relief when through no fault of their own they are having these deductions made from what is a very small discretionary income. If we jump then to their paying it back where it might have been more deliberate there was some discussion at the Social Services Committee as I said earlier over the consideration that the chief executive makes when determining the level at which someone is paying it back or determining whether or not there are any special circumstances involved. They are required to determine the payment rate and whether or not any financial hardship will result but there is still very little leeway there. That is not to say the debt should not be recovered; it is simply that we think common sense should apply and that if someone in the process of paying back their debt is left in a position where they cannot survive well that serves no one at the end of the day.We do have some differences in the level of discretion—the quite liberal way the Inland Revenue Department is able to determine leniency in that regard compared with the much more rigid approach the Ministry of Social Development is required to take. That probably explains why you are seeing a greater write-off of arrears in our Inland Revenue Department system than you are seeing in our Ministry of Social Development system.One last thing that I want to come to and I also want to touch on Part 2 equally and this was pointed out in Victoria University’s research as well is that the Ministry of Social Development can recover debt from delayed redundancy retirement payments compensation and damages—from basically anything. If you get any form of income even if the ministry has to wait a number of years it will then be able to recover the debt from that place. We can debate whether or not that is right or wrong. My question simply is this: does the Inland Revenue Department have that same power? It is a simple question because if we are doing it here it should apply to that system as well.One final point I wish to make. We have not discussed this in great detail but this bill also changes the ability of the Ministry of Social Development in its investigations to conduct a thorough investigation without first informing the accused.That might seem like a strange thing to do. Why would the Ministry of Social Development tell someone they were being investigated? Well for the very simple reason that some people sometimes report beneficiaries for vexatious reasons for mischievous reasons. We know it happens. That probably explains why in 2010 of the 16000 allegations of benefit fraud 2000 resulted in a debt and 14 percent of those were found to have warranted prosecution—quite small proportions when you look at how many allegations are being made. Why would we want to then remove one of our mechanisms to determine whether or not something mischievous is occurring? If you ask the questions of the individuals sometimes there are entirely plausible explanations and that is where it ends. Instead we are allowing resources to go into an investigation that actually may not be required not to mention the privacy issues that come with that and the ability to undermine someone’s employment by going straight to an employer in an investigation rather than to the individual accused.LOUISA WALL (Labour—Manurewa):Kia ora Mr Chair. Thank you very much for the opportunity to contribute to this Committee stage of the Social Security (Fraud Measures and Debt Recovery) Amendment Bill. We are speaking on Part 2 of the bill which very much focuses on the debt recovery part. Part 1 is about the fraud measures; Part 2 really is about the amendments and provisions to enact those fraud measures.What I specifically want to focus on—and I do have a couple of questions for the Minister in the chair Associate Minister for Social Development Borrows—is I guess the integrity of a social security system that contains our most vulnerable societal members. That is the context of this piece of legislation. It is a context where the most vulnerable New Zealanders seek help from the Government. The Government helps those members of our society. Within the context of this bill we are talking about $23 million worth of fraud that is perpetrated within our social security system. There are approximately 700 fraud cases every year. Within that context 200 of them are specific to relationship fraud which is the whole focus of this piece of legislation.The question I had for the Minister came after reading the regulatory impact statement dated 8 November 2012 which essentially outlines a problem definition and the intervention logic. What I found really interesting within that paper was that in 2012 there was a $485 million debt to the Ministry of Social Development. In context of that amount of money $106 million was due to fraud which was 22 percent of the overall amount that was owed to the Ministry of Social Development. The actual percentage of relationship fraud I have got no idea of. There was $176 million worth of overpayments which actually is about the administration by the Ministry of Social Development. So it is actually the ministry’s internal processors who overpay people and then beneficiaries who have been identified as getting too much money have to enter into a repayment scheme with the ministry. Then there was also $203 million worth of advances which was the bulk of the provision. These are beneficiaries who have requested assistance from the Ministry of Social Development. They want assistance.The reason I bring these issues up is that it seems to me that we have gone down a really punitive path in terms of relationship fraud specifically and that we are wanting to criminalise a group of people. The punishment contained within Part 2 of the legislation is very much about fining people who are beneficiaries and then actually saying that if they have not got the money the worst case scenario is that we are going to send them to jail which actually does not make sense to me. What would have been maybe a more pragmatic response is sharing the debt. I believe that there are women particularly and specifically who end up in debt through relationship fraud and who end up having the whole of the liability of that debt that the Government says it is owed because they are in a relationship where their spouse is earning too much money they have got an accommodation supplement they were not entitled to or they have got a whole lot of entitlements they were not entitled to. This piece of legislation is saying: “OK we’re going to share the burden. Their partners have enjoyed the Government’s money and we believe that a fraud has been perpetrated so they must pay.” My question to the Minister would have been around the fact that there is an administrative cost in terms of now creating a new regime around dealing with fraud and I just wonder why we could not have treated—for the women and for the men actually—aspects of this particular legislation as advances and then just integrated the $106 million worth of fraud into existing systems. Why are we creating a whole new system when in fact we could have just added value to what was already there?I am particularly passionate about this area as a member of the Social Services Committee because whom we are dealing with are as I said before our most vulnerable members of society. Many people have talked about the context of relationship fraud. It is mostly women who are getting the DPB. What I found staggering actually in this regulatory impact statement is that there was not a gender analysis because I think that what we are actually talking about is debt that women have. There was not an ethnic analysis. We do not actually know how many Māori or Pacific or other New Zealanders are affected by this particular issue.You know frankly what we have tried to highlight tonight is the prioritisation by this Government of trying to recover what amounts to a very small amount of money that beneficiaries owe. What we have said is that the opportunity cost for that time in terms of a bill would have been much better spent looking at the up to $6 billion worth of tax evasion that occurs in the country. The whole reason and rationale for highlighting that to New Zealanders some of whom will be watching tonight really is trying to underline the prioritisation of this Government of making sure that beneficiaries pay back money that they supposedly have defrauded our Government of. As I said before these are New Zealanders who would have got too much accommodation allowance or too much other support which actually has enabled them to survive and live in this country within the context of no work or the work that they do have actually not paying them enough to live on.Another question I have for the Minister is around the commencement date because that has changed. This Act was supposed to come into force on 4 November 2013—The CHAIRPERSON (Lindsay Tisch): Part 2. We are on Part 2.LOUISA WALL: Sorry Mr Chair. The question really is about communicating this piece of legislation if the House consents to it being passed to the social security community so that it understands the implications of this bill. The only thing I can see out of it that could be positive is that the ministry is going to engage with people—I would target those on the DPB—to make sure that they know that there are new requirements within the context of this legislation that could have huge implications for their relationships. It obviously has huge implications for how they live their lives. It is just to make sure that they are fully informed and can make an informed decision about how they live and how they meet the requirements of being a recipient of the Ministry of Social Development support. Lest we forget the people we are talking about are those who are unemployed. They are those who in most cases have children so they have dependants. They are people who without the State’s support actually have not got a home and have not got food on the table. Fundamentally at the end of the day it means that our children do not have a solid base from which to be able to go to their local school to learn and be the productive members of society that we all want them to be.My challenge really to the Minister in the implementation of this legislation is that hopefully there will be some empowerment in the process because I do see aspects of this that are really positive. Leaving women in debt and having to pay off $5 a week for the rest of their lives with it actually compounding if they owe and take advances because they need other forms of support just means that the poorest and most vulnerable end up being revictimised and stigmatised to a point where life is too tough and where even getting out of bed and making sure their kids get to school is a struggle. So Labour is supporting this piece of legislation. Obviously we do have reservations. The big question we would ask this Government is why it has prioritised this when there is a whole lot of other income that the Government could be getting. From our perspective this is a perpetuation of the stigmatisation of beneficiaries which appals us. Kia ora.Part 2 agreed to.Clause 1 agreed to.Clause 2 agreed to.Clause 3 agreed to.Bill to be reported without amendment presently.Trade (Safeguard Measures) BillIn CommitteeDebate resumed from 11 March.Clauses 1 and 2 (continued)Dr DAVID CLARK (Labour—Dunedin North):The Trade (Safeguard Measures) Bill is a bill that attempts to ensure that we have the necessary trade safeguards at the border. It is great to be able to speak to it in the Committee. I enjoyed my earlier contribution and I am very very much looking forward to hearing what my colleague Phil Goff has to say.Hon Damien O’Connor: What about the Minister?Dr DAVID CLARK: The Minister in the chair Nikki Kaye too I am sure will make an interesting contribution and so I will be all ears.Hon PHIL GOFF (Labour—Mt Roskill):It is a bit of a shame to have to take the call when we have a Minister in the chair the Minister for Food Safety who does not even know what the Trade (Safeguard Measures) Bill is. She did not even know she was meant to be in the chair. That really degrades the importance of passing legislation through this House because what I wanted to do in the debate on the title and commencement clauses was to ask the Minister in the chair questions about the bill that earlier Ministers in the chair who were equally ignorant about the bill have failed to answer. If we are going to take up the time of the taxpayer and the time of the Committee to have a proper debate on the bill we need to have a Minister in the chair who knows what the bill is. It makes a farce of this place—Hon Nikki Kaye: You have no idea.Hon PHIL GOFF: —if the Minister does not. Oh the Minister says she does. Well look I have got some questions for the Minister. The first question is this: if we look at the title clause we see that “This Act is the Trade (Safeguard Measures) Act 2008.” That is 2008. Well my question to you Minister is first of all why are we still debating this bill 6 years after it was introduced—6 years after it was introduced? I think that the Minister in the chair owes it to the Committee and owes it to the country to explain why it has taken 6 years to get a relatively straightforward piece of legislation to the point where it still has not even got through its Committee stage. This bill was sent to the Foreign Affairs Defence and Trade Committee in the very first weeks of the first term of the National Government. We are now in the last weeks of the last term of the National Government and we have not passed this legislation.So Minister we on this side of the Chamber expect you to take a call and explain to us whether it was just poor management of the House that the Government has just never got its act together to manage its legislative agenda or was it sheer incompetence? Were there problems with the bill that the Government could not come to terms with? Was its incompetence in managing the bill—oh! The Minister has left the chair. Maybe the Minister of Commerce who has just assumed the chair who is meant to know something about this bill—even if he is late in arriving to hear the discussion on it—will answer these questions. Why Minister Foss has it taken 6 years to get this bill to the point where it is now? Is it incompetence? Is it poor management? Is it partly because the Minister who was in charge of this bill is a guy called John Banks? The last thing that the National Government wanted to do was have John Banks in the chair and subject to scrutiny. Whichever way you look at it it is hard to imagine why a Government takes more than 6 years to get through a piece of legislation that is supposedly necessary. If it is necessary why was it not put through the House much earlier Minister Foss? Why has it taken this long?I want to raise some other questions about it. Actually the Labour Government is supporting this bill. The Labour Party is supporting this bill. The Labour Government introduced it and the Labour Party is supporting it. I do not want to have to wait until the next Labour Government albeit in only a few months’ time to actually get the bill through. You know this is about trade safeguards. I am a person who believes in freeing up trade so why would we have trade safeguards? Well there are some very good reasons for having trade safeguards. You need trade safeguards when other countries decide to dump their products in your country at below the value of the product. That is not fair trade. It is not a level playing field. It can damage your local industry There is a clear argument for having anti-dumping trade safeguards. That is touched on in this legislation but it is covered in another piece of legislation.There is an argument too for having countervailing duties. You put countervailing duties on when the exporter is from a country where the Government of that country is subsidising the exports and again it is not fair competition. We do not mind here in New Zealand competing with anybody on a level playing field but if another Government is subsidising the product so that it can out-compete our industries that are standing on their own feet that would also be unfair trade. Again that is touched on in the bill but it is not the central purpose of the bill.The central purpose of this bill is to actually provide temporary protection for when a domestic industry might be faced with increased imports and it needs time for adjustment. But the question I have got for Minister Foss on this is which industries are we talking about that actually require this sort of protection? Because actually our tariff levels are generally either non-existent or below 5 percent and I cannot think of the last time Minister when these sorts of temporary safeguards were actually used. So can the Minister—this is a genuine question—explain to the Committee when the last time was that temporary safeguards were used for the purpose that is set out in this bill and which of the industries potentially need protecting and against what countries. That is a basic piece of information that Parliament and the country are entitled to know.I think that the bill can be justified but my experience is also that trade safeguards can sometimes be utilised in a way that are not productive for fair trading. A number of members of this House have just came back to New Zealand from a trip to China where we were asking questions there about the trade safeguard—the agricultural special safeguard measures—that is impacting on the dairy industry. I know that my colleague Damien O’Connor is particularly interested in this. I negotiated that trade agreement. We put in the special agricultural safeguards—the trade safeguard mechanisms—because frankly we would not have got the free-trade agreement without it. The Ministry of Agriculture in China is still fuming about the fact that we have negotiated the total phase-out of tariffs.But I have got to say that if you look at the Chinese example and relate it to what this bill is about those safeguards are not really justified by the reality. Yes our exports have gone up rapidly. When we set the trade safeguard levels they were set at a level well above the level of trade. Within 5 years there has been a fivefold increase in dairy exports so people are paying that trade safeguard mechanism—actually in the first month of the trading year—and it is costing us some tens of millions of dollars. The Chinese would be able to justify that if there was damage as this bill sets out to the local industry. But there is no evidence that what we are doing is damaging the local industry. Yes dairy production in China has dipped but not for the reason of competition. The reason we are sending the volume of trade into China that we are is the demand. The demand has gone up; we are simply meeting the demand. So we are faced with a situation where a trade safeguard mechanism is being employed but without justification for doing it. I do not think that that is what this bill provides for New Zealand.Of course we asked about whether we might renegotiate those trade safeguard measures with China and the answer was why would China give us something and get nothing in return? There would be a quid pro quo and since the trade safeguard measures are only transitional—they are phased out by the early 2020s—then we probably will not be able to do anything about it. That is an example of where a trade safeguard mechanism can be utilised as a revenue-grabbing mechanism but without being justified by an actual need to protect a local industry. In this bill we say that it is about protecting the local industries but the Minister who was asked earlier during the Committee stage which industries might need this sort of protection failed to answer that question. It is a valid question Minister and I would like you Minister to answer or to attempt to answer that question. That is what you are paid to do. That is why you are sitting in the chair. We do not expect you to do sit there like a dummy and ignore the questions and not do what you as a Minister have a responsibility to do.I said before that notwithstanding the fact that this Government has taken 6 years over this measure I think that the measure is worthwhile. I think that it does a number of things. It streamlines the process of responding to allegations against imported products and the need for the trade safeguards. It removes the temporary safeguard authorities. I do not think we need those now; the investigative work can be done by the Ministry of Business Innovation and Employment. It enables a more realistic time frame to work through the trade safeguards. Currently it is 35 days; I do not think that is sufficient. It increases the period to 75 days and actually 85 days where provisional safeguards are being requested. And it also sets out clear criteria. Those criteria are set out in clause 12 of this bill. I think they are sensible measures. The chief executive must look at whether the increased imports are actually causing serious injury. He or she needs to look at whether the increased imports are due to unforeseen developments; whether they are necessary to prevent serious injury; and if they are necessary which goods should be subject to it which measure is appropriate and what is the extent and duration of time—JAMI-LEE ROSS (Junior Whip—National):I move That the question be now put.DAVID SHEARER (Labour—Mt Albert):I was pausing because I hoped the Minister in the chair the Minister of Commerce might be able to stand and give us the explanation that my colleague Phil Goff was actually asking for. I think those were legitimate questions and if you ask a legitimate question in the House particularly in the Committee stage I think the Minister who has taken the chair late has a responsibility to answer them. The Trade (Safeguard Measures) Bill is a bill that we are supporting for the reasons that Phil Goff just outlined. We are a trading nation. We do rely on overseas trade. We have freed up our trade significantly in the last few years. We have very little in the way of tariffs restricting the flow of goods coming into New Zealand at the moment. I think the last are around about the 5 percent mark. We have a number of free-trade agreements that have been developed principally under a Labour Government but also of course continued on by this Government as well with for example Taiwan.As Phil Goff just mentioned we have just completed a visit to China with the Foreign Affairs Defence and Trade Committee which I think was interesting on a number of levels in terms of the trade relationship we have with China. It did highlight a couple of points that I think I would like to mention in relation to the Trade (Safeguards Measures) Bill however and those are our huge dependence and growing dependence on China—that sort of dependence likens back to the 1960s and our dependence on the UK—and also the huge dependence in the area of primary products particularly milk powder. Forty-four percent of our milk powder now goes to China Taiwan or Hong Kong. We are very very dependent on that. That places us in a situation where there is considerable risk should that market not perform.It also dominates vis-à-vis other industries and it is these other industries that I think the trade safeguards legislation is really aimed at because let us face it it is unlikely that for example China or another country is going to flood our country with milk powder. It could however be able to flood some of our manufacturing markets with some of the goods that could easily swamp and put out of business some of our manufacturing industries. That is unlikely to happen but it could happen and this legislation is designed to help prevent that from going on. It does put in place some temporary restrictions around the ability for that to happen for overseas countries to flood our market with goods that are well undervalued in order to be able to suppress and eliminate some of own markets.The bill gives quite an amount of authority to not only the Minister but also the chief executive officer of the Ministry of Business Innovation and Employment to be able to mobilise measures from what used to be 35 days’ protection now up to 75 days and in exceptional circumstances up to 85 days to protect that. It gives that Minister the ability to do that. Normally that could be in the form of a duty but there is a degree of flexibility around that as well. As we have heard it replaces what is in place at the moment which has been there since 1987. In 1987 we had the Temporary Safeguard Authorities Act. That was regulating this part of our export market or our local market. That will now be replaced and instead of the safeguard authorities being in place we will have the Ministry of Business Innovation and Employment being able to do that job for us just as effectively.I want to come back to the two key questions that Phil Goff asked of the Minister and I call on the Minister before Jami-Lee Ross jumps up to take yet another closure motion to actually get around to answering this. The first question is why it is that this bill which first came up in 2008 has taken more than 6 years to get to where it is now in the Committee stage. We do not even know whether in fact this bill will get through before there is a change in Government.I can tell you one thing. When there is a change in Government we will be able to push this through and get it done—something we started in 2008 and we can finish off in 2014. This bill was first introduced by Lianne Dalziel. It was then taken up by Simon Power. Simon Power used the same speech notes as Lianne Dalziel was speaking from when she spoke on it. That was—how many years ago now—3 years. It then went to John Banks. The baton was passed to him. Well John Banks did not last for that long for all the reasons we know and all the reasons he may not last very much longer. As we speak the clock is ticking around John Banks. And now it has been passed through to Craig Foss. I think it is a legitimate question to ask why it has taken so long and why it has been put on the back-burner of back-burners in order to be able to be considered today.There is a second question that Phil Goff raised and that I would like the Minister to answer. Yes this bill is important in terms of protecting our local industries in world terms and certainly New Zealand terms where we have opened our borders substantively from dumping but I would like to know what examples the Minister can give of which industries need temporary protection and what countries he envisages us looking at in terms of being the greatest source of threat to New Zealand. I think actually we need to have a little reality here. At the moment people are probably watching this and saying “Well yeah I can kind of get my head around the idea that we need to protect our local industries.” but they want to know from whom and what sorts of industries do need protection. Why do we need this legislation as it is drawn up right now?There are the two questions. One is why it has taken 6 years for this legislation that we are supporting. We do not have a problem with the legislation as such but we do have a problem with the delays in this legislation coming through. Why has it taken so long since Lianne Dalziel in 2008? Lianne has gone now. Simon Power whom she passed it to has gone. John Banks well he is “gone-burger” as well. It is “gone-burger” all the way down the line and it will be “gone-burger” for this Government. Craig Foss does not have very much time before he can get this legislation through this Parliament before he is “gone-burger” as well. There is a long line of skittles being knocked over by this trade bill that has been lingering on our books for the last 6 years. The second question I ask is why do we need it? What industries need protection? And lastly from whom? Thank you very much.ANDREW WILLIAMS (NZ First):I take a call on behalf of New Zealand First on the Trade (Safeguard Measures) Bill. Back in March 2009 the Parliamentary Private Secretary to the Minister of Foreign Affairs John Hayes said: “The bill’s purpose is in particular to allow New Zealand to apply safeguard measures at the border in accordance with the WTO rules adopted in Marrakech back in April 1994.” Mr Hayes then went on to say that “The bill states that such measures are intended to provide temporary protection to a domestic industry from serious injury caused by increased imports.” Many of us can recall there was an instance concerning whiteware a number of years ago where Fisher and Paykel had concerns here in New Zealand because whiteware in its eyes was being dumped on the New Zealand market causing great difficulties for the domestic manufacturer here. It thought there was unfair advantage in that significant quantities were coming from a foreign source affecting the domestic market here. The Government at the time did investigate that situation. This bill is very much intended to protect in those sorts of situations.New Zealand First would ask as well the question why this was initiated under the Labour Government back in 2008 and is now here in 2014. If the purpose of this bill as Mr Hayes said is to protect our domestic industry from serious injury caused by increased imports in situations like that why has this Government taken the best part of 6 years to get it to the Committee stage in the House? This is an appalling situation and it beggars belief as to why our domestic manufacturers do not have a level of protection under the World Trade Organization (WTO) rules such as this bill brings in. The Hon Simon Power tried to put this bill through in 2009 and he hung his hat on it. As we have heard it was then passed on to the Hon John Banks and now it is with Mr Foss.New Zealand is a very small market. We have only 4½ million people. We have a very small manufacturing base. Those manufacturers that we do have come under intense pressure at times from very significant global players global suppliers and major importers into this country which could literally swamp and overpower many of our local domestic manufacturing sources. In that respect this is a very important bill that will give trade safeguards as the bill’s name puts it to ensure that we do not have unfair international conglomerates coming in and swamping such a small market. We are less than the size of Sydney in population and we have a fraction of the manufacturing of the likes of Australia yet Australia has far more in place to protect and assist its manufacturing base to ensure that its manufacturers have some safeguards.New Zealand has been very much an open market. In fact New Zealand is often used as a test case. Manufacturers around the world often use New Zealand to trial products because we are an island nation and we are somewhat isolated from the rest of the world. Our particular country is sometimes used by manufacturers out of Europe out of North America and out of Asia to test and trial products when they would not wish to do that in their own home markets or in significant markets where it would be far more costly.A result of them coming to New Zealand and perhaps using us as the test case as the guinea pig is that that can at times have serious consequences for fledgling manufacturers here in this country which can be absolutely swamped by such a venture. So it is very important that New Zealand has this bill in place and that we can then go to the WTO under the WTO rules and raise concerns if we feel that that is happening. If this Government walked the talk in terms of giving greater support to New Zealand manufacturing greater support to New Zealand business and greater support to try to grow this economy and provide more jobs then we would need the safeguards in place as provided under this bill to ensure that our companies in New Zealand can level-peg it with very very large multinationals globally.New Zealand First supports this bill but we support it on the basis that we get on with it we get it moved through the House and we put this legislation in place. We had a similar situation with the Rena off Tauranga.The CHAIRPERSON (Lindsay Tisch): Order!This issue is very close to that because legislation was not passed and had it been passed—The CHAIRPERSON (Lindsay Tisch): No no.ANDREW WILLIAMS: Well had this bill been passed already in certain instances perhaps New Zealand would have been better protected. Likewise had the legislation on the Rena been passed New Zealand would have been $30 million better off by not having to pay out to overseas interests. Tardy legislation does not help New Zealand interests. In this instance where it is in the interests of New Zealand business New Zealand First supports it and we commend it be passed by the Committee with swift promptness.PAUL GOLDSMITH (National):I move That the question be now put.A party votewas called for on the questionThat the question be now put.Ayes71New Zealand National 59; New Zealand First 7; Māori Party 3; ACT New Zealand 1; United Future 1.Noes49New Zealand Labour 34; Green Party 14; Mana 1.Motion agreed to.Clause 1 agreed to.Clause 2 agreed to.Bill to be reported with amendment presently.House resumed.The Chairperson reported the Land Transport and Road User Charges Legislation Amendment Bill without amendment and that the Committee had divided it into the Land Transport Amendment Bill (No 2) and the Road User Charges Amendment Bill; the Industry Training and Apprenticeships Amendment Bill without amendment; the Social Security (Fraud Measures and Debt Recovery) Amendment Bill without amendment; and the Trade (Safeguard Measures) Bill with amendment.Report adopted.Victims of Crime Reform BillIn CommitteePart 1 Amendments to Victims’ Rights Act 2002ANDREW LITTLE (Labour):I take a moment to speak to the Victims of Crime Reform Bill noting as we have done from the outset that Labour will support this bill. I note that this bill makes important changes to the gradually evolving victims’ rights legislation that we have in this country starting as it did in 1987 under the then Labour Government when it passed the first victims’ rights piece of legislation. It was reviewed in the early 2000s and changes were made then and now we come to this piece of legislation.I think it is quite clear that around the world the place and the role of victims in the administration of criminal justice have become greater and have become very important particularly following conviction and leading up to sentencing. Although the theoretical role if you like of the victim was to hand over their place and their interests to the prosecutor usually the Crown in criminal matters increasingly victims now want to have their voice directly heard in the court and that is not a bad thing. We live in an age of accountability whether it is organisational or whether it is personal and in the criminal justice system that counts for a great deal. It counts for a great deal when victims can directly report to the court and often to the perpetrator of the crime of which they are the victim the impact of that crime on them for their family and often the wider community.So this bill is important. It clarifies some of the rules for example around victim impact statements—how they are to be presented and what is to be included in them. It is interesting that in the new section 17AA under clause 11 which sets out how a victim impact statement is defined subsection (2) states that information to be presented as part of a victim’s impact statement can “include any photographs drawings or other visual representations provided by the victim.” This is an interesting development. Certainly up until now most victim impact statements have been written—either written directly by the victim who is making the statement or written on their behalf with the assistance of others.Up until recently they were read on behalf of the victim but more recently they have been read directly by the victim to the court.There have been tensions about what should be included in a victim impact statement. The tension is usually between the judiciary on the one hand which clearly has an interest in maintaining the decorum of the court and the victim on the other who is often profoundly affected by crimes perpetrated against them and want to be able to deliver a statement reflecting their feelings emotions and usually their grief in the most sheer and stark way. That tension has to be resolved and I think that this bill goes some way to ensuring that the interests of the victim in being able to present their statement in a very clear way are preserved but also that a judge can exercise some control to ensure that the order of the court is maintained. So all of that is good and we welcome that.We should also reflect now on the pace at which victims’ rights are being developed in this country. Is it enough to simply make some gradual and incremental changes to this legislation and to these rights of victims that have been around for some time or is it time to consider a more deep-seated approach—for example a specific advocate for the victim? Is it perhaps time to consider a comprehensive or a coherent charter of rights for victims rather than appearing in this piece of legislation—in terms of their right to make a statement to the court—or in other legislation where their right is to have some assistance from the court or from Victim Support? Is it perhaps time to go beyond that and ensure that where those victims face costs associated with attending trials as many victims do particularly of serious crime—attending a hearing or attending court which may be for days or in some cases for weeks at a time—it is automatically accepted that the costs that they face in doing so would be covered by the State to enable them as the victim to participate properly and fully in the criminal hearing.For many victims it is attendance at the trial of an alleged offender and if they are then convicted attendance at their sentencing that helps to close that emotional loop or to bring some closure to them and their wider family. In particular where the offence that they are a victim of involves a homicide or a very serious assault that has materially—and deleteriously changed the life of the family member on whose behalf they are there and where they are a victim because of the loss of a functioning family member. Perhaps it is time for this House and for the Minister of Justice to consider the next step which is a more comprehensive review—or at least a more comprehensive piece of legislation—covering the whole gambit of victims’ rights and the means and processes by which victims can participate in the criminal justice process so far as it affects them.So we do support the bill. It is an important addition to our victims’ rights matrix. It will address a question that has been longstanding for many victims and their advocates and indeed for the courts themselves—that is to be very clear about the way that victim impact statements are to be dealt with how information is to be disclosed to victims and about the protection of victims’ contact details so that they cannot be further harassed or prevailed upon by perpetrators of crimes or those who would assist them or be their acolytes. It is welcome in that regard but I simply conclude by re-emphasising the plea that I have made that perhaps now it is time to do something more comprehensive and to go further. But perhaps it is also time to bring together all that victims’ rights legislation that we have in other parts of legislation so that there is now a single place to go for victims and their advocates for them to understand not only how the process works but what their rights are and indeed the obligations of the system to them. On that note we welcome the bill and we will support it.Hon MARYAN STREET (Labour):I rise to speak to the Victims of Crime Reform Bill as a new entrant to the Justice and Electoral Committee having sat on that select committee only since September or so of last year. I have not had the privilege of hearing submissions on this bill and here we are now with the bill in the Committee stage. So I have had to apply myself to it and find out exactly what it was about. I would like to take a moment Mr Chair with your indulgence just to recap on that because this bill was introduced on 18 August 2011—18 August 2011. It went to the Justice and Electoral Committee and it was reported back in a not extensive time frame on 27 June 2012 taking into account of course that there was an election between those two dates. With that obvious disruption the Justice and Electoral Committee seemed to have dispensed with this bill in very efficient order.It has come back to the House on 8 April 2014. So I think members of the public could be forgiven for feeling somewhat confused as I am about whether or not this bill is of importance to the Government because of that time frame. We are now looking at nearly 2 years since the report was presented to the House. Although I applaud transparency and I would encourage the Government to be transparent on all occasions in this case I suspect that it is transparent to everybody that it has brought this piece of legislation back to the House only because we are now approaching the next election and because it would like to have this particular notch on its belt in respect of justice issues law and order issues which people will be paying special attention to during the election campaign.So having dispensed with that little bit of cynicism and the fact that the Government has been and is in fact being transparent on this occasion I would like to recap on what the bill is about. People may remember it best I think if I refer in passing to one of the most difficult trials which received a great deal of media coverage—it was the trial of the killer of Sophie Elliott. In the course of that trial the defence of Clayton Weatherston relied on a character assassination of Sophie Elliott in a way that caused her family enormous distress as victims of that crime. I cannot think of anything worse than to be a family member particularly a parent of a child who was murdered in such violent circumstances. Therefore the rights of victims of crime came to the fore again in the public consciousness.This was something that the Labour Government as my colleague Andrew Little has just alluded to did address. I want to draw attention to the Labour Party minority report in the select committee’s return report on this bill. The Labour Party minority view said that the New Zealand Parliament has dealt a number of times with the rights and interests of those who suffer as a result of criminal offending. The Victims of Offences Act 1987 and the Victims’ Rights Act of 2002 were Labour Government initiatives and both adopted a broadly similar approach to this one: incremental changes. Again I refer to the comments that Andrew Little made in respect of the fact that it may be time for more than incremental change. But I was mindful when I was reading the bill and reading the select committee’s report on it that there is a balance that needs to be—The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to report progress. This debate is interrupted.Progress reported.Report adopted.The House adjourned at 9.55 p.m.