Williamson Maurice: Border (Customs Excise and Tariff) Processing Bill — Second Reading In Committee 
Text is incorporated into the Bound Volume 
Williamson Maurice: Border (Customs Excise and Tariff) Processing Bill — Second Reading In Committee 
[Sitting date: 24 November 2009. Volume:659;Page:8220. Text is incorporated into the Bound Volume.] 
Hon MAURICE WILLIAMSON (Minister of Customs) 
: 
 I move  
That the Border (Customs Excise and Tariff) Processing Bill be now read a second time 
. The bill was introduced into Parliament in October this year and had its first reading on 15 October so I think that gives members an idea of how quickly the Government Administration Committee worked to process it to get it through and get it back. I pay tribute to the members of the committee which was ably chaired by Mr David Parker and deputy chaired by my colleague Jacqui Dean. The committee members did a superb job. I pay tribute to them all and thank them for the attention that they gave to the bill including some of the minor tweaking and tidying up that select committees often do so well to make a bill just a little bit better. 
The bill is an omnibus bill that amends the Customs and Excise Act 1996 and the Tariff Act 1988 and makes consequential amendments to the Goods and Services Tax Act 1985 the Finance Act (No 2) 1993 and the Finance Act (No 2) 1995. The amendments contained in the bill make improvements in the processing and administration of goods and people required under these interrelated Acts. The majority of amendments relate to border processing and administration by facilitating New Zealand’s international commitments or the use of new technology while other amendments improve border processing and administration generally. This bill contains three sets of amendments to improve the effectiveness of the Customs and Excise Act—which I will refer to as the Act from here on—and to meet the Government’s policy goals: amendments relating to the automated passenger processing system SmartGate six amendments to clarify and enhance the Act and eight amendments to address legislative gaps and/or uncertainties. 
In today’s international travelling environment we are faced with threats to our personal security. Those of us who have travelled internationally are well aware of the various security measures with which we must comply whether it be to protect New Zealand’s biosecurity New Zealand’s community—from for example illegal firearms offensive weapons and controlled drugs—New Zealand’s aviation security or indeed New Zealand’s immigration laws. These obligations on the travelling public have resulted in longer waiting and processing times at airports. 
To counter this the Government has announced that low-risk Australian and New Zealand passport holders will enjoy a faster more streamlined exit through border processes at the international airports at Auckland Wellington and Christchurch. As part of that automated processing through the SmartGate system will become an option for travellers holding an Australian or a New Zealand e-passport. In reviewing the Act to take account of SmartGate Customs Service officials have identified potential amendments relating to passenger interaction with the clearance process. These amendments are relatively minor. The focus of the amendments is to ensure that automated systems can be used in place of customs officers. The effect of the amendments is to allow the use of the automated processing systems at the border which will benefit the travelling public and will contribute to the Government’s objectives of improving the border-crossing experience for trans-Tasman travellers. 
The Government Administration Committee has proposed an amendment to ensure that the Customs Service provides for an alternative means of border processing that involves having a person in any new or amended automated electronic system. Having a manual processing option is already part of the SmartGate arrangements so I was happy to agree and accept this amendment in order to provide an assurance to the public that anybody who does not like machines or who does not want to use them can always use the manual alternative. I intend to propose a very minor technical amendment by way of Supplementary Order Paper 100 however to ensure that this new provision does not inadvertently impact on some existing arrangements. For example if we specified that there has to be a manual alternative to every automated process it may mean that the Customs Service would need to have a manual paper base for all its automatic database tracking of incoming passengers. This amendment will make sure that only the processing of passengers through the gate has the alternative for a human to process passengers not all the back-office computer systems which if the provision had stayed would have caused at least some doubt. 
Hon Darren Hughes 
: Sounds a bit tricky. 
Hon MAURICE WILLIAMSON 
: Well it is very straight up and down. It is not a coastal shipping type of thing. 
SmartGate will enhance the role of customs officers at the border as front-line customs officers can be redeployed to the secondary line where the intervention with high-risk passengers occurs. I reiterate that SmartGate cannot and will not be a substitute for the observation skills and vigilance employed by trained customs officers at the border but I want those customs officers putting their effort into the really high-risk big targets and not into all of the ordinary Kiwis and Australians travelling across the Tasman as part of their everyday operations. 
Six amendments are included in the bill to clarify and enhance the Act especially in relation to strengthening the Customs Service’s law enforcement capability. The amendments enable customs officers to search a vehicle regardless of whether it is being operated or is unattended and they give them the ability to use reasonable force to gain entry to effect the search of such a vehicle. The bill will create a power to arrest any person committing an offence punishable by imprisonment under the Act whether or not the person is on a craft. One of the quirks of history is that a person had to be on the craft to be arrested but once the person was off the craft customs officers could not do that. 
The bill provides that duty on goods manufactured other than in a manufacturing area become due immediately upon the manufacture of the goods. It creates a new offence of making a false allegation or report to the Customs Service that an offence has been committed while knowing that the statement is not true or of making statements with the intention of wasting or diverting personnel or resources. The bill will enable the Customs Service to use future technology in those provisions that relate to the detection of tampering or interference with goods containers or packages. It will also provide the Customs Service with the ability to require payment of debts within the 20-day time limit period where the Customs Service receives advance warning that a company has a dubious financial situation and payments by the due date are unlikely. 
I note that committee members have paid close attention to the arrest provisions which is entirely appropriate given the serious nature of this power. This particular amendment extends the circumstances where customs officers may arrest without warrant but it is consistent with the focus of customs officers’ work. I am pleased to see that the amendment has been supported by the whole committee. 
The bill also includes eight minor amendments to the Act aimed at addressing legislative gaps and uncertainties. These include amendments to clarify the provisions in the Act relating to authorised persons to allow for the revocation of a customs export delivery order in certain circumstances to allow material usually set out in the schedules to the Customs and Excise Regulations to be incorporated by reference to relocate the alcohol personal use exemption from the Customs and Excise Regulations to the Act to allow the chief executive to nominate non - customs officer employees to lay an information to allow for the suspension of a registered user’s registration to clarify that the chief executive can grant further time for the lodgement of an entry of goods for exporting in appropriate cases and to allow for the imposition of administrative penalties for entries containing an error or omission. 
The bill contains amendments to the Tariff Act 1988 primarily to allow for the faster and more efficient implementation of tariff reductions arising from free-trade agreements. It will allow material usually set out in tariff amendment orders to be incorporated by reference and will make  
The Working Tariff Document of New Zealand 
 which is maintained by the New Zealand Customs Service the legal Tariff. Following the amendments to the Tariff Act schedule 3 of the Customs and Excise Act is replaced with an excise and excise-equivalent duties table available on the Internet and in hard copy. The bill also enacts a previous decision of Cabinet to raise fuel excise duty by 3c per litre effective from 1 October 2010. 
Again I thank the Government Administration Committee very much for completing its work on this bill in such a very compressed time frame. We will be launching the SmartGate terminals at Auckland Airport on 3 December which is only a few days away and this legislation is required to allow those terminals which operate without any manual intervention to be implemented. I commend the Border (Customs Excise and Tariff) Processing Bill to the House.