Goldsmith Paul: Budget DebateText is incorporated into the Bound VolumeGoldsmith Paul: Budget Debate[Sitting date: 07 June 2016. Volume:714;Page:11743. Text is incorporated into the Bound Volume.]Hon PAUL GOLDSMITH (Minister of Commerce and Consumer Affairs): I am very happy to answer the previous member’s question about what it is that the Government is doing to build a platform that people can build on. The simple answer is that—Todd Barclay: Tell us.Hon PAUL GOLDSMITH: —thank you—the most fundamental thing that any Government can do anywhere in the world is to provide stable predictable and financially sustainable government for the country. That financially sustainable government provides the platform upon which investors have the confidence to invest and it is ultimately only investment—whether it is people spending money on new plant and machinery investing in a new company or hiring a new person—that leads to jobs and growth and wealth. So that is the most fundamental thing that any Government can do when potential investors stand back and look at how the Government is conducting itself—whether what it is doing is affordable over the medium term or whether or not it has to make radical changes to its basic policy platform because what it is doing at the moment is not financially sustainable and then confidence drops and investment drops.But when they look at this Budget and this Government after 8 years of stable predictable and financially sustainable government—now with our second year of surpluses on track to reduce debt to 20 percent of GDP which is very unusual internationally continuing to produce jobs and increase earnings for New Zealanders—that gives the confidence that potential investors need. So a short answer to the previous member’s question about what we are doing to build the platform upon which people can build—it is just that. It is providing that strong stable predictable platform that encourages people to invest. That is why I am pleased with the progress that we have made in this economy. You just have to look around the rest of the world and acknowledge—[Interruption]Mr DEPUTY SPEAKER: Order! You have had your speech.Hon PAUL GOLDSMITH: You have had your speech. That is right. You just have to look around—Mr DEPUTY SPEAKER: You know the Standing Orders.Iain Lees-Galloway: I raise a point of order Mr Speaker.Mr DEPUTY SPEAKER: A point of order—Iain Lees-Galloway. He should be very careful.Iain Lees-Galloway: Are interjections now out of order?Mr DEPUTY SPEAKER: No they are not funnily enough. But they are to be rare reasonable and hopefully witty to quote Speaker Hunt as I have quoted to that particular member on many many many occasions.Hon PAUL GOLDSMITH: Yes that member was lacking in wit but I will carry on. Look Parliament is very effective at passing laws. Some legislation enables the Government to spend money and that is what we try to do wisely and that is what this Budget is all about in terms of enabling this Government to invest in quality health-care quality education proper justice and all the things that good government requires.But other legislation tries to stop people doing bad things. In my area as the Minister of Commerce and Consumer Affairs in the past couple of years we have made a lot of changes around the Fair Trading Act and the Credit Contracts and Consumer Finance Act to amongst other things stop people making unsubstantiated claims for products to prevent businesses offering unfair contracts—where unreasonable penalties and conditions are listed on say page 32 of some fine print somewhere—and to put a stop to irresponsible lending practices where fees and penalties are not properly disclosed. Those are some of the sorts of legislation that we have been passing over the past few years.But of course legislation is only useful if it is properly enforced. In my area the area that I am responsible for the Commerce Commission is the enforcer of the legislation that we have been passing over the last couple of years where we have made significant changes like I say to the Fair Trading Act and the Credit Contracts and Consumer Finance Act. Any agency with a fixed budget has to make choices about which cases to prosecute and who to follow up and who to chase and it has to make those decisions every day. I was determined very much as the Minister that we give the Commerce Commission the best chance to protect consumers and promote competition. So I am very glad that within this Budget 2016 we have provided an extra $15.2 million of operational funding over the next 4 years to the Commerce Commission. In fact the last time that the Commerce Commission funding for general markets regulation was increased was back in 2005 more than 11 years ago. So Budget 2016 actually increases that core funding for general markets regulations by 25 percent. This is very timely because as I say over the past few years we have added a lot of consumer protection law and that needs to be properly enforced.This is an area that can actually make a real impact on the lives of everyday New Zealanders. I mean one of the saddest things that I came across as a Minister—last year actually in South Auckland—was an iPhone 5 advertised for $59 a week for 100 weeks. So it was $59 a week for 100 weeks and this is an iPhone that was retailing for about $800 at the time. The new consumer affairs laws that came into effect in June last year require that traders and moneylenders be much more upfront about the total cost of the purchases and interest rates. So now under the law you would actually have to say that that equals $5900 for an iPhone and hopefully that will encourage a few people to think that that is not a good purchase.So we have changed the laws in order to try to protect those vulnerable consumers but as I say those laws need to be enforced by the Commerce Commission actively enforcing those laws. We have seen over the past few months since that legislation was passed the Commerce Commission being very active in this area and that is already having an effect on behaviour. What I am particularly pleased about in this Budget is that we have now been able to give extra resources to the Commerce Commission so that it can continue to push further in trying to improve the standard of behaviour and the conduct of some of those groups working in the moneylending area.It is worth just traversing a couple of the cases. Just this month the Commerce Commission announced the successful prosecution of the Twenty Fifty Club which was just one small step in a very complicated process. In December 2013 the commission started to investigate a Mr Marsich and the Twenty Fifty Club a pay-day loan business targeting low-income customers in Manurewa. Just to give you an idea there was a history of using offensive weapons including a meat cleaver to threaten customers and enforce compliance with loan terms which included a 7-day repayment window. The commission consequently filed charges under both the Fair Trading Act and the Credit Contracts and Consumer Finance Act and charges included failing to disclose loan information to borrowers charging unreasonable default and establishment fees falsely claiming to be a registered financial services provider and a member of a dispute resolution scheme and failure to supply information required by the commission. This month the Twenty Fifty Club and Mr Marsich were found guilty of 16 charges most notably around unreasonable fees. Fifty percent of the original loan amount per week was his standard fee—50 percent of the original loan per week was his standard fee—and he will be sentenced in the coming months.Protecting vulnerable consumers against unfair lending practices like these is one of the central drivers of the legislation that we passed and I am very pleased that this Budget gives extra resources to the Commerce Commission to get out there and hold those people to account and to root out some of those worst practices. I suppose the broader point I would make is that although you can pass laws and you can have those laws properly enforced the broader picture is about trying to improve the basic money skills or financial capability of New Zealanders as a whole and particularly those vulnerable communities. That is why this Government puts such resources into budgeting courses through the Ministry of Social Development but also the work of the Commission for Financial Capability that coordinates the national strategy for financial capability which is all about making sure that the various arms of Government that are working in this area and many areas in the private sector that are working in this area are all pulling in the same direction so that over time we have better resources available in schools and better-equipped teachers in order to teach this area to schoolchildren up and down the country.So that combination of passing laws having them properly enforced and over time building financial capability is I think a very effective way of dealing with what can make a real difference to the lives of many families up and down this country. On that basis it is one small part of a broader Budget that is providing that confidence and certainty for New Zealanders to invest and get ahead. I commend this bill and this Budget to the House. Thank you.