Clark David: Insurance (Prudential Supervision) Amendment Bill — Second ReadingText is incorporated into the Bound VolumeClark David: Insurance (Prudential Supervision) Amendment Bill — Second Reading[Sitting date: 20 August 2013. Volume:692;Page:12651. Text is incorporated into the Bound Volume.]Dr DAVID CLARK (Labour—Dunedin North):I have to start by saying that this legislation the Insurance (Prudential Supervision) Amendment Bill has introduced a rare outbreak of consensus in the House at least thus far. Even after that scintillating address from Mr Goldsmith I do not think we will see many people marching in the street over this legislation despite—Paul Goldsmith: It had gravitas.Dr DAVID CLARK: Well Mr Goldsmith is telling us that he spoke with gravitas. I will let the viewers at home make their own assessment. But as I say there will not be people marching in the street I do not think even after that scintillating address with gravitas in the way that there are people upset by say the Government Communications Security Bureau (GCSB) legislation which we have seen before this House today. I understand that 66000 people signed an online petition on that and that was nearly twice as many as debated snapper.The ASSISTANT SPEAKER (Lindsay Tisch): Order!Dr DAVID CLARK: This piece of legislation attracted just four submissions—just four submissions—which is a long way I think members of this House will agree from the amount of interest in those other areas which I shall not go any further into at this point.Mr Goldsmith himself is to be congratulated on steering this legislation through. I did not have the privilege of sitting on the Finance and Expenditure Committee as it dealt with this legislation but I have worked with many of the members on it before. I know that they do work well and constructively together and they have brought this bill back to the House very quickly. If this side of the House was to be critical at all of the way in which this bill has progressed it would be—Paul Goldsmith: There’s no need to.Dr DAVID CLARK: —of the stopping and starting nature of its progress. Mr Goldsmith says that there is no need for that but I think the viewers at home should understand that this bill does come into effect to take over from the transitional period which the previous Act covered which expires in September this year. So suddenly there is an urgency to get this bill through the House.It is housekeeping legislation as Mr Parker has drawn attention to but it is housekeeping legislation that is now being rushed through due to the perhaps incompetence of the Government’s management of the House. We certainly have seen a lot of urgency and extended House time in the House this year and also in terms of the legislation itself there are a lot of “Henry VIII” clauses in legislation certainly in the Inland Revenue Department stuff that has been dealt with through that same committee dealing with matters related in terms of revenue and so forth. We have seen clauses in legislation that have been intended to cover up for stuff-ups that might subsequently happen. Certainly the student loans area has seen lots of legislation that has not been able to be implemented and has subsequently caused the Government embarrassment. So it has become fond of these “Henry VIII” clauses. I am pleased to say that there is none in this particular piece of legislation and that is because it is a very simple piece of legislation which has widespread agreement and it is simply tidying up a couple of simple matters.The area that the Reserve Bank is getting the powers in is to do with monetary policy. We do know that there are a number of things that are not in this legislation that might in fact be more useful and more usefully debated perhaps if the Government was able to get legislation through the House in a useful time frame and in an orderly manner and not stopping and starting. We would in fact be debating in more depth the use of macro-prudential tools such as those announced today by the Government—those loan-to-value ratios that will shut more first-home buyers out of the market. These are important issues. The things that the Reserve Bank deals with that are dealt with here in this legislation do affect a lot of people either directly or indirectly. This bill contains amendments that are largely technical issues including requiring the Reserve Bank to keep a register of licensed insurers. It is very difficult to object to such a measure I have to say. This bill also contains amendments that empower the Reserve Bank to give notice to an insurer that allows the insurer to prepare interim financial information in accordance with requirements other than the New Zealand generally accepted accounting practices (GAAP) which Mr Goldsmith referred to. It also extends the term of provisional licences of insurers that enter into an insolvency procedure before 7 September 2013.No one would argue that any of these things should not be in the legislation. We really would only be more concerned with what is not in the legislation in terms of the Reserve Bank’s powers. If the Reserve Bank was given more powers to be more flexible in the area of monetary policy we might have a more up-to-date and 21stcentury policy that kept pace with the rest of the world. Mr Parker raised the matter of the promissory of inflation targeting—I note that Mr Goldsmith had nothing to say in response to that—and the lack of economic growth and the lack of employment opportunities that this 1980s legislation has introduced and failed to correct over time. Governments of all stripes have failed to address this issue fully in my view. But it falls again to the Labour Party to raise these issues and to ask why it is not in this piece of legislation why we are not addressing these big issues in this House and why we are stopping and starting to take pieces of housekeeping legislation like this through. We might otherwise be debating bigger issues the kinds of issues around economic growth and employment that see in my area down in Dunedin the loss of 85 jobs at Invermay—The ASSISTANT SPEAKER (Lindsay Tisch): Order! [Interruption ] Order! This is a second reading speech and a second reading is what has come back from the select committee. So I ask the member to confine his comments just to that.Dr DAVID CLARK: Sorry Mr Assistant Speaker. I understand that the select committee did have a discussion about monetary policy and its wider implications which I am alluding to. I apologise if I am spreading that debate too widely but these are important matters.The Labour Party will support this legislation. We recognise that it is a sensible bill. That is why we supported it going to the select committee. That is why our members heard those submissions. That is why our members describe the bill as housekeeping. That is why our members questioned why there might not be a little bit more in this bill that actually would support our exporters so that we could have an export-led recovery in the fashion that the Government talks about but has failed to deliver upon.We have also discussed the insurance industry here and a shift from a one-in-500-year cover to a one-in-1000-year cover and there can be no disagreement with the importance of ensuring that New Zealand has adequate insurance cover and has an industry-friendly policy so that insurers are not faced with undue red tape when delivering their policy to New Zealand. No doubt that has been taken into account in the exemptions around GAAP that have been proposed which I am sure will be discussed further by Mr Bennett when it comes time for his contribution which many in this House will listen to with great interest as with so many of his contributions on insurance matters in the Finance and Expenditure Committee.Well it comes to the end of this contribution and I do wish to again stress that the Labour Party will be supporting this bill despite the reservations that I and other members have raised with the House in terms of the completeness of the legislation and in terms of its failure to address those broader issues of economic growth and employment that are affected by monetary policy that is put through this House. This is housekeeping legislation. It is not a hands-on approach. It is not hands on in the way that some of the other areas are being dealt with. When we think of the Tīwai smelter or the GCSB there is a much more active role being taken by the Government. But it is legislation that needs to go through this House. It is legislation that we welcome. It makes those changes that will make it easier for insurers to be here and to make sure that New Zealanders are supported through good times and bad. We think particularly of those who have been affected by the recent earthquakes in Wellington and the fears they may be carrying which may in some small way be alleviated by having insurers available and able to share some of the risk that goes with living in these shaky isles. Thank you.