Volume 671 Week 69 - Tuesday 22 March 2011 
Volume 671 Week 69 - Tuesday 22 March 2011 
[Volume:671;Page:17437] 
Tuesday 22 March 2011 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Ministerial Statements 
Earthquake Christchurch—Extension of State of National Emergency 
Hon JOHN CARTER (Minister of Civil Defence) 
: 
 I wish to make a ministerial statement under Standing Order 347 on the fourth extension of the state of national emergency over Christchurch City. On Saturday 19 March I further extended the duration of the state of national emergency for Christchurch City under section 71 of the Civil Defence Emergency Management Act 2002. It was the fourth extension of the state of national emergency since it was first declared on 23 February. 
The situation in Christchurch City has improved and water and power supplies have been restored to most residents outside the central business district. However the remaining response tasks are still challenging and require the Director of Civil Defence Emergency Management to continue exercising his powers and functions under the Civil Defence Emergency Management Act. I therefore consider it necessary to extend the state of national emergency. I will continue monitoring progress in Christchurch and make further extensions as required. 
CHARLES CHAUVEL (Labour) 
: 
 Our thoughts and strong sympathies remain with the people of Canterbury as the House discusses the renewal of the state of national emergency. There is no doubt that an emergency exists in Canterbury as a result of the events of 22 February and subsequently and that extraordinary powers are required to deal with that emergency. The Labour Opposition supports such powers being made available there. 
The Minister of Civil Defence has made the judgment that a nationwide state of emergency should remain in force for a further period. A state of national emergency is the option that the Government has placed on the table and it is therefore the only option available so we are bound to support it. We note that the powers that accrue to the Government in respect of a state of national emergency are extremely wide. Across New Zealand not just in Canterbury the Government can order the evacuation of premises and places; entry to premises; the closing of roads and public places; the removal of aircraft vessels and vehicles; and the requisitioning of goods and services. 
I asked the Minister on a previous occasion to consider whether he needs to be able to exercise those wide powers across the country or whether the Government might rely on a regional declaration bolstered by the very very broad powers that are conferred by the Canterbury Earthquake Response and Recovery Act which the House passed unanimously last year in the wake of the original earthquake. I would like to renew that request of the Minister to consider all the options on the table. On the next occasion that he reports to the House about his deliberations on the need for emergency powers in Canterbury to continue it would be helpful to be assured that he has considered those options particularly whether those wide emergency powers are required in Auckland Hamilton Dunedin and anywhere in between. 
Meanwhile we all have seen the reports that the people of Christchurch are struggling with issues such as getting insurance sorted on purchases and house transactions. Concerns have also been expressed about rising prices and rents. Many members will have already received correspondence from a wide range of people in Canterbury about the day-to-day struggles that they face. As I said earlier our hearts go out to the people of Canterbury and we continue to support them but it is useful to be reminded that they are watching us in this place and they expect us to look after their welfare in the round. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 Of course the ACT Party supports the motion. Our thoughts and prayers are with the people of Christchurch as they get over the trauma of the earthquake and look to rebuild the city. 
This is an unprecedented experience in New Zealand’s history—not just the earthquake but to have these emergency powers extended for a fourth time. Mr Chauvel is correct in saying that the powers are wide ranging. We are already seeing some considerable discontent grow in Christchurch over the exercising of the powers and indeed a failure by us and by the civil emergency personnel to explain the use of the powers to the satisfaction of the people most directly affected by them. 
I suggest at this stage that the Government respond. I suggest a Government member take a call and provide for us—this Parliament which is granting this power—some timetable for the continuation of the state of emergency. Each week the Government has come here and said it requires 7 days then another 7 days then another 7 days and then another 7 days—four times. Will the extension be requested six times eight times 10 times or 12 times? What is the expectation about the extension of the emergency powers? 
It would also be helpful if in reply the Government explains to the House and to the people of Christchurch how the powers will be exercised because it is very uncomfortable to see business owners who are directly affected not being able to get answers to what appeared on the face of it to be very simple and straightforward questions. 
Motions 
Libya—United Nations Security Council Resolution 1973 
HILARY CALVERT (ACT) 
: 
 I seek leave to move a motion without notice and without debate relating to United Nations Security Council Resolution 1973 and the developing situation in Libya. 
Mr SPEAKER 
: Leave is sought for that course of action. Is there any objection? There is no objection. 
HILARY CALVERT 
: I move  
That this House express its support for United Nations Security Council Resolution 1973 condemning the gross and systematic violation of human rights by the Government of Libya and supporting United Nations member States taking any and all measures necessary to protect civilians and civilian-populated areas under threat of attack by Libyan Government forces. 
Motion agreed to. 
Points of Order 
Voting—Accuracy of Interpretation 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. It shoots to the heart of the integrity of our Parliament and it is this: what assurance are you able to give this House that the Maori interpreters who operate in this House under your jurisdiction will not repeatedly mislead Parliament as happened on Wednesday last week? 
Mr SPEAKER 
: I can assure the member that the interpreters will give an accurate interpretation. I take it the member is referring to a vote that occurred in the House. The member will recollect I made it very clear at the time when I was recalled to the House that voting is a very serious business and that where members do not vote according to the Standing Orders their vote will not be counted. The interpreters have been instructed to make sure that they do interpret what is said by members during voting. If members do not comply with the Standing Orders their votes will not be counted. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. Thank you for that. Will the House—and if so when—get an honest interpretation of what it was that Hone Harawira actually said when the vote was being taken? So far we have not had it. 
Mr SPEAKER 
: This particular issue was dealt with at the time by the House and that is the end of the matter. It was not a case of what the member has just alleged. I dealt with the matter at the time. I was recalled to the House. The Chair of the Committee of the whole House had already dealt with the particular issue. I dealt with the wider matter when I was recalled as Speaker and that is the end of the matter. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. I do not wish to contradict you in any way shape or form; however what you dealt with was that it was the obligation of a member who stands up in Parliament to vote to vote according to the rules which are the Standing Orders of Parliament. The issue I am raising is in fact a more serious one and it is that when a member speaks in Maori and the interpreter provides for the House something entirely different which is what happened repeatedly— 
Mr SPEAKER 
: I will not let the member carry on in this vein. The matter has been dealt with. The interpreters have been instructed that they are to interpret exactly what the member says so that the Chair can assess whether the Standing Orders of this House have been followed and that is the end of the matter. That is the instruction that has been given to the interpreters. I am not going to entertain any more points of order along that line. I have dealt with that matter. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. Will this House get an interpretation of what it was— 
Mr SPEAKER 
: I have told the member that the matter has been dealt with. If he continues to raise points of order I will have to deal with him. I do not wish to do that. But the matter has been dealt with. The Chair at the time interpreted what he was advised by the interpreters in terms of the voting intention of the member I was recalled I made it clear how issues were to be dealt with in the future and that is the end of the matter. The vote was recorded as the member had intended and that is the end of the matter. The matter will not arise again so there is no further point of order. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. It is the  
Hansard 
; my question is whether the  
Hansard  
will accurately reflect what Hone Harawira said. 
Mr SPEAKER 
: The convention of the House is the  
Hansard  
records only the votes cast. It does not record particular words during voting. It records only the votes cast and there is no change to that. 
Hon DARREN HUGHES (Senior Whip—Labour) 
: 
 I raise a point of order Mr Speaker. Coming from that exchange you have just had one issue that arises is that when members vote in Maori the vote is not translated over the television or radio broadcast at that time. Given that the issue has come up I wonder whether you would take that into account. It is under your control for that to happen so that people who are watching the proceedings of the House are aware of which way parties have voted. It seems that now is a time to bring that up—while this issue about members’ understanding of te reo being used is before you. 
Mr SPEAKER 
: If the member wishes to pursue it with me further my understanding is that the interpretation of the voting taking place would be the same as during debates so the procedures to achieve the interpretation during debate should deliver the same interpretation during voting. If that is proving not to be the case I would appreciate the member— 
Hon DARREN HUGHES 
: I am sorry; I should have been clearer with you Mr Speaker. I was referring to viewers who are following it. For us in the House— 
Mr SPEAKER 
: No I mean viewers of television. The procedures that viewers need to follow to pick up the English interpretation when Maori is being used during debates should pick up the interpretation of voting as well. But if that is not happening I am very happy to check the matter out further because it should be happening. 
Questions to Ministers 
Early Childhood Education—Findings of Children’s Commissioner 
1. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
 to the  
Minister of Education 
: Does she agree with the Children’s Commissioner who has stated that “providing culturally affirming education and care was considered important for supporting parents from minority cultures”; if so what will she do to demonstrate she is listening to the views of parents? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
on behalf of the  
Minister of Education 
: Yes. The Government is always listening to the views of parents and we recognise the value of culturally appropriate early childhood services. That is why we have invested $91.8 million in community-driven initiatives based on community needs to ensure that any local barriers to participation in early childhood education can be addressed. 
Te Ururoa Flavell 
: How will she respond to the call from the report for “more community services to be available in te reo Maori.”? 
Hon PAULA BENNETT 
: We recognise that it is important to ensure that early childhood education is responsive to the different communities in New Zealand. This year early childhood education TeachNZ scholarships have been targeted at people who have experience working with Maori or Pasifika communities who want to teach in the early childhood sector. The Government also introduced the 20 hours’ free attendance at kohanga reo. 
Te Ururoa Flavell 
: Does she agree with the Children’s Commissioner that parents need more choice in childcare including greater flexibility in the hours they pay to put their babies into childcare; if so what response will she make to the recommendation that there should be better funding support for parents who choose to stay at home to look after their infants? 
Hon PAULA BENNETT 
: The Government is still considering its response to this report in conjunction with the findings of the independent task force on early childhood education which is due to report back in the next few weeks. 
Prime Minister—Statements 
2. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Why did he say on breakfast television on Monday 21 March that people earning between $40000 and $70000 a year were “really struggling”? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Because some of them are and actually some of them probably have been for a very long time notwithstanding that in the 2 years National has been in office someone earning $48000 a year has received a tax cut of $64 per week. That is because people in that category often have children they face a significant number of costs and some of those costs are unexpected like higher petrol prices. 
Hon Phil Goff 
: Are they really struggling because his Government contrary to its promise put up GST on almost everything those families had to buy including high-priced goods like milk and petrol? 
Rt Hon JOHN KEY 
: Quite the contrary actually—they received a reasonable tax cut. As I said someone earning $48000 a year has received a tax cut of $64 a week while this Government has been in office. As I have said so often if the Leader of the Opposition does not agree with the policy he should just go and reverse it. 
Hon Phil Goff 
: Are middle-income people really struggling because the tax cut that he gave to somebody on $40000 a year is about $22 a week while he gave himself and his mates on the same income a thousand dollars a week? 
Rt Hon JOHN KEY 
: I do not get a thousand dollars a week as a tax cut. The point I make is that the Leader of the Opposition has just answered his earlier question—they are getting $22 a week more. 
Hon Phil Goff 
: Is the couple with two children in early childhood education who are now paying $50 a week more because of the cuts his Government imposed really struggling because that $50 a week more for that one thing alone is more than they got for their entire tax cuts? 
Rt Hon JOHN KEY 
: I cannot say that there is not a New Zealander who is paying $50 a week more but I will say this: I will be surprised if there are too many because I fondly remember a question in the House about a month ago where the Labour member went through all of the increases and listed people paying $14 to $18. He could not come up with one solid name at 50 bucks. 
Hon Phil Goff 
: Are there a whole lot of families who are to use his term “really struggling” because with the number of unemployed going up by an extra 700 Kiwis a week many families that used to be able to meet their rent or their mortgage with two incomes are now forced to do it on just one? 
Rt Hon JOHN KEY 
: It is always possible that if somebody loses their job their family might have to survive on one income and not two. I would point out if we are talking about mortgages that the average floating rate at the moment is 5.7 percent in New Zealand; it was 10.9 percent the year Labour left office. A family with an average mortgage of $200000 would be paying $200 a week less under National than Labour. 
Hon Phil Goff 
: Are those families really struggling because their incomes have not gone up because under his Government in the last 6 months of 2010 New Zealand had one of the worst rates of growth of any developed country in the world? 
Rt Hon JOHN KEY 
: No that is not the case. If one looks at real after-tax wages one can see they have grown by about 9 percent under this Government in 2 years in office. They grew 3 percent in the entire 9 years under Labour. If the member is interested I am happy to point out to him exactly what the increase has been. Someone on the average wage in after-tax terms in the time the Government has been in office has seen their income rise from $39518 to $42214—last year alone. That was a rise of 6.8 percent. 
Hon Phil Goff 
: If any of that were true why is it that the number of New Zealanders emigrating to Australia last year was the second highest in 10 years? 
Rt Hon JOHN KEY 
: Well it is true and if the member does not believe it is true he is quite welcome to take a breach of privilege claim. I can assure members that he will not be doing that this afternoon. If the member wants to talk about people leaving for Australia he should look at the figures for the entire time he was in Government. 
Hon Phil Goff 
: If the Prime Minister thinks somebody on $40000 a year is really struggling how does he think that the person on the minimum wage $27000 a year is getting on when his Government gave that person a miserable 25c an hour extra in face of the highest level of inflation in 20 years? 
Rt Hon JOHN KEY 
: If the member thinks that 25c an hour is miserable then why is he promising all New Zealanders a $10 tax cut which equates to exactly the same number? [ 
Interruption 
] 
Mr SPEAKER 
: We will have some order. The member has been waiting for microphones to be open and has been interjecting quite extensively today. It is not good enough. 
Dr Russel Norman 
: Does he agree with the Minister of Finance’s statement from 1 February that borrowing an additional $5 billion would almost certainly lead to a credit ratings downgrade for New Zealand pushing up interest rates for Kiwi families and businesses and costing jobs; if so why in his response to the Christchurch rebuild is he proposing to do exactly that: borrow an additional $5 billion rather than strike a temporary levy? 
Rt Hon JOHN KEY 
: Yes I agree with the Minister of Finance and the reason is that the Government has decided that the most effective way of paying for that short-term build-up in debt is to try to trim its expenditure. That way we can cut out some expenditure we think is not as optimal today as it was back when it was first introduced as opposed to sending New Zealanders a bill. Under the policy being promoted by the Green Party he would be sending New Zealanders a bill for the earthquake. 
Dr Russel Norman 
: Does he agree that if he proceeds to borrow $5 billion to pay for the rebuild the bill for the New Zealand Government in interest alone will be around $250 million a year not even paying off any of the capital and that a much more fiscally responsible approach would be a small temporary earthquake levy? 
Rt Hon JOHN KEY 
: No and no because the Government will be trimming its expenditure and therefore paying off its debt. 
Dr Russel Norman 
: Does he believe that savage cuts in Government spending will have a negative impact on the New Zealand economy? 
Rt Hon JOHN KEY 
: I would not describe the proposal the Government is reviewing at the moment as “savage cuts”. The Government will in fact spend more money next year. It may like to get to a point where it— 
Hon David Cunliffe 
: That’s not what you said on Sunday. 
Rt Hon JOHN KEY 
: I am sorry the member does not understand the economics. I know Labour is struggling to come up with a finance spokesman. The reality is that one’s discretionary spend might be zero but there will be more older people in New Zealand next year getting superannuation and there will be more people taking other benefits from the Government. So no I do not agree with that proposition. 
Budget 2011—Spending Priorities 
3. 
CRAIG FOSS (National—Tukituki) 
 to the  
Minister of Finance 
: What will be the Government’s spending priorities in Budget 2011? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The Budget will press on with reducing New Zealand’s vulnerability to foreign lenders getting the Government’s finances in order and building faster growth around higher national savings and exports. Health and education are likely to receive the bulk of new operating spending about $800 million per year and in addition there will be considerable expenditure in rebuilding Christchurch particularly its infrastructure. The operating deficit could be as high as 8 to 9 percent of GDP per year. 
Craig Foss 
: Why is it important that the Government return to surplus and stop accumulating debt within a reasonable time frame? 
Hon BILL ENGLISH 
: For a number of reasons. First New Zealand as a whole has among the highest levels of debt public and private in the developed world and the debt incurred with the earthquake would push us to the limits of our comfort. Also if we can get hold of the deficit and debt we will be able to help keep interest rates low which will help with the creation of jobs and higher incomes. 
Hon David Cunliffe 
: Why is he using the 22 February earthquake as an excuse for proposing cuts to Working for Families when the Prime Minister said he was looking at cutting Working for Families less than a month before the earthquake? 
Hon BILL ENGLISH 
: There is no doubt that the earthquake puts extra pressure on the need for Government to control its expenditure but as we have done in the last couple of Budgets we are taking a considered and consistent approach and we are taking measured decisions. The member will just have to wait but there will not be anything too radical. 
Rt Hon John Key 
: Has the Minister of Finance seen comments made by the Hon Phil Goff at his press conference yesterday when he was asked a question and said in reply that he was opposed to making changes to Working for Families? To the question whether he thinks someone earning $140000 a year needs help from the Government his answer was: “Well the answer to that is probably no.” and when he was asked what about a family with two parents earning $70000 a year—whether their Working for Families payment should be changed—he said: “I’m not going to go through that because I haven’t worked through the detail.” Has he seen those questions? 
Hon BILL ENGLISH 
: Yes I have seen those and I was embarrassed to read them. 
Hon Phil Goff 
: If the Government breaks its word and cuts Working for Families can he inform the House that the money he would save by cutting Working for Families for a couple with a joint income of more than $100000 would be only about $27 million? 
Hon BILL ENGLISH 
: The Government as I said is working through a considered process of making decisions and the member can expect that we will maintain our principle of protecting the vulnerable and supporting New Zealanders through tough economic times. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. Do you believe that the Minister even attempted to answer that question? 
Mr SPEAKER 
: The member asked the Minister whether he could confirm that certain things would or would not happen. The Minister in answering said that a process was being followed. We cannot force the Minister to give a particular answer. 
Hon Rodney Hide 
: I raise a point of order Mr Speaker. I was wondering whether we could ask the Prime Minister through you to table the transcript so the Minister of Finance’s embarrassment can be more widely shared. 
Mr SPEAKER 
: I apologise to the House for being too slow to sit the member down. He knows that is not a point of order. 
Craig Foss 
: What factors will drive total operating spending over the next few years? 
Hon BILL ENGLISH 
: The Government will be slowing down the rate of growth of spending. Core Crown operating expenses will be around $72 billion in 2011-12 which is about $8 billion higher than 2 years earlier. That may be Labour’s definition of slashing expenditure; it is not ours. 
Hon David Cunliffe 
: What does he consider measured and considered about the following process: that last Thursday he said that there will be no cuts to operating spending and by Sunday the Prime Minister said that there will be no new operating spending? 
Hon BILL ENGLISH 
: That is not correct. The Prime Minister signalled early in the year that the Government would be tightening up on spending. We have set about a considered and measured process for doing so. There is no doubt that the earthquake has put more pressure on the need to eliminate some of the wasteful programmes that Labour put in place so we can use the money for better purposes. 
Hon David Cunliffe 
: The Minister has contested the presumption of my previous question. Therefore I seek leave— 
Mr SPEAKER 
: The House will come to a little more order. The member knows that if he is going to seek leave to table a document he should not preface it with that kind of language. I will give him one more chance to get it right. 
Hon David Cunliffe 
: I seek leave to table a copy of the transcript of  
Q 
+ 
A 
 on Sunday which confirms the Prime Minister’s statement— 
Mr SPEAKER 
: We do not table transcripts of recent television programmes. 
Craig Foss 
: How will the Government direct its capital spending in Budget 2011? 
Hon BILL ENGLISH 
: The Government remains committed to the programme of roads of national significance as well as reinvesting in rail and upgrading the electricity grid and in rolling out ultra-fast broadband. That is because we are committed to the long-term investment required to lift productivity and economic performance and therefore produce more jobs and higher incomes. 
Family Violence Prevention Programmes—Funding 
4. 
Hon ANNETTE KING (Deputy Leader—Labour) 
 to the  
Associate Minister for Social Development and Employment 
: Is she proposing to reduce funding to family violence programmes; if so why? 
Hon TARIANA TURIA (Associate Minister for Social Development and Employment) 
: 
 No. 
Hon Annette King 
: In light of that answer why have non-governmental organisations providers of family violence services in Te Rito programmes and child advocates from all around New Zealand heard that funding to their services is to be cut? What did she say to Maori Television last week for it to announce that there will be such funding cuts with $50 million going to Whanau Ora initiatives? 
Hon TARIANA TURIA 
: It would be wonderful if $50 million was going to Whanau Ora initiatives but the information that that person has put in the House is quite inaccurate. 
Hon Annette King 
: What did the assessment of the effectiveness of the Te Rito coordinator’s position show following the Ministry of Social Development’s report of 2009? 
Hon TARIANA TURIA 
: The decisions surrounding the programmes that the Hon Annette King is talking about will be made as part of Budget 2011. 
Hon Annette King 
: Is she proposing cuts to the It’s Not OK campaign for action on family violence which in June 2010 won the Prime Minister’s Supreme Award at the Institute of Public Administration New Zealand Public Sector Excellence Awards; if so why? 
Hon TARIANA TURIA 
: That decision will be made as part of the 2011 Budget decisions. 
Earthquakes Canterbury—Government Support for Businesses 
5. 
AARON GILMORE (National) 
 to the  
Acting Minister for Economic Development 
: What measures has the Government recently announced to help support the economic recovery of Canterbury businesses? 
Hon STEVEN JOYCE (Minister of Transport) 
 on behalf of the  
Acting Minister for Economic Development 
: This morning the Hon Gerry Brownlee and the Hon David Carter announced that the Government is committing a further $6.85 million to a targeted economic recovery package aimed at assisting businesses affected by the two major earthquakes to get back on their feet. The package has been developed in conjunction with the Canterbury business community and it is the next step in providing assistance to the business community and allowing a stronger Canterbury to emerge. 
Aaron Gilmore 
: What are some of the key details of the package announced today? 
Hon STEVEN JOYCE 
: The package covers a range of services including $1.7 million for 30 new business recovery coordinators a one-off donation of $2.5 million for the Canterbury Business Recovery Trust Fund and a $2 million fund to support visits to international markets by affected export businesses. Overall the package is aimed at rebuilding the confidence of businesses and assisting them to make well-informed decisions about their future. 
Hon David Parker 
: Is the Minister aware that a month after the 22 February earthquake most building owners and business tenants of buildings to which access is prevented have still not received communication advising whether or when they will be able to enter their business premises to obtain computers business records and the stock-in-trade that they need to restart their business and that this is putting into jeopardy the jobs of many many Christchurch people? 
Hon STEVEN JOYCE 
: The Minister appreciates the difficulty that the cordon is causing and it is a problem for businesses. But the reality is that we are talking about a very significant safety issue. Civil defence is working hard on a plan to increase controlled access for business owners and it hopes to have that in place very shortly. Until then we need to exercise patience and not lose sight of the facts that safety has to remain paramount and that the red zone remains an unsafe area. 
Aaron Gilmore 
: Is this the limit of the Government’s support for earthquake-affected businesses? 
Hon STEVEN JOYCE 
: No absolutely not. Today’s announcement is just one further element of the ongoing support that the Government is providing to Canterbury businesses. We are working with Canterbury business associations to constantly review and reassess the needs of affected businesses and we expect to take further steps to aid economic recovery in the near future. 
Economic Growth—Forecasts 
6. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: Are the downward revisions in growth forecasts a sign that the Government’s economic plan is not working? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 No. 
Hon David Cunliffe 
: So nice of him to wake up! Does he stand by his statement: “I want to stress that New Zealand starts from a reasonable position in dealing with the uncertainty of our economic outlook.”? 
Hon BILL ENGLISH 
: In that statement I would have been referring to the level of Government debt at that time which is now 2 years ago. Since then there has been a series of unexpected shocks ranging from finance company collapses through to and including a couple of earthquakes. The fact is that as the IMF said this morning when we put it alongside the level of private debt held in New Zealand we have every reason to worry about the growth in Government debt. 
Hon David Cunliffe 
: Given his admission that the Government started from a reasonable position how did his tax package contribute to the decline in the economy over the past 2 years which had him admitting the earthquake was a contributor to National’s double-dip recession? 
Hon BILL ENGLISH 
: The tax packages the Government has announced have been self-funding—that is reductions in income tax have been offset by increases in other taxes. In our view like our investment in infrastructure our focus on a better performing public sector and our support for better educational standards are all investments in the long-term improvement of New Zealand’s economic performance. 
Hon David Cunliffe 
: How can the Minister say that the tax package was self-funding when Treasury says that it was $1 billion short over 4 years and when two-thirds of the money went to the top one-third of income earners? 
Hon BILL ENGLISH 
: The member is not correct in those particular facts. The fact is that this economy under the stewardship of Labour became severely unbalanced. We set about reducing consumption and excessive housing speculation by increasing taxation on those activities and encouraging investment savings and exports by decreasing tax on those activities. We believe that is in the best interests of the economy in the long run. 
Hon David Cunliffe 
: Does the Minister stand by his statement in this House last Thursday that “The cost of the earthquake will essentially be borne by the Government’s balance sheet rather than by cutting operational spending …” or has that changed since the Prime Minister went on television on Sunday? 
Hon BILL ENGLISH 
: As I have pointed out a number of times the significant costs of the earthquake are being incurred as we speak—for instance the Government is spending probably up to $150 million in the current month on just welfare support. There is no way we can make significant operational savings in the very short term to offset those costs. So we will be borrowing the upfront costs of the earthquake and of course we need to get back to surplus quickly so that we can get on top of that rising debt. 
Hon John Boscawen 
: I seek leave to table a statement from the New Zealand Institute of Economic Research on the effect of the earthquake on New Zealand’s growth— 
Mr SPEAKER 
: Is this a statement it has released or a statement from the media? 
Hon John Boscawen 
: It is a statement from the New Zealand Institute of Economic Research released at 12 noon on Monday this week 21 March. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Hon John Boscawen 
: I seek leave to table a statement from Westpac also dated Monday 21 March outlining the impact of the earthquake on the Government’s accounts and GDP growth. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Documents by leave laid on the Table of the House. 
Hon David Cunliffe 
: I seek leave to table a transcript of Radio New Zealand  
Nine to Noon 
 on 28 January 2011— 
Mr SPEAKER 
: We do not table transcripts. I could see that the House had some unease about the media release of the New Zealand Institute of Economic Research but it was my judgment that the House should have the benefit of deciding whether it wanted those releases tabled. But we do not table transcripts of recent television or radio programmes or recent press statements. 
Earthquakes Canterbury—Government Support for People Affected 
7. 
KATRINA SHANKS (National) 
 to the  
Minister for Social Development and Employment 
: What is the Government doing to support Cantabrians through the earthquake recovery? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 We are focused on getting Cantabrians through the recovery and back on their feet. For my department alone this cost has totalled over $160 million or $5.7 million a day since the February quake. 
Katrina Shanks 
: How is Work and Income supporting those who have been left without jobs as a result of the earthquake? 
Hon PAULA BENNETT 
: Work and Income staff are doing a remarkable job but we have also started up an employment hub. It has been set up and will be fully operational from this week to support businesses and employment needs. The hub will be staffed by the Ministry of Social Development the Inland Revenue Department the Department of Labour Te Puni Kokiri and the Canterbury Development Corporation. 
Hon Annette King 
: How many workers from national and multinational companies have been eligible for and received individual assistance from Work and Income and what guarantee can she give that any error in processing of claims by Work and Income will not disadvantage already stressed and struggling workers? 
Hon PAULA BENNETT 
: I do not have the number of individuals to hand but I can assure the member that we found particularly in the early days that we had individuals applying for job loss cover as well as their employers. Obviously communication was hard between them in the early days so we had double-ups. We have been looking at what we need to do in relation to that. But to date it seems to be working out and the policy in relation to that is to always err on the side of helping the individual. 
Early Childhood Education—Findings of Children’s Commissioner 
8. 
SUE MORONEY (Labour) 
 to the  
Minister of Education 
: Does she support the findings of the Children’s Commissioner that small group sizes improve the quality of care and education for infants and toddlers? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
on behalf of the  
Minister of Education 
: Yes that is why we have minimum requirements for adult to child ratios and a minimum requirement for the number of children to space. 
Sue Moroney 
: Is the Minister concerned then that the Children’s Commissioner found that group sizes need to be reduced for under-2-year-olds just days after the Minister changed the regulations to allow group sizes for under-twos to increase—in fact to treble—allowing up to 75 babies in one area when the maximum was 25? 
Hon PAULA BENNETT 
: I do not think that the member understands the policy change made in that respect. What was changed was not the centre size but that a centre would not need more than one licence to have more than 50 children. So as a consequence we still have the actual rules and regulations around the ratio of space per child. That has not changed. 
Sue Moroney 
: Did she read this section of the report of the Children’s Commissioner: “Some centres can have up to 25 under-2s in one space. With high numbers and little open space the … teachers reported that babies lacked the spacial freedom to move and toddlers were sometimes jostled and unable to experience enriched learning.”? 
Hon PAULA BENNETT 
: The member does not discuss how big that space is. The minimum requirements under National are the same as those under Labour. I have read a quote in a newspaper made by the City Heights early childhood centre in Dunedin stating that Minister Tolley was to be applauded for removing an irritating extravagant and time-wasting piece of bureaucratic red tape. 
Sue Moroney 
: Why did she decide to change the regulations regarding group size on 28 February just 6 days after the Christchurch earthquake? 
Hon PAULA BENNETT 
: I do not think the member quite understands the issue. We have changed the requirement in respect of more than one licence. We have not changed the group size. We have not changed how many children can be in a centre. What we had was a requirement for three licences if a centre had over 100 children. There was a doubling up of administration paperwork and Education Review Office reports. It was completely ridiculous. As members can see the change was commended by the sector. 
Sue Moroney 
: I seek leave to table two documents. The first document is a letter from the office of the Hon Anne Tolley dated 28 February just 6 days after the earthquake notifying an early childhood centre of the change to the regulations. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Sue Moroney 
: The second document I seek leave to table is a copy of the report of the Office of the Children’s Commissioner entitled  
Through their Lens. An inquiry into non-parental education and care of infants and toddlers 
. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Earthquake Christchurch—Consequences of Borrowing for Rebuilding 
9. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
 to the  
Minister of Finance 
: Is it fiscally responsible to increase borrowing to pay for the rebuilding of Christchurch? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes if two important conditions are met. Firstly the money borrowed would need to be invested in assets that increase productivity and benefit the economy. There is no doubt that investment in rebuilding Christchurch would meet that test. Secondly there needs to be a credible plan to pay the money back and get debt back to pre-earthquake projections in a reasonable time. The Government will lay out its plans for achieving that in Budget 2011. 
Dr Russel Norman 
: Does the Minister agree that it would be more fiscally responsible to raise a temporary levy of a couple of cents in the dollar on income to pay for the rebuild of Christchurch rather than add more debt to the Government books given the Minister’s statements that the Government already has a lot of debt? 
Hon BILL ENGLISH 
: The member is right in that we have to weigh up the costs and benefits of the different options. In respect of raising a levy there are really two reasons why we prefer not to do that. The first is that as the member and others have stressed people are already dealing with the pressures of an increased cost of living. An extra tax which would have to be fairly significant would simply add to those pressures on households. Secondly given that households are being very careful with their spending the economic growth has been flatter than expected and an additional tax is unlikely to help the economy pick up. 
Dr Russel Norman 
: Dealing with the Minister’s second argument has he seen the most recent report from the New Zealand Institute of Economic Research which stated: “Recent personal income tax cuts did not have much impact on overall spending.” and is this not strong evidence that a temporary earthquake levy on higher incomes would have very little detrimental impact on spending in the economy? 
Hon BILL ENGLISH 
: At the time that we announced tax cuts particularly in last year’s Budget we made it clear that we did not expect that the tax package would have a significant impact on spending. That was because it was largely self-funding so that money that stayed in people’s pockets because of income tax cuts was offset by money coming out of their pockets through increases in GST and increases in taxes on housing. 
Dr Russel Norman 
: Does he agree that his response to the cost of the Christchurch rebuild which is on the one hand to increase borrowing and on the other hand to make some pretty savage cuts to Government spending in the upcoming Budget is in direct contrast with the idea of sharing the burden that is embodied in the idea of a small temporary earthquake levy? 
Hon BILL ENGLISH 
: No I do not agree with all of those propositions. The fact is that any changes the Government makes in spending will be considered and reasonably moderate and certainly not radical. In our view financing the earthquake recovery by incurring debt is something we do not have a lot of choice about. As I explained earlier to the House a lot of the costs are being incurred as we speak or will be recognised in this financial year so we do not have much choice but to go ahead and borrow the money. What is important is to have a plan to pay it back. The member is right in that in fairness to all New Zealanders particularly to future generations we should take responsibility for paying back our own debts. 
Science and Innovation Business Support—Package Progress 
10. 
Dr PAUL HUTCHISON (National—Hunua) 
 to the  
Minister of Science and Innovation 
: What progress has been made in implementing the science and innovation business support package? 
Hon Dr WAYNE MAPP (Minister of Science and Innovation) 
: 
 Last week the 2011 round of technology development grants was announced. This was one of the major initiatives from Budget 2010. This year’s grants will total $48.3 million to support innovation-intensive businesses. It follows the first-year round of grants last year which saw 26 businesses receive grants totalling $92.6 million over a 4-year period. 
Dr Paul Hutchison 
: What reports has he seen of the impact of this package? 
Hon Dr WAYNE MAPP 
: Good news here: a report released today by Statistics New Zealand noted that spending on research and development had gone up by 13 percent since 2008. The total is now $2.5 billion or 1.3 percent of GDP. Business is the largest single contributor to research and development investment boosted by Government support of course and businesses are collectively spending $1 billion. Clearly the policies introduced since 2008 have had a tangible and beneficial impact. 
David Shearer 
: What has his response been to the more than 60 percent of businesses that have been turned down by his bureaucracy when seeking to obtain a technology development grant given that they would have been eligible for assistance under the 15 percent tax credit? 
Hon Dr WAYNE MAPP 
: That just shows us how popular the grant is. It is true that demand is exceeding supply. We have taken a responsible approach through our technology development grant unlike Labour’s fiscally irresponsible approach during previous years. Apparently Labour is still promising to take that fiscally irresponsible approach even now. 
Marine and Coastal Area (Takutai Moana) Bill—Public Access 
11. 
Hon JOHN BOSCAWEN (Deputy Leader—ACT) 
 to the  
Attorney-General 
: Is it Government policy that the right of the public to access beaches conferred under clause 27(1) of the Marine and Coastal Area (Takutai Moana) Bill is subject to prohibitions imposed by wahi tapu under clauses 27(2) and 78 of the bill? 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I refer the member to the definition of “marine and coastal area” in clause 7 of the bill and to clauses 27 and 78. Those clauses do not mention beaches. 
Hon Rodney Hide 
: I raise a point of order Mr Speaker. The question asked about the Government policy. It is very hard to see how the Attorney-General’s answer addressed that question in any way shape or form. It was after all on notice. 
Mr SPEAKER 
: It seemed to me that the Minister addressed the question in some detail. He referred specifically to clause 27—that was one of the clauses I remember him referring to—and pointed out that it did not refer to beaches if I heard him correctly. It seems to me that the answer was not faulty. Maybe the question needs to be fine-tuned somewhat. I feel that I cannot ask the Minister to answer further if he has disputed the basis of the question in his answer. 
Hon John Boscawen 
: Is it Government policy that the right of the public to access the common marine and coastal area which is conferred under clause 27(1) of the Marine and Coastal Area (Takutai Moana) Bill is subject to the prohibitions imposed by wahi tapu under clauses 27(2) and 78 of the bill? 
Hon CHRISTOPHER FINLAYSON 
: Much better! Yes. I also refer the member to clause 77(2) which states that any conditions on wahi tapu must be those necessary for the protection of the wahi tapu area. It does not hold that this necessarily means public access will be restricted. I also refer the member to clause 27(2) which sets out the way in which restrictions may operate. They may be temporal; they may relate to the particular area or parts of the particular area. 
Hon John Boscawen 
: Why did he tell members of the Rotary Club of Remuera last night in relation to wahi tapu areas that in terms of people walking over it he did not think access could be denied? 
Hon CHRISTOPHER FINLAYSON 
: Having referred to Mr Jones’ question about having a picnic in a wahi tapu area and people being out to lunch I then went on to discuss the possibility of a person wanting to walk over a wahi tapu area. I used the example of an urupa. It does not necessarily follow as I told the meeting that access would be denied or restricted. If however someone wanted to excavate an urupa or a wahi tapu area that may be a different question. 
Hon John Boscawen 
: I seek leave to table a transcript of part of the debate between me and Mr Finlayson at the Rotary Club of Remuera last night in which Mr Finlayson is asked a very specific question about wahi tapu.  
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Unemployment—Minister’s Statement 
12. 
JACINDA ARDERN (Labour) 
 to the  
Minister for Social Development and Employment 
: Does she stand by her statement that “this is about working together to maintain the highest possible levels of employment while we weather the downturn. We need to have a combined approach that is pragmatic respectful and effective”? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 Yes. I recently met with the Mayors Taskforce for Jobs. We hotly debated how best to join forces in order to tackle youth unemployment. We are constantly challenging each other to find better ways that policy can enable local solutions. 
Jacinda Ardern 
: How would she describe her current relationship with the Mayors Taskforce for Jobs which represents all but three of the country’s 67 mayors? 
Hon PAULA BENNETT 
: It is very good to the point where just a few days after the meeting Mayor Frana Cardno of Southland was quoted in  
Southland Times 
 as saying: “We congratulate central government for recognising the importance of our youth programmes …”. 
Jacinda Ardern 
: Can she explain why the minutes of the last meeting of the Mayors Taskforce for Jobs note that the mayors were “extremely disappointed in the response from the Minister and the disrespect with which they had been treated.”? 
Mr SPEAKER 
: I am not sure the Minister has responsibility for the minutes of another organisation. I invite the member to maybe reword her question because I think we have to be a little careful not to allow questions to expand too widely. I am sure she could bring it within the Standing Orders. 
Jacinda Ardern 
: I will rephrase the question. Is she aware of the minutes of the last Mayors Taskforce for Jobs meeting which note that the mayors were “extremely disappointed in the response from the Minister and the disrespect with which they had been treated.”? 
Hon PAULA BENNETT 
: Yes. As I say I cannot take responsibility for a minute-taker but I can take responsibility for the mayors I have spoken to—[ 
Interruption 
] I can quote back to the member about the mayors I have spoken to since the meeting who did not feel that way. 
Jacinda Ardern 
: Does she believe that her dismissal of 12 months’ worth of work by the mayors on a youth transition policy questioning what they “bought” to the table and accusing them of being a lobby group with pet projects has damaged her ability to work with local government on youth unemployment? 
Hon PAULA BENNETT 
: As previously said I do not think those minutes are a true and accurate record of what happened at the meeting. In fact we have been working very closely with mayors. I can bring an example of the Auckland social policy. I can also bring an example of the work we have recently been doing in Christchurch with councils. Certainly I value the work of the Mayors Taskforce for Jobs which has been mentioned many times. 
Jacinda Ardern 
: I seek leave to table the core group minutes of the Mayors Taskforce for Jobs dated 10 March 2011. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Urgent Debates Declined 
Earthquake Christchurch—Announcement of Recovery Package 
Mr SPEAKER 
: I have received a letter from Hilary Calvert seeking to debate under Standing Order 380 the announcement today of a $6.85 million recovery package for Christchurch. This is a particular case of recent occurrence involving ministerial responsibility. The test for whether a particular case of recent occurrence requires the immediate attention of the House is a high one. The business of the House should not be set aside just because a ministerial statement has been made even though it may be important. There must be an element of urgency that the matter must take precedence over other business. 
It is also relevant when considering whether a matter requires the urgent attention of the House to consider whether there are other parliamentary means of debating the subject. The House has before it today the financial review debate. This provides an opportunity to debate the current operations of the Ministry of Economic Development from where the $6.85 million funding will be realigned. I am not persuaded that the business of the House should be set aside today. The application is therefore declined. 
Financial Review Debate 
In Committee 
The CHAIRPERSON (Hon Rick Barker) 
: The House is in Committee on the Appropriation (2009/10 Financial Review) Bill. The financial review debate is the Committee stage of the Appropriation (2009/10 Financial Review) Bill. The time allocated for this debate is 4 hours and comprises two distinct elements. The first is the debate on the annual financial statements of the Government as reported on by the Finance and Expenditure Committee. Once this has concluded the Committee debates individual financial reviews of departments Offices of Parliament and non-departmental appropriations as reported on by the select committees. The debate on the Government’s financial position may be fairly wide ranging but the debates on individual financial reviews of departments Offices of Parliament and non-departmental appropriations should be relevant to their performance in the 2009-10 financial year and their current operations. 
The compendium of financial reviews and non-departmental appropriations for debate is on the Table. A member may have no more than two calls on each financial review. At the conclusion of the debate a single question is put on the provisions of the bill. There is no amendment to or debate on this question. The Chairperson then reports the bill to the House and it is set down for third reading forthwith. There is no debate on the third reading. 
Treasury 
Financial Statements of the Government of New Zealand for the year ended 30 June 2010 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 It is hard to imagine a fiscal circumstance where this debate of the Appropriation (2009/10 Financial Review) Bill could be more important for New Zealanders because the Crown’s accounts which this debate seeks to discuss will take a hit to the tune of $8 billion to $10 billion from the recent 22 February 2011 and September 2010 earthquakes. That comes against the background of a recession that has gone on for months and months and years and years longer than it should have done and a Government that has revised downwards its growth forecasts and revenue forecasts sequentially at every Budget update and half-yearly update making the budgetary situation worse. In these brief remarks this afternoon I will cover three key points: firstly the fiscal baseline from which this debate springs; secondly important issues to do with the earthquake response and how it is funded; and thirdly the implications for ordinary New Zealanders of the fiscal position and what it means for the rising cost of living and the squeeze on lower and middle income earners particularly. 
On 18 December 2008 the Minister of Finance the Hon Bill English—the Minister in the chair—said: “I want to stress that New Zealand starts from a reasonable position in dealing with the uncertainty of our economic outlook. We have room to respond. This is the rainy day that Government has been saving up for.” He was referring of course to the onset of the global financial crisis. The backdrop to that was that the Labour Government had left the incoming National Government with a net debt position that was actually a surplus to the tune of 4.7 percent of GDP in 2008. There was a net credit position by the time the assets of the New Zealand Superannuation Fund—which the Government has done its best to run down since then—were added to the very modest amount of debt the Government was then carrying despite the urging of the now Minister of Finance to give tax cuts that would have worsened the fiscal position and further inflated the bubble of the preceding decade. That was the starting point. 
It is sad that today’s debate is against the background whereby that relatively sound position has been beggared by two Budgets which have showed no more imagination than firstly the jeopardising of New Zealand superannuation and secondly the delivery of $22 billion over 4 years in tax cuts two-thirds of which have gone to upper income earners who did not need it. 
Hon Parekura Horomia 
: How much? 
Hon DAVID CUNLIFFE 
: Two-thirds has gone to the top third who did not need it and who did not spend it all and from whom it has been lost from the economy. It has been lost from stimulus making the recession deeper and longer keeping people out of jobs and making the fiscal position more difficult in periods to come. 
So it is no surprise to us that the recession has ground on. A little spark of hope in 2009 was snuffed out by our deteriorating position through all of last year with a negative third quarter after a faltering mid-year and with every prospect that we will have zero or very low growth in the fourth quarter—possibly even negative growth. This is not the global recession; this is National’s recession. This is the recession brought on by $22 billion of misdirected tax cuts and the lack of a growth plan. It is a human-induced tragedy fuelled by a lack of planning and a lack of imagination from that Government. 
Then the earthquake hit. That was not the Government’s fault and I think that all members of this House have been at pains to show that we are putting Canterbury first and politics second in respect of the response to that earthquake. Our top priority all around this House has quite rightly been to get resources flowing to Christchurch to stabilise and to support the people of Christchurch and to commence the rebuild. We remain in support of the Government’s broad objectives in that respect. 
But what is disturbing to me is that in the last week in particular the Government’s fiscal response to that earthquake has been all over the map all over the road like a drunk driver behind the wheel of a car. Last week the Minister of Finance told this House that it would be fine for the Government to bear the whole cost of the earthquake response be it $8 billion or $10 billion—roughly half of out-of-pocket infrastructure costs and half of lost tax revenue that has to be made up—all of it on debt none of it on expenditure reprioritisation and none of it on a revenue response be that a levy or a backing off from some of those tax cuts. It was an extraordinary position and our colleague Dr Russel Norman rightly pointed out that it was a highly fiscally irresponsible position. 
There was no surprise then that on Sunday on nationwide TV the Prime Minister confirmed that it was a highly fiscally irresponsible position and he overrode it. He said that we would have a zero new-expenditure Budget in 2011. I ask New Zealanders to pinch themselves for a second. No I tell them they are not dreaming. That is not the ghost of Ruth Richardson; that is a real statement by the current Prime Minister about a Budget that will be the most radical surgery to the public sector that we have known in two decades. Coming in the middle of a recession it is a highly dangerous surgery from which the patient may not recover. It is dangerous because it will suck demand from out of the economy it will prolong the recession it will make tax receipts lower and it will create and produce a doom-loop from which this economy will be lucky to recover before the change of Government. 
It is no surprise that it took the International Monetary Fund to raise the alarm on the ninth floor in order for the Minister of Finance to be overridden on  
Q+A  
on Sunday. The International Monetary Fund is calling the shots in the Beehive not the Minister of Finance. He has been rolled in the last week—absolutely rolled. His “Whack It On the Bill Bill” strategy has been canned by the Prime Minister who has said “No no—we are going to cut the lot to pay for it.” 
What will that mean for ordinary New Zealanders? It means that firstly the Prime Minister is out of touch. He is a man who would have got well over a thousand dollars a week out of his own tax cuts because the man is a man of means. He is a man of independent and private wealth. How did he get there? It was by being one of those fancy-pants money men who brought the world to its knees in the global financial crisis. He was a paper shuffler and a money trader and he took a cool $50 million for himself. 
That is why he is out of touch today with the hard-working New Zealanders up and down the country who every time they go to the supermarket are asking how it is that their trolley of groceries is costing 20 bucks or 50 bucks more than it seemed to cost last week and how it is when they go to the petrol station it is costing them a hundred dollars to fill up a small car with gas—100 bucks. My little Toyota Prius cost a hundred bucks to fill up last week. It broke the hundred-dollar limit for the first time in history. I can afford that; I am an MP on 130 grand. That is not as much as the Prime Minister’s dividends but it is enough to get by. But a hell of lot—in fact about 90 percent—of New Zealanders are on less than that. In fact 70 percent of New Zealanders are on less than the average wage let us not forget. Seventy percent of New Zealanders are on less than the average wage and I can honestly say that I do not know how people are bringing up families with the cost of living rising in the way that it is at the moment and with a Government that does not care. Families that can barely pay the bills and that are dependent on Government support to have low doctors’ fees good-quality public schools and good-quality hospitals have just been kicked in the guts by John Key. He has said there will be no new money in this year’s Budget—ah except for the holiday highway; that is sacrosanct. There will be an exception for new missiles for the frigates; they are sacrosanct. Anything that goes to health and education will come out of something else. It will come out of stuff that ordinary people use because that seems to be the way of the world. 
In the last couple of weeks Steven Joyce has been running around cutting cosy deals with the broadcasting industry in an election year. Shame! I do not care whether he has sold his shares but those deals ought to be a breach of the Electoral Finance Act. He has also done a cosy deal with Telecom to hand the telecommunications and broadband markets back to them on a plate and beggar the rest of the industry. He may know where his bread is buttered but it is on a different side of the loaf from that of ordinary Kiwis who are struggling and finding that with rising rents power petrol and food and with GST on everything things are getting desperate. 
CRAIG FOSS (National—Tukituki) 
: 
 The previous speaker today the Hon David Cunliffe issued a statement and it shows why he is destined to be only the Opposition finance spokesman and for quite some time. His statement is pretty scary stuff. It says: “Trying to balance the Government’s budget … is no recipe for success.” How scary is that for the rest of New Zealand? How scary is that for our credit rating? How scary is that for households across New Zealand that are trying to balance their own budgets? In fact balancing a budget is a recipe for success. Showing open transparent intentions to balance a budget is a recipe for success. But to be fair to the previous speaker his statement aligns with the policies Labour has announced so far which I think add up to something like $6 billion or $7 billion of extra spending. We can read from that $6 billion or $7 billion of extra tax or $6 billion or $7 billion of extra borrowing which some day must be paid back—those are the only ways to fund the policies Labour has announced so far. 
The rebalancing of our economy is happening. After out-of-control rampant economic mismanagement after the 9 long Labour years finally the rebalancing is starting to come to play. Households are rebalancing. They are spending less. They are borrowing less. Actually they are saving more. They are responding to our tax switch of the last Budget. In fact they are earning higher after-tax incomes. After only 2 years their incomes—that is their real after-tax incomes—have gone up 9 percent versus the 3 percent over the total 9 years of the previous administration. The Government is also trying to rebalance its accounts and balance its budget. We are working hard but it was because of rampant spending that interest rates in the previous administration were at record highs and floating interest rates were in double figures and those exact statistics squeezed the rest of New Zealand into having to borrow against their own house to start to at least try to live. Labour’s $2.8 billion of extra spending year after year after year squeezed real jobs real families and the real economy and actually has made the job of rebalancing the economy now so much harder. Unfortunately the total bill for the tragic episode in Christchurch has been estimated to be between $10 billion and $20 billion. The cost to the Crown has been estimated to be somewhere between $5 billion and $10 billion. We are still learning about those figures. The previous speaker seems to blame events in Libya and the Middle East on this current Government. Sorry we might want to be able to affect the price of oil and what is going on over there but we cannot. The Government is doing with its accounts what it is asking every single New Zealander to do. 
Every single tax dollar is a precious dollar. Every single tax dollar is a precious hard-earned dollar. It is imperative that households which are rearranging their own affairs and rebalancing witness and watch the Government do the same thing with the money it takes from them in the first place. Every single borrowed dollar—every single borrowed dollar—is a charge against all New Zealanders. Therefore it is imperative we optimise and prioritise all Government spending to get the best most efficient and most effective outcomes in this very capital-constrained world we live in. No one of course wanted the natural events that have come to pass around the world. No one of course wants the war-like events that are happening around the world. But we need a robust economy we need a robust balance sheet and we need robust forward projections to be able to sustain such shocks in the future. 
This Government has found so far $4 billion in savings—$4 billion in savings after only 2 years. That is $4 billion that does not have to be borrowed and it is $4 billion that does not have to be obtained through taxation. We can contrast that with the $6 billion of extra spending announced by the Opposition so far. Labour continues to confuse the cheque book with the balance sheet. Press release after press release after press release seem to say that Labour members must have failed Accounting 101 or sixth-form economics or something. A cheque book is somewhat different from a balance sheet. Those members should take a bit of time to look that up because their promises so far and where they are going will leave New Zealand in dire straits. 
STUART NASH (Labour) 
: 
 That speech made by Craig Foss was astounding. That member said New Zealanders are responding to the tax switch. Well I will tell him how New Zealanders are responding. They are responding by going in ever-increasing numbers to food banks by going in ever-increasing numbers for budget advice and by going in ever-increasing numbers to creditor courts. If that is the sort of response the National Government wants from New Zealanders then I am ashamed. It is a disgrace—an absolute disgrace. 
I stand during the Committee stage of the Appropriation (2009/10 Financial Review) Bill to talk about the financial review of Treasury and more specifically the $6 million spent by Treasury over and above the amount allocated in Budget 2009-10. I have only two points to make: the first is that the National Government has no plan; the second point is that Labour does. 
Treasury is not a big department when compared with many others but it is most important. Treasury provides financial and economic advice to the Government. I wonder what the $6 million worth of extra money spent on providing advice resulted in. I wonder whether it was the sort of advice that ended up with very wealthy New Zealanders—New Zealanders who earned over $1 million a year or more—getting a tax cut of about $1000 a week. Yet those who are on the median wage in Napier as in most cities have ended up with a tax cut of about $5 per week. What sort of advice is that? There are 650 people in New Zealand who earn $1 million or more. Every one of those people received over $1000 a week more yet thousands and thousands of New Zealanders received around $5 a week. That is simply not fair. The National Government is not working for the vast majority of Kiwis; it is working only for its very wealthy mates. I say as do the vast majority of people who come into my office that the National Government is out of touch. Its members simply do not understand how hard it is for hard-working New Zealand families to make ends meet. They do not care about those who are on the median wage who receive just $5 a week in tax cuts and who are facing an increase of $20 a week in their food bills. Those members are so out of touch and they simply do not care. 
The thing that astounds me is that the $6 million overspend by Treasury resulted in only two plans for economic growth. The first was to mine national parks and the second was to sell State assets. When is a plan not a plan? When National is so desperate that it comes up with the plan to mine national parks and sell State assets. That is no plan because this Government has no plan. It is as simple as that. 
With an extra $6 million Labour would ensure that advice sought is on how to create jobs how to provide opportunities for the nation’s children and how to create a future for the nation’s grandchildren. Labour believes in giving all a fair go not just those who earn substantial amounts of money. Advice from Treasury to a Labour Government after November—if Treasury wants to be heard—will never ever include a suggestion to sell State assets because unlike the National Government Labour will never sell State assets. Labour has a plan for the future that gives all New Zealanders a fair go. Labour has a plan for the future to make sure that everyone who wants to work has a job. We have proven that we can do it. When Labour left office there was 3 percent unemployment and now 160000 New Zealanders are out of work—160000 New Zealanders are out of work. I tell members that the National Government has no plan to get those New Zealanders back into work. It has no plan to create jobs for good hard-working New Zealanders. Thank you. 
DAVID BENNETT (National—Hamilton East) 
: 
 The debate in the Committee stage of the Appropriation (2009/10 Financial Review) Bill is shaping up to be a classic debate between Labour and National. Labour does not have a plan it has no direction and its members come to this Chamber and try to use fear tactics on ordinary New Zealanders; that is what they do. They go out there and prey on the most vulnerable people in society. They try to scare them although they are saying: “We’re here to help.” What does Labour want to do to help ordinary New Zealanders? It wants to tax them more. Labour’s answer to Christchurch would be to tax the good hard-working people of New Zealand; that is Labour’s plan. That is not a plan. That would actually kill the economy. That is not the economic plan we need when the economy needs growth; it needs production and it needs the tradable sector to be effective and to provide a future for New Zealand. That is the difference between National and Labour. Labour is based on fear tactics. It tries to keep people down and says: “You don’t know what can be done. We will redistribute. We will take that money off you.” National on the other hand understands economics and through its coalition partners understands that we need a growing economy. A growing economy means more revenue coming to the Government and more revenue to the Government means we can pay off our debts. More repayment of debt means that we can pay off what Christchurch will need to rebuild and we can build an even stronger economy a stronger country and a strong Canterbury going forward. National provides a vision that will work. Labour provides a vision that is based on fear tactics keeping people under the thumb so that Labour can control their votes at election time. That is the simple rhetoric Labour brings out. 
Let us have a look at the reality of what economics demands. It demands prudent management and it demands that we invest and have savings. Economics demands that we have a plan for the future that leads to growth and a Government that can sustainably use that growth to— 
Hon Annette King 
: What is the plan? 
DAVID BENNETT 
: The plan is that we will get savings and investment and we will not tax ordinary hard-working New Zealanders just to keep in Government as Labour did year on year. National does not believe in taxing people just to stay in power; we believe in giving people the opportunity to make this country stronger and better and therefore able to pay for whatever we need to do as a Government or as in this case to pay for the terrible tragedy that befell the people of Christchurch resulting in the need to rebuild that great city. That is the fundamental difference between the two political parties. 
At the next election that fundamental difference will be shown in the economic field because the people will have a choice. They have a choice of being told that they do not know what they can do that they need fear tactics and that they need a Labour-Green approach where hard-working ordinary New Zealanders are taxed to pay for things. Or they have a choice where they see a future for New Zealand—a future that is long dynamic and successful. Our future the National Government’s future is the right future and it is the future that will be sustainable long term. We need to invest in and grow this economy long term. Growth is not just a short-term requirement to pay for Christchurch. Growth is the long-term answer so that our people stay in this country and so that we can deliver the social services and the standard of living we want. It is the long-term answer; New Zealanders want that. They do not want a Government that will use fear and prey on the tragedy of Christchurch to try to keep itself in Government. New Zealanders want a country that is built on growth that is successful and that provides a future for New Zealanders so they stay here and do not want to go to Australia. That is the future National has and will continue to deliver through the rest of this year and going forward. That is a stark choice for New Zealanders—a choice they understand and very much support because they know what is important long term. New Zealanders know that they need to have that kind of economic growth to enable a country to provide those services. 
Aaron Gilmore 
: Ambition versus scaring. 
DAVID BENNETT 
: It is. As my colleague has said it is ambition versus scare tactics and that is the difference. It is an ambitious plan for a New Zealand that can be a successful country where we can have pride in ourselves and where we can deal with any situation. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 This is a very strange debate we are having in the Chamber this afternoon. It is a very strange debate because the Government has no clothes. The Government is presenting itself on this occasion as being fiscally responsible. Actually the Government is not being fiscally responsible. If we look at the options that the Government has in terms of paying for the Christchurch rebuild we see that there are three basic options: to cut spending to borrow more or to raise more revenue. The most responsible approach would be to raise more revenue because that would protect the Government’s books. If members’ concern is fiscal responsibility then money should be raised to cover the costs of the rebuild. In fact the Government plans to borrow the money. This is a borrow-and-hope Government. 
Of course the presentation of the National Party—and this is what is core to the National Party—is that it is the fiscally responsible party. It wants to present itself to the world as the party that will safely look after the books in Government. In fact we have many quotes from the Minister of Finance where he talks at some length about the problems of increased borrowing. Just recently on 1 February Mr English said in relation to the Labour Party plan which he claimed would lead to $5 billion worth of more borrowing that $5 billion worth of more borrowing would almost certainly lead to credit rating downgrades for New Zealand thereby putting up interest rates for Kiwi families and businesses and costing jobs. Well that is a fair statement from the Minister of Finance. 
The question then is why the Minister of Finance and the Government are proposing to dramatically increase borrowing to pay for the rebuild in Christchurch. The most fiscally responsible thing to do is strike a temporary levy. If the Government wants to pay for the rebuild it should reach out to fellow New Zealanders who actually want to contribute to the rebuilding of Christchurch and strike a temporary levy so that everybody in New Zealand who can afford it would contribute to the rebuild. At the end of that process we would not have Government debt to pay for it because we would have paid for it out of a temporary levy. We would not have had to cut spending as this Government is proposing to do. 
When we look at what options the Government is choosing we see it is going down the path that will increase borrowing and cut spending quite savagely. The Prime Minister’s comments at the weekend for anyone who was paying attention are very very scary. The Prime Minister said that there will be zero new spending in nominal terms. That means a very significant cut in real terms. If inflation is running at 5 percent—we will see what the price of oil does—then there needs to be a 5 percent increase to keep things where they are. The health budget tends to run higher than general inflation so there needs to be a higher increase just to stand still. So if the Government is proposing that it will keep nominal spending flat then it is talking about a savage cut in real spending. Those are the kinds of cuts we have not seen since 1991. This will be a “black” Budget. We have not had a “black” Budget in New Zealand since 1991. If the Government does what the Prime Minister told the country on the weekend that he plans to do we will have a “black” Budget this year because the cuts in Government spending will be savage. 
If people think that that is pretty bad because there will be very significant real cuts on top of that the Government has said that it wants to put more funding into health and education even while keeping a cap on nominal funding overall. If $600 million to $800 million is being transferred out of the rest of the Budget to be put into health and education that means the cuts in the rest of the Budget will be even more savage. Not only does the funding have to be cut because in real terms it is dropping given that inflation is not being accounted for but on top of that another $600 million to $800 million has to be found to transfer into the health and education budgets. It means that we are looking at multibillion-dollar cuts maybe in the order of $4 billion in the rest of the Budget. Those are very very significant cuts. 
People who think that it is easy to find that money—just to snip a little bit here and snip a little bit there—are kidding themselves. If we cut Working for Families for everyone earning above $100000 then we might save $20 million or we might save $50 million depending on how we calculate it. That is peanuts compared with the $4 billion worth of cuts that the Government is now talking about. It is not easy to find multibillion-dollar cuts in the Government’s Budget outside of health and education. 
Hon BILL ENGLISH (Minister of Finance) 
: 
 It is good that the Greens have got a position of some principle on the Government’s fiscal position and that the co-leader of the Greens has set out the fact that there are some choices; they are quite legitimate choices and the Government will get to weigh them up one way or the other. As explained in question time the Government has decided that it would be better to reduce spending when it is low-priority than to put on a levy. It is quite possible that another Government would make a different decision. That stands in stark contrast to Labour whose views on this are— 
Craig Foss 
: Forming! 
Hon BILL ENGLISH 
: —forming perhaps—still fluid. Labour’s views are certainly impossible to describe to anyone else who is not part of its own little internal squabbles over economic issues. 
Hon John Carter 
: And then they don’t know either. 
Hon BILL ENGLISH 
: Well I do not think those members do. It is a bit like the position on the GST increase when the Government went through a public debate. There was a high degree of understanding in the public mind about the increase in GST well before it was announced—which was not the style of some of our former Ministers of Finance in this place who just announced all the big packages on the day—so people understood the increase. Labour members understood what the Government’s position was but even with the time since the 2010 Budget those members still cannot make up their minds whether they are for it or against it. They took the bus out in the “Axe the Tax” campaign but after a couple of stops no one would get on it so they started taking the axe to each other instead of to the tax. But we hear the axe coming back again with the worry about the—well Labour almost lost the Mana by-election. That was meant to be about campaigning to get rid of GST but Labour still almost lost a safe seat. I do not blame the candidate completely; I think it was the Labour Party rather than the candidate. So those members still cannot make up their minds. 
Hon John Carter 
: Aren’t they for and against it? 
Hon BILL ENGLISH 
: Well they are for and against it. I think they are for and against income tax cuts and I think they are against a GST increase; they are just not going to do anything about it. 
I suspect it will be the same with the discussion about how the earthquake rebuild is financed. Labour will be unable to make up its mind about whether it supports the reductions in expenditure and the more strongly controlled Government expenditure that will be required to get the New Zealand Government’s accounts back to surplus. But we are certainly aiming to do that. The earthquake has made the job more challenging. If it had not been for the earthquake with tight Government expenditure we may have been able to get back to surplus perhaps as early as 2013-14. We will never quite know now. The Government set out on the path early in the year to control expenditure more tightly then the earthquake came along. We have to meet the earthquake costs. They are not choices in the way a lot of our Government programmes are choices. The earthquake costs do not amount to choices but we will aim to get back to surplus. 
Of course the fiscal discipline will not end as soon as we get back to surplus. By that time the New Zealand Government will have a higher stock of debt which will sit alongside a very high stock of private sector debt. Both the private sector and the Government will face a challenge over the next 10 years or so to try to get their stock of debt down. 
Why do we worry about that? It is simply because of the kind of events we have seen go on in the last 6 months which none of us would have forecast 6 months ago: a large-scale earthquake in Christchurch and a disaster on an even grander scale in Japan which may affect us through its impact on the Australian economy if not directly on our economy where it is a relatively small trading partner. So we are at the edge of our comfort zone. In fact we are probably past the edge of our comfort zone with the amount of debt the Government will be racking up over the next couple of years. 
The Government accounts that we have been debating and the Budget we will be debating in this House in a few months are focused on getting the Government’s books back in order at the same time as rebalancing the economy to where it is going to earn more than it spends through growth in the tradable sector and relatively speaking a shrinkage in the non-tradable sector. I have to say that it will be a fairly long job. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 I thank the Minister of Finance for his intervention. He acknowledges the problem of debt that the Government has yet the Government has chosen not to use the instrument that would have resulted in a reduction in Government debt and that instrument is a temporary earthquake levy. The way in which a temporary earthquake levy would work is that if we were to strike it at 1.5 percent on incomes between $48000 and $70000 and at 3 percent on incomes above $70000 and if at the same time we were to delay the cut to the company tax rate which is due to drop shortly we could raise around a billion dollars a year in a temporary earthquake levy. For someone earning $50000 a year that would be an extra 50c a week in tax. For someone earning $70000 a year it would be an extra $6 a week in tax and for someone earning $100000 a year it would be an extra $23 a week in tax. 
An extra $6 a week in tax in order to rebuild Christchurch is a very very important way for us to do the rebuild without going into debt. An extra $6 a week for someone on $70000 is 1½ cups of coffee. Literally 1½ cups of coffee is what most New Zealanders would be willing to contribute if it meant that we could rebuild Christchurch without going into serious debt. If we go into serious debt of just under $5 billion we find that the cost of servicing that debt is $250 million a year. So Government members are saying that they want to rack up $5 billion in debt which will cost the taxpayers of New Zealand $250 million a year to service. Then on top of that as the Minister of Finance has repeatedly pointed out it will drive up interest rates right across the economy because the Government is going into further debt. So every person in New Zealand who has a home mortgage will pay a higher interest rate because Government members do not have the common sense to have a temporary earthquake levy so that we do not have to go savagely into debt in order to pay for the rebuild. 
A temporary earthquake levy is one of the options we have on the table. It is an option that the Minister of Finance and the Government have chosen not to take. I think that is a mistake because we have an opportunity to reach out to New Zealanders who are willing to contribute to the rebuild of Christchurch so that everybody right across the country kicks in a few bucks a week and over the course of a few years we pull together the money we need to pay for the rebuild. The alternative is that we go seriously into debt which adds to the interest payments of the Government which also puts upward pressure on interest rates for all mortgage-holders right across the country. 
We actually have a choice here. We will end up paying a temporary earthquake levy or we will end up paying higher mortgages on our homes so that we will pay the money to the overseas lenders or we will pay the money to ourselves and not go into debt to pay for the Christchurch rebuild. These are the genuine options that we have before us. We can have a temporary earthquake levy we can cut spending or we can increase borrowing. The Government has chosen to cut spending and increase borrowing. I think that they are poor choices and that we would do much better to have a much more fiscally responsible approach. 
The other thing I want to touch on briefly in talking about the Government’s strategy is what came up during question time in relation to the price of petrol. The Prime Minister described the increase in the price of petrol as an unexpected one. There is nothing unexpected about an increase in the price of petrol. Not only is it expected but it is predictable; not only is it predictable but the Greens predicted it. In fact I say to the Minister of Finance that the price of petrol will continue to go up and we need to factor that into the building of our infrastructure. It is completely insane in a world of rising petrol prices to throw all of our money at new motorways. That is not a sensible rational approach to increasing petrol prices. 
When petrol prices go up we should invest in the alternatives to the private motorcar and the use of petrol. Instead the Government is throwing billions of dollars at new motorway projects. There is a deep insanity and irrationality in the Government’s throwing more money at new motorways. In terms of the Puhoi to Wellsford road we can make that road safe for $300 million instead of the $2 billion new motorway project. We have done the costing to make that road safe because it is unsafe. We can improve the safety of that highway for a fraction of the cost. 
Hon Sir ROGER DOUGLAS (ACT) 
: 
 Where are we currently economically speaking and how did we get into our current position? In terms of income per person if New Zealand were considered a state in the Anglo world we would be 81st out of 82 such countries. We would be behind Prince Edward Island behind Tasmania and behind New Brunswick. Of these 82 countries the only country with a per capita income lower than ours is Wales. We have to ask how we got to that position. We need to remember that 100 years ago we were first and 50 years ago we were in fourth or fifth position. We might well ask what the heck has happened since. How did we get into the mess we are in? How have we managed to make ourselves so poor in relative terms? 
If we want to look at that we might look at where we were a few years ago compared with Singapore and where we are today. In 1960 New Zealand’s GDP was three times that of Singapore. By 2015—and probably earlier—Singapore’s GDP will be three times ours. Singapore has gone from having a level of GDP that was one-third of ours to having a GDP that is three times ours. We have to ask how that has happened. 
In a word it was productivity. In the end we get higher wages only through higher productivity. If we look at productivity per worker we find that in Singapore it is $182000; in New Zealand it is $93000. In the period between 1984 and 1996 our productivity grew quite rapidly. It has been in the years since 1996 that we have had problems. Why is it that we have gone down and Singapore has improved so rapidly? In a word I guess it is about policy. I will highlight some of the policy differences that have made the difference in terms of Singapore’s growth rate its improvement in productivity and therefore its increases in wages. 
First there is taxation. Singapore has a zero tax on incomes up to NZ$21000 then a tax of 2c on incomes from between $21000 and $35000. In other words Singaporeans pay virtually no tax until they earn beyond $35000. They reach the top rate of tax only when they earn $320000 and that rate is 20c in the dollar. We on the other hand reach our maximum rate at $70000 and that is a major difference between Singapore and New Zealand. It is one of the reasons they have shot ahead compared with New Zealand. 
The other area is expenditure. Government expenditure in Singapore is 17 percent of GDP. New Zealand’s expenditure by various measures could be as high as 50 percent according to one answer the Minister gave but the figure I would use is about 42 or 43 percent. The thing that has killed New Zealand more than anything else is the massive increase in expenditure that took place in this country after 1996 and more particularly from 2000 on. If one looks at the amount of Government spending per person one will see quite a big increase between 1970 and 1984. Government spending actually went down per person in real terms between 1984 and 1996 but then there was an absolutely massive increase in Government spending from 1996 to 2009. 
I think that was outlined in an article I wrote called “How the Labour Government Robbed You Blind”. It sure as heck did. It was responsible for a massive transfer of about $25 billion to $30 billion from the private sector to the public sector. The increase in Government expenditure that took place during that period of 12 years was $7567 per person. It had gone down by $320 in the 12 years before but then it went up by over $7500 per person over the 12 years from 1996. We saw essentially under a Labour Government an increase in expenditure of $30000 for a family of four. Members might well ask what this country got under a Labour Government when it increased expenditure by such a massive amount. It certainly went up quite dramatically under National between 1996 and 1999 but it went up primarily under Labour. I think a lot about what people could have done with that $30000 for a family of four. What did they actually get for that money? Most taxpayers are not really sure what they got for that increased size of Government. 
But it is not only in those areas. Certainly tax policy and expenditure are important but productivity has also hugely increased in areas such as health and education—it has hugely increased. In Singapore the Government spends only 3 percent of GDP on health. The private sector has a much larger role. In New Zealand we are looking at Government expenditure on health being 10 percent of GDP. It is 9 percent at the moment but it will soon be 10 percent. Under Labour we did not see an improvement in productivity in the health area over 6 or 7 years; in fact we saw the productivity of doctors in the health sector in New Zealand actually decline by 15 percent. We saw a decline in the productivity of nurses by 11 percent. Overall the decline in productivity in the health sector was I think 8 percent. One might ask how the rate for doctors can be 15 percent and for nurses can be 11 percent yet overall there is a decline of only 8 percent. The answer is that there were actually improvements in productivity in those areas that were largely covered by the private sector in public hospitals in New Zealand. 
I think we need to look at where we are going because unless we improve productivity we are going to fall further behind. In the public sector in areas like health and education we have the wrong focus. We are focused on the wrong things—for example we are focused on class size. I have asked probably 100 audiences around the country—and it is my request to members in this House—to hold up their hands according to whether they would want to put their sons and daughters in a class of 35 with a quality teacher or a class of 15 with a mug teacher. I have not had anyone hold up their hands for the poor teacher yet. We need to improve our productivity in all these areas and if we do not we are going nowhere. 
AARON GILMORE (National) 
: 
 I will go back to a few things raised by the Opposition—in particular the complete ranting about the Government’s lack of a plan for the economy. I will go back to the six key things that people keep forgetting about. This Government is spending more on infrastructure than anyone has ever spent before. We are spending more on education than anyone has ever spent before. We are spending plenty more money on innovation thanks to Minister Mapp sitting in front of me. We are spending plenty of money in turning round and getting rid of waste in terms of lack of resources and bureaucrats. We are putting plenty of effort into dealing with crime and getting things put in place. Those are the key parts of the Government’s economic plan. 
The report we are debating today was released in early February. The key aspect of what has happened between then and now is that on 22 February the town I was born in and grew up in suffered a tragedy—a massive tragedy that probably cost the lives of about 180 people. New Zealand has changed as a result of that tragedy and my home town has changed as a result of that tragedy. We need to think carefully about what that might mean for our fiscal accounts. There has been much debate by many people on the other side of the House about some of the options and choices that that gives us. From my perspective we have limited choices. We have to rebuild Christchurch. Christchurch makes up about one-sixth of the New Zealand economy. Not only does it make up one-sixth of our economy but it is a more productive part of the economy than other parts of New Zealand. More exports come out of Canterbury than almost any other part of New Zealand and it has much higher levels of exports per capita than any other part of New Zealand. 
The tragedy we have incurred will cost our country about $15 billion. We are very lucky in that most of that cost is insured money that will be paid for by people having been prudent and having put insurance contracts in place. Some money has to come from the Government and I think that is one of the key reasons why we are starting to make some tough key decisions about our choices in the future. You see we do not have a giant piggy bank of money sitting there to pay for things. I wish we did. We have made choices in the past that mean we do not have a giant piggy bank of money. So we have to make collectively some tough choices about how we will pay that $15 billion. There are options in place for us to make some tough calls and spend it on the things that make the most sense. 
We have had a series of community meetings in Christchurch in the last 2 weeks. They have been attended by about 3000 people in total. I can tell members what the feelings of those people are. Those people have strong feelings about the future of Christchurch and about the role of the Government in that future. I know that the gentleman currently sitting in the Chair the Hon Rick Barker sat in on one of the smallest of those meetings and listened to some of those people’s views and opinions. They are worried and concerned about their futures in New Zealand and they want guidance from the Government to provide them with some clarity about what will happen to their jobs their homes their families their schools their roads and everything else that makes up their lives in this country. This Government is one that will provide that. 
Yes that will mean that some time in the future there will be tough decisions made about things we probably do not really need right now because there are some other things we do really need right now and they will need to be rebuilt—things like schools in my area that kids cannot go to at the moment or the sewerage system that is currently floating through the Avon River. About 80 percent of sewage from Christchurch is floating through the Avon River through our wetlands and out through the beach. It is like the forests that I normally go mountain-biking through. There are 240000 tonnes of silt and demolition material in that massive recreational area which 800000 people a year used to go through. Those are the things we have to fix before we can get back to growing our economy the way we want it to grow. 
Despite all the things that have happened over the last 2½ years—global recession global credit crunch a series of one-off economic disasters ranging from our first earthquake to our second earthquake and Pike River in between—it is remarkable that the Opposition seems to think that nothing has changed. It is a bit like a drunken sailor who keeps going from town to town spending his money everywhere he goes and having spent everything turns up to the next place and thinks he can borrow money from his mates. Then he turns round and thinks he can borrow money from another mate. He turns up at home and borrows it from his mum and dad and still thinks he can keep spending the way he has been spending in every single town. 
We cannot keep doing that; we have to think very carefully. That is the reason this Government has taken prudent positions and prudent decisions on the way forward. That is wise not just for me but for my children. Those decisions mean that my children will stay in New Zealand in times to come. Those are the reasons why we have to rebuild our country—particularly my home city—in the way we really want it to be. That will not be easy. The easy option is to jump on a plane and leave for Australia. The tough decision is to stay here and make New Zealand the way we all want it to be. For my home town in particular that will be a long hard road. 
GARETH HUGHES (Green) 
: 
 Kia ora Mr Chair. I wonder how many Government MPs were boy scouts or girl scouts when growing up. I wonder because if they were they have forgotten the Scout motto “Be prepared.” When it comes to New Zealand’s vulnerability stemming from its dependence on oil we are as unprepared as we could be. 
Oil is the lifeblood of the modern economy. We are so dependent on oil that when prices seriously fluctuate or rise as seen in the previous oil shocks of 1973 1979 1990 and 2008 those fluctuations have preceded global recessions. Morgan Stanley says that sharp increases in global oil prices pose the biggest threat to the global economy and in New Zealand we are particularly vulnerable. A parliamentary report entitled “The next oil shock?” found that as a country we are reliant on oil imports and heavily dependent on cheap oil for our major sources of income. 
New Zealand is highly exposed to oil shocks. I recently released research showing that every US$1 price rise in a barrel of oil wipes out between $40 million and $60 million from New Zealand’s annual gross domestic product and destroys between $22 million and $33 million in household spending. Oil is pervasive and is in everything from fertiliser to food to furniture. New Zealand is particularly vulnerable because of our transport sector which is 99 percent dependent on oil. In total oil makes up over 30 percent of our nation’s imports. 
Right now we are just a few cents shy of the highest petrol prices in our country’s history. People are feeling the pain at the pump. The last time petrol was over $2 a litre in New Zealand thousands of people switched to public transport in their droves but they found public transport lacking. In Wellington the sector literally went to the museum to pull carriages out of retirement to deal with the capacity crisis. So in facing another period of volatile and increasing price pressures is our Government prepared? In the absence of a national plan I asked the Minister of Finance whether he would finally support an inquiry into how New Zealand can best prepare its economy for the effects of high oil prices. His response was “Probably not.” 
New Zealand is one of the few countries with no modern strategy to deal with oil price shocks. Last year the Government turned down a Green Party request for an inquiry that was made at the Finance and Expenditure Committee. Less than a month ago the UK Government released its carbon action plan which has more than 130 actions to reduce emissions and that country’s dependence on oil. Yet New Zealand an internationally outlying country is unprepared and is relying on the “She’ll be right.” attitude. In short the Government has no plan and no plan to start planning to reduce our dependency on oil. 
The Minister of Finance believes that the best strategy is for people to see the price signals and change their behaviour accordingly. I ask how people can have a real alternative to paying more to fill their car like cycling more when we lack safer cycling facilities. How will someone near the now-closing Muri railway station north of Wellington change their driving commute and catch the train when their station closes? How will an East Coast logging company transport logs to the port on anything other than trucks when their rail line closes? Without a clear plan people lack alternatives to respond to those market signals and on the flip side the Government has a plan to increase New Zealand’s dependency on oil and vulnerability. The Government still intends to invest some $10 billion on motorways further locking us into a car and oil-dependent future and increasing our national emissions. The Government is idly standing by as New Zealand looks set to lose four regional rail lines from a sudden desire to extract a profit from the lines which have faced decades of asset-stripping and under-investment. 
We have asked the New Zealand Transport Agency what oil price assumptions were used in its latest models for the roads of national significance. We found that oil was not even factored in at all. It is irresponsible as petrol hits over $2 a litre that the Government still has its head in the sand on the role of oil prices in its transport planning. The responsible solution to reducing our vulnerability is an inquiry leading to a strategy and the redirection of funding to public transport infrastructure like the Auckland CBD rail loop or a light rail link for Wellington and better walking and cycling options. We need to protect our economy by decoupling the economy from its addiction to oil. We are a resilient innovative can-do nation. Let us take a leaf from the Scouts and be prepared. 
Report noted. 
Ministry of Economic Development 
Hon DAVID PARKER (Labour) 
: 
 I struggle to see why we should approve any funding for this Minister for the Ministry of Economic Development. I know that is a little harsh and I do not really believe that because there is some machinery of government work that the Ministry of Economic Development has to continue to do. But why we should give the Minister more money for the support that he receives in his office from the Ministry of Economic Development or for some of the other things that are funded through this Budget I cannot see. We had a National Party that when it came to office said it would lead New Zealand to a brighter future. Do members remember that? National talked about a brighter future and said its key to a brighter future was that it would develop the New Zealand economy so that it became more profitable. 
One of the things that National kept saying to us was that it would bridge the wage gap with Australia. What has happened since? Has the wage gap grown or has it decreased? It has gone up and by a lot. The wage gap with Australia continues to grow. The Minister of Economic Development during the year under financial review was asked about that in Parliament. He turned up and was questioned as to whether the wage gap with Australia has gone up or down. He got the answer wrong; he did not even know. So then the big spin machine came out of the National Government and the Prime Minister came to the Chamber the next day and tried to manipulate the figures by using some purchase price parity figures—figures adjusted for purchase price parity. He said that on that basis the wage gap had narrowed. But of course when we looked at that we found the Prime Minister was wrong too. At the time TV3 accused the Prime Minister of being too slippery by half. It used the words “too slippery”. 
On that measure as a consequence of that we have been trying to get the Minister of Economic Development at least to say what the milestones are if that is the Government’s objective by 2025 by which time many members of this Parliament will sadly be dead most of the sitting members will have retired and no one from National will be accountable for the promise that it made. Given that it is a meaningless promise and National does not even know where it is getting to halfway through that period we have asked it to give us some milestones. We have asked National to give us something by which it will be held accountable. We asked whether it could at least agree that if by the next election the gap is still getting wider it will have failed. National would not accept that as a target. So we asked it to promise that it would get the wage gap back to where it was when National started in office. It would not even agree to do that so we have not been able to get any milestone by which the Government will be held accountable. 
What other promises was the Government making at the time? It said it would cause a step change in the New Zealand economy. That was another of its promises. I cannot see any line item in the Budget that describes an initiative to get towards National’s step change in the New Zealand economy because the Government has given up on that lingo too. That term has dropped out of the Government’s lexicon; we no longer hear Government members talking about a step change in the New Zealand economy. 
I was really embarrassed at the other failure by the National Government to do what it promised to do to curb the flow of people to Australia. Why was I embarrassed? Because I am a member of Parliament who thinks we should not make promises to the electorate that we will not keep. Another of National’s promises was to stop the great flow of people from New Zealand to Australia. What has happened? Last year that flow was the highest that it has been in the last decade bar one year. The figure is the second-highest in a decade. When Julia Gillard was here recently she said she liked having New Zealand as a provider of talented well-educated people as a source of labour to make Australia’s economy grow. We are losing too many of our best well-educated and productive people to Australia. 
What is the Minister for Economic Development doing in response to that? The answer is very little. During the year that is under review we saw the failed attempt to mine national parks. National said the big difference between New Zealand and Australia was mining and it would mine New Zealand’s national parks and other schedule 4 areas. There was an outcry against that as there ought to have been partly because the Government was exaggerating the difference that mining those areas would make and partly because doing that was just wrong in principle. In the end in the face of public protest the National Government backed down on that proposal but it did not replace it with a new policy. 
Now we have come to the Government’s third Budget and we have been told by Mr Bennett one of the members for the Hamilton area that the big thing in the Budget will be savings. National is finally admitting after 2½ years in power that one of the big differences between the New Zealand economy and the Australian economy is Australia’s depth of savings and therefore the investment capital that is available to its enterprises to invest in more productive equipment and improve the productivity and competitiveness of its economy. Well hello? That has been obvious for a number of years in the New Zealand economy. That National did not have a plan in that respect after its members had spent 9 years in Opposition is lamentable. Indeed everything that the Government has done in respect of savings since then has been wrong. 
When we were in Government we ran Budget surpluses and that means public savings. When we were in Government we introduced the KiwiSaver scheme to encourage private savings. What did the National Government do? It undermined it. The third thing that we did whilst in Government was to establish what is known as the Cullen fund to through public savings help pre-fund superannuation and by doing so increase the depth of our savings and investment in New Zealand. For National to say after 2½ years in office that the focus of the next Budget in terms of economic development will be savings is a sad indictment on the lack of a plan on the part of this Government. It obviously has an inadequate plan so much so that the New Zealand Institute produced a report which I thought was a very clever flick at the Government stating that a goal is not a strategy. I think that might have been in reference to the Government’s 2025 goal of bridging the wage gap with Australia but having no strategy or accountability for milestones in the meantime. 
Mr Brownlee has had to go away to perform duties in Christchurch post-earthquake. Good on him for doing that and I wish him well in those efforts. We now have the Acting Minister for Economic Development present in the chair. We have asked him about his economic plan for lifting us out of the economic malaise that New Zealand is in. We are in a second recession—National’s recession. Over half of the latest re-estimation of Government revenue and economic growth was caused by factors other than the earthquake yet National says the earthquake is the cause of all its problems. We have not heard from the Acting Minister one new idea—not one. We have rising unemployment bigger gaps with Australia and dropping tax revenue. The only way we will get out of this mess is through improved economic growth. 
“Bomb cases” as commentators have described them such as the United States and the United Kingdom are bouncing out of recession and what is happening in New Zealand? We are heading into a second recession. The economic malaise continues and we have no alternative vision for growth being shown in New Zealand. Instead we have the Government saying it is all the fault of the earthquake. Of course the earthquake has made New Zealand’s problems worse but it is not the underlying cause of the malaise. The underlying cause of the malaise—low growth in jobs and low economic growth—is mismanagement by the National Government. 
Hon DAVID CARTER (Acting Minister for Economic Development) 
: 
 I was not going to take a call but a comment such as that from Mr David Parker who has just resumed his seat cannot go without being challenged. The first thing I will do is take an opportunity to remind the member that he has selective memory loss. Let us consider the early 2000s when New Zealand had the best opportunity for economic growth that the globe had seen in Mr Parker’s lifetime. He has the audacity to say that Labour established a pattern of Budget surpluses yet when Michael Cullen handed over the reins he left us with a legacy of facing 10 years of Budget deficits. That was the legacy of the previous Labour Government. 
The member further does not realise that having successfully won the election we faced a global financial crisis—the biggest financial challenge the world had seen since the 1930s. The member may have also failed to notice two earthquakes that have devastated my home city and caused a loss of life. He then said he would take away my budget. I tell him that I was in Christchurch today when we announced another package to assist businesses in Christchurch. I want Mr Parker to stand and say in the Chamber today for the benefit of those businesses whether he and his Labour colleagues support that package for Christchurch businesses. 
Hon Annette King 
: Yes of course we support it. 
Hon DAVID CARTER 
: Oh they now support it. So Labour members want to take my budget from me but also expect me to deliver support packages to Christchurch businesses to help them get through their economic crisis. It is no wonder Labour is struggling to poll over 20 percent. In fact the people who give Labour 20 percent support need to have a serious look at why they have bothered to support it. 
I will give Mr Parker a lesson on the economic plan of this Government. We need to get our tax system sorted out and we have moved to do that—but Labour opposed that measure. We established a substantial amount of investment in innovation and again Labour opposed that. 
Hon David Parker 
: I raise a point of order Mr Speaker. The debate is on the 2009-10 year not the 2010-11 year. The Acting Minister seems to be confused about that. I ask that you bring him to order. 
The CHAIRPERSON (Eric Roy) 
: It is an interesting point of order. The debate is on the 2009-10 financial year and current operations. That does not mean that any member can get into the estimates. It covers current operations. I am listening carefully. 
Hon DAVID CARTER 
: It is typical of Mr Parker to take such a frivolous point of order when he cannot win the debate while he is on his feet. This Government has a very established economic agenda which was well and truly elaborated to Mr Parker when he worked on the financial review while sitting on the Commerce Committee as a freshman member. He ought to refresh his mind that the examination in that financial review was very much about what this Government was doing. There was a lot of mention of our broadband strategy. There were 10 years of neglect of ultra-fast broadband by Mr Parker and Ms King when they had a chance to do something about it. This Government has stumped up with a magnificent programme involving $1.5 billion plus an associated rural broadband package— 
Hon Annette King 
: Not 1 metre has been laid. 
Hon DAVID CARTER 
: —and again Annette King continues to decry it. She cannot have it both ways. 
Hon Annette King 
: Yes I can. 
Hon DAVID CARTER 
: Only Ms King would try to have it both ways. Only she would try to go out to the public of New Zealand and acknowledge the good things we are doing and then come into this House and try to argue against them. That sort of presentation to the public of New Zealand is exactly the reason that Labour continues to poll at around 20 percent and I do not think it has much chance of lifting that between now and 26 November. 
Report noted. 
Ministry of Health 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 It is a pleasure to participate in this debate. In the last couple of days the Government has told us that health and education are safe—health and education are safe. As the “slash-and-burn Budget” comes before the country in May the Government tells us it is OK because health and education are safe: money will be redirected to the health system. 
The truth is that the health system is operating in significant deficit. We know that before the last Budget just for health expenditure to stand still we needed to see an investment of $555 million or $600 million. That amount was needed just to stand still but that investment did not come from this Government. This Government under-invested by $150 million. Programmes in public health and primary care were cut as the district health boards—pushed by the Minister to look at his manufactured targets and meet his slogans rather than the actual needs of the communities around them—were getting in there and making sure that those targets and league tables were met while primary care and public health were let go and under-invested in. 
This year—I know I can talk only a little about current operations—we will see a hole in the health budget of around $700 million. Mr Key and Mr English have told us that there is only $600 million to $800 million for everything in health and education. Mark my words: we will be back in this Chamber debating a Budget that will show a cut in health spending. Government members will say more money is going into health but everybody involved in the health system knows that health inflation an ageing population and the increasing costs of buying equipment because GST has gone up—all of those things—mean that just to stand still in the health sector it will take $600 million or $700 million. This Government will not be making that investment; this Government will be making cuts. 
This Government has lost its focus on the core part of the health system. As my mother would say prevention is better than cure. But the Minister of Health is not interested in prevention; the Minister is interested in looking good with his targets and charts that say that he managed to improve elective surgery even though the Auditor-General’s report on elective surgery which we await with interest might actually be telling a different story about how people get their surgery. 
I will leave that issue to one side. We have reviewed the district health boards’ performance and we have learned that they are following the money. They are following the Minister’s targets which means public health and primary care are being cut back. Everywhere I have been in New Zealand since I have been the spokesperson on health for Labour—from Wanganui to Rotorua to Nelson—I have been told constantly that the cuts are coming in public health primary care and mental health. That is a problem for the future of New Zealand. Although the Minister’s priority might be to look good in the health portfolio and have a nice colourful chart the priority for New Zealanders is affordable access to quality primary care. That is not happening at the moment. 
That is not happening when it comes to after-hours care. When I was in Rotorua I was told by a doctor the story of somebody ringing his clinic just after 5.30 wanting advice about whether they should bring in their child. She said that if it was after-hours and the cost was going to be $40 or $50 then she would not bring in her child. The doctor said that she had better come in. When they came in the doctor found that the child was potentially suffering from meningococcal disease. If that mother is deciding whether to take her child to the doctor on the basis of how much it costs rather than how sick her child is then there is something wrong in our system. The Minister needs to take some responsibility for what is wrong in our system. 
People in Queenstown are paying $102 to take a baby to after-hours care. That is wrong. 
Hon Tony Ryall 
: That’s not true. 
GRANT ROBERTSON 
: They are. That is exactly what they are doing. Someone on the Kapiti coast is being charged $41 to take a 20-month-old to get a cut lip repaired at 5.30. That amount represents 20 percent of that family’s grocery bill. Something is wrong. That person asked me whether Mr Ryall wants her to go to the emergency department at Wellington Regional Hospital. Is that what the Minister wants? It is the wrong priority to send people the signal that primary care and public health are not important. 
Hon TONY RYALL (Minister of Health) 
: 
 The National-led Government continues to grow and protect the public health service in New Zealand. The Government continues to grow and protect the public health service in New Zealand as we move public money into the areas of priority. In the last 2 years under this National Government we have employed over 500 extra doctors and over 1000 extra nurses in our public hospitals and we are close to having a thousand fewer administrators. We are employing 500 extra doctors 1000 extra nurses and close to a thousand fewer managers. We are also investing very heavily in the New Zealand health service. We put in an extra $750 million with our first Budget keeping up with population change and inflation. Last year we put an extra $512 million into health keeping up with population change and ageing and using the benefits of reprioritisation within the health service. 
We are delivering for New Zealanders. Every week 400 extra New Zealanders are getting elective surgery compared with any week under the Labour Government. 
Hon Steve Chadwick 
: It’s all about counting. 
Hon TONY RYALL 
: The member says it is how we count it. Four hundred extra people are getting operations. Labour members do not like that. The more they do not like it the louder they get. We are also treating more and more patients faster than previously in our country’s emergency departments. People will remember that on the North Shore and in many parts of the country old people used to languish for 3 days on end on hospital trolleys under bright fluorescent lights. North Shore Hospital was described as the weeping sore of the public health service. This Government pushed aside the Labour lackeys in Waitemata and put money into a new emergency department—$50 million that Labour said no to. We said yes and we are speeding up the emergency department in Waitemata.  
What is more we are providing cancer radiation treatment for New Zealanders. When the party opposite was in Government it was not unusual for New Zealand women to be sent to Australia for radiation treatment and they were waiting 12 to 13 weeks. We had women Labour Ministers of Health defending 13-week waits for treatment for breast cancer. Women Cabinet Ministers were defending that situation. In the last quarter not one patient who was ready for treatment waited more than 6 weeks. In fact right now most are being treated within 4 weeks. 
We are also investing very heavily in preventive health. We have the highest number of 2-year-olds being immunised in the history of New Zealand. Here is my favourite bit: do members remember the Labour Government’s plan about closing the gaps which became about reducing disparities? The Labour Government never did anything about the gap between Maori and the rest of the community in immunisation. We have closed that gap under a National Government. What is more we have invested hundreds of millions of dollars in a home insulation programme that has benefited over 80000 New Zealanders. The programme is having a real impact on the health of a lot of low-income New Zealanders. The health ministry put $25 million—members should wait for this—a year into that home insulation programme and Labour members described that as a cut to the health budget. We put $25 million of health money into the single most effective public health initiative in this country in the last 10 years and Labour called that a cut to the health service. 
What is more the timid party opposite put the price of smokes up by 10 percent once in its 9 years in office. It put up the price of smokes with a 10 percent increase once in 9 years—once in 9 years. We have done that three times in 20 months. Doing that three times in 20 months resulted in the single-biggest increase in the price of smokes in the history of New Zealand. Those members had one 10 percent increase in their very first year in office hoping that no one would remember it but we have put a 30 percent increase on the price of smoking in 22 months. What is more let us remember the Labour members saying: “We have a little smoking-cessation medicine here.” We have provided more people with more choice and with more smoking-cessation medicine than ever before. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 That was a fantastic amateur dramatic performance there from the Minister in the chair the Minister of Health. The Whakatane amateur dramatic society has never looked so good. The Minister is failing to remember something about a couple of the issues he raised: firstly closing the gaps. I remember National telling us that closing the gaps was a racist policy. That is what National told us but now the Minister stands up and proudly says that his Government has done it. That is selective memory from the Minister. 
It was selective memory from the Minister on smoking too because I know that that Minister and all bar two of his colleagues opposed every measure that the Labour Government tried to bring up on smoking. I ask Mr Ryall who opposed the Smoke-free Environments Act. Did Mr Ryall oppose that? Mr Ryall opposed that bill. “Old Smoky” over there Associate Minister of Health Jonathan Coleman opposed it as well while he was blowing cigar smoke all over people. This Government has no creditability to lecture Labour on smoking cessation because those members opposed all the measures that our Government put up. Labour stands proud behind people like Steve Chadwick Annette King and Helen Clark who brought those measures into play. 
Mr Ryall seems very concerned about the notion of patients going to Australia. He seems very concerned about the notion of patients going to Australia—other than the fact that of course under National cancer patients did go to Australia—but I will tell members whom Mr Ryall should actually be worried about going to Australia. He should be worried about doctors and nurses going to Australia. There has been a 300 percent increase in the number of doctors going to Australia in the last 2 years. 
Hon Parekura Horomia 
: 500 doctors? 
GRANT ROBERTSON 
: That is what he said that is right. That is what he said. But actually a 300 percent increase in the number of doctors going to Australia is the move to Australia that the Minister should be worried about. It is all smoke and mirrors with this Minister. It is manufactured targets it is being able to show off his little league table but the reality is that for people on the ground health care is now less affordable and less accessible than it was previously because this Government has decided to focus on its cheerleading targets rather than on the actual needs of people in New Zealand. 
We have to remember that the cuts that have come have come to some of the most vulnerable people in our community such as the cuts that have come in aged care. People have been called on the phone and asked “How are you feeling?” and at the end of the call they have received a cut because they have said they are feeling OK. My constituent’s father a 92-year old war veteran was called up and asked over the phone how he felt and had his home care cut and a neighbour found him on the ground several hours after he had a fall in his house—because his home care was cut by this Government. That is the kind of cut we have seen under this Government. 
We have seen cuts here in my region of Wellington to programmes in sexual health and community mental health. Organisations that have worked for years in mental health and community mental health have had their funding cut by this Government. Because the Minister does not have a target for mental health the district health boards look somewhere else. The Minister does not have a target for public health so the district health boards look elsewhere. This Minister likes to shove the problem off to other people. 
Hon Annette King 
: Where did the 500 doctors come from? 
GRANT ROBERTSON 
: Yes and we would like to see evidence of the 500 doctors who were magicked up from somewhere by the Minister. But the problem for this Minister and the problem for this National Government is that the affordability and accessibility of health care have declined under this Government and will decline further in the future as the amount of money needed to go into health is simply not being invested. This Minister might be able to throw his arms around in the air and tell us in his dramatic style about all the wonderful things that he has done but the truth is that on the ground faced with an increased cost of living and the inability to put a healthy meal on the table for many people—because it is now too expensive—people are making choices on the basis of how much money they have about whether they and their family can access primary care. That is not the New Zealand that I want to live in. I want to live in a New Zealand where people know that they can get quality health-care and that cost is not a barrier for them. Primary care public health and prevention should be the priority; sadly from this Minister it is manufactured targets and slogans. 
IAIN LEES-GALLOWAY (Labour—Palmerston North) 
: 
 There are New Zealanders out there who are saying this Government is out of touch. They are saying this Government is out of touch with what ordinary New Zealanders need and New Zealand’s health system is going backwards. The Government must be out of touch with ordinary New Zealanders because the Minister in the chair Tony Ryall the Minister of Health is completely out of touch with his own party’s stance on tobacco cessation and tobacco control in this country. He got up and said the Labour Government had been timid when it came to smoking cessation and trying to reduce the number of people in New Zealand who smoke. But it was his party the National Party that railed against everything that the Labour Government did when it was in office to curtail the number of people in New Zealand who were smoking. 
Hon Tony Ryall 
: Once. 
IAIN LEES-GALLOWAY 
: It was not once; it was on the Smoke-free Environments Act it was on the increase on tobacco excise and it was on a whole range of measures right through the 9 years that the Labour Government was in charge. The National Party voted against every single one of those measures. 
Now because the Maori Party has managed to get one little thing out of its coalition deal with the National Government Tony Ryall suddenly turns round and says— 
Hon Annette King 
: That he’s in favour. 
IAIN LEES-GALLOWAY 
: —he is charge. He is in favour— 
Grant Robertson 
: Closing the gaps. 
IAIN LEES-GALLOWAY 
: He is closing the gaps; that is right. He has had his road to Damascus moment. He has turned round and said the National Government is interested in smoking cessation. We know the truth; New Zealanders know the truth. If the Maori Party was not involved—and I have to give this to the Maori Party—National would be doing more to make sure that the tobacco companies had their way and more people would be taking up smoking. That is the truth about this Government. 
I tell members that what people are really worried about is the cost of living. As the cost of living continues to go up as this Government adds GST to people’s food bills and lets car registration and ACC costs go up people are becoming more and more worried about the cost of living. The reason they are so concerned about the cost of going to see the doctor is that that has gone up under this Government as well. The cost of seeing the doctor is going up and what is really appalling is the outrageous cost of going to see the doctor after hours. People in Auckland and Wellington are being charged up to $100 for after-hours care. In Queenstown it can be as high as $139 just to go and see the doctor. For children under 5 who are supposed to have free access to primary care in this country the cost can be as much as $102 if they happen to live in Queenstown. 
It is an outrage that the National Government has let those costs skyrocket and made it very much harder for hard-working Kiwi families to get to the doctor or to get their kids to the doctor. Sometimes if we are adults we can wait and we do not have to go to the doctor after hours but when it is our children—when it is a 2-year-old a 3-year-old or a 4-year-old—we want to get them straight to the doctor. We want to get them dealt with straight away because it can be a very scary time for parents when children are ill their temperature is going up and they are showing signs that something could be seriously wrong. If we are adults we can handle that and deal with it. We might take an aspirin and go to see the doctor on Monday. But we never ever want to do that with our children and that is why the Government should be doing more about the cost of primary care. It should be rolling up its sleeves and doing something for Kiwi families. It should be making sure that there are no barriers to access to primary care because of its cost which this Government has allowed to explode. 
The Minister got up and crowed about the $750 million extra that the Government provided in its first year and the $512 million extra in its second year. Well $750 million was simply a continuation of the funding track that the Labour Government had put in place and $512 million was actually the first cut because the Government needed $750 million just to tread water basically—just to maintain current services. The first cut was $512 million and the Government is forecasting more and more cuts over the years to come. That will mean there will be more and more cuts to front-line services: the kind of cuts we have already seen to mental health to diabetes clinics to primary care; the cuts that we are seeing right across the country. I say to the Minister in the chair that people are feeling the effect of that and it is real to people. 
This is what ordinary Kiwis are crying out for: they want their basic services to be retained. That is not what this Government is delivering. It is all about smoke and mirrors. It is all about pretend targets that the Minister makes up with no substance behind them whatsoever. He says there are 500 extra doctors a thousand extra nurses and a thousand fewer administrators. I ask where the evidence is. He will not answer the Official Information Act requests that our spokesperson has put in. He will not put it on paper. 
Report noted. 
Ministry for the Environment 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I thank the Local Government and Environment Committee for its report on the excellent performance that the Ministry for the Environment achieved in the first full year under the John Key - led National Government. First I will note the background. When National came into Government the ministry was almost in a state of crisis. Both the chief executive and the Minister for the Environment had had to resign as a consequence of a scandal that immersed this Parliament and had sapped away the motivation and the good work that we needed to do in this important space. Three chief executives in less than a year three Ministers in less than a year—it was a ministry that was crying out for a fresh start. 
The financial review shows quite stunning and progressive change that is consistent with the blue-green agenda that this Government came into office with. Let me go through some of the achievements in the financial year. Firstly the implementation of the waste levy and the implementation of the Waste Minimisation Act have seen real green growth with a whole number of new businesses from Kaitaia to Bluff starting up in that blue-green space. I will give an example. In Southland in which I know the Chair Eric Roy would have some interest there are new businesses recycling antifreeze so that that waste does not end up in our drains. That is a good programme. In the area of Canterbury we have had a new business supported by my ministry that recycles nappies into usable compost. We have had businesses start up to recycle silage wrap which is a huge area of plastics. Businesses that are recycling building waste have started up which will become particularly important with the huge rebuild job we have in Christchurch. New businesses that are using a whole range of plastic and other wastes that would otherwise go to landfill have been successfully implemented in this financial year in review. 
We have had the very successful implementation of the emissions trading scheme. Let me give members two key outcomes that are so important to New Zealand’s environmental performance. Under the Labour years despite all the rhetoric on climate change 70 percent of new generation stations built were thermal power stations—a trebling in the amount of electricity produced from burning coal. In the first 12 months of the emissions trading scheme we have seen a huge shift in investment to renewable energy—in fact 100 percent of consents granted under the Resource Management Act changes implemented by the ministry have been for renewable power stations and that is a good thing. 
After the record period of deforestation that occurred under the previous Government we have seen a welcome shift to New Zealand planting more trees than it removed in any one year. That is so hugely important in the balance. 
Let us take the issue of fresh water. Freshwater quality is another big challenge. In the financial year under review the ministry supported by this Government increased five-fold the amount it is investing in freshwater quality; initiatives in Lake Rotorua the Waikato and Lake Taupo are making a real difference. 
I will note the steps we are taking to try to get more efficient resource consent processing. The bill we passed in this Parliament in 2009 has seen a huge improvement in the efficient processing of resource consents. We had compliance levels of about only 50 percent but we are now at over 80 percent. We are heading for over 90 percent performance in resource consents being processed on time so that the work of the ministry is supporting a growing economy new initiatives and the sort of infrastructure that will support a growing economy. 
The last point I wish to make on our blue-green agenda is in terms of the Environmental Protection Authority and the work that the ministry has successfully done for that new authority. It had its first stage last year and has moved to full implementation this year. We really have a successful blue-green agenda being advanced by the Ministry for the Environment. 
Report noted. 
Department of Corrections 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 It is an absolute pleasure to speak to this report in relation to the Department of Corrections. I am extraordinarily proud of the work it has done over the last year and the fact that it is in my opinion a stand-out department. That is certainly something that was not true under the previous Labour Government. 
I acknowledge that in the past year we had a tragedy happen to corrections with the death of our first corrections officer to have died on duty Jason Palmer. I acknowledge his loss and the loss that that was for all of our staff—as well as I am sure for many people in the country who felt very deeply for him and for his family. 
However apart from Jason’s very untimely death this year has been a fantastic year for corrections. Our staff turnover has been the lowest that it has been in the last 5 years. Escapes are down to the lowest level ever—escapes from our prisons are at the lowest level ever despite the fact that we have more people in prison now than we have ever had in the past. Positive random drug tests are down to the lowest level ever—despite all the rhetoric from the previous Government they are at the lowest level ever. Community Probation and Psychological Services is now working at levels it has never worked at before. It is doing outstanding work. It was a part of the department that we came into a crisis with when we came into Government. 
We also inherited a crisis in accommodation for prisoners. We found that we were suddenly faced with looking at whether we had to let prisoners out of their sentences earlier—we certainly were not about to do that. We have now got almost 1000 extra bunks from the double-bunking that we put into our prisons. Despite all the calling from the Labour side and the fact that it left us with a prison-muster crisis there was not one word from Labour to congratulate our staff on the excellent work they have done to deal with the situation. 
We have had the container cells. Everyone will remember the container cells. Well Labour said that container cells would not happen they were a stunt and they would not be used. I announced them in about August and by September we got the funding approved. Work started on them around November and in March they were ready to go. It took about 4 months to get them ready. Despite all the rhetoric that they would be slums and that they would be inhumane I am told that at Rimutaka Prison the prisoners are basically lining up to get into them because they are so good. They are some of the best accommodation and they are about one-third of the price of a traditional build. So what we actually have is a department that is doing the most amazing work. 
In addition to that it is rehabilitating people. Under Labour only 500 prisoners a year could get into drug and alcohol rehabilitation. By the end of this year we will have over 1000 prisoners in rehabilitation—we will have doubled Labour’s number over the 3 years we have been in office. Not only that but we are now targeting people who are in prison on short sentences. Basically under Labour they had to be in there for years and years and at the end of their sentences they would finally get some help—just before they went out. Now we are getting to them early and that means we are getting to people who are in prison for crimes that are not as bad as some others. I think that is really important. It is important to get to them while they are young earlier during their time in the system so we can get them out of the system and keep them out of the system. This is rehabilitation that works. 
Sue Moroney 
: But violent crime is going up. 
Hon JUDITH COLLINS 
: Well I say to that member: “Just wait for the crime stats next week honeybun because they won’t be.” Crime is actually coming down under this National Government and I am so thrilled that it is because we are taking crime very seriously. We take it very seriously and we take victims seriously. Unfortunately the previous Government had absolutely no idea what to do. It was so soft on crime that it sent out the message to criminals that they could just keep going back to jail because it was a nice warm place to be. Well funnily enough under a National Government what we are forecasting for prisons is that they are not going to grow in number to the same extent that they did under Labour and that is because people want to get out of prison. What we are seeing as well—[ 
Interruption 
] and let us be sensible here; I know that it is difficult for the Labour Party—is that rehabilitation is absolutely paramount when we are dealing with the prison population. It is absolutely paramount to get drug and alcohol rehabilitation both in prisons and in the community. Labour never did it but National is doing it. 
CHESTER BORROWS (National—Whanganui) 
: 
 It is a pleasure to take a call in respect of the work of the law and order Minister—Minister Collins the Minister of Corrections and the Minister of Police. It is very interesting to note that nobody from the other side of the Chamber decided to jump up and seek a call after the Minister completed her speech. The reason for that is that the National Government has taken the heat out of the law and order debate. The issues that were going on within the police portfolio and within the corrections portfolio up until December 2008 have dissipated away because the Government has taken some initiative. 
This Government has built on work that was done under the previous Government around police numbers. At the end of 2008 it was obvious that if the Government did not take some action in South Auckland or Counties-Manukau in respect of where the state of affairs had got to around law and order issues and policing in South Auckland there would be some big trouble. The National Government committed to putting 300 new staff into South Auckland. What did that do? It put 25 two-manned incident cars their supervisors and their relievers on the front line 24 hours a day. What did that do? It drove down crime in Counties-Manukau. It took the number of murders down in the year after Labour left Government by 57.1 percent. 
People in this Chamber will recall no doubt as those listening on radio or television will recall the early stages of 2008 when we had a horrific number of aggravated robberies and murders in the South Auckland area. People will remember for instance the murder of Navtej Singh and a number of others and that the terrible situation there was put down by the then Prime Minister to the effect of the “mother of all Budgets” and by the police Minister to the effect of the position of the sun and the moon. Well the National Government has worked hard in this area and has had some stunning results. 
As a result of law and order policy implemented as part of the 100 days of action programme we saw the completion of the Criminal Proceeds (Recovery) Act and we have seen $36.5 million of assets seized in the first years of operations in that particular area. The P busts had a street value of $30.4 million in 2010 up by one-third over the take seized in 2009. Police safety orders were another initiative of this Government and 2773 orders were issued as at the end of January. A number of people said those orders would just be breached in any event. Actually there have been only 186 breaches. This is all good news. Do members remember the street racing crime that was prevalent under the previous Government and caused all sorts of headaches? There has been a reduction of 18 percent just in that particular area of crime. The people of Christchurch have noticed that particularly and are relieved about that. The number of confiscation orders was 49; that has shut it down completely. 
I congratulate not only the Minister in the chair but the members of the police operating under her administration and direction on the huge successes they have had. Just recently I visited the child and sexual abuse centre on Auckland’s Great South Road and was shown around there by Detective Senior Sergeant Dave Pizzini. He ran through the work that they do there and how the various agencies work together in a very collaborative way to deal with sexual offences and child abuse offenses. I was incredibly impressed with the level of professionalism that has come into this area of police investigations. It was noticeably different from my experience in the time when I was in the police. 
In respect of prison capacity and in respect of prison rehabilitation I commend the Minister for her work in these areas. I commend her for the reduced level of recidivism we have seen the enhanced number of mental health opportunities available to deal with the 65 percent of prisoners who do have mental health problems and the drug and alcohol beds that are available for the 83 percent of prisoners who have drug and alcohol issues and dependency issues. The work we have done in 2 years in Government in respect of that has resulted in a doubling of the number of beds that are available for those prisoners. 
It is great to see the level of confidence in the police has been completely enhanced— 
The CHAIRPERSON (Eric Roy) 
: I am sorry to interrupt the member but the bell is not working and his time is about to expire. 
CHESTER BORROWS 
: —and the attrition rate in the police which was very high under the previous Government is now less than 1 percent. I congratulate the Minister. 
Report noted. 
New Zealand Police 
Hon JUDITH COLLINS (Minister of Police) 
: 
 What a marvellous thing it is to be the Minister of Police in a National Government! My goodness it is fun! The fact is that we are a Government that supports the police and we can see it in the way in which the police now have the confidence to do what they need to do. Not only are the police dealing with very serious crimes and criminals such as gangs and in particular methamphetamine dealers—who took over an awful lot of people during the 9 long years of the Labour Government—but they are also able to take the assets off these criminals. The police have so far recovered $37 million worth of assets and cash including diggers—that is my personal favourite—houses farms and lifestyle blocks. It is pretty much a case of you name it and they have got it. 
But the police have not been able to do this just because of their own excellent work; there are certain things the Government has done. We have been able with our colleagues in the ACT Party in particular and with support from the Maori Party and United Future on certain issues to bring to this House 18 new laws that have made a huge difference to the way in which New Zealand is policed. 
We have also been able to bring in and approve the use of Tasers. This has had a dramatic effect on the safety of our police officers and on the safety of offenders as well as of innocent members of the public. I am sure that most members can remember the terrible tales of woe and doom that would come upon New Zealand should the police be able to use Tasers to subdue offenders who were about to do something extremely dangerous. We were told that Tasers were a tool of torture. Well they are not in the way the New Zealand police use them. We have seen that offenders who have been about to kill themselves or others attacking people have been able to be subdued without loss of life. This has saved the lives of offenders and in my opinion the most important thing is that it has saved the lives of police officers it has saved them from harm and it has saved innocent members of the public from harm. 
I hope the police realise and I am sure they do that this Government absolutely backs the New Zealand Police to get on with the job. We have around 12000 members of the New Zealand Police. Almost 9000 are sworn officers or as we call them constabulary staff and about 3000 are employees. All of those people are absolutely devoted to trying to make New Zealand a safer place and to keep it that way. I would like to thank each and every one of them for the effort they put into their work. We have seen so much of this in the last 6 months—at Pike River after the first Canterbury earthquake and following the aftershock in Christchurch on 22 February. We have seen police officers from those districts but also from other districts who were brought in from outside to help go to the utmost of their abilities to show humanity compassion and professionalism and make us all extremely proud. 
When I went around Christchurch on 24 February this year when we saw the Pyne Gould building the CTV building and the terrible state of almost demolition brought about by the earthquake our officers were there working with the Fire Service working with urban search and rescue and working with the other emergency services. But what I also saw were people who really understood that they were making a difference not only for the people of that area but for everybody in New Zealand. We saw our New Zealand police at their finest. We saw them making decisions that in many cases put their own lives at risk to be able to save others. I would like to thank them for that. 
By the end of this year we will have 600 more front-line police on the beat than when National came into office. I can say that that is making a difference. When I said we were putting 300 extra police into Counties-Manukau the Labour Party spokesman said it was an ill-conceived un-thought-out plan or words to that effect. What we have seen in Counties-Manukau with the extra police and the different style of policing that is going on there is crime dropping which is something that nobody would ever have thought possible. Next week the crime statistics will be released and I am very pleased to be able to say to the people of New Zealand and to this House that our police are doing everything they can to keep crime down. I am sure everyone will share the great amount of pride that I have in the work they are doing. 
The CHAIRPERSON (Lindsay Tisch) 
: Members that is the sound of the new bell just so you are aware of what it is. 
Report noted. 
Ministry of Education 
Hon DARREN HUGHES (Labour) 
: 
 Firstly I congratulate the Minister who was previously in the chair Judith Collins on the invention of having the bell not work—presumably she could have talked for ever. That was a good trick and I think everyone should at least try to do that. 
In turning to the financial review of the Ministry of Education can I first of all with your indulgence Mr Chairperson speak outside the period that is under review and thank the Ministry of Education for the work it has done in Canterbury in supporting the schools and early childhood services in that city to get to a state where many have been able to reopen in such a small amount of time. I think all members would like to thank the people in the ministry who have worked to support parents teachers and educators in that respect. 
The period under review is the one where the Government’s flagship education policy was being developed. The 2009-10 financial year was when the national standards policy was being worked through by the Government as the answer to all the problems in primary education. It would be interesting to hear from the Minister an admission that in the end the national standards policy was never actually a policy; it was a slogan. As the work that has gone on in schools since the time of the work the ministry has done in trying to implement national standards has come to pass it is absolutely clear that it was a slogan about something to say on the election campaign trail rather than an actual educational policy that could be introduced. We see that through much of the research that has been done which has come forward to show that the policy is not standing on the merits that members opposite campaigned on at the last general election. 
There is no more clear sign of that than the fact that the person at the Ministry of Education who was charged with implementing the national standards policy has upped sticks and left the position. It is interesting that a policy that we were told was designed to assist parents and was being demanded by parents has been rejected by a number of parents who serve on boards of trustees in New Zealand. There are 300 boards across the country made up of parents that are refusing to implement the national standards policy. That is a phenomenal number of boards made up of parents of children and students in our country who do not believe that this is the right thing educationally for their school. 
Tomorrow’s Schools was about ensuring that schools could fit the delivery of the curriculum in a way that best suited their community. The curriculum document that was developed under the previous Government in a non-partisan fashion has received widespread support across the education sector and from parents who see it as being an innovative and courageous curriculum designed to bring out the best in all of our students. We should have trust in our parents and in our boards to choose a range of assessment tools that are available to them in order to report back against the curriculum. Instead the national standards policy has been imposed on parents boards and schools in the country by the Government in a way that runs totally contrary to the way that the curriculum was developed as a way of unleashing potential in our schools. 
We see it with the way that 500 boards of trustees chose not to lodge their charter with the Ministry of Education this year. These may seem like small things. In fact Anne Tolley described it as a “petty protest”. But they show that committed parents who care about their children’s education enough to serve on boards of trustees are trying to express their frustration that these standards have been imposed on schools untested without research and without the work done on such critical issues as moderation. The Minister during the period of the financial review was very gung-ho about this. She was convinced that she was right. She said that there would be no concessions there would be no trials and that the national standards would be enforced on all primary schools and intermediate schools in the country. That was during the period of the financial year. 
This year John Key the Prime Minister said: “Oh well there have been some major teething problems with the national standards and one of the reasons for that is that the first year was just a trial.” So that reinforces the point that under this Minister’s leadership of the sector education has been allowed to fall into a mess because the right hand does not know what the left hand is doing. That is nowhere more obvious than in the implementation of national standards. 
There is another issue I would like to raise because I am sure we will hear about it from Government members and it is that 20 percent of New Zealand children cannot read and write. Government members say all the time that 20 percent of our children cannot read and write at a level that will get them through life and that is why national standards are in force. I would like Government members opposite who say that to let us know whether that is happening in their electorate. Members opposite always tell us how well schools are doing in their electorate yet there is this mythical electorate around the country where 20 percent of children cannot read and write. I am sure if members go on school visits and they see children who cannot read and write they would be very keen to draw that to the Committee’s attention but I guarantee not one member opposite will give us the name of a school in their electorate where 20 percent of children cannot read and write. This is why we think the national standards policy is a mess. It detracts from the curriculum which is an excellent document for transforming the lives of young people in our country. 
ALLAN PEACHEY (National—Tamaki) 
: 
 I guess it would be gracious of me to begin my remarks by congratulating the young list member opposite on his appointment as the Opposition spokesperson on education. I think that was probably his first substantive address on education in this House since his appointment. Well there is quite a bit of work to be done. But I can recommend a book or two to that member who previously spoke that he may well find instructive. In fact there is one in particular he may like to take as his Bible. 
Hon Darren Hughes 
: I’m one step ahead of the member. 
ALLAN PEACHEY 
: Ha ha! If I could be so bold in speaking to this review to say to the member who has just spoken that he has nothing to build on that his party—the Labour Party—has not really brought any education policy to the table in the last 2½ years and that on reflection I think that the best place to start would be to go back to 1999 and draw a parallel to where the economy was in that time. The Government that was elected in 1999 the Labour Government had the very best of times. Never in the memory of most New Zealanders has there been the opportunity to grow and develop this country and the same comment could be made and is being made now about the schooling system. When old dogs like myself get together and reminisce about our years of leading schools in the 1990s and that sort of thing we talk about that time as having been a dream time to lead schools. Those were times when we were free of the controlling and the ordering and the bossiness that became a feature of the last Labour Government’s education policies. 
It has to be said that schooling did not move forward in those 9 years. But at least there is a fresh face now. He was even at school probably during those dream years in the 1990s if the truth is known. I urge that member to take a completely fresh approach and as I said to read the right books. 
There are a couple of specific things that I want to talk about and one relates to special education. Special education stood still in a mire of ideology and argument and ultimately a refusal to come to grips with some pretty hard questions during the first 8 years of this century. Now at least we are getting some movement as a result of this Government. I invite any of the members opposite to get up and say that they oppose the increase in Ongoing and Reviewable Resourcing Scheme funding for the highest-needs children in our schools. They should get up and say that they do not support that. Those members should not sit there and scream and shout across the floor; they should get on their feet and tell this House that they do not support the increase in Ongoing and Reviewable Resourcing Scheme funding for the least fortunate of our children. I suspect I will wait a long time. 
I invite members opposite also to get up and say they do not support the actions of this Government in reinforcing and developing the role of special schools for our children. They should get up and say that the Labour Party does not support special schooling education. They should not shout across the floor at me; they should get up and say it so the people of New Zealand can hear them. 
I would like also to make a brief comment about the relevance of early childhood education because I suspect we will get a flurry about that in a moment. I invite the member who will deliver that little flurry—and it will be a little one—to explain to the people of Glen Innes in the Tamaki electorate that I represent in this Parliament why the Labour Party does not want their children to have a fair crack at early childhood education funding. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 In rising to speak to the report of the Education and Science Committee on the 2009-10 financial review of the Ministry of Education I am faced with a not unusual predicament. That predicament is that my greatest concern—the issue of Maori disengagement and underachievement in education which is arguably the most significant issue facing education—is barely mentioned in this financial review. I make it blatantly clear that the Maori Party is absolutely committed to enhancing Maori educational success. We want to see faster and more comprehensive improvement for Maori right across the sector. 
There have been some key achievements in education that we must take the time to celebrate. These milestones include the following: an increase in the percentage of Maori children participating in early childhood education from 87.9 percent in 2006 to 89.4 percent in 2010 a 21 percent increase in Maori students gaining a National Certificate of Educational Achievement level 2 qualification and a 5.5 percent increase in the retention rate at secondary school for Maori from 40.3 percent in 2008 to 45.8 percent in 2009. These are all significant advances and I want to take the time to congratulate the Hon Dr Pita Sharples on his role as Associate Minister of Education in his relentless drive to lift educational outcomes for Maori. 
There are still some glaring omissions that I would have thought the financial review would bring up. The main areas of focus for the review were early childhood education the new curricula the national standards and the review of special education. One would think from reading this review that there is only one language operating and only one curriculum in place. Well it may be breaking news to some but there is another curriculum Te Marautanga o Aotearoa—the Maori-medium curriculum. It is the partner document of  
The New Zealand Curriculum 
. It has been developed for Maori-medium setting levels 1 and 2 but all New Zealand schools can use this document. It is all a matter of the value we place upon ensuring excellence for Maori across all educational settings. It is not a translation of  
The New Zealand Curriculum 
; its development was based on Maori philosophies and principles. 
In my second bout of breaking news for the day there are also national standards in Maori. Nga— 
Kelvin Davis 
: Whanaketanga. 
RAHUI KATENE 
: I thank the member. Nga Whanaketanga Rumaki Maori shows the ongoing progress of tamariki in years 1 to 8 in te reo matatini which is literacy and pangarau which is maths within Maori language immersion education. Why is this so important? It comes down to the evidence that tells us that 40 percent of Maori school leavers from Maori-medium schools qualified for direct entry to university compared with 20 percent of Maori at English-medium schools. Let me repeat that: 40 percent of Maori school leavers from kura qualified for direct entry to university compared with 20 percent of Maori at other schools. That is a powerful statistic. If we want to do something about lifting Maori educational performance then we should be looking at those results and learning from them. If one group has a proven success rate that is 20 percent higher than another group would we not take up every opportunity to study the success of the first group and modify practice accordingly? 
There is another point in the financial review that I will highlight. The Ministry of Education claims that barriers to accessing early childhood education vary considerably and that fee increases are only really a barrier for solo parents or parents on benefits. The House will be aware of course that numerous studies have shown the huge importance of a child’s first 5 years. Surely we should be able to support solo parents or parents on benefits to support their children in their right to participate in early childhood education rather than just accepting it as a barrier and leaving it at that. 
Finally I want to highlight that in the coming year the Government will be facing a task of appointing new chief executives across various departments including the Ministry of Education. Our call to the Government would be that if we really want to achieve progress and improve educational outcomes for Maori we must ensure that management at its highest level is culturally competent and committed to the immediate implementation of Ka Hikitia—Managing for Success in order to plan and manage for Maori educational success. Thank you. 
SUE MORONEY (Labour) 
: 
 If one issue in the last financial year has personified this Government’s lack of a plan for the future it has to be its funding cuts to early childhood education. I know that the National backbenchers have all been told that they must deny that there have been funding cuts to early childhood education but I invite every National backbench and front-bench member to visit any one of their local kindergartens and find out from them why they have $50000 less of Government funding this year than last year—or $20000 or $60000 or whatever it may be. I want those National members to look the people at those kindergartens in the eye and tell them that they are making it up. 
Paul Quinn 
: Kohanga reo—9000. 
SUE MORONEY 
: Paul Quinn should look them in the eye and tell them that they are making up their funding cuts. Every time I debate this issue with any National member that member tells me that there are no funding cuts and they do not know what the kindergartens are talking about. 
It is even worse than that. Not only are National members in denial about it but also the Prime Minister has demonstrated that he is completely out of touch on this issue—[ 
Interruption 
] 
The CHAIRPERSON (Lindsay Tisch) 
: Continued barracking across the Chamber is not acceptable. I ask the member to tone it down. You have had a fair go. It is one all. 
SUE MORONEY 
: As I was saying the Prime Minister has absolutely demonstrated that he is so out of touch with ordinary New Zealanders on this issue. He does not understand the cost pressures on families. On more than one occasion he has said that he would be very surprised if fees increased for families. In fact he said on national television that fees would not increase but he is absolutely wrong. 
Has he talked for example to Gemma Greig? She has said that she will pay an extra $60 per week for her two children—Kaydyn who is aged 4 and Kelsy who is aged 21 months—to continue to go to the Redwood Early Childhood Centre. Has he talked to people like Gemma Greig? Has he spoken to Debra Bullock who reports that she has two preschoolers who attend Durie Hill’s Polson Park Kindergarten? Her fees are going up by $35 a week. That is an extra $35 that that family has to try to find from somewhere. Lisa Kingsford’s child Caitlin goes to Newlands Childcare right here in Wellington. It will cost her family an extra $25 a week just to stand still. 
Under this Government those families are paying more but they are getting less. Many of these early childhood education centres have told Labour members in a survey that we did that they are taking a range of measures to deal with the savage funding cuts to early childhood education by this National Government. They are doing things that affect the quality of early childhood education. They are reducing the number of staff. In particular they are reducing the number of qualified staff. They are reducing the children’s access to field trips and a whole range of things. They are also having to put up fees. Because of the short-sightedness of this Government families are being left in the position of paying more and getting less. That is happening in many many neighbourhoods and communities in New Zealand at the moment. 
Has the Prime Minister spoken to Megan Ross who is the manager of the Motu Weka Neighbourhood Early Learning Centre? She was reported as saying that that centre is putting its fees up by 50c per hour for every child. She said that for some families that will mean an additional $30 a week per child. I do not know whether the Prime Minister understands this but many people do not have just one preschool child; sometimes they have two or three under-fives because that is the stage of their lives they are at. They are at the stage where they have young children. A fee increase of $30 a week at the Motu Weka Neighbourhood Early Learning Centre will cost some families an extra $60. 
Megan Ross goes on to say that that cost increase is very significant with the price of petrol and food going up. We know that one of the main causes of the price of food going up was the GST increase by this Government. Megan Ross says that everywhere they turn they are getting hit with increases. That is what she said about the families who are using the Motu Weka Neighbourhood Early Learning Centre in Nelson. I think many families from throughout the country in lots of different neighbourhoods and communities will be able to relate to that statement. Under this Government everywhere they turn they are being hit with increases. 
Hon Dr Jonathan Coleman 
: So what answers can you give them? 
SUE MORONEY 
: The member wants to know what Labour would do. I thank him for asking that question. Labour has pledged to put back into early childhood education the funding that his Government has stripped out. We get it. On this side of the Chamber we get that early childhood education is one of the best investments we can make in this country’s future. 
The member asks why that is. He does not seem to have read any of the research regarding this issue. All the research tells us that for every dollar spent in early childhood education this country saves up to $17 in the future. That is a great return on investment. If we spend $1 on early childhood education we save up to $17 in the future. It is a perfect investment in the future. But it requires a Government that actually has a plan for the future a Government that thinks further than the end of its own nose and a Government that understands about investing in small children and what that means for the future. It requires a Government that understands that if we get it right in early childhood education then we do not have extra remedial costs in our education system and we do not have to keep building the prisons that Judith Collins was so proud of before. We do not have to keep spending money in that area if we get it right in this area. 
It is no mistake that in the Budget the Government announced last year it cut funding to early childhood education and it increased the money being spent on building prisons. New Zealanders will get used to that style of Budget if they want to keep this National Government in power because that is exactly what the future will look like for this country if we have such a short-sighted Government. 
National members claim that they had no choice. They say they had no choice but to cut the funding to early childhood education—that is when they admit they have made cuts—because of the recession. Next they will start blaming the earthquake. We will wait for that one! It is utter rubbish that they had to cut funding because of the recession. We know that as the Government cut $400 million out of early childhood education it also gave $9 billion away in tax cuts to just the top 10 percent of income earners in New Zealand over that same period of time. Does that not expose the lack of truth in the statement—[ 
Interruption 
] 
The CHAIRPERSON (Lindsay Tisch) 
: I say sorry to the member. Speaker’s ruling 43/1 states that members cannot use the phrase: “Tell the truth.” I do not know where it came from but I am warning members not to use that phrase. It is unparliamentary and it leads to disorder. I do not know where it came from but I did hear it. 
SUE MORONEY 
: I am absolutely prepared to tell the truth because this is from the Budget documents. The Budget documents tell us that the Government cut $400 million worth of funding to early childhood education at the same time as it gave away $9.1 billion of taxpayer funding to the top 10 percent of income earners in tax cuts. That is where the money for early childhood education has gone. 
Government members would have us believe that they have taken the money out of some centres and put it into creating participation in some other areas. Let us just explore that for a moment because the numbers do not add up. Government backbenchers need to understand that they are being fed a line by their Minister. The Ministry of Education website will tell them that $400 million of funding has been cut out of early childhood education in the last financial year and $93 million as opposed to $400 million is planned to be used to boost participation in early childhood education. There is a discrepancy: $400 million is being taken out and $93 million is being used to fund increasing participation. 
Where has the rest of it gone? I can tell members that it has gone into helping to fund the $9.1 billion of tax cuts given away—frittered away—to the top 10 percent of wage earners in this country. Those tax cuts did nothing to stimulate economic growth. Government members said that they were giving that money to the wealthy because it would stimulate economic growth. We now know that that stimulation never happened. Before the Christchurch earthquake even happened the Government was already admitting that there had been no growth in the economy. 
COLIN KING (National—Kaikoura) 
: 
 This Government has got it right in relation to education. When we look at the situation in early childhood education we see that it is all about giving people the opportunity that early childhood education offers. We recognise that lifting achievements in education is very important and that starts at the earliest of stages. Directing nearly $100 million towards increasing participation is about getting it right and for those people who would normally have the door of opportunity to early childhood education closed on them it is opening the door up and giving them that opportunity. 
When we look at education we see that it has been central to this Government’s plan for lifting economic potential in the long term and we see that plan starting with early childhood education. It was quite interesting that I had a small number of staff from early childhood education centres come to me early on when the policy came out for capping teacher-led services at 80 percent. For a while I was led to believe that the policy was a terrible thing. But then Louise Upston came down the wonderful MP from Taupo and we went around the rest of the early childhood education centres in Marlborough and we got a totally different story. We got a very positive story about how capping teacher-led services at 80 percent was wonderful that education centres were able to bring in very capable senior mature people who could meet those needs and that we could make the funding go so much further so much more effectively. 
I also want to concentrate on the transition from schooling to work. It is an area in which the last administration failed miserably. It threw heaps of money at it and achieved nothing. The National Government has implemented the Youth Guarantee programme. It is a fantastic policy. It has enabled children who have not really been able to find a schooling environment that meets their needs to be given a universal entitlement of free access to wananga polytechs and suchlike in courses such as automotive engineering tourism travel business administration carpentry and suchlike. It is such a common-sense approach for ensuring that those children who have a hands-on learning style are hooked into education for as long as possible because if you can see the relevance of what you are learning you will be passionate about it. 
The CHAIRPERSON (Lindsay Tisch) 
: Order! 
COLIN KING 
: Sorry Mr Chairperson. So one will see the wisdom of education and be quite passionate about it. The 4000 places that have been made available under the Youth Guarantee are a great step forward and the policy is making sure those young ones—16 and 17 year olds—do not fall between the gaps. 
Adding to that this Government is working to create a number of trade academies. This too is a further enhancement for young people who will not necessarily go to university but who will be wonderful citizens of New Zealand and who need the literacy and numeracy skills to be able to complete a trade. They therefore need to be tied into education for as long as possible so that when they commence their trades they will have the level of literacy numeracy and maths to be able to complete the distance-learning aspects of their trades. It is an area where we have been void in this country in relation to education for many many years. Too much of our focus has been on a single academic pathway leading into university. 
The biggest challenge this Government faces now—and we will address it—is how we can attract the right teachers to do the training. If we do not get the right teachers to inspire build up and create the passion we need in our students then we will have failed them which is a point that National is very conscious of. It is good to see now that the Government has allocated $36 million to support those children under national standards who are identified as being the below the Plunket line if members want to describe it that way so that we can lift them up with the skills we have. 
Report noted. 
Ministry of Culture and Heritage 
Hon CHRISTOPHER FINLAYSON (Minister for Arts Culture and Heritage) 
: 
 I must say I am a little surprised that Mrs Chadwick has not leapt to her feet that the new star of the Labour Party Jacinda Ardern has not leapt to her feet or that Grant Robertson is not in the Chamber to speak because believe it or not Labour— 
Hon Annette King 
: I raise a point of order Mr Chairperson. 
The CHAIRPERSON (Lindsay Tisch) 
: I know what the member is going to say. 
Hon Annette King 
: Perhaps the Minister might like to talk about his own portfolio rather than denigrating other people. 
The CHAIRPERSON (Lindsay Tisch) 
: The member cannot refer to the absence of another member. I ask him to come back to what this debate is about. 
Hon CHRISTOPHER FINLAYSON 
: I apologise. I was just in passing saying how disappointing it was that Labour has three spokespeople for this very important area but no one has taken a call. But I am very happy to take a call because our record in the arts is very good indeed. 
Indeed 2 years after Helen Clark skipped off to the United Nations I am still finding there are huge amounts of big policy work and big expenditure work that need to be undertaken in the arts. Although it is a relatively small portfolio it is actually an important portfolio. When one looks for example at heritage issues in Canterbury one can see how important they are but that is more for this financial year so I am not going to talk about it at all. 
Hon Steve Chadwick 
: I wonder when the Minister got to Christchurch to look at heritage—rather late! 
Hon CHRISTOPHER FINLAYSON 
: I beg the member’s pardon? 
Hon Steve Chadwick 
: I wonder when the Minister got to see heritage in Christchurch. 
Hon CHRISTOPHER FINLAYSON 
: This member has been to Christchurch on a number of occasions working very closely— 
Hon Steve Chadwick 
: After questions in the House. 
Hon CHRISTOPHER FINLAYSON 
: No; before questions in the House. The member’s question was—as the member’s questions so often are—utterly irrelevant in the circumstances. 
Let me say something about some of the work we have been doing in the Ministry of Culture and Heritage because it is very important. The first is the Cultural Philanthropy Taskforce that was working right through last year in the relevant period. That task force has been looking very closely at how one can increase the putea for the arts and for heritage. When one thinks about the sorts of big issues that there are in Canterbury I say to Mrs Chadwick it will be very important that we engage private donors and corporate donors without cutting the budget. Indeed right throughout the last election campaign that was the clarion call from the Labour Party. Labour Party members went around the place complaining that funding for the arts would be cut. Well look at what happened. The arts sector is in a very rosy position in dealing with the problems it faces because of the dedication of people like the Minister of Finance and the support of the National Government. 
I want to say something about the Film Commission. I simply observe how nice it was to see Peter Jackson on the front page of the  
Dominion Post 
 yesterday. David Court of Australia and Peter Jackson undertook a very important review of the Film Commission and they reported about the middle of last year. Criticisms had been made of the commission’s historical performance but the new chair and the new chief executive both of whom are outstanding people have been addressing those particular concerns. It was very timely that we looked at the governance of the Film Commission. It was set up in 1978 by Allan Highet an excellent former National Minister for the Arts and so much that has happened in the film industry can be traced back to the establishment of the Film Commission. The Film Commission has reported and I am very pleased to see that it is working on a number of recommendations. Indeed they had been working on those recommendations even prior to the report. 
Associated with the Film Commission is of course the Film Archive. In last year’s Budget after years of neglect by Labour we injected some additional funds into the Film Archive so that it could go about its very important work of restoring New Zealand’s film heritage and I am very proud of that intervention. 
Perhaps the proudest intervention in the whole area of film over the last period has been the intervention by Mr Brownlee and the Prime Minister to save  
The Hobbit 
. It was their actions that saved  
The Hobbit 
 from the haters and the wreckers in the unions. A very good job was done. When we look at the front page of yesterday’s  
Dominion Post  
and see that wonderful New Zealander Peter Jackson on the first day of filming of  
The Hobbit 
 we can be very very proud indeed. I stand by what we did. It was necessary and without it the films would have gone offshore. [ 
Interruption 
] The self-proclaimed MP for Weta Workshop the member for Rongotai would not have been able to stand up in this House with any pride whatsoever. 
A huge amount of work is being done on the Historic Places Trust. Again it has a very old statute. It needs a total review and I am pleased to see reforms there. I am pleased to see reforms with the Arts Council. So much that is good is being done. 
Report noted. 
Ministry of Agriculture and Forestry 
SHANE ARDERN (National—Taranaki - King Country) 
: 
 It is a pleasure to rise and speak on the report of the Primary Production Committee on the financial review of the Ministry of Agriculture and Forestry. A number of things have happened in the agricultural sector over the last 2 years but the establishment of the Primary Growth Partnership is probably right at the front of the list of important announcements and initiatives that have taken place under the very capable leadership of the Hon David Carter. The partnership involves an investment of $140 million a year with industry-promoted innovation. It is wonderful to see for the first time in many many years investment being put back into science research and development in the agricultural sector. 
One of the things that Labour could never understand when it was in Government—and never does understand whenever it is in Government—was the fact that the economy of New Zealand is basically driven by primary production. I know that some members opposite hate that concept some struggle with it and some wish to change it but after many many years of their meddling cutting adjusting criticising and attacking they have failed to do so. In 2011 we are still in a situation where the low-hanging fruit as far as growing the New Zealand economy is concerned will come and are coming from our primary industries. Getting up and running an organisation with the horsepower of the Primary Growth Partnership and investing once again in technology systems environmental protections and all of the things that will enhance our primary production sector as we go forward is a wonderful development and a wonderful initiative. 
The establishment of the Global Research Alliance on Agricultural Greenhouse Gases with an investment of $45 million is the most significant single thing that has happened in terms of our looking at what we can do to minimise the agricultural footprint of New Zealand. One of the ironies I guess of the debate in that area which is generally driven by our opponents on the other side is the idea that we need to tax the primary sector. 
New Zealand’s primary production system has one of the lowest carbon footprints of any production system in the world. That has been proven by research undertaken by both of our major agricultural research universities—Lincoln University and Massey University. The Opposition wants to tax that sector or reduce production thereby increasing production in the systems elsewhere in the world that would have to produce that food which in turn would lead only to higher carbon emissions. The alliance is a wonderful development and it was led by this Government. We were one of the very first Governments to get in behind it. It is a great thing to see. 
Improving water management is one of the key drivers that will lift our productive systems in the agriculture sector. It provides such a huge opportunity for us particularly on the eastern belt of New Zealand. A lot of attention has been paid to Canterbury recently for a range of reasons but when we look right along the eastern belt of New Zealand we see highly productive land that is suitable for a range of different production systems and not only for development in the dairy industry as a lot of people would say. When water was made available in Marlborough it was not dairy cows that went on to the land; it was grapes. I will not stand here and try to forecast what might happen if those opportunities were made available in other areas but potentially there is an enormous opportunity there for us. Investment and leadership in that area are essential as we go forward and it is happening under the National-led Government. 
The animal welfare issue never goes away and it is always a very sensitive and emotive topic. We have made a significant investment of $8.2 million in that area. We have provided more officers than in the whole 9 years of the previous Government. 
Hon DAVID CARTER (Minister of Agriculture) 
: 
 It is a pleasure to take a call in this debate particularly in light of the very good report that was tabled by the Primary Production Committee ably chaired I might add by my colleague Shane Ardern. I think it is a great pity that when we are talking about the most significant industry to the New Zealand economy the Labour Opposition is not prepared to take a call. The thousands of listeners out there today need to note the interest shown by the Labour Opposition in the portfolio of agriculture and forestry. I guess it is not surprising; after all when Labour was in Government it termed the industry a sunset industry. 
There is so much this Government can be proud of in terms of what we have achieved within this portfolio particularly when we review last year. My colleague Shane Ardern mentioned the Primary Growth Partnership. We now have the largest expenditure in primary sector innovation that New Zealand has ever seen. That programme was launched only 18 months ago. We now have $475 million worth of projects under way. That is a remarkable investment in 18 months. [ 
Interruption 
] Annette King may criticise that but no farmer in New Zealand I assure her would criticise this National Government’s expenditure in the primary production sector and in innovation. 
There was a lot of talk about the emissions trading scheme last year as we changed the scheme we had inherited from the Labour Government. We made it far more practical and far more affordable and we faced with our farmers the issue about the introduction of agriculture in the scheme. We are reviewing that position at the moment as we promised we would. 
Let me make known the Labour Party’s position on the emissions trading scheme. We have heard the comments of Charles Chauvel the previous Opposition spokesperson on climate change. He said that if the Labour Party is elected at the next election—not likely I acknowledge—it will bring agriculture in immediately and rather than grandparenting any of the emissions to agriculture it will land that immediately on the farmers of New Zealand. When farmers go to the polls I want them to realise that fact. 
Animal welfare has been a big issue for a long period of time and Mr Ardern is quite right in saying we have now allocated the largest increase in expenditure at $8.2 million that the sector has seen for years. We had a situation in Southland where the Ministry of Agriculture and Forestry and Federated Farmers had an issue with the conducting of a particular animal welfare inquiry. I am pleased to say that the report has now been accepted by both the ministry and Federated Farmers. 
We want to move forward in a constructive manner with Federated Farmers because we need their assistance just as we need the assistance of organisations such as Beef and Lamb New Zealand Ltd and DairyNZ as we collectively make sure we help farmers who get into unfortunate animal welfare situations—but if it is a perpetual habit of any farmer frankly I do not want that person in our industry. 
There is mention of water in the financial review. Water is the greatest competitive advantage this country has and collectively we have to find ways to better store and allocate that water. With the allocation of that water farmers will then have to utilise it far more efficiently than they do at the moment. With water will come intensification so again we need to be prepared to invest money in science to allow the agricultural scientists of this country to find mechanisms by which we can intensify and increase productivity and profitability on farms while mitigating the environmental impacts of such intensification. 
The final issue I want to talk about is probably the biggest risk this sector faces and that is the risk associated with biosecurity. Day by day 175000 items come into New Zealand and every one of those is potentially a danger. All of us in the sector have a duty and a responsibility—and this applies to members of Her Majesty’s Opposition—to do what we can to have the most efficient biosecurity system in the world. If we have a breach of our biosecurity borders—and we have had one in the last 12 months in the kiwifruit sector—we have to acknowledge that we have to move quickly to try to contain it and do what we can to mitigate the effect of any biosecurity incursion. 
Report noted. 
Ministry of Foreign Affairs and Trade 
KEITH LOCKE (Green) 
: 
 The situation in the Middle East is now central to the considerations of the Foreign Affairs Defence and Trade Committee and was among the topics addressed in the financial review we are debating today. We have been inspired by the success of the Egyptian and Tunisian people in toppling their dictators and we were hoping that the Libyan people would soon prevail over the Gaddafi regime. However as we know the regime has fought back and was making advances prompting calls for an internationally imposed no-fly zone to neutralise Gaddafi’s air force which was bombing rebel forces. 
The proposal for a no-fly zone is only one element in the resolution recently passed by the UN Security Council. The motion had a very loose wording allowing member states to “take all necessary measures … to protect civilians” in Libya. So far the coalition powers have bombed not only anti-aircraft batteries but also Gaddafi’s tanks troops and even his compound in Tripoli. The British Secretary of State for Defence Liam Fox has not ruled out Gaddafi himself being a target. 
Five important Security Council members—Germany Brazil India China and Russia—did not support the UN resolution. They were reluctant to support military intervention in Libya and the Greens share their concerns. Although we fully identify with the democratic forces in Libya and do not wish to see them crushed we see a lot of problems with the military intervention as it is evolving right now. Many civilian casualties will result from the air attacks on Government facilities in the cities of Libya. That has been the case in all previous air assaults by Western powers in places such as Belgrade Baghdad and Kabul. 
We are also looking at more than coalition air operations; it is a military intervention that could involve foreign forces on the ground even though the UN resolution prohibits a “foreign occupation force” in Libya. We read in this morning’s  
New Zealand Herald 
 that “Coalition commanders argue that a ground intervention is not the same as an occupation and that this form of military action must remain a viable option” if Gaddafi stays in power. In other words regime change is on the agenda as it was in Iraq a war that New Zealand stayed out of. 
We know well the problem that evolved with the Iraqi regime change when it was controlled by foreign forces as opposed to the more orderly transition that is currently taking place in Egypt which is being driven by domestic forces—the people and institutions of Egypt. It is also possible that the attacks by foreign forces could strengthen the dictator Gaddafi’s base of support as he pushes the message to Libyans that the attacks are coming from Western powers which have traditionally been seen as hostile to Arab causes in Palestine and elsewhere. In a related problem it could be more difficult for the democratic forces to get ordinary Libyans involved in their struggle particularly in the capital of Tripoli if the regime can portray the democratic forces as agents of the foreign invaders. 
The intervention also takes place against the background of hypocrisy from the Western powers involved. For the last few years those same countries have been good mates with the dictator Gaddafi praising him and selling him the very weapons he is now using against his own people. The fact that Libya had oil was justification enough they felt. They also said that he had a stable Government and that was a plus for them even though that stability was enforced by a complete clamp-down on anyone who dissented against Gaddafi. 
Of course the same countries that are involved in the air attacks at the moment backed a range of dictators across the Middle East from Mubarak in Egypt to Ben Ali in Tunisia and the kingdoms in the Persian Gulf. Even today there is hypocrisy with the same Governments that are taking action against Gaddafi’s forces not being particularly worried about the Saudi Arabian forces entering Bahrain to crush the democratic movement there with many people being killed. 
JOHN HAYES (National—Wairarapa) 
: 
 It is really interesting that people can find clouds even on a sunny day. I am interested in the comments made in the Chamber earlier this afternoon by Gareth Hughes a Green member and by Keith Locke who has just resumed his seat. The issues in the Middle East are a water shortage which goes right across North Africa and down through the Middle East as well as poverty decades of injustice mass unemployment and rapid population growth. Those things all put pressure on food prices which underpin the instability in this part of the world. The Middle East is hyper-arid the underground water resources are disappearing the population will double to 600 million in the next 40 years and climate change will result in increased temperatures so we are dealing in that part of the world with political dynamite. 
I say good on the Minister of Foreign Affairs for opening embassies in Kabul and Abu Dhabi because he is in touch with reality. The issue is water. Abu Dhabi has been developing underground storage tanks to store 26 million cubic metres of desalinated water. That will represent a 90-day reserve. The UN estimates that in this country we could sustain a population of about 48 million based on the amount of water that falls in this country. The Arab countries are as sensitive to water as Australia is to floods. This is the paradox: although the Arab countries depend on increasing oil prices those increases in turn will cause increasing food prices. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
JOHN HAYES 
: Prior to the dinner break I was talking about the paradox that applies in the Middle East whereby the countries there want to increase the price they get for their oil but as they do that they are pushing up the price of the food that they need to import. 
We are here to address the financial review of the Ministry of Foreign Affairs and Trade. I pay a particular compliment to the Minister for focusing the ministry on backing John Key’s undertaking to lift our exports from 30 percent to 40 percent of GDP. We are doing that by consolidating trade agreements—for example with China. In the financial year under review we secured a trade agreement with Hong Kong; initiated dialogue with the Trans-Pacific Partnership countries with a view to establishing a trade agreement there; and entered into negotiations with India Russia and Korea because those countries are our future. 
The ministry has performed very well under the Minister’s leadership. For example if we think about the ministry’s response to the tsunamis in Samoa and Tonga and though not in the financial year under review to recent events in Japan we realise the ministry has performed exceedingly well. This work within the ministry is being done under the Minister’s leadership. He is looking at how to improve the efficiency of the department. The Minister has engaged with the private sector and taken advice from the export sector on how we can do more to support the activities of New Zealand businesses and exporters. At the same time the ministry has brought together and reabsorbed the NZAID agency which spends $500 million a year back into the ministry securing efficiency gains there in its administration. 
The ministry has also performed very well in other areas of its work. It has preserved the International Whaling Commission and supported it as the sole agency representing the interests of whales and of people who support the longevity of whales on this planet. The ministry is also engaged in things like the agricultural research partnership looking at how to engage other countries to address the issues of greenhouse gas emissions from our livestock in this country. Tim Groser has done a particularly fine job there in bringing a range of countries into a research partnership that involves not only New Zealand but also a lot of other countries and their money. 
Report noted. 
Ministry of Research Science and Technology 
Dr PAUL HUTCHISON (National—Hunua) 
: 
 It is a great pleasure to speak on the 2009/10 financial review relating to science and innovation because even this afternoon we had the Minister of Science and Innovation announcing that since 2008 under this excellent National Government there has been an extra 13 percent increase in investment in science and innovation. 
Hon John Carter 
: How much? 
Dr PAUL HUTCHISON 
: Thirteen percent since 2008. That is pretty good. It is particularly relevant because in the preceding 10 years under the dismal Labour regime there was pretty well static investment. 
Hon John Carter 
: None. 
Dr PAUL HUTCHISON 
: No there was some but it was static. 
It is important to go through the history a little bit. In 2002 the Knowledge Wave Trust identified a missing billion dollars of investment in this area—if we were to benchmark with our international partners in both private and public sector science and innovation spending—but nothing happened. In 2005 however the then Labour Prime Minister Helen Clark said that investment in science and innovation was critical to the New Zealand economy but she did nothing—nothing apart from spending lots of money on bureaucracy and heaps of money on non-productive health services. She absolutely mucked up the New Zealand economy and certainly as a percentage of GDP if anything it went from static to going down. 
Hon Annette King 
: What about the Fast Forward Fund? 
Dr PAUL HUTCHISON 
: Well I will go to that. It was not until the dying days of the Labour Government that Helen Clark put in the fiscally irresponsible tax credit. It was not until the dying days of the Labour Government that she put in that fiscally irresponsible tax credit that basically had every accountant up and down the land licking their lips. That is what the Labour Government did. That is how badly designed the tax credit was. 
Thank goodness Prime Minister John Key came to office in 2008 said that science and innovation would be central to his Government and started doing things. He appointed the Chief Science Adviser who has been incredibly useful. He launched the very prestigious Prime Minister’s Science Prizes which have been very very important in raising the media attention on and knowledge about science in society. There was also the establishment and growth of the Primary Growth Partnership which was far far better designed than the Fast Forward Fund. It has been extremely successful and as was pointed out the other day already an investment of $227 million by the Government will be matched by the private sector making a total of $475 million invested in our vital primary industries in science. There has been the initiation of the Global Research Alliance on Agricultural Greenhouse Gases which has been one of the vital things for New Zealand to lead on and has been extremely well received by the international community. 
The good news goes on and on. The Government has been determined to ensure that we have a lean efficient science system with low compliance costs. The Foundation for Research Science and Technology and the Ministry of Research Science and Technology have been merged. The Crown research institutes have been reviewed and they are very very happy with the way things are going. I think it is important to point out that only last week at the Speaker’s Science Forum Sir Paul Callaghan made a plea to parliamentarians that science funding should be medium to long term and that there should be a degree of collaboration in the approach because it is very important that science policy is not used as a political tool. 
Report noted. 
Ministry of Transport 
Report noted. 
Ministry of Social Development 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 When we look at the financial review for 2009-10 of the Ministry of Social Development we need to see it in the context of comments made by the Minister of Finance in December 2008. At that time having just come into Government Bill English said: “I want to stress that New Zealand starts from a reasonable position in dealing with the uncertainty of our economic outlook. In New Zealand we have room to respond. This is the rainy day the Government is saving up for.” 
The reason why I raise that is that in this House over the last financial year we have consistently heard the Minister of Finance refer to the dreadful position that the Government inherited when it came to office. It does not quite add up. I raise this issue because it is germane to what is happening in social development. If this Government wanted to make a priority in social development particularly for children it had every ability to do so because the finances of this country were in a reasonable position to face the global recession that this country and other countries faced. Other countries have got through it; we now face a double-dip recession. We in Labour say to the Government that it is a recession of its own making. What it means is that those who are the most vulnerable and who need the most help in New Zealand are the ones who face the biggest problems and the biggest cuts. Under this Minister in the chair the Minister for Social Development and Employment very little has been done to help children in New Zealand. 
What is depressing and distressing for me is that I have constantly asked the Minister for Social Development and Employment what she has done for the children who face abuse and lack of care in this country. Her only answer has been the same: “Every day I work so hard for them.” But every day more children are abused in New Zealand. Every day more children are neglected in New Zealand. Every day we hear of things that are happening in this country to our children that no notice has been taken of except in pretty speeches and crafty answers to questions asked in Parliament. 
I say to the Minister that if she does not want to believe Opposition members when they talk about children maybe she would like to listen to those who provided a report for this financial year—the Salvation Army for example which released a report called  
Stalled 
. What does the Salvation Army talk about in that report? It says that there has been very little meaningful social progress in New Zealand and that there are now greater problems of unaffordable housing alcohol-fuelled family violence child poverty and youth disaffection. The report also found that over the last 12 months to September 2010 average weekly earnings grew by just 0.5 percent when adjusted for inflation or in real terms. The low-income household consumer price index developed by the Salvation Army has found that the cost of living has gone up by 4 percent. So the lowest-paid people in New Zealand including beneficiaries and older people have seen their cost of living go up although their income has not risen. Those people are facing considerable difficulties. 
The report went on to point out that under this Minister there has been an increase of 40000 more young people who are out of work. We now have about 60000 young people under the age of 25 who are not in work who are not in training and who at this stage feel they have no hope. That is what the Salvation Army pointed out. 
If the Minister still does not want to believe what I am saying then perhaps she will believe what the Salvation Army is saying on child poverty. You see the Salvation Army is at the pointy edge of social service delivery. It is there every day out in the community providing services. It is all very well for the Government to praise the Salvation Army when it is on the streets and helping people when there is an earthquake but I ask why the Government does not listen to the Salvation Army when it is telling this Government that child poverty rates in New Zealand have increased over the last 18 months particularly in single-parent families. 
CAROL BEAUMONT (Labour) 
: 
 I will follow on from my colleague the Hon Annette King. The work of the Ministry of Social Development and of the Minister in the chair the Minister for Social Development and Employment is meant to be about successful individuals building strong healthy families and communities but in these areas New Zealand is going backwards. We are becoming a more unfair society; we are becoming a worse place to bring up our children. The sad fact is that the Government is out of touch with the reality facing most New Zealanders particularly low and middle income New Zealanders. 
I will tell members some stories about people because this portfolio in particular is about people. These people have come to either my Panmure office or my Onehunga office. We see these people as a consequence of the policies that are reported on in this financial review. There was the mother of three who lost her job. She did not get any redundancy and she had a medium level of debt so she was reduced to seeking handouts of food in order to get by. She made sure her children were fed before she ate anything herself. Once a certain number of food parcels have been accessed the overwhelmed agencies handling these cases cannot give out more. Her situation was not about poor life choices as our Prime Minister would have us believe. 
There was the man on the sickness benefit who was reduced to eating out of rubbish bins because his household goods and his wallet had been stolen. His debt which he had subsequently run up through replacing fridges beds etc. was with Work and Income and two local appliance stores. The debt was too high for him to get any more advances and the repayments for the money borrowed from three sources took up most of his benefit after his rent was paid. He has mental health issues and his diet is so poor that he has been hospitalised twice because of it. These are real people. 
Then there was the man who thought that he would actually be better off in prison because at least in prison he would get something to eat. We have mothers coming into my offices who are living in tin sheds. We have had three in 1 month including one with a severely ill baby. These are real people. 
I could go on about housing issues but perhaps it goes past this portfolio so I will not continue down that track. But I am saying that this Government is out of touch with the reality of these New Zealanders. It does not have a plan to deal with them. In fact the best plan it seems to have come up with is giving the wealthy tax cuts costing $14 billion over 4 years building roads cutting money out of industry training and cutting funding for early childhood education. That is not a plan and that mismanagement of our economy is taking us backwards. 
That so-called plan is leaving many New Zealanders feeling helpless and hopeless. This is contrary to the idea of social development. We need a bold Government that governs for the benefit of all New Zealanders and understands the realities that they are facing. We do not need a Prime Minister who talks about these people making lifestyle choices. We certainly do not need Kate Wilkinson and Hekia Parata who think that New Zealand women who are underpaid and struggling to make ends meet should be grateful that there is a National Government supposedly focused on lifting economic performance. That is not what those women out there are feeling. 
The fact is that economic progress and social progress are inextricably linked. A plan that really addresses social and economic development will come only from a Labour Government focused on creating jobs and opportunities for our children and grandchildren. It is about the question of unemployment. We now have 100000 more people on benefits. Where is the plan to deal with that? Where is the active Government working to try to create a stronger economy that delivers jobs? Where is the support for research and development? Where is the support for skills? Where are the initiatives to lift productivity? 
Talking about the issue of skills how is it that we can have something so significant that would lift our productivity and increase employment security yet we cut funding out of that area? We cut $55 million out of industry training. It did not go into social development to pay for more job skills did it? No. That is an absolute outrage in the current economic climate. 
As my colleague Annette King said the situation of child poverty in this country—and the Salvation Army report talks about this—is that 22 percent of our children are living in workless households where they are below the poverty line. That fact impacts on the future of this country in terms of health education and our economic performance let alone the situation— 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 I will start by thanking all those involved in this process particularly all of those hard-working officials who have worked so hard to present the review process. I will talk about what the scope of that is. Being the Minister of Social Development and Employment means that I am responsible for a spend of over $21 billion more than 30 percent of all Government spending. Quite frankly it is going to those people who need it most—about 1.6 million New Zealanders in any year. 
I start by acknowledging the Ministry of Social Development’s most recent work in the Christchurch earthquake. I am sure that other Ministers would disagree with me on this but I believe that my department has been exemplary and is one of the star performers. It moved in quickly. It moved in for those people who were firstly surviving but the situation was also about that saying that “They move to living from surviving.” I think that is a reality for so many people in Christchurch. 
I will run through a few quick facts because that is what this review is all about. The helpline has received 125615 incoming calls. It is extraordinary that staff have stepped up and been there to answer those calls and to provide some pretty amazing help. They have identified 18500 senior clients who were living alone. We have over a thousand staff in the Canterbury region. We have redeployed about 200 staff from across the Ministry of Social Development into Canterbury so that some of those staff can get a bit of time off. Three Work and Income sites are closed but the other eight are open. We now have 10 recovery and assistance centres. We have 10 information kiosks open. Child Youth and Family has reopened in another building. 
Members know the facts. They would have heard them in the House today in relation to the amount of money involved; $160 million has been paid out in employer assistance and under job-loss cover for employees. Civil defence payments have now totalled over 80000 payments and about $14 million has been paid out. The work that is done behind those payments is fantastic. It is one thing for a Minister to stand up and say what is going on but to be honest people out there have been working 24/7 to make this a reality for those people in Christchurch. I take this opportunity to commend them. 
Hon Nathan Guy 
: That’s fantastic. 
Darien Fenton 
: They’re backroom staff. 
Hon PAULA BENNETT 
: They are. They are pretty amazing staff. I say thank you to both sides of the Chamber for acknowledging that. 
What has the Ministry of Social Development done though? Let us talk briefly about that department and what has been going on. The Value-for-Money programme has resulted in a total of $254 million in savings and efficiency gains across the business. In addition to managing the cost pressures of that the ministry has returned $52 million to the Crown in the last 2 years. That has happened through a number of strategies but most of it has been about moving most of our services online. A lot of seniors are now going online as well and students are using the online services more than ever. In fact there has been a 60 percent increase in volumes dealt with by the business. 
Lean Six Sigma has been rolled out throughout Work and Income. That has made a huge difference in how we move people to the front line. We have reduced the amount of waiting time for beneficiaries who go in to get assistance. I think that is pretty remarkable in these pretty difficult times. Shared services have been a big part of that as well—that is working across other agencies reprioritising resources lowering operating costs reducing client numbers and making sure we get that front-line help. We are at a point now where for the first time last week I saw that for people who come in to go on a benefit and then go away we were at an over 50 percent triage rate for them. I want to give one of those facts because we deal with a lot of stuff in this Chamber but when it comes to the Opposition we are not often talking about the actual facts of the situation. 
In the last 2 years 136000 people have cancelled their benefits to go into a job. That does not mean that it has all been fantastic and easy but it does tell us that the labour market is still moving. The biggest concern certainly from my perspective would be if it had stopped moving. People are still moving out of benefits and—most importantly—into work and those sorts of numbers prove it. 
I will end on the issue of children child abuse and neglect. I think that the work done there has been such a key focus certainly for me as Minister. I do not have time to go through all the things from the Never Ever Shake a Baby campaign to having social workers now in all hospitals the first response trial the multi-disciplinary meetings before discharging a child from hospital—re-abuse has been a major concern to me—and better data and monitoring systems. Quite frankly we cannot fix it unless we are monitoring it. Thank you. 
TIM MACINDOE (National—Hamilton West) 
: 
 May I say how delighted I am to take a call immediately after the Minister for Social Development and Employment. I do want to— 
Chris Hipkins 
: Brown-noser. 
TIM MACINDOE 
: I will ignore that comment I say to Mr Hipkins. I acknowledge the fact that I doubt whether in Mr Hipkins’ lifetime any Minister has ever held this office in more difficult times. I acknowledge the huge compassion determination focus and commitment that she is bringing to the role. She has— 
Stuart Nash 
: Every Labour Government that takes over from a National Government holds it in more difficult times. 
TIM MACINDOE 
: Every National Government I say to Mr Nash takes over from a Labour Government that has mucked up the economy and then has to spend the next 5 to 10 years sorting it out. Never has that been truer than at this moment. When that happens it puts particular pressure on the Minister of Social Development and Employment. I return to my theme but I acknowledge the Minister for the huge job she is doing in incredibly difficult times. 
As a member of the Social Services Committee I am very proud to stand up and focus for a moment during this discussion on the financial reviews of this Government department. Some people listening to this debate may not appreciate that this department is the largest Government department in New Zealand. It has huge responsibilities which come under particular pressure at times of global economic crises of the type we are suffering at the moment. It is worth noting that its responsibilities include employment and income support services; New Zealand superannuation a huge area of Government expenditure and commitment; the provision of student loans and allowances; the care and protection of at-risk children and young people which the Minister just alluded to; youth justice; adoption services; New Zealand’s international welfare portability arrangements; the coordination of social support services; and the funding of community service providers. 
That is an overwhelming workload. There is plenty to talk about in this discussion. There is plenty of great work—it has to be said—that is being done right now in a host of challenging areas. That is why I have to say I was really disappointed to hear the deputy leader of the Labour Party in her reference to the comments that the Minister of Finance made after our election in 2008 when he made a comment about the uncertainty of the current economic outlook questioning our determination to make this an area of priority. I do not think that any impartial reasonable observer would say other than that we have made this an area of huge priority. There have been a number of really important initiatives led by this excellent Minister Paula Bennett and I think by a Government that is absolutely determined on trying to— 
Hon Shane Jones 
: Name one. 
TIM MACINDOE 
: I am happy to name Job Ops. I am happy to name the Community Max scheme I say to Mr Jones— 
Hon Shane Jones 
: Labour policy. 
TIM MACINDOE 
: That is absolute nonsense and Mr Jones knows that they are not. There are a whole range of initiatives. I do not question for a moment the fact that these are always important areas for a Government but the really significant thing is that under this Minister and this Government they have been thrown so sharply into focus and have received such determined and coordinated—[ 
Interruption 
]—application and as the Minister Hekia Parata has kindly mentioned are showing that we have the real determination to make some difference to them. 
There is no question that we are living in incredibly difficult times. No one disputes the fact that unemployment has risen in recent times—of course it has in this country as it has around the world. What is really important is what we are doing about it. I am pleased to say that under the leadership of this Minister and under the leadership of the department that she is the head of we are seeing a really determined focus on reducing unemployment. Even though we are living through some of the most difficult times of all there is a clear focus on reducing unemployment and evidence that the policy is working. There is a clear focus on getting people off welfare dependency and there is very definite evidence that it is working. 
It is not because as the Labour Party would like to suggest we are either hard-hearted or insensitive to the needs of people—quite the opposite. It is because we are determined to help people out of the trap of welfare dependency. It is because on this side of the House we will never say: “That’s good enough for you.” We are always determined to say to the very hardest hit in an economic recession: “There is better hope. We are ambitious for you; you can be aspirational and we will put in place measures to assist you to get there.” I am pleased to say that there are a whole host of measures that are achieving just that. Unfortunately as we have seen—and I do want to acknowledge the huge suffering that Cantabrians have undergone—the Christchurch earthquake has further knocked us back in recent times. Mr Jones challenged me a minute ago to name some schemes and I mentioned Job Ops and Community Max. Let me also mention Future Focus. We have to focus particularly on those long-term recipients of unemployment benefits and say that we will get them off that scheme. 
Report noted. 
Department of Labour 
DARIEN FENTON (Labour) 
: 
 I think next week brings to fruition the changes that were being considered during the period of the financial review of the Department of Labour. On 1 April there will be many changes for New Zealand workers. While this House is adjourned New Zealand will go backwards. This Government has no plan other than to attack workers’ rights and take their rights away from them in a pathetic attempt to try to prove to the rest of the country that it actually has a plan. 
Next week on 1 April the “90 Day No Rights (Fire at Will) Employment Bill” brought in by the Minister of Labour Kate Wilkinson will become law for every worker in New Zealand. Every worker in New Zealand when they change jobs from next week 1 April will be subject to a period where they have absolutely no rights. If dismissed they will have no right to ask why they have been dismissed and no right to challenge that dismissal. This measure has been put forward by the Minister as some kind of economic plan some kind of reason to take the country forward. Government members are so out of touch with this country that they have no idea. Ordinary Kiwis who are struggling to make ends meet will simply find that this makes their lives harder. It will make things worse not better. National members have forgotten how to talk to ordinary people and their families. 
During this period—and everybody knows this has been a very heated debate in the Chamber and it will continue to be a heated debate—Labour members have been going out and talking to ordinary people. What they are telling us is that this Government is not working for them and their families but for its mates and foreign interests. We had a ridiculous situation where the Minister claimed from a very very unsupportable report from the New Zealand Institute of Economic Research that 13000 new jobs were created under the 90-day no-rights trial period for workplaces of fewer than 20 employees. When we look at the research and unpick it we see that that is simply ridiculous. The Government took one statistical period and said that it must be an indicator somehow that small businesses are creating more jobs because there was a difference between workplaces with fewer than 20 workers and workplaces with more than 20 workers. The Government did not take into account any other things that were happening at the time such as assistance that was being targeted at small business other stimulus measures that could have assisted small business and upheaval in the economy. When the Minister makes claims about the New Zealand Institute of Economic Research report and says that 13000 jobs were created well certainly I will look forward and Labour will look forward to seeing the creation of a huge number of jobs. National members claim that when their policy is applied in all workplaces we will see suddenly see many more jobs created throughout New Zealand. It is a very weak argument. 
In addition to that during this financial review period we have seen other changes to labour laws. There have been many but I want to concentrate on a few. One of them is the denial of union access to workplaces. Union representatives now have to ask permission from an employer and wait up to 2 days for it to be granted. Apparently it cannot be unreasonably withheld. I am really interested— 
Hon Shane Jones 
: Sounds oppressive to me. 
DARIEN FENTON 
: That is right particularly in light of recent events: the awful situation in Christchurch and the Pike River Coal mine. I am really interested in the proposal that was taken to Cabinet last year where the Minister’s department said that this consent should not have to be applied for when it involves the health and safety of union members. That advice was taken by the Minister to Cabinet—it was from her department. I want to know what happened to it because it never turned up in the bill. I think that she will live to regret the decision that union representatives will have to wait up to 2 days to get consent to enter a workplace particularly when it is in regard to health and safety matters. 
Then there are of course the other things that have happened in this period like the so-called law change from  
The Hobbit 
.  
The Hobbit 
 law change was absolutely disgraceful. This Government was completely run over by— 
Hon Shane Jones 
: Hollywood welfare. 
DARIEN FENTON 
: —that is right—multinational interests. It was terrified by the film makers of America who came here and threatened to remove their industry. It was never about the actors’ union. It was always about a multinational company trying to dictate to New Zealand what employment rights should be in this country. What happened in that debate and in that law change is that a whole category of workers—not just actors but cleaners drivers and catering workers anyone who works in the film and video production industry—no longer have rights as employees. They no longer have the right to challenge the fact that they can be employed without rights under the Employment Relations Act. That is what has happened. Mr Macindoe should not look puzzled. 
Tim Macindoe 
: You know that’s nonsense. 
DARIEN FENTON 
: No—of course it is true. It makes Labour extremely worried about who will be the next category of workers on the list. 
Then of course next week on 1 April the changes to the Holidays Act come into force. We have a country where workers are working longer hours than ever. In fact productivity has gone up because they are working longer hours than ever and getting paid less not because we have improved productivity and the Government is saying we should reduce their rights to holidays not increase them. 
The other thing that happened during the last period of the financial review was the meals and rest breaks legislation. Do members remember that? Do members remember those dreadful air traffic controllers who were so unreasonable about the fact that we had a meals and rest breaks law that said they were entitled to a break after 8 hours and after 4 hours? It was so unreasonable according to this Government that the whole country had to be stopped so a law had to be rushed into Parliament—and where is it now? Where is the Employment Relations (Rest Breaks and Meal Breaks) Amendment Bill? I think it is about No. 16 on the Order Paper. I would like to know from the Minister in the chair the Minister for Ethnic Affairs what happened to that legislation. A year and a half ago it was so urgent that the Government had to remove from the whole country all the rights to meals and rest breaks and water the legislation down so much because of those dreadful air traffic controllers. Well something happened obviously. Of course it could be negotiated which was always the intention of that bill and it is now way down the track. 
Hon Shane Jones 
: They don’t believe in negotiation. 
DARIEN FENTON 
: No that is true. Now it is right down the bottom of the Order Paper. 
The other thing that has happened in this period and it is mentioned in the financial report is the situation of the IDEA Services workers. For the last 3 or 4 years they have appeared before three courts including the Court of Appeal where the Government joined the appeal to try to stop them from getting the minimum wage for working overnight looking after our most vulnerable citizens. Three courts have now said that they are right it is work and they should be paid the minimum wage. What has the Government done? Absolutely nothing. We called on the Government to sit down and negotiate with the stakeholders with the union and with others who are completely willing to find a durable solution to this issue. The Government has done nothing. Instead we now have IHC going to the Supreme Court and wasting money that it does not have money that was allocated by the Government for the care of vulnerable people. It is treating workers absolutely like rubbish. Here we go—yet another group of low-paid workers will have to put up with this for the next little while. 
Then finally the minimum wage rises by 25c an hour next week. The Minister’s own advice was 25c an hour but 50c an hour was affordable. The Government could have done that. It could have put up the minimum wage to $13.50 an hour. Actually the Government could have put up the minimum wage by 75c an hour. It was affordable; that was the Minister’s advice. It is not about losing jobs; it is about jobs that might be created. It would have had negligible impact on employment. The Minister’s own department’s advice was that that 25c an hour is no increase at all. It is not an increase in real terms. It is insulting. Those workers are trying to make ends meet along with everybody else. It just shows how completely out of touch this Government is. Labour will give everybody a fair go. We will make sure people will pay their fair share. 
MICHAEL WOODHOUSE (National) 
: 
 I would like to talk about being out of touch because last October I happened to be in Seoul South Korea when the news of the objections by New Zealand unions to filming  
The 
Hobbit 
 went on BBC World News. Some people from the United Kingdom came to me and said: “What on earth are New Zealand trade unions doing objecting to one of the largest film productions ever made in New Zealand or around the world for that matter by the same director who put New Zealand on the world map with three fantastic movies that ended up scooping a whole wedge of Oscars? What on earth are New Zealand trade unions doing undermining that sort of thing?”. I had to say I had no idea but I trusted the National Government to come in and fix it. That is exactly what it did. I am absolutely delighted and proud to be part of a Government that puts pragmatism ahead of principle every time. 
If there is anything that separates National and Labour it is industrial relations. I am absolutely delighted to stand up and defend the changes that have been made by this Government in respect of both the Employment Relations Act and the Holidays Act. Let me start with the simple premise that employees know what is best for them and they can go to their employer and say: “You know what? I’ve got that fourth week’s holiday but I want to cash it up. I’ve got a few bills to pay.” Somehow that represents the sort of “can’t think for themselves” mentality that Labour wants to continue to promote. It absolutely defies belief. But the thing that really really gets me the most is the fact that Labour members are not prepared to give the marginalised the young and the very old the opportunity to demonstrate to employers that they are worth giving a go. We changed the legislation so that small employers could do that. What happened? It was a fantastic success. So what did we do? We extended that out to all employers. I think that will see the handbrake on productivity in this country finally come off. The legislation comes into effect in a couple of weeks and I think we should stand by because it will be one of the things that will get this economy going. The other thing that employers have been saying to us for years is that the Holidays Act is impossible to manage. In fact as an employer prior to the last election I shared that view. The one thing we needed to get rid of was the terrible relevant daily pay basis for calculating pay for leave taken which absolutely undermined the Holidays Act. We have done that. Frankly I think we can do a little bit better with that but this is a journey and I know that the Minister of Labour has that under control. 
But the one thing that comes within the purview of the Department of Labour that I want to talk about and the thing that the public of this country still wait to hear from the previous Labour Government is the apology it owes the public for its absolutely woeful performance on ACC. The Department of Labour oversees Vote ACC on behalf of the Crown and the public of New Zealand is still waiting. We were delighted to hear that the turn-round that was required has been achieved with a substantial accounting surplus at least if that does not translate to a cash surplus. That follows 2 successive years when firstly a $2.4 billion deficit was signed off as accurate by the previous Minister for ACC Maryan Street followed hard on its heels by a $4.8 billion deficit and a blowout in the unfunded liability from about $11 billion before the rot set in in 2005 to— 
Chris Hipkins 
: They collected $1 billion more than they paid out last year and $2 billion more than they paid out this year. 
MICHAEL WOODHOUSE 
: You see that is another classic example of how completely ignorant the Opposition spokesman for ACC is on the way in which the scheme works. Labour supports full funding but does not want to recognise when the books are absolutely in deficit. 
Chris Hipkins 
: Those are the facts: $2 billion more than they spent. The global financial crisis is a short-term setback. 
MICHAEL WOODHOUSE 
: Denial—there it is. You see we did not have a problem. Apparently there is money in the bank so that is all right. It is a bit like saying: “I’ve got $10000 in the bank and a $500000 mortgage so everything’s fine. If I don’t bring home the bacon I’m OK.” It is like jumping out of a plane from 50000 feet and saying that everything is all right 100 metres off the ground. No parachute but it is going to hurt in time. 
Chris Hipkins 
: The investments recovered ACC’s financial position. 
MICHAEL WOODHOUSE 
: You see it is the investment problem now. Let me tell the member that the rot set in a long time before the global financial crisis set in. I am absolutely proud of the turn-round this Government has put in place for Vote ACC. Congratulations to the Department of Labour on its role in the oversight that that has produced. Long may that continue and with that spokesman I have no doubt that it will. 
Report noted. 
Department of Building and Housing 
Report noted. 
Department of Internal Affairs 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 The Government is completely out of touch with ordinary New Zealanders and nothing illustrates that more than its upgrade of the ministerial BMW fleet at a time when the Government is asking other New Zealanders to stomach cutbacks in the services that are available to them. Government Ministers are having their cars upgraded so they can travel around in flash new BMWs while the Government is cutting public services and telling New Zealanders they need to tighten their belts. 
Government Ministers cannot even get their story straight about the cars. John Key said first of all that he did not know anything about the upgrade and that the first he ever heard about it was when his driver told him on 15 February. 
Tim Macindoe 
: Who signed the deal? 
CHRIS HIPKINS 
: John Key signed it. John Key signed the deal. John Key signed it off. I will get to that in a moment. John Key signed off the deal not once but four times—four times. I will get to that if Mr Macindoe will hold on to his braces for just a moment. 
John Key told TV3 on 15 February that the first he knew about the cars was when his VIP driver told him. So first of all it is the VIP driver who told him then later on he said that the first he heard about the upgrade was when he read about it in the newspaper. So we have two stories now: that it was the VIP driver who told him about the upgrade and that he read about it in the newspaper. 
I will go into this issue in a little bit more detail. John Key then said that the upgrade did not come as a surprise to him. He told Mike Hosking on 21 February—this is a good one—that when the Crown car driver said to him some weeks back some comment about the car and about new ones coming it did not seem much of a surprise to him because he sort of knew the fleets turned over. If members can follow all that they will know that basically John Key said the VIP driver told him about the upgrade he was not surprised and he did not really care. Of course a few weeks later when it all blew up into a big issue suddenly he had never been told about the upgrade of the VIP cars and he did not know anything about it despite the fact that he had signed it off four times. 
So when in fact did John Key first find out about the upgrade of the VIP cars? Well we have to go all the way back to 30 March 2009 when he first signed off on the upgrade of the VIP fleet. He signed it off first on 30 March 2009 then he signed it off again on 21 April 2009 then on 21 March 2010 and then on 20 April 2010. John Key signed it off not once but four times. What was his rationale behind that? Well he did not read the reports. He did not read the reports. What are the reports that John Key did not read? They are nothing particularly important just the statement of intent for the Department of Internal Affairs. What does the statement of intent actually do? It only authorises the spending of tens if not hundreds of millions of dollars of taxpayers’ money. That is all right; it is not particularly important! It does not matter that John Key signs those reports without reading them. This is only the deal that basically tells the Department of Internal Affairs what it will do. John Key signs off reports without even reading them. 
First of all he claimed that he did not know anything about the car upgrade then it turns out he signed it off four times—four times—and then it turns out he did not know about it because he did not bother to read any of the reports on it that he had received. 
Hon David Parker 
: A bit like those emails from the Exclusive Brethren. 
CHRIS HIPKINS 
: It is a lot like the emails from the Exclusive Brethren; he never opened those emails. He did not know anything about all that money the Exclusive Brethren were washing into the National Party’s campaign. Apparently John Key is not very good at reading things. He does not open his email. He does not even read substantive documents from his department and there is nothing much more substantive than the statement of intent which is basically the Government’s job. 
John Key did not bother reading the statement of intent because why read it when he has no plan? If the Government actually had a plan it might care what is in the statement of intent for the department but it has no plan at all. The Government is totally at sea with a Prime Minister whose only objective is to have his photograph taken as many times as possible. There is no photo opportunity involved in reading a statement of intent before he signs it off—no photo there. It has not even got John Key’s photograph on the cover so why would he bother reading it? He just signed off the statement of intent without even bothering to read it. I think that is pretty disgraceful. 
We then find out that there is a lot more to it. Between 19 and 20 July 2010 it turns out that the Prime Minister’s chief of staff had been meeting with the Department of Internal Affairs and Ministerial Services and discussing the upgrade of the VIP fleet which John Key knew nothing about. Nobody thought to tell John Key anything about it —if we believe exactly what he said. The Prime Minister was marching along totally in the dark with no idea about the upgrade of the BMW fleet. He signed it off four times and all the time his chief of staff was meeting regularly with the Department of Internal Affairs and discussing the very issue of the upgrade yet John Key did not know anything about it. 
What about the rest of the Cabinet? Did those members know anything about the upgrade? Well in fact they did. It turns out that the Minister of Internal Affairs not only signed off the upgrade but back in December he wrote a letter to Bill English asking to keep some of the money from it. The Minister of Internal Affairs knew all about the upgrade but the Prime Minster did not know about it. According to John Key no Ministers knew anything about it. Well the Minister of Internal Affairs knew all about it and the Minister of Finance knew all about it. In fact John Key knew all about it too if his signature is to be believed. If we are to believe John Key’s signature then he knew all about it. But apparently no we cannot trust his signature because he does not read the things he signs. We cannot trust his signature. 
That could explain the National Party’s manifesto which had John Key’s signature on it too. He does not seem to know very much about that and he does not read the reports that get sent to him. He does not read stuff he signs off. 
John Key knew all about the upgrade of the VIP fleet. He knew all about it and he simply was not willing to front up and say he knew about it. He did not care. He was so out of touch with New Zealanders that he did not care that Ministers were getting new BMWs while ordinary working Kiwis were being told to tighten their belts with cuts to their public services cuts to their health services and cuts to their benefits with more coming. More cuts are coming because Bill English and John Key have said that all new spending is off the table. 
This year’s Budget will not even keep pace with inflation. It will not even keep pace with inflation but that is OK because the Ministers have their new VIP cars to cruise around in while the rest of New Zealanders stomach the cuts to services. 
Hon Member 
: Out of touch. 
CHRIS HIPKINS 
: The Ministers are totally out of touch and they have no plan but they have new cars to drive around in. Whose interests is this Government really looking after? It is looking after its own interests. It is looking after the interests of its mates not ordinary hard-working New Zealand families. 
There are other examples of that in the Internal Affairs portfolio particularly Ministerial Services. 
Hon Hekia Parata 
: Well let’s hear some! 
CHRIS HIPKINS 
: Well one of the first things John Key did as Minister Responsible for Ministerial Services was to sign off a new ministerial housing regime that effectively gave a tax-free pay rise to all of the Ministers in Cabinet. So now they have these flash new ministerial houses— 
Hon Members 
: Not me. 
CHRIS HIPKINS 
: —well Mr Macindoe is not a Minister and Hekia Parata lives in Wellington. Chris Finlayson apparently lives in Wellington. He has been seen once or twice around Rongotai. Those members do not get the housing allowance all the other Ministers get so I can understand. Nathan Guy lives just a bit further up the road and he got the tax-free pay rise for his ministerial house under John Key’s new regime. Why did John Key sign off on a new housing regime in the first place? Because Bill English was found with his hand in the till helping himself to taxpayers’ money which he was not entitled to. So the Government set up a new housing regime that was going to be more transparent and that gave it more money. Why did it do that? Government members are interested only in their own interests. Ministers are driving around in fancy BMWs and living in fancy ministerial houses but they are not interested in the plight of ordinary working Kiwis who are having their State house maintenance budgets cut and who are paying more for their early childhood education. But that is all right because the Ministers have new BMWs and flash ministerial houses. 
Bill English has increased the spending on flowers in his office. He has doubled the budget. He is spending twice as much money on flowers in his office as the previous Minister of Finance did. “The Dipton Petal” has a new BMW car his fancy ministerial home that he claims is his secondary residence—despite the fact that he has lived there all along—and lots of flowers. Bill English is feeling pretty good about things. He has pretty flowers to look at drives around in his fancy ministerial BMW and goes home to his ministerial home up in Karori— 
Stuart Nash 
: Got his tax cuts. 
CHRIS HIPKINS 
: —and got his big fat tax cut. This Government is busy looking after its own interests. It is not looking after the interests of ordinary working New Zealanders. 
Hon NATHAN GUY (Minister of Internal Affairs) 
: 
 I start off by remembering the people of Christchurch. We are a month on from the terrible earthquake of 22 February. I think the whole Committee offers its support for Canterbury to get back on its feet particularly those residents of Christchurch and those businesses. 
The reason I raise this is that over the last week we had the memorial service in Hagley Park. The Department of Internal Affairs was directly involved through the Visits and Ceremonial Office in organising that event. I think it did a fantastic job. If we went out to the private sector and asked it to organise an event in a park for in the vicinity of 90000 to 100000 people and said it had a bit over a couple of weeks to do it it would go into panic mode. In my opinion the Visits and Ceremonial Office did a fantastic job. 
Thinking about the terrible loss that occurred just over the hill from Christchurch at Pike River the Visits and Ceremonial Office stepped up and organised that memorial service for that community. It was difficult to organise that memorial service because of the logistics and the location but once again it stepped up and did a fantastic job. 
The Department of Internal Affairs operates across eight votes and six Ministers and had close to $230 million expenditure over the 2009-10 period. It encompasses citizens the Government and the community. A lot goes on within the Department of Internal Affairs that a lot of people do not necessarily realise happens. We have rolled out the new passport which enables people to get into 50 countries visa-free and has 50 security features. We have the very high performing Births Deaths and Marriages which is trusted by New Zealanders. We are also talking about New Zealand citizenship with 20000 to 30000 citizens heading through that process. The department is trusted by a whole lot of New Zealanders. 
I was interested in listening to the address from the Labour member. I would have thought he would talk about the integration of the National Library and Archives New Zealand into the Department of Internal Affairs because that was a huge issue to Labour last year but we did not hear anything about that. That integration has gone fantastically well. It was interesting to read in the report from the Government Administration Committee which is before the Committee today that: “The powers of both the Chief Archivist and the National Librarian are enshrined in statute”. That was a huge concern of the Opposition. I believe that the integration has gone fantastically well. 
I look forward to welcoming the new National Librarian who will start in early May. William McNaught— 
Hon Christopher Finlayson 
: Puke Ariki. 
Hon NATHAN GUY 
: That is right. He comes to this new role highly respected. He is the former manager of the Puke Ariki library visitor information centre in New Plymouth. In fact I visited there over the summer holidays and I was really impressed. I look forward to establishing a great working relationship with Mr McNaught. I also look forward to carrying on the ongoing strong working relationship I have with the Chief Archivist who was in an acting role and who has now been appointed to a permanent role. That of course is Greg Goulding. 
As I say there has been nothing tonight from Opposition members about the integration which was a big issue last year. Opposition members ran around and said that it would not work. We have a real focus on front-line services and combining back-office functions and this integration is a very important part of that. I note that when we announced the merger the New Zealand Public Service Association (PSA) welcomed the protection of these statutory roles and the efforts of this Government to reduce fragmentation in the public sector. 
Hon John Carter 
: The PSA accepted it. 
Hon NATHAN GUY 
: Mr Carter is right. The PSA welcomed it. 
Hon John Carter 
: What about the Opposition? 
Hon NATHAN GUY 
: Opposition members have their heads in the clouds. We have just heard the rant from the member for Rimutaka. He should be particularly worried about the new National Party candidate who has been selected for that electorate Jonathan Fletcher. Mr Hipkins should get used to the sound of knocking because Mr Fletcher has been out today knocking on doors and getting a fantastic response in that electorate. It is probably only a matter of time—a few months—before Mr Hipkins says goodbye to this place. 
The other important thing I wish to raise is the focus of the Department of Internal Affairs on digital information. We have a real focus on ensuring that all of the department’s information is more accessible to the New Zealand public. That suits the Government’s focus on rolling out ultra-fast broadband ultimately to every home in New Zealand. Many many fantastic areas of digitisation and technology are happening in the Department of Internal Affairs. Recently in the igovt logon service the 1000000th log-on occurred. 
The CHAIRPERSON (Hon Rick Barker) 
: I am sorry to interrupt the member but the time for this debate has expired. 
Clauses 1 to 11 and schedules 1 to 5 agreed to.  
Bill reported without amendment. 
Report adopted. 
Appropriation (2009/10 Financial Review) Bill 
Third Reading 
Hon JOHN CARTER (Minister of Civil Defence) 
 on behalf of the  
Minister of Finance 
: I move  
That the Appropriation (2009/10 Financial Review) Bill be now read a third time. 
Bill read a third time. 
Marine and Coastal Area (Takutai Moana) Bill 
In Committee 
Debate resumed from 17 March. 
Clauses 1 and 2 ( 
continued 
)  
The CHAIRPERSON (Hon Rick Barker) 
: Members I feel that someone should say “groundhog day”. I need to advise members of a vote correction. The result of the vote on Wednesday on the question of Hilary Calvert’s amendment to clause 37(2) to omit “38 to 44” and to substitute “38 to 44 or to local authorities.” was incorrectly announced as Ayes 4 and Noes 114. The correct result is Ayes 5 and Noes 114. The record will be so corrected. 
Hon DAVID PARKER (Labour) 
: 
 I raise a point of order Mr Chairperson. Could I have clarification as to whether that is because a vote has been corrected or whether there was an addition error which meant that an adding error got four votes rather than five? 
The CHAIRPERSON (Hon Rick Barker) 
: I cannot tell the member precisely how the error occurred but the Clerk’s Office has advised me that there was an error. The advice is that the vote was incorrect and needs to be corrected. It has been corrected. 
Hon DAVID PARKER (Labour) 
: 
 I raise a point of order Mr Chairperson. I should have thought the Committee was entitled to know whether it was a party correcting its vote or whether it was an addition error. 
The CHAIRPERSON (Hon Rick Barker) 
: I can advise the member that if a party had called its voting numbers incorrectly it would have then been the responsibility of the party to seek the leave of the Committee to correct the vote. That was not the case. So by deduction the member is entitled to come to the conclusion that it was an arithmetical error. No leave was so sought. 
Hon JOHN BOSCAWEN (Deputy Leader—ACT) 
: 
 As you say Mr Chairperson we are back on groundhog day debating the last debatable question in the Committee stage of the Marine and Coastal Area (Takutai Moana) Bill. Of course we are debating clauses 1 and 2 dealing with the title and the commencement date. I would like to speak on the amendment in the name of my colleague Hilary Calvert who suggests that this bill might be renamed the “Marine and Coastal Area (Secret Deals Behind Closed Doors Without Public Scrutiny) Bill” or simply the “Removal of Public Scrutiny Bill 2011” or the “Secret Deals Bill 2011”. 
Alternatively perhaps Hilary Calvert could have chosen to move another amendment to the title: the “Marine and Coastal Area (Lost Opportunities) Bill”. The reason I say “lost opportunities” is that I am amazed by the number of Government members who have said over the last 6 months that Labour made a mistake. Within hours of the Court of Appeal making its decision known in 2003 Helen Clark walked in where angels feared to tread and decided she would legislate. As a consequence ever since that time iwi and hapu have felt that they have had their rights taken from them and that they have been denied their day in court. 
What have the National and Maori Party responses been to that? It seems to me that the most basic response and the correct response would have been to correct Helen Clark’s mistake and simply repeal the Foreshore and Seabed Act. The Maori Party campaigned at the 2005 and 2008 general elections on repealing the 2004 Act. It seems to me that if that repeal had happened we would not have had the hikoi marching on Wellington today. Although the Attorney-General thinks he is doing what is best for New Zealanders the problem with this solution is that we still have a group of New Zealanders who feel as though their property has been confiscated and that they have been denied the right to have their day in court. The only way to correct that was to ensure that the 2004 Act was repealed full stop. 
But this bill takes fright. National is taking fright just as Labour took fright in 2003. National was not happy for iwi and hapu to have their day in court. It wanted to set down a number of tests; it wanted to set down the rules if you like. The Attorney-General has talked about the importance of British common law and of the courts interpreting common law but in this bill he is actually denying the courts the right to do that. He is actually setting down the tests. In setting down those tests the ACT Party believes that the Attorney-General is lowering the bar. We believe that large areas of New Zealand that would otherwise not be transferred are likely to be transferred to iwi and hapu at the expense of other New Zealanders. Equally we believe that some iwi and hapu may well be denied the right to have their day in court and denied the right to get what would lawfully be theirs. This bill is not the correct solution. The Government has taken fright. 
Not only has the Government taken fright but it has actually misled New Zealanders. I was at a debate last night at the Remuera Rotary Club with the gentleman who sits alongside Mr Chair the Hon Chris Finlayson. The members of the Remuera Rotary Club invited us to debate this particular issue. It is a tragedy that some of the misinformation that is coming from National was repeated last night at that function. I refer to the continual reference to the need to prove continuous and exclusive occupation. National members have said time and time again that one would need to show continuous and exclusive occupation of an area in order to gain customary title. That is not the case. The Attorney-General knows that there are provisions in this very bill that say it is quite acceptable for other New Zealanders to have fished in a particular area for other New Zealanders to have boated through a particular area and for iwi and hapu not to have had exclusive occupation since 1840 but that nevertheless we will continue to maintain the charade that they have. 
I raised with the Attorney-General at question time today the issue of access to beaches. When the Attorney-General was asked a question about access to beaches at the Rotary Club last night he said he did not believe that the presence of wahi tapu would prevent people from walking over an area of the common marine and coastal area—what the members of the Rotary Club would regard as a beach. I actually had to stand up and point out to the members of the Rotary Club that despite the assurance of the Attorney-General they had only to look to clause 27(2) to see it makes it absolutely clear that the rights of free access are subject to the rights of wahi tapu. It is there in black and white. 
But I also said to the members of the Rotary Club when I was asked that the reason this bill is being passed is that most New Zealanders do not understand it. Most New Zealanders have had a gutsful of debating this issue over the last 7 years. It has gone over their heads. National is pushing the bill through the House and I suspect it will pass its final Committee stage tonight because most New Zealanders have not taken the trouble to find out the provisions of the bill or because they have been happy to accept what in our view are the incorrect assurances of National. I think that is a tragedy because eventually those New Zealanders will wake up and understand the full provisions of the bill. It is as simple an issue as that. If more people had become aware of the provisions of the bill and if those provisions had not been misrepresented I believe we would have a much bigger uproar and I do not believe that this bill would be passed through the House. One has only to go to the document on the Beehive website that a member of the Rotary Club referred to last night  
Setting the Record Straight 
. As I have said before in this Committee stage down at the bottom of the page the Government accuses a group such as the Coastal Coalition of spreading misleading information when in fact the Government is doing that. 
KELVIN DAVIS (Labour) 
: 
 When debating the title and commencement clauses of the Marine and Coastal Area (Takutai Moana) Bill there is really only one alternative title that should be considered and that is the “Foreshore and Seabed Act (Mark II) Bill” because there is no substantial difference between this bill and the previous Act the Foreshore and Seabed Act of 2004. The only real difference is that Maori will have access to the courts. But the Maori Party is confusing access to the courts with access to justice and Maori do not feel that they have access to justice. That is why today a hikoi turned up in the grounds of Parliament. There is a significant number of Maori who do not feel that they have access to justice because of this bill. It is a Clayton’s repeal—it is the repeal we have when we are not really repealing anything. 
Access to the courts and access to justice are two totally different things. This bill is the best the Maori Party could do. This is the best they could do—they can get Maori to go to court but they cannot guarantee justice because the hurdles Maori have to jump over are too difficult and will not actually get them what they believe they deserve. This bill is a Clayton’s bill; it is the “Foreshore and Seabed Act (Mark II) Bill”. 
Now that the Maori Party members have ticked this off their list what is next for them? They have put all of their energy into this bill. It is a bill that has basically torn them asunder. What is next? Our people out there have more issues. We do not want to be relitigating this issue every 3 years. I will read out what was reported on 8 September 2010: “The Maori Party will not rule out using post-election negotiations to try to get a better deal on the foreshore and seabed despite agreeing to support the National Party’s new law.” So what they are saying is that post-election they will be dredging this up again dredging it up over and over again every 3 years. Maori have had enough of relitigating these types of issues. It is time for us as Maori to move forward not to keep bringing up this type of issue over and over again. John Key said he believed it was “a lasting solution to the matter and would not be revisited.” We heard Te Ururoa Flavell say that this bill was the best that the party could negotiate in the circumstances and that it was possible that there would be “another time for our people to come back and have another go in the future”. We have missed an opportunity; we have missed an opportunity to settle this issue once and for all. Instead we have the prospect of coming back every 3 years to relitigate it to raise it over and over again when we cannot afford as Maori to do that. 
Hon Tau Henare 
: Are you going to make the test easy? No. 
KELVIN DAVIS 
: We need to focus on the issues that are really hurting Maori such as Maori unemployment. Under the National Government of which Tau Henare is so proud Maori unemployment has gone backwards and New Zealand has gone backwards. What will the Maori Party and National do about Maori teenage pregnancy rates or Maori suicide rates or Maori incarceration rates? These are the issues that we need to be debating and making decisions about so that our people can rise up from the bottom of the pile and get to the top of the pile where we deserve to be. 
I ask the Maori Party what is next now that it has ticked this issue off the “to do” list. What is it that will really move us forward as a people? We have heard about Whanau Ora. In the Maori Affairs Committee I asked these questions: what exactly would Whanau Ora change or improve what was the current baseline data and in 5 years’ time what would show us that Whanau Ora was making a difference? The officials could not answer those questions. They do not know exactly what Whanau Ora will address. 
Hon Shane Jones 
: No idea. 
KELVIN DAVIS 
: They have no idea. They do not know by how much it will improve. All they know is that this undefined problem will be improved by an undefined amount. They do not know who will do it and who will do what. All they know is that it will cost $134 million over 4 years. It is a bit like Tariana Turia announcing that she is going to build a bridge. She does not know where the bridge will start where it will end how long it will be how many lanes wide it needs to be and what it will be constructed of. All she knows is that it will cost $134 million. 
I ask the Maori Party now that they have ticked this legislation off their “to do” list—for now—what the next item on their “to do” list is how they will help lift Maori off the bottom of the pile and how we will move ahead as a people. We deserve better from this House. We should not be relitigating this type of issue over and over again. We need to focus on those issues that are hurting Maori. Those are my questions for the Maori Party. 
This bill should have only one name and that is the “Foreshore and Seabed Act (Mark II) Bill”. It is the bill that just repeats what has happened in the past. It does not give Maori access to justice which is what the crowd today was marching for. All it does is give them access to the courts but it means that the hurdles that they jump are no different; the result is no different. 
I want to bring up again the issue about wahi tapu. John Boscawen mentioned wahi tapu once more and I struggle to see how many wahi tapu have the potential to be excavated as we heard today when these wahi tapu that we are talking about are all below the high-tide mark. There may be wahi tapu that have eroded into and become part of the common marine and coastal area but I can really think of only one wahi tapu that would not be eroded and that is the example I raised of the Mataatua waka sitting somewhere out in Takou Bay. That I would consider to be wahi tapu. Who will ever drive their digger out there and excavate it? Who will ever have a picnic there? 
Hon Tau Henare 
: This is 2011 not 1611. 
KELVIN DAVIS 
: I do not understand what the concerns are with this bill— 
Hon Tau Henare 
: For goodness’ sake. 
KELVIN DAVIS 
: —preventing people from walking along the coast walking along the beach or walking to wahi tapu. [ 
Interruption 
] If the Hon Tau Henare were listening he would know I am backing up his party’s line. 
Hon Tau Henare 
: Sit down and vote for the bill. 
KELVIN DAVIS 
: I tell the Hon Tau Henare that I am backing up this part of the bill. I do not understand the hysteria of the likes of the Coastal Coalition. They say that as there will be so many wahi tapu along the coastline people will be prevented from accessing the beach. We are talking here about the area below the high-tide mark and it is suggested that wahi tapu will all be in the sand dunes and that people will be prevented from walking across the sand dunes. To me it is nonsense; it is a bit of a red herring. It is just one of those issues that have been raised throughout New Zealand to generate fear and loathing about Maori. 
I also take issue with the point that Mr Boscawen made that it has not been exclusive as people have been able to fish in particular areas and swim in particular areas. It sounds like what he is wanting is for Maori to have excluded people since 1840 from areas of the coast in which case Maori would be bagged by all and sundry if we had been exclusive if we had blocked areas off. We would have been hammered by mainstream New Zealand for not allowing people on to the beach. Now because of our generosity we are being slammed and the argument has been undermined that because of Maori generosity—Maori allowing people access to the foreshore and seabed—somehow we should not now be allowed to have that exclusivity clause in the bill. I think that what the Hon John Boscawen said is at odds with what he wants in the future. He has said that if in the past Maori had been exclusive and prohibited people from accessing the foreshore and seabed for fishing and swimming in particular places then we would have a right to now exclude people. I do not see the logic of that argument. I think that Maori have been handicapped in this argument through our generosity in allowing people to have rights to the foreshore and seabed. 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I thank the honourable member Kelvin Davis for the latter part of that contribution which I thought hit the nail on the head. I think the confusion that comes out of the ACT Party on this issue is because they do not know the difference between the marine and coastal area and the beach so all the scaremongering which was so evident tonight comes because they presume that we are talking about the beach. 
The only example I could give at the great celebrated Rotary Club of Remuera debate last night was about Kaingaroa at the very northern tip of the Chatham Islands because I think there was an urupa that was very much part of what is called the foreshore and seabed the common marine and coastal area. The example that the member gave about the waka is another example. So I think it is simply scaremongering. What I find surprising is that when the honourable member John Boscawen was at the debate last night—and maybe we should have more debates at the Rotary Club of Remuera—he was on his best behaviour but when he comes down to Parliament I am afraid the honourable member goes feral. 
I will say something about clause 77. Let us just go back to basics when we are dealing with wahi tapu areas. Clause 77(2) states: “A wahi tapu protection right may be recognised if there is evidence to establish … (b) that the group requires the proposed prohibitions or restrictions on access to protect the wahi tapu or wahi tapu area.” It is not carte blanche to stand at the top of a cliff and decide that all before me is wahi tapu. So yes there can be restrictions on the right of access but the first point is that they have to get to establishing a wahi tapu area. As I said earlier today in question time the conditions that may be imposed may be of a temporal kind for one or more defined periods an indefinite period a recurring period of a stated kind or directed to a specified area. 
So my advice to the ACT Party is that the wahi tapu question is a very interesting one but as Mr Davis so accurately said it will not be a massive issue in the practical world simply because we are dealing with wahi tapu areas in the common marine and coastal area. So stop trying to scare people and at the same time diminish the concept of wahi tapu. Let us concentrate on the issues that divide the parties in this Parliament and they are codification versus no codification or agreements being permitted. They are the big issues that divide us. The scaremongering and the imbecility have to stop. 
HONE HARAWIRA (Independent—Te Tai Tokerau) 
: 
 Kia ora Mr Chairperson. Kia ora tatou katoa e te Whare. In talking about the title of the Marine and Coastal Area (Takutai Moana) Bill I recommend that “Takutai Moana” be removed because its inclusion insults the notion that the marine and coastal area bill will do anything to help Maori restore their rights to the takutai moana when in fact all of Maoridom—apart from the four members of the Maori Party caucus of course—know that it will not do anything of the sort at all. 
I also recommend that “Takutai Moana” be removed from the bill because Maoridom has shown clearly that it does not support this bill. In fact of the 72 submissions that came before the Maori Affairs Committee from organisations such as whanau hapu iwi marae and other Maori organisations only one supported the bill which is a strike rate of about 1.5 percent support. I also suggest that “Takutai Moana” should be removed from the title because the iwi leadership which was widely touted to be supportive of this bill withdrew its support from this bill before it even got to this Parliament and has been notable by its absence in the gallery at every reading of this legislation because it does not want to be seen in any way shape or form to be supporting this bill. 
I also suggest that perhaps the bill might be renamed the “Taku Tahae Moana Bill”—“My Stolen Seabed Bill”—as in my seabed has been stolen by the Government. It has no doubt already mapped out all the seabed around our country and has no doubt already identified the kind of corporate entities it intends to do business with including corporate pirates such as BP and Exxon Mobil which have demonstrated a ruthless commitment to profit at the expense of the environmental destruction that their industry is noted for. 
I suggest that the bill be renamed the “Taku Tahae Moana Bill” to also reflect the fact that my seabed has stolen by this Government which plans to ram through the Trans-Pacific Partnership agreement which will open up all our resources including our foreshore and seabed to the international rape and pillage brigade which will in turn repay the good turn that we are doing it by suing our Government in secret international courts should Maori and other environmentally conscious New Zealanders take positive and concrete steps to protect our seas from the destructive activities of the petroleum industry. Perhaps the bill might be renamed the “Taku Tahae Moana Bill” to reflect the fact that my seabed is being stolen by the Government which has already entered into dodgy relationships with petroleum companies that have a record of disaster and mayhem in the oceans of the world without any formal record of corporate accountability that most other countries would demand of such resource-exploiting agencies. 
Renaming the bill the “Taku Tahae Moana Bill” would also reflect the fact that my seabed has been stolen by this Government which sees the foreshore and seabed as a commodity from which it can maximise profits to repay overseas debt all the while ignoring the crippling debt that ordinary New Zealanders are facing up and down the country. Perhaps the bill should be renamed the “Taku Tahae Moana Bill” to reflect the fact that my seabed has been stolen by this Government which is committed to entering into contractual relationships with foreign companies that have demonstrated no interest in the needs of indigenous peoples anywhere in the world or for that matter in the needs and aspirations of Maori people or indeed of New Zealanders generally. 
This bill might rightfully be renamed the “Taku Tahae Moana Bill” to reflect the fact that my seabed is being stolen by this Government which has already decided that genuine consultation with Maori is no longer a requirement for the passage of legislation aimed at exploiting resources that are rightfully the domain of whanau hapu and iwi. Thank you. 
PAUL QUINN (National) 
: 
 I move  
That the question be now put 
. 
HILARY CALVERT (ACT) 
: 
 I am sure people have been looking forward since Thursday to hearing me take a call on the Marine and Coastal Area (Takutai Moana) Bill. It is probably confusing that the Attorney-General sometimes says that access can be restricted in the wahi tapu area and sometimes says it cannot. That may be why he is concerned enough to feel the need to be rude about my colleague. It would be helpful if that stopped. 
This bill should have been called the “Marine and Coastal Area (Different Rules for Different Races) Bill”. Not only is this one of the worst bills to come before the Committee in living memory but the entire process has made a mockery of our democracy. The select committee process at its best is an example of democracy in action. It listens to the people and recommends changes to legislation according to what the public says. With this bill we have seen the select committee process at its worst. Despite spending month after month travelling round the country listening to and reading thousands and thousands of submissions vehemently opposed to the bill the select committee reported back the bill without even one amendment. It was as if there had been no consultation at all. Members of the select committee might as well have stayed at home. Accordingly the title should be changed to the “Marine and Coastal Area (Abuse of Process) Bill”. 
More important in the end the substance of this bill flies in the face of the basic principle of equality before the law. The idea that all citizens are equal before the law is integral to all New Zealanders. This bill however legislates for the opposite which is why it should be called the “Marine and Coastal Area (Different Laws for Different Races) Bill”. 
The first hikoi marched for Maori to have the same access to the law as other New Zealanders. We supported that then and we support it now. Instead this bill creates undefined and unclear tests such as “substantial interruption” and “more than minor” against which Maori have to test their claims for customary title. No other New Zealander has to do that. Maori like all New Zealanders should have the right to take grievances to the courts and most important to have those grievances measured against common law tests not vague ambiguous tests invented by politicians. 
Yet another reason to call this bill the “Marine and Coastal Area (Different Laws for Different Races) Bill” is that it provides for a new set of property rights available only to Maori and will allow some iwi to override the laws of the land in respect of resource management around the coast of New Zealand. The Auckland District Law Society said as much in its submission on the bill when it stated that the bill gave Maori unjustifiable legal privilege. That is especially the case as Maori who already own freehold land do not have the right to circumvent the Resource Management Act nor do they have permission rights that will be granted to them under the bill. The whole idea of the bill undermines the principle of one law for all—a fundamental idea of democracy. 
This bill should equally be called the “Marine and Coastal Area (Ignore Public Opinion) Bill”. Early in the process the Prime Minister said that he would proceed only if the bill had widespread support. He promised he would listen to the people. Well the Government did not listen to the review it did not listen to the 5000-plus submitters who wrote in against the bill and it did not listen to the more than 500 submitters speaking for hundreds and thousands of others who came to the hearings. It has not listened to its constituents and it will not listen to the hikoi that arrived at Parliament today. The Government just will not listen. 
One thing this bill cannot be called is the “Marine and Coastal Area (One Law for All) Bill”. As a country we need to keep talking about what one law for all New Zealanders means. One law is clearly set out in the Treaty of Waitangi. To ignore one part of the Treaty is to disrespect the rest. Successive Governments have strayed from that principle and this bill is no exception. ACT is the only party that has always argued for equal rights not special rights. Other parties may not like it but one law for all is one of the fundamental principles that should guide this Committee in everything we do. This bill breaches that principle. In doing so it disrespects the Treaty. 
Hon SHANE JONES (Labour) 
: 
 Tena tatou katoa. Today we saw an assemblage of kaumatua and rangatahi predominantly from the north bringing their nawe about the seabed and foreshore to Te Upoko-o-te-Ika. In that group today—and this does relate to the title of the Marine and Coastal Area (Takutai Moana) Bill—was Selwyn Murupaenga. It is extraordinary that Selwyn Murupaenga was here in 1975 accompanying Dame Whina Cooper in the Matakite march and that he should find it necessary to come back many years later and repeat his message. Unfortunately the bill does not settle the issue.  
The name of the bill is rather interesting. I will not steal any more of the thunder that Hone Harawira characteristically laces his speeches with. Unfortunately his loudness of voice is inversely related to his impact on policy process and legislation which voters will note and make a very sensible decision about on 26 November.  
The Takutai Moana Bill uses the word “marine”. I want it noted that the original Marines were soldiers. They were sent on vessels at a time when the sailors and other people working on those vessels were press-ganged. What was necessary because of this level of authoritarianism and eventual type of slavery was that the Marines needed soldiers to keep them disciplined. The fact that the bill unwisely uses the word “marine” in the title has little to do with the vegetation that grows in that part of the world’s environment but everything to do with the absolute loss of autonomy free thinking and personal sovereignty on the part of the Maori Party. 
The Maori Party has had visited upon it the effect of the National Government in the form of some sort of Marine Corps insisting that it votes toes the line and passes this foul legislation. Another thing about the word “marine” is the quality of navigation that is necessary to sail through treacherous seas avoid the shoals and keep away from the reefs etc. The Maori Party’s navigational abilities have failed it. It has unwisely sailed blindly behind Captain Bligh otherwise known as the Attorney-General. He has unleashed his whip and today in that somewhat waspish sense that he generally addresses people with he said he got wet. Of course we say he is wet behind the ears. The Attorney-General has actually demeaned and weakened the position of the Maori Party permanently and fatally. All will be revealed after the World Cup delivers a result to the Golden Oldies rugby team and the All Blacks. 
I come back to the bill. An element about being successful as a Marine is the ability to be amphibious. During the course of the debate as I dwell upon the full meaning of the title of the bill I see we have had amphibious-like behaviour from one or three members of National. They have managed to sink themselves into the surf. Now and again they pop up and then as they take a gulp of oxygen and are allowed to actually offer their views about Maori politics and legislation they are quickly pulled down by an undercurrent emanating from the top of the National Government. You see the Maoris in National are not allowed to speak. They were given 10 15 or 20 minutes to debate the bill last Thursday at a time when most people were thinking about the next day in Otautahi. 
H V Ross Robertson 
: Going to sleep. 
Hon SHANE JONES 
: When Tau Henare speaks no one goes to sleep because they are reminded of what it is like at 1.30 in the morning when children who have earache or are teething are bawling. Those memories are very threatening which is why when Tau Henare speaks no one unfortunately is able to sleep. 
There is a Supplementary Order Paper that deals with the commencement clause. To the best of my knowledge it represents an opportunity to bring the law into full legal effect in a far less circuitous fashion. It was the subject of some debate during the course of the Maori Affairs Committee’s deliberations so in that sense there is not an inordinate amount of criticism that we can ladle upon the Attorney-General for that other than for Hilary Calvert’s names and titles. Not only is she worsening her own cause but she is wrong to come to this Chamber and be a parrot for the Coastal Coalition and Muriel Newman. There is an underlying current of banality hurtfulness and open plain bigotry and ACT members are wrong to be parrots and amplifiers for it. That quality of contribution has no place in this debate. 
This debate is about whether a person’s right ought to be determined by having the ability to argue in court in a broad unfettered fashion or whether they should be constrained and strait-jacketed. That is a decent public policy issue to argue. It ought not to be clouded or undermined by the very sad and quite frankly un-Kiwi views that have been expressed by ACT members. Fortunately 26 November will wash them away in the ebb of the tide and we will be free of their contributions for the foreseeable future. 
Labour members do not agree with the title of the bill. Hone Harawira aptly named it. I want my friend and distant relative from the other side of the Chamber Tau Henare to bear in mind that he was press-ganged along with Rahui Katene. They witnessed mutiny in the form of our whanaunga Hone Harawira the Fletcher Christian of Maoridom. Kia ora tatou. 
CHRIS TREMAIN (Senior Whip—National) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 62 
New Zealand National 57; Maori Party 4; United Future 1. 
Noes 57 
New Zealand Labour 42; Green Party 7; ACT New Zealand 5; Progressive 1; Independents: Carter C Harawira. 
Motion agreed to. 
The CHAIRPERSON (Lindsay Tisch) 
: Before we vote on clauses 1 and 2 we have an amendment in the name of Hilary Calvert as set out on Supplementary Order Paper 209. It is out of order as not being an objective description of the bill. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 62 
New Zealand National 57; Maori Party 4; United Future 1. 
Noes 57 
New Zealand Labour 42; Green Party 7; ACT New Zealand 5; Progressive 1; Independents: Carter C Harawira. 
Clause 1 agreed to. 
Clause 2 not agreed to. 
New clause 2 Commencement 
A party vote was called for on the question  
That the amendment set out on Supplementary Order Paper 207 in the name of the Hon Christopher Finlayson to insert new clause 2 be agreed to. 
Ayes 62 
New Zealand National 57; Maori Party 4; United Future 1. 
Noes 57 
New Zealand Labour 42; Green Party 7; ACT New Zealand 5; Progressive 1; Independents: Carter C Harawira. 
New clause 2 agreed to. 
The CHAIRPERSON (Lindsay Tisch) 
: We have an amendment in the name of Hilary Calvert as set out on Supplementary Order Paper 209. This amendment is now out of order as it is inconsistent with a previous decision. 
House resumed. 
Bill reported with amendment. 
The CHAIRPERSON (Lindsay Tisch) 
: I move  
That the report be adopted 
. 
A party vote was called for on the question  
That the report be adopted. 
Ayes 62 
New Zealand National 57; Maori Party 4; United Future 1. 
Noes 57 
New Zealand Labour 42; Green Party 7; ACT New Zealand 5; Progressive 1; Independents: Carter C Harawira. 
Report adopted. 
Financial Markets (Regulators and KiwiSaver) Bill 
Securities Trustees and Statutory Supervisors Bill 
Second Readings 
Hon JOHN CARTER (Minister of Civil Defence) 
 on behalf of the  
Minister of Commerce 
: I move  
That the Financial Markets (Regulators and KiwiSaver) Bill and the Securities Trustees and Statutory Supervisors Bill be now read a second time 
. Both bills are important components of the Government’s programme of reform to restore confidence in New Zealand’s financial markets following the global financial crisis and the failures of a number of financial companies. The Financial Markets (Regulators and KiwiSaver) Bill establishes the new Financial Markets Authority to replace the Securities Commission and to take on the responsibilities of the Government Actuary and some of the regulatory roles of the Registrar of Companies. The bill also makes changes designed to improve the governance arrangements for KiwiSaver schemes and provides for better disclosure of fund performance. The Securities Trustees and Statutory Supervisors Bill addresses weaknesses in the supervision of issuers in retirement villages by trustees and statutory supervisors. 
I will focus on the most significant recommendations of the Commerce Committee’s responsive and expeditious consideration of both bills. In addition to the Financial Markets Authority’s main objective of promoting fair efficient and transparent financial markets the committee has rightly recommended the inclusion of a reference to the facilitation of the confident and informed participation of businesses investors and consumers in financial markets. An important regulatory tool in the bill is the Financial Markets Authority’s power to exercise a person’s right of action. The committee recommended changes to strengthen the rights of individuals by preventing the High Court from overriding an individual’s choice to opt out of the Financial Markets Authority’s proceedings. However the Financial Markets Authority will be able to seek the leave of the High Court to exercise a corporation’s right of action or to take over a corporation’s existing proceedings if the court is satisfied that it is in the public interest to do so. The provisions enabling the Financial Markets Authority to take action in the public interest are necessary to enable it to pursue negligent directors of a company. 
In respect of the amendments the bill makes to the Securities Markets Act 1988 the committee has recommended the retention of the new statutory oversight regime the new exchange rule approval process and the Financial Markets Authority’s ability to request rule change and undertake real-time surveillance of market activity. The committee has also recommended the inclusion of amendments to the bill that target unsolicited offers due to recent concerns regarding lowball share offers. The Financial Markets Authority will be able to use its enhanced warning powers to require a prominent warning to be included in such offer documents. The new regulation-making power is also recommended to allow rules to be set for unsolicited offers. Subsequent regulations could require a minimum offering and cooling-off periods disclosure of a market price and disclosure of other relevant information. 
The committee has recommended a number of amendments to the KiwiSaver part of the Financial Markets (Regulators and KiwiSaver) Bill including the shifting of responsibility for a range of functions from the trustee to the manager of the scheme. This change reflects the manager’s primary role in the marketing operation and regulatory compliance of non-restricted KiwiSaver schemes. As signalled in the explanatory note of the bill further changes will need to be made by a Supplementary Order Paper with regard to retail KiwiSaver schemes in order to require trustees to be licensed and to align the regime in the Securities Trustees and Statutory Supervisors Bill. 
I turn to the Securities Trustees and Statutory Supervisors Bill. The committee has recommended that the maximum licence period for trustees and supervisors be extended from 5 years to 8 years to reduce uncertainty arising from the need to regularly reapply for a licence. In respect of the power to grant or vary a licence the committee has recommended a regulation-making power to set out matters that must be taken into account when assessing whether directors and senior managers of the applicant satisfy good-character requirements. The committee has also made some important recommendations regarding the power to appoint a temporary supervisor when the previous licence holder has been removed or no longer holds a licence. The Financial Markets Authority will be allowed to appoint any person it sees fit in the circumstances as a temporary supervisor regardless of whether he or she holds a licence. This is essential as there is a limited pool of licensed supervisors to call upon. 
Although some submitters queried whether it was appropriate for retirement village statutory supervisors to come within the scope of the bill the committee decided on balance that they should. Both the committee and the Government are conscious of not imposing unnecessary costs on the retirement village sector yet it is justified there given the benefits to residents from improved supervision. I note the committee’s recommendation that the Government undertake a review of all statutory fees that impact on retirement village residents. The Government considers that this would be a useful step and it commits to undertaking its review within the next 2 years. 
As I signalled earlier I will table a Supplementary Order Paper that will align both bills by removing clauses from the Securities Trustees and Statutory Supervisors Bill that have been made unnecessary by the Financial Markets (Regulators and KiwiSaver) Bill. The Supplementary Order Paper will also provide for the licensing of KiwiSaver trustees align provisions relating to classes of trusts and statutory supervisors respond to some minor issues that have arisen since the committee’s report back on the bills and provide for consistency in commencement and transition periods under both bills. 
Both of these bills constitute very important steps in restoring investor confidence in New Zealand markets by establishing a new market conduct regulator that will promote fair efficient and transparent financial markets and by providing better oversight of front-line regulators. I commend these bills to the House. 
Hon DAVID PARKER (Labour) 
: 
 Labour supports both of these bills the Financial Markets (Regulators and KiwiSaver) Bill and the Securities Trustees and Statutory Supervisors Bill. In my contribution I will focus on the Financial Markets (Regulators and KiwiSaver) Bill. 
As the Commerce Committee notes in the commentary on the bill and as the Minister of Civil Defence has already outlined the Financial Markets Authority is established by this bill and it has responsibility regarding the regulation of the financial sector. It takes over some of the existing functions of the Securities Commission which is disestablished; it assumes some of the responsibilities of the Government Actuary and the Registrar of Companies; and it has a role in the oversight of securities exchanges. The bill also makes changes to improve the Government’s arrangements for KiwiSaver schemes. 
It is quite clear that following the collapse of finance companies in New Zealand that caused billions of dollars of losses to New Zealand investors there was a need for improved regulatory oversight of the sector. This bill which was brought forward by the Government and is supported by the Opposition gives effect to some of the necessary changes. 
I will focus on an area where the select committee considered the issues thoroughly and which relates to the rights of the new Financial Markets Authority to in some instances take over rights of action on behalf of injured depositors in for example a finance company or investors in unit trusts or group investment funds. 
In the company situation which is perhaps analogous to the situation for finance companies a company can be controlled by the directors of the company or by a number of shareholders of the company. Those shareholders might effectively control the company and take decisions through the company in their role as directors to block the company itself suing directors when the directors might have breached their duty to the company. Directors of the company owe fiduciary duties to the company to act in the interests of the shareholders of that company. On occasion they can breach their duty and cause a loss to the company which is to the detriment of the shareholders in whose interests they are meant to be acting. 
The difficulty that those minority shareholders face is that the company that ought to be suing the errant directors can be under the control of those very directors. The law in the companies situation under the Companies Act allows for what is called the derivative action. The shareholders who feel aggrieved can apply to the High Court and ask to be put in the shoes of the company to sue the errant directors when the company because of those errant directors will not commence an action to recover the losses that have been occasioned by the directors’ breach of their fiduciary duties to the company. Through that derivative action route the minority shareholder is effectively protected against abuse by the management powers by the court allowing those minority shareholders to stand in the shoes of the company and sue the errant directors. 
We had a gap in New Zealand’s law. We did not have a similar right of derivative action in respect of the likes of some of the finance companies and issuers. There could have been poor practice on the part of a financial participant. A financial markets participant is defined in the legislation to include “a person who participates in an offer of securities to the public as an issuer or a promoter”. In terms of the Securities Act those issuers and promoters effectively include the class of people who have controlled the offer of investment securities to members of the public. Sometimes those issuers make misrepresentations or breach their duties under the Securities Act. 
Sometimes those breaches mean that a person suffers a loss. The investment entity and indirectly the investors in that investment security who have made investments in the company—they might have loaned money to the company; they might have invested in shares in a company—have suffered a loss. The amount of their loss might be relatively small—it might be $1000 or $2000—but there could be a thousand of those people. The total losses could be very large despite the fact that the individual suffering the loss might have suffered a small fraction of that total loss. 
In practice it can be the case that none of the individual participants have a sufficient financial interest to justify them going to the expense of bringing to justice the people who have caused their loss even if the actions that caused their loss were irresponsible and illegal. This legislation fixes that situation by saying that just as one can have a right of derivative action for a company under the Financial Markets (Regulators and KiwiSaver) Act the Financial Markets Authority can apply to the court for authority to sue a financial market participant on behalf of those classes of people who for whatever reason are not doing it themselves. 
That can also apply in respect of trustees: unit trustees of a unit trust or a trustee of a group investment fund. Again those entities theoretically are in control of the right of action sometimes against themselves. Just as a company director can act in breach of their duty but can block the company suing them for breach of their fiduciary duty effectively the unit trustee or the statutory supervisor can have an interest in not seeing themselves brought to justice because they would be forced to make a civil payment back to the unit trust or the group investment fund for the effective benefit of the investors in that unit trust or group investment fund who have suffered the loss. 
Again the legislation defines in Subpart 3 that they are a financial market participant in respect of whom the Financial Markets Authority can go to the court and say: “It looks like these people have been errant. They’re not going to police themselves. We the Financial Markets Authority want to apply to the court to stand in the shoes of investors and take an action against the people we think have acted improperly.” If they are found to be correct through a subsequent court action and the civil remedy of the court is found in favour of the Financial Markets Authority on behalf of these people who have suffered a loss it may well be that they can get a remedy for the effective benefit of the investors who have suffered a loss and perhaps even more important establish a standard of conduct to discourage that sort of irresponsible behaviour in the future so that those losses to investors become less likely. 
In practical terms what are some of the things that have gone wrong in the finance company sector and need to be pursued at times? It is clear that there has been some terrible conduct on the part of some of the participants who have lent money to entities that are related to them effectively to profit themselves and related entities—and in “related entities” I include family trusts and the like. Such participants have taken the upside of some of these transactions for the advancement of their personal wealth yet they have not taken appropriate securities from the family trusts and things. When things have gone haywire the related family interests of some of the people controlling these finance companies have managed to escape liability. The risks are being taken effectively by the person who invested in securities in those entities—be it equity or debt securities—and they are the ones who end up bearing the loss. 
The Labour Party supports both of these bills and commends them to the House. 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I am also honoured as a Government MP to stand to support the Financial Markets (Regulators and KiwiSaver) Bill and the Securities Trustees and Statutory Supervisors Bill. The Financial Markets (Regulators and Kiwisaver) Bill establishes a new financial sector regulator the Financial Markets Authority which will be a super-regulator bringing a number of powers and functions from various Government bodies into a single body. 
The work we have done in the Commerce Committee particularly our inquiry into finance company failures has made us realise as a group that there has been a fragmented approach to regulation of the securities and financial industry and that such a move as the creation of this authority would be welcome. It is overdue and we certainly welcome the establishment of the Financial Markets Authority to regulate the financial industry. 
As has already been noted tonight finance company failures continue to dominate our news. We saw another example this week in a court case that began with charges against directors of finance companies. This legislation is about maintaining the integrity of our financial system. It is about bringing together confidence and trust for mum and dad investors as well as corporate institutional investors in our financial markets and capital markets so that we can have a fluid market and facilitate access to capital for our businesses. The National Government is focused on boosting growth and creating jobs and fluid financial markets certainly facilitate a stronger economy financial security real opportunities for growth of our economy and more opportunities for our people. 
As has been mentioned some changes were made to the bill during the select committee process. The bill addressed some really good work that was produced by the Capital Market Development Taskforce and issues raised in respect of the global financial crisis as well as the finance company failures that I have already alluded to. 
The bill ensures that the Financial Markets Authority has the right tools to keep our capital markets working for investors. As Mr Parker has said it gives power to the Financial Markets Authority to exercise investors’ rights of action when it is in the public interest to do so. That is an important criterion because as we saw with a lot of the inaction over the last 4 to 5 years in terms of finance company failures the Securities Commission did not have the power to take action against some of the rogue parties in our financial markets. 
So what does the bill do? One of the other important areas that were looked at was that of lowball unsolicited offers. That is where predatory investors make lowball offers that are well below the market price for securities to mum and dad investors who may or may not be ignorant of the market price in order that they will take up the offer. Often those offers are unsolicited and the result is a large degree of market loss for those mum and dad investors. This bill includes a regulation-making power that will enable greater regulation of unsolicited offers including minimum offer and cooling-off periods as well as the requirement to show on the offer documents a disclosure of the market price. I think that is particularly important. It will allow mum and dad investors to see through the predatory behaviour of some of the investors. 
In summary it is clear that New Zealand needs a single market regulator and a culture of proactive and timely enforcement which has sadly been lacking in recent years in respect of some of the finance company failures. It is undoubtedly about market confidence for our investors—institutional individual and mum and dad investors—and the critical role that the Financial Markets Authority will play in the regulation of the industry. This bill will consolidate the functions of the Securities Commission as well as parts of the Ministry of Economic Development and the Government Actuary and the regulatory function of the New Zealand Exchange. 
We will talk in the Committee stage about how the bill will do that. It is certainly a commendable bill. I am happy to see that there is multiparty support on the Commerce Committee for the bill and for it to proceed and for the Financial Markets Authority to be established this year. Thank you. 
CLARE CURRAN (Labour—Dunedin South) 
: 
 As members have heard the Labour Party supports both of these bills. I intend to direct most of my comments to the Securities Trustees and Statutory Supervisors Bill but I would first like to make a few comments about the Financial Markets (Regulators and KiwiSaver) Bill. 
This bill establishes the Financial Markets Authority and sets out the wider enforcement and surveillance powers that are to be available to regulators. It also makes changes to the regulation of registered exchanges and improves the regulation of KiwiSaver schemes. Labour believes that it is critical that we enhance confidence in our financial markets and that having a single market regulator should contribute to that end. Labour launched the Capital Market Development Taskforce and is pleased that the Government is acting on its recommendations. We are concerned about a lack of transparency around the current securities commissioners. Labour supports this bill as I said. We think that the concentration of power in the hands of the Financial Markets Authority means that all its officers must be beyond reproach and its processes must be fully transparent and that the integrity of the markets depends on the integrity of the Financial Markets Authority and its personnel. 
Labour started the financial markets reform process and it is pleased that the Government is continuing that work. I would like to make a special mention of the Hon Lianne Dalziel with regard to both of these bills. She set up the Capital Market Development Taskforce in 2008 to develop a blueprint and an action plan for the development of New Zealand’s financial system. Out of this has come these bills. Labour believes in terms of the Financial Markets Authority that enforceable principles such as integrity skill reasonable care and financial prudence are needed. Principles are flexible unlike rigid rules that are made to be broken. It is important that ethics underpin the new regime because that will help to rebuild trust and confidence in the financial sector. I think we have heard from all speakers on these bills about the absolute importance of having trust and confidence in the financial sector. 
In speaking to the Securities Trustees and Statutory Supervisors Bill and the Financial Markets (Regulators and KiwiSaver) Bill I should thank the Minister Simon Power for his work as well. I also again make particular mention of the Hon Lianne Dalziel and the work done by the Commerce Committee which did enormous amounts of work on these bills and recommends that with certain amendments they be passed. I also thank the officials for their work and the consultation with the committee on the legislation. 
Although Labour supported the Securities Trustees and Statutory Supervisors Bill at the time that it passed through the Commerce Committee we did have some concerns about it. We considered at the time that it was a back to front bill. We felt that it needed to be considered at the same time as wider reform of the financial markets. So we are pleased that it is being read alongside the Financial Markets (Regulators and KiwiSaver) Bill. The Securities Trustees and Statutory Supervisors Bill seeks to address a number of weaknesses in the current supervision regime for trustees and statutory supervisors. It establishes a licensing regime for trustees and statutory supervisors who supervise certain issuers of securities and for statutory supervisors of retirement villages. It amends several pieces of legislation which include the Retirement Villages Act 2003 the Securities Act 1978 and the Unit Trusts Act 1960. That new regime was to be administered by the Securities Commission. We noted at the time that it was intended that the commission’s role under the bill would be taken over by the Financial Markets Authority once it was established. It appears now that that will happen. 
It follows on from the conclusions of both the International Monetary Fund and World Bank report in 2004 and the consultations undertaken by the Ministry of Economic Development in the Review of Financial Products and Providers in 2006 which found that New Zealand placed far too much reliance on private supervisors such as corporate trustees and that those supervisors and trustees often lacked accountability. This bill removes the automatic right for the six statutorily appointed approved trustees to supervise issuers of debt and some investment schemes. It also introduces a licensing regime for trustees which will be run by the Securities Commission. It makes it an offence to act as a trustee or a statutory supervisor without a licence so that a person who commits such an offence will be liable on conviction to a fine that does not exceed $300000. The bill also includes a number of provisions designed to ensure that trustees statutory supervisors and unit trustees comply with their obligations and the Securities Commission may seek pecuniary penalties and compensatory orders against those who fail to comply. 
Those clauses are designed to address the lack of capability and accountability of supervisors and trustees in the current system as I have already said. The fundamental role of trustees statutory supervisors or unit trustees is to ensure compliance with the terms of the trust deed or the offer of security. When an issuer gets into difficulty the trustee supervisor is supposed to take action inform the investors and engage expert assistance or to place that issuer into liquidation. 
I would like to quote from a speech that was given by the Hon Lianne Dalziel at a conference Reviewing Securities and Investment Regulation in New Zealand on 30 August last year. In it she backed 100 percent the establishment of the Financial Markets Authority to absorb all those functions that have been talked about that are currently spread across the Securities Commission the national enforcement unit within the Ministry of Economic Development the Government Actuary and the market discipline functions of NZX. She said: “The Minister has said it will have grunt and I welcome that. We need a single-minded approach that says that the risk of getting caught is high and the consequences of conviction are severe. I am constantly affronted at the discount our criminal justice system appears to afford the white collar criminal over all other criminals even though the wealth they have destroyed makes the proceeds of house burglaries pale into insignificance by comparison. I think we should allow our courts to impose what I now call the Madoff sentence for the most egregious cases. And there are some people who should never be allowed to fundraise from the public ever again or to claim the protection of limited liability against creditors—and those are the people against whom fraud has been proven. There should be no second chances under these circumstances.” 
Lianne Dalziel talked about the five key objectives that should underpin the Financial Services Authority framework. They are: market confidence which is maintaining confidence in the financial system; public awareness which is promoting public understanding of the financial system; financial stability which contributes to the protection and enhancement of a financial system; consumer protection which secures the appropriate degree of protection for consumers; and the reduction of financial crime which reduces the extent to which it is possible for a business to be used for a purpose connected with financial crime. It is those principles and objectives that should underpin all reforms in this area. 
The Securities Trustees and Statutory Supervisors Bill was referred to the Commerce Committee on 23 March last year—a year ago tomorrow. We received and considered 18 submissions from interested groups and individuals and we heard eight submissions. Essentially we support both of these bills. We think it is good that they are being read together and I recommend them to the House. 
KATRINA SHANKS (National) 
: 
 It is my pleasure to take a call tonight on the second reading of the Financial Markets (Regulators and KiwiSaver) Bill along with the Securities Trustees and Statutory Supervisors Bill. First I thank the officials for all the work they have put into this legislation. There was a fairly tight time frame and it is a significant piece of work. It was quite complex. It took the Commerce Committee a fair amount of time to get to grips with the extent of the legislation which is far reaching and very important when we are looking at improving investor confidence in New Zealand. 
The Financial Markets (Regulators and KiwiSaver) Bill establishes a new financial sector regulator the Financial Markets Authority and makes important changes to the governance of KiwiSaver schemes. It is clear that New Zealand needs to have a single market regulator with a culture of visible proactive and timely enforcement. On too many occasions in finance company collapses we have heard of investors’ money falling to the floor through gaps between regulators. The select committee has undertaken an inquiry which is still ongoing into the finance company collapses. Investors feel frustrated that they had nowhere to go because the regulations or the legislation were not strong enough to enforce some of the issues where money was lost so those investors had no recourse to enforcement action. 
That situation has undoubtedly damaged New Zealand and the confidence of our mum and dad investors. Once a sector has lost a significant amount of money which happened with the finance companies—and these were the same investors who in 1987 lost money in the stock market crash and who lost it around 2000 in managed funds when they took a big dive—the confidence of those investors is damaged. Because those investors had been burnt on the stock exchange and burnt by the fund managers they went to what was considered to be the next-lowest risk which was the finance companies only to be burnt in that sector. So the confidence of our mum and dad investors of our retirees is pretty damaged. It is important that we put some— 
Aaron Gilmore 
: It’s munted! 
KATRINA SHANKS 
: As Aaron Gilmore beside me would say it is munted which is a Christchurch word. 
We have to do something pretty significant in order to get those investors back into the markets. Without investment in New Zealand by Kiwis we cannot strengthen our capital markets. The Financial Markets Authority has a critical role to play in rebuilding that confidence. Everyday investors need to feel more confident about where they are putting their savings and to understand the basics of investment: how to get advice they can trust and how to make truly informed choices. The issue is not just about the risk of an investment being 2 percent more than a bank— 
Mr DEPUTY SPEAKER 
: I am sorry to interrupt the honourable member but the time has come for me to leave the Chair. 
Debate interrupted. 
The House adjourned at 10 p.m.