Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill — First Reading 
Text is incorporated into the Bound Volume 
Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill — First Reading 
[Sitting date: 13 September 2011. Volume:675;Page:21214. Text is incorporated into the Bound Volume.] 
Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill 
First Reading 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I move  
That the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill be now read a first time. 
 I intend to move that the bill be referred to the Local Government and Environment Committee. This bill is an integral part of the Government’s blue-green programme to strengthen New Zealand’s environmental and resource management systems. This significant bill puts in place a system of environmental protection for the ocean beyond the 12-mile territorial sea covering the 400 million hectares in the exclusive economic zone and the 170 million hectares in the extended continental shelf. 
This bill recognises the opportunities and responsibilities that go with New Zealand being a significant maritime nation. The ocean area over which we have jurisdiction is 20 times our land mass and is the fourth-largest of any nation. The bill also recognises that our ocean resources are coming under increased development pressure from a growing global population the depletion of resources on land and advances in technology that are making the use of ocean resources more possible. 
I acknowledge the support of the Maori Party the ACT Party United Future and the Green Party for this important bill. Such a broad consensus shows that this is a bill whose time is due. National proposed this reform from Opposition as part of our blue-green agenda announced in 2006. We have revised these proposals with the support of officials. We sought further independent advice after the Gulf of Mexico disaster to ensure that we were putting in place the best system possible for environmental protection. 
This legislation will manage the adverse environmental effects of activities in the exclusive economic zone which are currently unregulated. That includes the construction of petroleum platforms seabed mining possible aquaculture developments carbon capture and storage marine farming and energy generation proposals that may evolve. The legislation will do this by providing a regulatory framework similar to the Resource Management Act for classifying certain activities as permitted discretionary or prohibited. This classification will depend on the environmental effects of those activities. The consent function will rest with the Government’s new Environmental Protection Authority. 
For discretionary activities consents will be needed. All such applications will need to be publicly notified and will require an environmental impact assessment and take account of both the receiving environment and the cumulative effects. We are also providing a mechanism for effectively dealing with consents that straddle over the exclusive economic zone and the territorial sea. This new legislation will not duplicate the existing regulatory processes for fishing governed by the Fisheries Act or for shipping under the Maritime Transport Act. It has also been carefully designed to ensure it is consistent with New Zealand’s international obligations. 
There will be a transitional period once the bill becomes law. The Government will require those already undertaking discretionary activities in the exclusive economic zone and the extended continental shelf to apply to the Environmental Protection Authority within 6 months of the legislation coming into force and they may continue those activities until those consent applications are decided. Existing oil and gas installations and associated infrastructure will be exempt on the basis that they are already operational. Existing licences for mineral prospecting will also be exempt on the basis that those licences contain environmental controls. 
There will of course be an intervening period as this bill travels through the legislative process and comes into effect as is the Government’s intention on 1 July 2012. That is why the Government is also putting in place interim measures to ensure a smooth transition to the new regime. 
Environmental impact assessments will be required and undertaken for oil and gas drilling operations. Operations will be required to comply with the latest beefed-up drilling safety rules which were developed in the United States following the inquiries into the Gulf of Mexico disaster. These measures complement the recent announcements made by the Minister of Labour on the establishment of a high hazards unit with four new inspectors specifically for the petroleum industry. The Minister of Transport is also reviewing the liability insurance requirements for the industry and is looking to raise that insurance level above the current $30 million. 
Some have advocated that we should have just extended the Resource Management Act out beyond the 12-mile territorial sea. This would have been too cumbersome. It would have required an extensive planning regime that is out of proportion with the likely scale of activities out in the exclusive economic zone. Others have questioned whether the Environmental Protection Authority should be the consenting authority and have said that it should instead go to regional councils. The reality is that these are highly specialised skills and the Government’s view is that once one goes beyond that 12-mile limit these are really national issues and it is more efficient for it to be done by the Environmental Protection Authority. 
The Government views New Zealand’s “clean green” brand as being important but this does not mean that in our ocean environment we should ban everything any more than we ban everything in our land environment. It does mean ensuring that we have world’s best practice environmental standards and systems and that is what this bill introduces. 
This bill is consistent with our broader Government agenda of ensuring we grow the economy but doing it in an environmentally responsible way. I acknowledge the support of groups like the Environmental Defence Society and the Petroleum Exploration and Production Association which have welcomed this move as they know it will provide better environmental protection as well as certainty of process for those who look to develop the largely unrealised potential that lies in New Zealand’s exclusive economic zone and extended continental shelf. It will help to manage the adverse effects on the environment while allowing for the sensible development and community engagement in decision making. 
New Zealand has been aware of the need for this legislation for a long time and this bill represents the culmination of years of work. If we do not act we risk harm to the marine environment and in my view there is a reputational risk for our country in respect of not having world’s best practice in the exclusive economic zone. This bill is part of a wider body of blue-green reforms already instigated by this Government to ensure that we have world-class environmental management systems. The time for a robust environmental management regime of our vast oceans has come. I commend this bill to the House. 
CHARLES CHAUVEL (Labour) 
: 
 As we heard from the Minister for the Environment the exclusive economic zone extends 12 nautical miles out from the coast to 200 nautical miles out and the continental shelf under the United Nations Convention on the Law of the Sea extends to an area of about 1.7 million square kilometres round the New Zealand coastline. It is about 20 times New Zealand’s land area and it contains as we know some of the wildest seas and marine conditions in the world. 
Over the last 3 years we have seen an absolute failure on the part of this Government to regulate New Zealand’s exclusive economic zone and continental shelf. 
Hon Dr Nick Smith 
: You had 9 years. 
CHARLES CHAUVEL 
: Well we hear a cry from the benches opposite that nothing was done by the previous Labour Government. As far as the extent of the continental shelf was concerned that was confirmed only in 2008 so the Minister needs to get his facts right before he shouts abuse across the Chamber. 
The reality is that this Government has had 3 years at a time in which it has rapidly and massively expanded marine exploration activity including offshore drilling but nothing has been done—nothing whatsoever—to provide any sort of protections for the marine environment. So I do not want to hear too many pious words from the Minister about the so-called blue-green agenda and its triumphs. We will say a little more about that so-called agenda a little later. 
But let us just be very clear for the record that for the past 3 years there has been no adequate oversight of the safety of offshore drilling despite its massive expansion; no requirement for consultation with affected communities as Te Whanau-a-Apanui would tell the Associate Minister of Energy and Resources the Hon Hekia Parata if she actually fronted up to one of their meetings rather than hiding from them; and no adequate monitoring of the activity that has been undertaken over this time. We are just lucky given the wild seas the difficult marine environments and the lack of oversight and safety conditions that we have not had a problem. 
I am glad we have not had a problem but it is a matter of luck. It is not a matter of regulation and it is not a matter of oversight. Let us not kid ourselves: nothing this Government has done as it has overseen that massive expansion of drilling activity offshore has shown the slightest concern for offshore safety or for the environmental considerations that ought to have been taken into account. 
Worse than that though and worse than the fact it has taken the Minister all of his term in office as Minister for the Environment to finally get around to regulating the exclusive economic zone and the continental shelf—despite having promised that it would be a priority for him; he has said time and time again on the record that his new Environmental Protection Authority would have the task as a matter of priority of regulating the exclusive economic zone—it has taken until the end of his tenure in office to be able to do anything about it. 
What is he doing? He is not proposing passing legislation and he is not proposing to the House that we take urgent action to remedy the scandalous situation that I have outlined. He is introducing the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill which has a prospective passage date of 1 July next year. Even with the best course of action available if the Government manages to get re-elected and if the select committee process does not take longer than anticipated this bill might become law in about 10 months’ time. Not only will we have had 3 long years of inaction but we could add another good part of a year to that before the Minister was able to do anything in the legislative field to remedy the lack of any standards in our offshore drilling industry for environmental safety. 
If that were not bad enough let us have a look at what the bill does. The Minister said “Oh well we don’t think we should apply the RMA standards to our exclusive economic zone and our continental shelf.” But let us look at what the bill actually does. The explanatory note states that the bill seeks “a balance between the protection of the environment and economic development.” in the exclusive economic zone and on the continental shelf. 
It is the Minister’s rhetoric continuing. He pretends to be blue-green but there is nothing green about his agenda. He pretends that a balancing act needs to go on between our economy and our environment whereas those who have actually thought about these questions know that it is exactly the same question representing two different sides of the coin. To pretend that we can have only as much environmental protection as our economic development priorities will allow us is the fallacy that lies at the heart of that Minister’s so-called blue-green agenda. 
The legislation itself is deficient because of the test I just mentioned—the so-called balancing test. It would be much better even if the Minister would not apply Resource Management Act standards to look at the sort of exercise that the Resource Management Act requires to be carried out when assessing any sort of activity. That is what the Environmental Defence Society asked the Minister to do. He should be very careful before he claims the society’s support because the Resource Management Act calls for the promotion of the sustainable management of natural and physical resources. 
The Minister asked earlier what Labour’s policy is on this issue. Well I tell him that that is our policy—the sustainable management of natural and physical resources in the exclusive economic zone and on the continental shelf. 
What is wrong with applying that settled test that well-known legal test to what ought to happen between 12 miles out and the end of the continental shelf? That is the question that has to be asked instead of introducing this developers charter by stealth which will simply lead to the economic— 
Hon Dr Nick Smith 
: What’s “by stealth”? 
CHARLES CHAUVEL 
: I will tell the Minister what is happening by stealth in a moment but let us not be under any illusions. All that this bill will do is act as a new National Development Act just as in the Muldoon days for offshore drilling activity. That will be this Minister for the Environment’s legacy. 
What is stealthy about the legislation is that the standards it is to set into place are all to be developed by regulation by the Minister himself. We do not know what sorts of environmental protections if any will be enjoyed under this legislation. We do not know the substance of the sorts of protections that are intended for the exclusive economic zone and the continental shelf because—guess what—the Minister gets to make them up under this legislation. 
It is just a repeat of what we saw with the Environmental Protection Authority legislation earlier in the year. We hear grand promises and great rhetoric about the blue-green agenda and then we see the tawdry reality of what actually will occur: a weak legislative framework no proper guiding principles and no following of settled law. Then it will be all up to the Minister to fill in the detail when it suits him. 
Well I tell the Minister that that is not good enough; it is not the sort of protection that most New Zealanders want to see for the exclusive economic zone and the continental shelf. It will be on the Minister’s head I tell him if we are unlucky enough to experience difficulties in an offshore drilling or exploration activity in the interim because he has tarried for the best part of 3 years now and it will be the best part of another year before we see any sort of legislation on the books. Even then it will be inadequate and it will be up to the Minister to decide how to fill in the detail of the legislation by regulation. 
This is not environmental legislation; it is a developer’s charter. It is an exercise in cynicism because it involves introduction and first reading with 8 days of this Parliament left to sit. There will be no time to debate it further than what we have today and it cannot possibly become law until the middle of 2012 at the earliest. This is an attempt by the Minister and the Government to look as if they are doing something but it is just an exercise in cynicism and Labour will not support this sort of duplicity in any way. 
NICKY WAGNER (National) 
: 
 I rise to support the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill at its first reading. It is very appropriate that in this week Conservation Week we debate this bill’s first reading. It should have been done under Labour. All New Zealanders are keen to protect and conserve our natural environment. We understand that our natural resources are precious and that they offer us opportunities but also that they impose responsibilities. We Bluegreens in the National Party believe that the economy and the environment can and must go hand in hand. 
It was interesting to hear Labour saying that the continental shelf designation happened only in 2008 and that nothing could have been done before then. That is absolute nonsense. Labour certainly could have introduced legislation on the exclusive economic zone and just added the information about the continental shelf later. More drilling was done under Labour in 2005 2006 and 2007 than has been done in the last 3 years. 
We have robust legislation in the form of the Resource Management Act to care for our environment on land but that legislation covers only 12 miles out into the ocean. The exclusive economic zone—the area of sea seabed and subsoil—goes from that 12-mile limit to 200 nautical miles offshore where New Zealand has jurisdiction. As we have said it even extends to some places beyond those 200 nautical miles because of the continental shelf but that would not have stopped legislation being passed while Labour was in power. 
New Zealand has one of the biggest exclusive economic zones in the world. It is an area of ocean that is 20 times the size of our land mass and up until now there has been no legislation to protect it. We are introducing this bill because it is our responsibility to manage this huge area well. This much-needed legislation will fill a gap and will give effect to New Zealand’s obligations under the United Nations Convention on the Law of the Sea to manage and protect the natural resources of this area. 
The new law will work in tandem with existing laws to manage the exclusive economic zone and the environmental effects of activities like petroleum exploration and mining. We do not want to see in New Zealand the sort of environmental disaster that was seen in the Gulf of Mexico. I make the point that one of the reasons that this bill is being introduced later in our term is that after that disaster we commissioned a review to make sure that we got it right and learnt from what had happened before. 
This bill sets up a general framework for our regulatory system and will make the Environmental Protection Authority responsible for consenting monitoring and enforcing activities within the exclusive economic zone. It will set up a consenting regime to regulate activities and it will require public notification and consultation on regulations and consents. All consents will require an environmental impact assessment and there will be a responsibility on consent holders to avoid remedy or mitigate any adverse environmental effects. The enforcement of penalties will be aligned with the Resource Management Act. 
This is good legislation. We have developed it responsibly. It has taken a little longer than we had hoped because of additional research and because of that interest in what happened in the Gulf of Mexico. But we have worked on it steadily and responsibly. We have heard from iwi that it is too fast. We are now hearing from Labour that it is too slow. I think it is probably in the right time. New Zealand’s exclusive economic zone needs to be managed well and this legislation will set the framework to do just that. It will give us world-best environmental practice. I commend this bill to the House. 
Hon SHANE JONES (Labour) 
: 
 Tena koe Mr Assistant Speaker Roy. Before I turn my attention to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill I would like it to be known that those of us who participated in the hunt owe a debt of gratitude to the man sitting in the Speaker’s seat. However some of us are better shots than others— 
Hon Steve Chadwick 
: Did you catch anything? 
Hon SHANE JONES 
: One approaches these matters looking at it as either a resource or a pest. My puku says that no pest if it is good for us should be allowed to disappear without being devoured. This bill is not good for us. I say to the Minister for the Environment that we on this side of the House especially those of us who have had family or friends go into the mining industry or the exploration industry are not antagonistic to the notion that we should use the natural resource endowments that we have in our country. We do not find it inimical that we should look for jobs so that we do not end up agreeing with the policies of the current Government of exporting too many of our young people over to Perth and other such areas where they work in those mineral or mining industries but remain reluctant to create our own mining industry. I want to put that on the record. That is not where we on this side of the House are coming from. Much of the roots of this party go back to the very industry and land base that this bill is endeavouring to cover off. 
I think it is important that we call the Minister on his track record in relation to this bill. He is a qualified engineer so without a doubt he has more than a passing political interest in environmental policy. No one can be qualified in engineering without having a sense of how resources the environment people and effects all work together. But I remain very reluctant about seeing much benefit from the statutory process that this bill outlines. For example will we see a rerun of the water imbroglio? We all knew how important the effects of poor water utilisation were and the negative effects of that and we look to this Minister to address that problem. We were served up with a dilution of what was a promising set of ideas. It is not unreasonable for us to have severe doubts about the man’s stewardship and I guess the man’s gall in bringing this bill before the House. 
I could go on to talk about land-based mining and exploration and obviously I have in mind lignite. We may disagree as a matter of public policy whether such exploration activities will increase the economic benefit to our country or worsen our international obligations. These points are legitimate in this debate. When we come back and say that we are not going to back this bill it is not because we are unwilling to back the utilisation of our natural resources. We are deeply fearful that this framework will not incentivise those who are investing capital those who are taking risks and those who are in the business of exploration in terms of addressing the negative economic or dare I say environmental externalities. Therein lies the rub. This is a framework the Minister is bringing forward but how on earth can anyone have any confidence in it? It is a bit like the ill-fated transport legislation that the disgraced Steven Joyce now that he has ruined New Zealand’s reputation through the train failure is seeking to bring forward—that is too much power descending to a subsidiary level of legislation. We will not know how robust how actionable or how enforceable this particular set of rules and standards will be because of these regulations that will flow from this legislation. If it is to have any fangs then that is where they will be found. They will not be in the motherhood and apple-pie statements that are in the title of the bill and a host of other florid terms. How is the public to derive any confidence that when things go wrong the people perpetrating the wrongdoing will be held accountable? Therein lies the major weakness of this bill. 
There is a philosophical debate as to whether legislation ought to create strict and highly prescriptive criteria that can be enforceable. This bill does not seek to do that. What this bill seeks to do is dilute and water down the raison ďêtre of the Resource Management Act. It draws a distinction between the agenda of growing economic output and trying to safeguard the environment. It calls for a balancing act. Well who will do the balancing? The balancing will be done by the regulator. Who is the regulator? The regulator is that Minister sitting over there the Hon Dr Nick Smith. It is not unreasonable for us to say that we should look at the man’s track record in respect of two major types of natural resources. It may be that the Minister thinks that this is a more efficient way for us to manage the effects of this exploration activity. Well efficiency has to be measured against not just confidence but also effectiveness. The public have every right to demand that we test the effectiveness through an open democratic parliamentary-based process not in shady drafting amongst officials who more than likely will suffer political pressure to come up with a level of regulation that not only simplifies—simplification is not necessarily a bad thing—but also when we suffer dilution and the ability to enforce environmental standards is written so far down that no court and no legal organisation as a part of the judiciary is capable of enabling a citizen or a group offering its services on behalf of a citizen to hold them accountable. That is a deep constitutional point. 
Why on earth if this area is so big as the Minister for the Environment has just described it has he taken this path of least resistance? We would not tolerate it with land-based activities. The sad thing is that there are fantastic resources in the ocean environment. On that point the Minister and I probably agree. I personally would like to see the development of that iron sand stretching from Ngamotu New Plymouth right up to somewhere near the Kaipara Harbour. I think it is a fantastic idea and that we should seek investment. I would prefer to see the investors in the form of our State-owned enterprises but if we have a set of environmental standards that are doubtful or dubious then we are not building a fast flight into development; we are building more roadblocks and more fear and it will spread severe anxiety in the community. That actually incentivises them to slow down the process not to hasten it. That is a small example where I think most members of the House would see great benefit if we could extend on what the Maori hapu in Ngati Mahuta near the township of Taharoa did when they sought to move ahead with the export of iron sand. That is a small example where we need an industry around that type of natural resource category. 
The Minister should not believe that by coming up with this threadbare piece of legislation where the majority of the decision making will be done through regulation he will build a constituency within garden-variety Kiwis to improve and increase the pace of this exploration. It will have the opposite effect. I say to the Minister that it will have people who do not want to see that kind of industrial exploration worsen the sense of ill will about it. I think that is a tragedy with this bill. The tragedy is that the bill will have the opposite consequence yet many of us on this side of the House are very keen to see such exploration and activities happen but happen only when we have a framework that is transparent that shows accountability and that does not have the effect of looking as though it is riddled with weasel words and is sneaky. When it is sneaky it will enhance the fears of those who in many cases are just as well organised as those who are taking the risk and putting together the capital. I think it will have the opposite impact at a time when we on this side of the House are willing to explore ways to enhance jobs and grow wealth through a clever and defensible utilisation of our natural resource endowment. Unfortunately this bill will have the opposite impact. 
DAVID CLENDON (Green) 
: 
 Kia ora Mr Deputy Speaker. Kia ora koutou. The Minister for the Environment in his opening remarks quite rightly pointed to the fact that the Greens will support the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill being referred to a select committee. That is a decision we made after some considerable thought. It was quite a finely judged decision I have to say. We are committed to supporting this bill being referred to a select committee because some good and positive steps are proposed in it. It is however a curate’s egg of a bill: it is excellent in parts but equally there are some very unsavoury elements that we would need to see excised amended or added to in order for our support to go beyond the select committee process. 
We have long acknowledged that there is a considerable gap in our legislative and regulatory frameworks to the extent that for example there is no requirement currently for any environmental impact assessment of activities that seek to exploit the seabed in the exclusive economic zone. Under the current regime of course the Resource Management Act covers matters out to the territorial sea. Beyond that other than legislation around shipping navigation and fishing there is a significant gap in our legislative framework due to a whole host of historic and other reasons we will not undertake to encompass here. We see considerable value for example in the establishment of a legislative framework. 
We are fortunate—and I am sure the Minister will acknowledge that we are fortunate—to have a very substantive independent paper prepared by the Environmental Defence Society and published earlier this year under the title  
Governing our Oceans. 
 We wholeheartedly endorse a number of recommendations from that paper. Not the least of those is the call for a royal commission of inquiry to undertake a comprehensive review of all of the existing mechanisms of international best practice and the current legislative framework including the territorial sea the exclusive economic zone and the continental shelf. For reasons of history and convenience we treat those as separate and distinct but in a sense—physically and certainly ecologically—we are talking about a continuum. There are no brightlines between those three zones. We think that any management framework and any legislative framework need to acknowledge that the separations are matters of convenience not reality. 
We entirely support the necessity of giving a level of environmental protection to the exclusive economic zone sooner rather than later as the Environmental Defence Society has indicated. So we support in principle the establishment of some governance prior to that more comprehensive review and inquiry being undertaken. We do though have serious reservations about some of the content of this bill some of the attitudes and assumptions that underpin it and some of the absences—some of what is lacking—from the bill. We are particularly concerned to see the emergence once again of the word “balance” which we have come to understand is a coded word shall we say for an unwillingness to engage with a notion of absolute environmental bottom lines. We must insist on some absolute environmental bottom lines if we are genuinely interested in environmental protection. 
Anyone who has read the Government’s recently released energy strategy will know that in terms of this so-called balance the Government clearly expresses a preference. It would tilt the balance if you like in favour of economic development which is designed to attract foreign investment. We are told it will potentially generate a $13 billion to $15 billion bonanza. 
Clause 61(2)(a) of the bill says that the Environmental Protection Authority may “grant an application … if the activity’s contribution to New Zealand’s economic development outweighs the activity’s adverse effects on the environment;”. Anyone persuaded by that chimera—that illusion—of a $14 billion to $15 billion bonanza awaiting us in seabed resources might be persuaded to ignore the very real environmental and social dangers and costs. It is notoriously difficult to do any sensible assessment of the potential value of exploitation of a resource. It is equally difficult to put figures or some sort of value on environmental quality and environmental protection. These are some of the issues that I say this bill avoids rather than engages with. 
A recent Cabinet paper pointed out that part of the reason for this bill is that the exploration industry is concerned about a lack of certainty and regulatory process that could affect their considerable long-term investment. A point was made that the reputational risk to companies that cannot demonstrate compliance with high environmental standards could compromise their willingness to invest or indeed their willingness to participate. In accepting that there might be a legitimate concern I suggest that those companies should be careful of what they wish for. Given that we are talking about what the industry refers to internationally as frontier areas and given the extraordinarily high risk and the various dubious assessments of environmental or economic return any organisation that was genuinely committed to long-term environmental protection would have no choice but to deny or to refuse any of the sorts of exploitation deep-water drilling and the like that might otherwise be mandated. 
The Environmental Protection Authority was established against the opposition of the Greens. We opposed its establishment because it was not an independent agency. It is a Crown agency for the purposes of section 7 of the Crown Entities Act and as such is subject to direction by the Minister. We acknowledge that clause 22 of this bill seeks to remove the ministerial option of directing the authority to fulfil Government policy one way or another. We can applaud that provision. Unfortunately any good intention of that provision is seriously undermined by clause 62(4) which denies the agency the right to impose any conditions on a consent approval that have previously been prohibited or vetoed by regulation. In other words it allows the Minister a back door to ensure that the authority is constrained in what conditions it might place on consents. As I say that effectively undermines the bill’s apparent good intentions. 
Rather than taking this very convoluted approach of giving a little bit of power to the Environmental Protection Authority and then seeking to limit its powers we challenge the Minister to actually assign the higher status of independent Crown entity to the authority as he indicated he might do in a speech earlier this year. That would clearly give the authority the mandate—the authority—that an organisation absolutely needs if it is to fulfil its role under this proposed legislation. 
We are told that the Environmental Protection Authority will monitor compliance and be responsible for enforcement. My question is where within the authority currently it has the capacity to do that. In respect of an offshore drilling rig in deep water for example I would be surprised if the authority inspectors—if we had any—got access to that site through any other means but the good officers basically hitching a ride with the oil company. That suggests that in practice it would be very difficult for the agency as it currently exists to do any sensible management monitoring of compliance or enforcement of anything that might come under this bill. 
The bill talks at some length about taking a cautious approach; it encompasses effectively the precautionary principle without actually using those words. Again it almost seems to avoid coming to grips with the precautionary principle which is well acknowledged well proven and has traction nationally and internationally as a concept and as an application of that concept. We wonder why there has been an attempt to simply talk about taking a cautious approach to decision making rather than being more explicit about applying the precautionary principle. 
The matters to be taken into account by the Environmental Protection Authority include a whole host of things including the protection of biological diversity and the protection of rare and vulnerable ecosystems. My final comments are that the authority in order to fulfil this proposed role will need a remarkably better understanding of and body of knowledge about the deep-water marine environment. We know very little about that environment and this bill does not address it. We look forward to further debate on the bill. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 The Maori Party has taken a keen interest in the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill particularly in respect of its capacity to provide for an effective environmental management regime in the exclusive economic zone and the continental shelf—essentially the seabed and subsoil of Aotearoa. Respect for the marine environment—the acknowledgment of the importance of land and waters that have provided sustenance—is an essential element of the Maori world view. Implicit in our tikanga is the reminder to respect and protect nature so that future generations may enjoy the same quality of life that we cherish now. We entered into an analysis of this legislation therefore with a view as to how it will enhance the sustainability of our environment and enable mana whenua the rights and responsibilities encompassed in our understanding of kaitiakitanga. We see any investment in protecting our primary ecosystems as being necessary for future economic prosperity and for the benefit of future generations. As seafaring people we appreciate that we have partaken of the food garden sown by our ancestors for our benefit. In due course it will become time for us to resow to ensure sustenance for the generations to come. That time is now; the opportunity is here through this legislation. This legislation sets out an obligation for adverse environmental effects to be avoided remedied or mitigated. 
In coming to this bill I am reflecting on the submission of one of my Ngati Kuia whanaunga Raymond Smith who presented a submission to the ministerial panel reviewing the Foreshore and Seabed Act on behalf of the runanga. He said in that submission: “We need to be part of that group that decides it. We believe that … if we do have our mahinga kai our pingao areas that need to be protected we need to be able to rahui. We need to be able to have those tools with teeth … for environmental protection sustainability and even our customary protection our cultural protection.” This view was reflected throughout our consultation in the very limited time period between when this bill was introduced and its first reading today. 
We understand that iwi welcome a legislative framework to protect environmental outcomes in the marine environment but there are two overarching issues for them: namely what is the process to ensure that iwi are involved in further policy development and what are the regulations and where do iwi fit into the regulations? There is no doubt where iwi are concerned that we want to avoid any potential risk of harm to the environment and subsequently any threat to the present and future economic well-being of New Zealand. We see the extension of the responsibilities of kaitiakitanga as taking up a vigilant stance to watch out for the health and safety of people; to safeguard the biological diversity and integrity of marine species ecosystems and processes; and to protect rare and vulnerable ecosystems as well as the habitat of depleted threatened or endangered species. Our commitment therefore to manage the cumulative effects of all activities on the environment is our uppermost concern in this bill. 
First and foremost we are pleased that the legislation will provide for consultation with Maori and will ensure consideration of Treaty settlements and customary rights and/or interests granted under the Marine and Coastal Area (Takutai Moana) Act 2011. But we are concerned from some preliminary views of iwi that the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill currently contains insufficient protection for and recognition of Maori interests. There are a number of areas where the regime needs to be strengthened which could improve the opportunity for more meaningful participation by Maori and enable better protection and recognition of Maori interests. We have approached the Minister with our suggestions in this regard and hope that he will give due thought to his response. One particular suggestion for example is for a mandatory requirement for a cultural impact assessment to be completed before an application can be accepted and provision to be made for cost recovery for iwi participation in processes. The preliminary assessment from the iwi we consulted is that they consider that the bill does not meet existing precedent and of course in their view and ours it should be seeking to improve upon existing statutory precedent. They also believe that the bill is somewhat hollow. The substantive criteria for balancing environmental impacts and economic outcomes are left to regulations and/or decision makers which may not provide desirable surety for environmental outcomes. 
We note that the Environmental Protection Authority advisory committee which carries over from a similar committee under the Environmental Risk Management Authority would also have a role in providing advice on process and decisions under the new legislation. The authority will make decisions on consent applications and will be responsible for the day-to-day operation of the legislation including information management monitoring and enforcement functions. If the Maori advisory committee is to be the principal mechanism to facilitate the recognition and protection of Maori interests it is a poor substitute for explicit statutory recognition of iwi rights and the inclusion of a stronger Treaty of Waitangi clause. At the very least if the Maori advisory committee is to play an important role it should be explicitly provided for in the legislation that its advice must be taken into account. I am mindful too that the recent Waitangi Tribunal report on the Wai 262 claim  
Ko Aotearoa Tenei 
 discussed the role of advisory committees in some detail and recommended that they should have broader roles including the discretion to comment at will rather than on referral and with input from iwi and hapu as to appointments. The appointments to the Maori advisory committee should be considered in areas where iwi have strong coastal interests and there should be direct iwi and hapu input into those appointments. One of the amendments we will be proposing as the bill proceeds through the House is that statutory status should be accorded to iwi that in some way provides for iwi to be recognised as a partner to the Environmental Protection Authority when it makes its decisions. 
The last comment I will make is about clause 14 the Treaty of Waitangi clause. The way this clause is currently worded sets out how the bill recognises the Crown’s responsibility to take account of the principles of the Treaty of Waitangi rather than as an obligation on a decision maker to have regard to take account of recognise and provide for the Treaty or its principles. This clause is therefore more of a declaration of the Crown’s view that the bill complies with its Treaty obligations rather than a provision that places a positive forward-looking obligation on decision makers in terms of the Treaty and Treaty principles. Not to put too fine a point on it but this is insufficient from a Maori point of view. It is also inconsistent with the Resource Management Act which will apply where activities occur within 12 nautical miles and which contains provisions that expressly require decision makers to have regard to Maori interests. Our recommendation to the Minister is that the clause should be replaced by a provision requiring that the Treaty or Treaty principles be taken into account. This could be done as part of clause 12 which lists the matters to be taken into account when making decisions under the legislation. It could also be done by way of a new forward-looking Treaty provision. 
We have made a commitment to the Minister that we are happy to work on redrafting the Treaty clause to ensure that it will recognise and respect the Crown’s responsibility to give effect to the principles of the Treaty of Waitangi and throughout the whole of the bill not just the specific parts referred to in the current version. Our support for the bill can be assured only for the first reading. We hope that sending the bill out for consultation during the select committee consideration will enable a far more comprehensive analysis of the bill and we will be actively encouraging whanau hapu and iwi to make submissions. 
Dr CAM CALDER (National) 
: 
 It is a pleasure to rise and take a brief call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. It is great to note the fact that we have the support of a wide range of parties—the Greens the Maori Party ACT and United Future—for this legislation. It is remarkable that we should be criticised by the Labour Opposition for bringing this legislation to the House. In the last few years of the Labour Government some 18 wells were drilled in Taranaki. Was any environmental protection put in by the Labour Government? Zero. How much? Zero nothing nada. It is risible to believe that we should do nothing just because the continental shelf has not been completely defined at this stage. 
We are bringing this bill to the House to protect the marine environment. We believe in economic development but also protection of the environment goes hand in hand with that development. At this point in time I would like to give credit to those at work in the North and South Taranaki bights where oil exploration and development has been going on for 50 years. In fact as far as I am aware there has not been any leakage to date from any well hole there which is a superb reflection on their professionalism and involvement in best practice. The catastrophe we have all noted with alarm in the Gulf of Mexico has even heightened their resolve to improve their activities. It has certainly informed our framing of this legislation. When I talked to an industry leader in Taranaki some months ago he pointed out that the catastrophic spillage was the result of a highly unusual cascade of events which is a little bit analogous to the holes in a Swiss cheese all aligning at the same time. That was the likelihood of those events occurring. 
The exclusive economic zone is a pretty recent construct. Historically the territorial sovereign limits extended out 3 miles—the distance of a long cannon shot. In the 1970s a tuna fleet from the United States encountered Ecuadorian naval gun boats. The dispute was taken to the International Court of Justice at The Hague and as a result the third United Nations Convention on the Law of the Sea was enacted defining the exclusive economic zone at 200 miles. This bill reflects New Zealand’s management and protection of the natural resources of the exclusive economic zone which is an obligation under that United Nations convention. I commend the bill to the House. 
Hon MARYAN STREET (Labour) 
: 
 Labour is opposing the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill and I will talk about some of the reasons why. Clearly we have always been in favour of appropriate responsible and sustainable use of the environment for economic purposes but our deep concern over this bill is that its protested balance between economic benefits and environmental protection is insufficient. It is insufficient. 
This legislation is not robust enough to give either the Greens or the Maori Party—whose members I have just listened to very carefully—any reassurance that any of the things they profess to hold dear will be maintained under this legislation. Why is that? This bill does not balance or provide us with any assurance of balancing economic interests and environmental protection because in the end it comes down to regulation. Although we might have some confidence in the Environmental Protection Authority which will be given the oversight of this regulation it is dependent on the say-so of the Minister for the Environment for the things that it is meant to monitor and assess. The authority is dependent on the Minister’s determination of regulations which will not come anywhere near this Parliament will not go anywhere near the Green Party and will not go anywhere near iwi. The regulations will be the prerogative of the Minister to determine. In our view that is not sufficient to guarantee the kind of protection that is required. 
In the wake of the Gulf of Mexico fiasco the world has woken up to some of the very serious possible threats if deep-sea drilling and oil exploration are undertaken without due process and without proper monitoring and assessment. When these things happen 200 kilometres out from the shore when they take place out in deep-sea waters it is very difficult for anybody in this House to say they know what is really going on. Therefore it is incumbent upon this House to make sure that the protective legislation around deep-sea oil drilling for example is as robust as it can possibly be. But that is not what this legislation offers. 
There is no guarantee of protection. What we have is the offer of regulations as the need arises made by a Minister whose track record has been remarkably poor in this regard to date. As the Minister for the Environment he was prepared to sanction and support mining on protected parts of the conservation estate—on schedule 4 land in the conservation estate. It was not until 2000 people marched down the street in Nelson that this Minister realised he was on the wrong side of public opinion—that he was on the wrong side of how people felt about the need for proper protection of our precious environment. This is the Minister who supported exploratory measures around Dun Mountain out the back of Nelson which was exactly the area where his Government had mooted a cycleway extension. So we were being treated to the prospect of a cycleway being constructed around potential mining operations. That would have been a great tourist attraction for the Nelson area! 
I cite these examples because this Minister for the Environment in this legislation is asking us to trust him to get the regulations right and worse than that to get the balance right between economic prosperity and advancement and environmental protection. This Minister has no credibility in that regard. Already with two proposals very close to home for him he has failed the test—he has failed the test. It was only latterly that he said that Kahurangi National Park would not be touched by mining. 
Hon Dr Nick Smith 
: I was involved in creating the park. 
Hon MARYAN STREET 
: Oh yes—in the latter days. Gosh! It was well under way under a Labour Government for goodness’ sake! He just comes to it last. It is like opening buildings that the Minister had nothing to do with advocating for in the first place. You know that happens. We accept that. We accept that a previous Government can set something up and an incoming Government gets to sign it off. I understand that; that happens. 
But in this regard this legislation is asking us to put faith in a Minister to make regulations that do not come anywhere near this Parliament for discussion. That ought not to be sufficient for the Maori Party. I am glad that Rahui Katene has drawn attention to the fact there is not adequate provision for consultation with Maori. We have already seen the fuss that has been created over the Raukumara trench and the oil exploration by Petrobras in that area. I suggest that having a two-and-a-half line clause in this legislation—clause 26 which refers to the Maori advisory committee—is not sufficient. 
I also draw attention to the Green Party’s comments. On 24 August when this legislation was introduced by the Minister the Green Party derided it for assisting dangerous extractive industries that contribute to climate change. I am sorry but today it seems to me that the Green Party is looking more blue than green. The National Party might like to celebrate its blue-green status although I have to say that with the opening of a lignite mine and the announcement of the opening of a plant in Southland the blue-green credentials of the National Party must be in tatters. The Green Party is beginning to align itself—in a foreshadowing of its possible coalition arrangements with National—in a way that makes it look now more blue than green. I ask the Green Party to consider this again. I hope that it listens really carefully to the submissions to the Local Government and Environment Committee and comes down opposing this legislation at its second reading. 
One of the other things that becomes apparent in this legislation is that there is a need for interim measures until this law is passed which will not be—even by the Minister’s own admission—until 1 July 2012. Interim measures need to be put in place. It says in the explanatory note of the bill that these interim measures will be developed in consultation with the industry or the various industries I presume that will be engaged in activities in our exclusive economic zone and our extended continental shelf area. I just hope that the consultation with the industries in this respect is a little more robust than the consultation with the film industry over the legislation surrounding that industry so that our legislation is not for sale. 
LOUISE UPSTON (National—Taupo) 
: 
 I am pleased to speak in the first reading of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. But I must say I am rather staggered to be in a situation where the Greens have very clearly supported this bill going to the important select committee stage where the public can have their say and submissions can be heard while the Labour Party has just flatly refused—it is just flatly opposing this legislation. I find that staggering. The fact is that our oceans are a major engine driving our climate system. Also our oceans have been in existence for 3 billion years longer than our land. Yet here we have the Labour Opposition with no interest in regulating and protecting this vast resource. 
Hon Maryan Street 
: Yes we do; we just don’t want Nick Smith to do it. 
LOUISE UPSTON 
: I find it to be somewhat staggering that we are in this position. 
The oceans of course provide vast opportunities whether it is in mining electricity generation carbon storage or aquaculture development—marine farming. These are just the opportunities that we know of. I am sure we will come across many opportunities in the years and decades ahead. But the interjection from the Labour speaker says it all: it is about one individual—one person. Labour members are so into personalities and not the issues of the day. They are not interested in actually debating economic opportunities to grow our economy as well as protect such a precious resource. 
This bill has got it right. We clearly need to have protection in place. At the moment unfortunately the resource management extends only to the 12-mile limit. This legislation looks at putting a regulatory and protection framework in place for an area that is 20 times the size of our land mass. If we look at that opportunity we see that it is enormous. Clearly risks are also involved and that is why it is really important that we have that balance in place and that we have legislation that protects this amazing resource—this amazing asset—on our doorstep. I will not go through all the provisions of the bill other than to say this is clearly part of a wider plan in terms of getting the balance right between economic growth and growing our exports and protecting our environment. This bill relies on the creation of the Environmental Protection Authority which is already in place. It clearly recognises that our environment is our greatest asset. We cannot do anything with that asset we cannot look at the opportunities that are available if we are not willing to protect it in the same breath. That is why I am proud that we have a Minister who is willing to take such bold steps. 
Quite frankly I am disappointed that we have an Opposition that does not even want to debate the issues. Good on the Green Party for allowing us to send the bill to the select committee. This is an important step not just for now but for many decades ahead. Thank you. 
MOANA MACKEY (Labour) 
: 
 As my Labour colleagues who have spoken before me have said Labour will be opposing the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. I say to the member who has just resumed her seat that fine words are all very well and good but what we need to have is decent legislation if we are serious about protecting New Zealand’s exclusive economic zone. 
Hon Dr Nick Smith 
: You had 9 years. Did nothing in 9 years. 
MOANA MACKEY 
: That is not true. Dr Smith says Labour did nothing in 9 years and he knows that is not true. An awful lot of work went into this issue. Unfortunately while Nick Smith was parading up and down the country saying the beaches belong to everyone—no deals; do not let Maori have access to the foreshore and seabed—and while he was planting New Zealand flags and raising up all the racial tension that resulted on the foreshore and seabed issue that work had to be put on hold because clearly there were implications for the foreshore and seabed issue of the oceans policy work that Labour was doing. We went through that period of time. As the Minister well knows he could have picked up that work. He has picked up the work that Labour was doing in this area but he has made significant changes to it which has meant that Labour cannot support it. 
Another three things have changed since that time. The first is that we have a National Government which the minute it came into office went out and said to the world that it wanted more oil and gas exploration in New Zealand. National ramped that up big time; it has never denied doing that. It saw that industry as becoming a big part of New Zealand’s economic future. So National went ahead and ramped it up—and the Minister is acknowledging that—despite there not being the protections in place. Despite there not being any protections in the exclusive economic zone the Government went ahead and said it wanted to do a lot more oil and gas— 
Hon Dr Nick Smith 
: It hasn’t happened yet. 
MOANA MACKEY 
: It has happened. Come up my way. I invite any Government Minister to front up in Gisborne and on the East Coast instead of running away and hiding every time they are invited and explain their position around oil and gas exploration in the Raukumara Basin. But they do not come. They hide and they send Government officials. Our local MP does not show up; the Minister does not show up. No one fronts up to talk to the people on the East Coast who are concerned about what is going on in their exclusive economic zone. That is the second thing that has changed. 
The third change is that the Gulf of Mexico oil spill was a big wake-up call for everyone. We had been told time and time again that technology had developed so far—which I am sure it has—that there were a lot more protections in place that we were able to do this work in a way that was a lot safer and that we would not have the kinds of accidents that we have had in the past. I think largely the public had accepted that. The public had accepted that the technology made oil and gas exploration a lot safer. What the Gulf of Mexico disaster showed us is that those dangers are very much still there and they are there in a big way. If we are not able to deal with them if we do not have liability issues sorted out up front if we do not have the capacity to carry out a clean-up in the country is this industry something that we want to ramp up as the National Government is doing before we get those protections in place? 
It is all very well for members to criticise the previous Government and criticise Labour for not supporting this legislation but we have taken all that on board. We have learnt from the developments that have happened over the last few years and we do not believe that this legislation will provide the protection that New Zealanders want to guarantee as much as we can that the kind of disaster we saw in the Gulf of Mexico will not occur here in New Zealand. 
Three things about this legislation are concerning. The first is that as we know the Resource Management Act applies out to 12 miles. The Resource Management Act’s principles are very clear and they are very well known. They are around the protection of our natural environment and our natural resources. But when we get beyond that 12-mile zone the well-known principles of the Resource Management Act principles that have been well tested and that people understand no longer apply. Instead the Government has put in a new test which is around a balance which is always a nightmare—a balance between economic development and environmental protection. I know that the community I live in on the East Coast is asking why we could not have the same principles. Why is it that beyond 12 miles apparently those principles of environmental protection do not apply and it now becomes a balance but within the 12-mile zone they do apply? 
The Minister Nick Smith is on record as saying this is because what occurs in the exclusive economic zone does not affect communities. I say again to the Minister that if he really believes that he should come to Gisborne and say it. He should go up the East Coast go into the tribal areas of Te Whanau-a-Apanui and Ngati Porou— 
Hon Dr Nick Smith 
: That’s not what I said. 
MOANA MACKEY 
: —it is—and tell them— 
Hon Dr Nick Smith 
: You’re making it up. 
MOANA MACKEY 
: I say to the Minister that I am not making it up. The little smile on his face tells me he knows very well that is what he said. It was a direct quote. The Minister said that the Government was not extending the principles of the Resource Management Act out because what occurs there does not affect communities. Does the Minister believe that? He has gone quiet; he has gone absolutely quiet. It does affect communities. The communities along the East Coast where that exploration is occurring in the exclusive economic zone are very affected and they were not consulted. 
There are no environmental protections in place. If the Minister is so passionate about the exclusive economic zone and its protection why did he not put on hold those consents until all the protections were in place? 
Hon Dr Nick Smith 
: Because it’s only seismic surveys and they were only subject to consents. 
MOANA MACKEY 
: They are only seismic surveys. Yet there were still intrinsic dangers in carrying out that work. Because this legislation will not be in place until July 2012 at the earliest will he guarantee that if National decides that prospecting will go ahead nothing will occur before the regulatory framework is in place—absolutely nothing? 
Hon Dr Nick Smith 
: We’ve put interim arrangements in place. 
MOANA MACKEY 
: Interim arrangements in place. Again I say it would have been nice if National members had fronted up to the numerous meetings on this issue held in the local community to explain this instead of sending four officials from the Ministry of Economic Development who had to sit there and say they did not know because it was a political decision. Our community could not get the answers it wanted because not a single National MP would front up. I think that in itself is very very telling. 
The exploration that occurred in the Raukumara Basin as the Minister well knows has caused enormous distress in the East Coast communities. Iwi leaders who should have been part of the consultation process heard about it on the news. They heard on the news that it was happening. Since then they have not been able to get answers to some very simple questions that the community has been asking about that exploration in a very ecologically sensitive part of the marine environment. What made it even worse was that for a number of years now the move that people have wanted to make is to put that area into a marine reserve. That was the kind of move from the Government that they were hoping for regarding the Raukumara Basin because it is ecologically significant because it is environmentally sensitive because it has breeding and feeding grounds I say to the Minister because it has a number of endemic species— 
Hon Dr Nick Smith 
: Is that your policy? 
MOANA MACKEY 
: The Minister will have to wait with bated breath to hear Labour’s policy. None of the environmental protections were in place. 
The Raukumara Basin is an ecologically sensitive area and it is incredibly seismically active. When we look at the number of shallow earthquakes over the last 10 years we see that with the exception of Canterbury most of them have occurred in the very area where the exploration is taking place. Also it is interesting to note that the other part of the country where the industry is currently doing exploration is in Canterbury off the Canterbury coast. The two most seismically active parts of the country are currently the areas where we are exploring. We know that these oil and gas reserves are now harder and harder to get to because all the easy resources have already been exploited. 
We have major concerns that the Environmental Protection Authority will be the body that administers this legislation. The Environmental Protection Authority is under-resourced incredibly under-resourced for the amount of work and the responsibility that the Government expects it to carry out. It is not autonomous so the Minister can direct it and therefore it is not solely about protecting the environment. It is about carrying out the will of the Government of the day which is not what was promised. Most tellingly the Environmental Protection Authority does not have environmental protection as one of its purposes. The Government refused to support an amendment that would have made environmental protection one of the purposes of the Environmental Protection Authority. That tells us an awful lot about the particular agency that is to administer this legislation. 
We do not have any detail on this legislation. All the detail on it is to be set out in regulation. This is something that the Government has been doing more and more of. So how could anyone have any confidence—any confidence—that this legislation will protect in any way? This is one of the reasons why Labour will not be supporting this legislation. It comes from a Minister who has weakened just about every single piece of environmental protection that the previous Government put in place. He has sat by while oil and gas exploration has been ramped up and then in the dying hours of this Parliament he has introduced a bill that will provide he says some form of protection. We say we cannot see that in the legislation— 
Mr DEPUTY SPEAKER 
: I am sorry to interrupt the honourable member. Her time has expired. 
A party vote was called for on the question  
That the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill be now read a first time. 
Ayes 76 
New Zealand National 57; Green Party 9; ACT New Zealand 5; Maori Party 3; United Future 1; Independent: Carter C. 
Noes 44 
New Zealand Labour 42; Progressive 1; Mana 1. 
Bill read a first time. 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I move  
That the Local Government and Environment Committeeconsider the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. 
A party vote was called for on the question  
That the motion be agreed to. 
Ayes 76 
New Zealand National 57; Green Party 9; ACT New Zealand 5; Maori Party 3; United Future 1; Independent: Carter C. 
Noes 44 
New Zealand Labour 42; Progressive 1; Mana 1. 
Motion agreed to.