Cunliffe David: Business Law Reform Bill — Second Reading 
Cunliffe David: Business Law Reform Bill — Second Reading 
[Volume:616;Page:12026] 
Hon DAVID CUNLIFFE (Minister of State) 
: 
 It is indeed a pleasure to rise in support of the Business Law Reform Bill and to follow the distinguished chairman of the Regulations Review Committee Richard Worth. This bill signifies two important things. The first—and this is something that the public listening to the radio broadcast of this debate in their hundreds of thousands may not appreciate—is that many of the processes in this Parliament are imbued with a strong sense of cooperation and this bill is one of them. By tradition this bill brings together a number of relatively non-controversial amendments that are designed to make business regulation work more efficiently and effectively. By tradition that is done through prior consultation with the various parties in the House and through taking a very bipartisan approach in the select committee. Clearly the Commerce Committee has done a good job on this bill. It has given us a detailed report and clearly the process of cooperation was working well as it should. 
Mr Worth mentioned the business compliance cost panel’s report which if I heard themember correctly contained 160 recommendations for ways in which the Government could reduce compliance costs—several of which are reflected here in this bill. It is important to note that since that report the Government has implemented or is implementing in the order of 85 percent of the recommendations representing in the order of 96 percent of the value contained the report. By anybody’s measure therefore this Government has been sincere about and successful at reducing business compliance costs. 
We are proud to bring this bill to the House. It is a small further step on the way towards making our laws more business friendly and towards reducing any unnecessary compliance costs and other impediments to business. I commend this bill to the House. 
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
: 
 In speaking on the second reading of the Business Law Reform Bill I should make it clear at the outset that National supports the bill for the good that it does. But I have to say that if the issue were not so serious one could not help but smile at the Commerce Committee’s introduction to the commentary on this bill. It states—and of course colleagues have already pointed out that this Business Law Reform Bill changes certain statutes relating to business; 13 of them in all—that this bill was designed to remove unnecessary compliance costs. What saddens me about that is the absolute lack of understanding by this Government and its Ministers of what compliance costs are all about. If we went along the Labour front bench today I do not think we would find any member who either runs a business today or has ever run a serious business in the past. If the Labour members think this legislation will have a significant impact on the compliance costs of running a business in this country they are deluded and are absolutely in a dream world. 
The issues that add hugely to the compliance costs of running a business in this country are the kinds of ones that came through my letterbox the other day. I do still run a small business and have done so for all the years that I have been in this Parliament. 
Darren Hughes 
: Does it make a profit? 
Dr the Hon LOCKWOOD SMITH 
: It does not make much profit at all sadly; in many years it makes a loss. I have continued to run that small business even though it means a lot of hard work. On a Sunday afternoon when I would rather have a bit of a rest from constituency work and the work of Parliament I am involved in running that small business. The beauty of it is that everything the Government does to a business comes through my letterbox. I am the director of a private company and everything the Government does to a business comes through my letterbox. It used to be the same when National was in Government. I was able to tell some of my colleagues what we were doing to businesses’ figures because it all came through my letterbox. 
One of the most recent things to come through my letterbox was a little package about a centimetre thick which tells employers about their responsibilities as from 1 April this year—in about 6 days’ time—following the changes to the Holidays Act. Those issues are real compliance-cost issues and they are far bigger than the issues covered by this bill for small to medium-sized businesses. I would not mind betting that Paul Swain—is he the Minister responsible for this bill? No he is not. This bill is in the name of the Minister of Commerce so Margaret Wilson is now in charge of it. Goodness knows where she is. She does not seem to be particularly interested in either business law reform or compliance costs for businesses. Margaret Wilson is I guess the very Minister who has been responsible for the package of changes that employers will have to put in place in order to comply with the new holidays legislation. The survey of businesses in New Zealand that was tabled in this Parliament today makes it very clear that businesses up and down the country are desperately concerned about the whole issue of compliance costs. 
This bill while it is marginally helpful with regard to compliance costs does not address in any serious way the major compliance costs that are crippling businesses—if they can comply with them. The Minister in charge of this legislation Margaret Wilson is personally responsible for some of the legislation that it is impossible for small businesses to comply with. I can absolutely assure members that if any of the Labour Ministers ran a business or had any idea of what is involved in running a business they would not try to put through this Parliament some of the legislation that they have. It will not be possible to comply with the centimetre-thick package of responsibilities for employers following the passage of the Holidays Bill by this Parliament. 
It is fascinating to realise that if members of Parliament had an employer I doubt whether that employer could comply with those responsibilities. I think there is an interesting issue there around the compliance costs of running a business and employing people. Who employs members of Parliament? If there is an employer of members of Parliament I do not believe that employer is complying with the law. Nothing has come to me as a member of Parliament that indicates my employer is in any way complying with the requirements that I have to comply with as a business person who employs people in this country. That just shows in my view the stupidity of the compliance costs that this Labour Government is imposing on business up and down the country. 
The Minister of Finance stood in this Parliament today and chortled about how wonderful the Government’s relationship is with business and how wonderful growth has been under this Labour Government. The Labour Ministers do not seem to understand the issue of compliance costs at all; they have no feel at all for what is involved in running a business in this country. The introductory part of the commentary on the bill states that this bill is about removing unnecessary compliance costs. I can say as someone who runs a business that if we were to add up the total compliance costs associated with running a small business we would find the changes made in this bill would not even scratch the surface of those costs. 
Recently the Meat and Wool Innovation Economic Service a service of the new combined meat and wool boards put out its analysis of the movement in the input prices for running farming businesses—in this particular case it was sheep and beef farming businesses. I guess I happen to have an interest in that because I run one of those farms. In the last 12 months three of the four biggest increases in the costs of running a business have been Government charges. Again that is an example of the absolute lack of understanding by the Ministers of this Labour-led Government of business and of compliance costs associated with running a business. That analysis of running a farming business is not mine; it is from the Meat and Wool Innovation Economic Service. Its analysis shows that the biggest cause of increased input costs for the running of a sheep or beef farming business is Government charges. 
 We support the measures in this bill. Interestingly one of the Acts that is to be amended is the Personal Property Securities Act which this Parliament passed not so long ago. It is now being amended with this legislation. That shows the problem that occurs with regard to some quite complex law when things are done too quickly. The select committee did not understand the full implications of the Personal Property Securities Act and here we are having to amend it. I see the Minister nodding as he acknowledges that fact. I hope that with the changes being made in this bill the Parliament is getting that law right this time. I would not mind betting that 99 percent of the members of this Parliament do not know whether the changes made in this bill will actually work. I bet the ACT MP Stephen Franks has a very good idea about the details of this bill as does my very good colleague Richard Worth but not very many other members in this House would have much knowledge about it. I suspect my colleague Brian Connell also has a good knowledge of the detail of the bill but not many other members would. Parliament has to be careful when it passes law that is as complex as this and is not well understood. 
Finally I conclude by saying that this Labour Government has to get serious about reducing compliance costs. This bill while positive will barely scratch the surface of the huge challenge to be met if New Zealand business is to get ahead.