Mallard Trevor: Reserve Bank of New Zealand (Covered Bonds) Amendment Bill — Second Reading 
Text is incorporated into the Bound Volume 
Mallard Trevor: Reserve Bank of New Zealand (Covered Bonds) Amendment Bill — Second Reading 
[Sitting date: 21 February 2013. Volume:687;Page:8143. Text is incorporated into the Bound Volume.] 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 The Labour Party is supporting the Reserve Bank of New Zealand (Covered Bonds) Amendment Bill albeit with some reservations. If you go right to the core of why we are supporting it it is that they exist anyway. The banks have issued them and the Reserve Bank appears to have unfettered power to have more than the 10 percent that is in the legislation to approve the banks doing this. What happens when that occurs is that the situation gets even worse than what is in this bill. While my colleague— 
Chris Auchinvole 
: David Clark. 
Hon TREVOR MALLARD 
: —yeah—was talking about small business what he was not talking about were the mums and dads who have their deposits with the banks. It is pretty awful what this bill does. What it says is that if you are a big overseas corporate lender to the banks or even a parent company with one of the tax-dodge arrangements lending to New Zealand banks then you get priority over the mums and dads or their grandmothers and grandfathers who have a few dollars in the bank when and if the bank runs into trouble. 
 The counterargument is that if you have some stable finance and an ability to draw down what is effectively preferential debt then that might help with the bank’s stability. That could well be right. So you then get to the question of how far do you go. I am not asking you how far you go Mr Deputy Speaker; I am saying that the House is faced with a question about how far does one go. Other jurisdictions have made decisions. The Canadians have decided on 4 percent. They have decided that to get a 4 percent draw-down in this area is sufficient that they can give cover. In that way they are giving better protection to the mum and dad investors. 
Dr David Clark 
: Mr Key said he would go all the way with Skycity. 
Hon TREVOR MALLARD 
: Well he certainly put the chips on the table with Skycity. I think actually politically he might have gambled and lost. I think one of the questions of course is whether Skycity will apply for a banking licence as well as a gaming licence; if so will it have covered bonds and will Television New Zealand (TVNZ) put any of its money there? I am told that the Prime Minister promised the TVNZ land for $100 worth of pokie chips. Is that correct members opposite? Is that true? Is that part of the deal? Millions of dollars a year—millions of dollars a year—of promotion money for Skycity has been promised by John Key. Millions of dollars promised and a TVNZ arrangement which I understand—I will not anticipate a matter before the House but I think some of us are looking forward with some excitement to 2 o’clock next Tuesday when the Prime Minister comes in here to make his withdrawal and apology for misleading the House because of course it must be that the first item of business next week will be the Prime Minister— 
Mr DEPUTY SPEAKER 
: This is the second reading of a bill. 
Hon TREVOR MALLARD 
: That is right—the broadest possible— 
Mr DEPUTY SPEAKER 
: No not as broad as that. 
Hon TREVOR MALLARD 
: The broadest—thank you for the reminder. This is the broadest possible debate and the question of whether the Prime Minister TVNZ or Skycity get banking licences and are involved in covered bonds is I think well within—well within—the ambit of this debate. But as one can probably tell this is legislation that we support because it is better than not having it but we regret very much the decision of the Government to favour overseas big money as opposed to the deposits of mums dads grandparents and small business.