Mitchell MarkHon MARK MITCHELL (Minister of Defence): I am very happy to take a call on this the External Sector Estimates debate. I am going to speak to trade foreign affairs and defence. I am going to come back to the points that were raised on the defence portfolio and also to Mr Coates' comments but can I just start first with trade.Can I acknowledge the Hon Todd McClay—he is away overseas at the moment working on another trade deal—and his commitment and the work that he has done. There is something that he has done that I have found actually really interesting. Through the Trans-Pacific Partnership select committee process when we were hearing submissions from the public it actually became really clear that the public genuinely wants to engage and to have a public debate and conversation around these free-trade deals—when they are being negotiated and when they are being prepared to be put in front of the country for a decision. I think what Minister McClay has done is he has been very very good in making sure that both he and officials are getting around the country—with public meetings with industry with different sectors and with NGOs—and actually engaging and talking about these trade deals. Fundamentally that has been extremely important in terms of getting the support required to continue to advance them.One trade deal I would just very quickly like to touch on is one that actually came through the Foreign Affairs Defence and Trade Committee and that was the Korean free-trade agreement (FTA). I was lucky enough that today I had a meeting with the Korean ambassador and he made the comment to me that this free-trade deal is already delivering beyond expectations in terms of what we saw and identified as value not only to New Zealand but to our trading partner in Korea as well. That just continues to reiterate and support the fact that these free-trade deals are very important for us as a country in terms of our overall Business Growth Agenda.Trade Agenda 2030 is the fundamental road map for us as a country in terms of our trade agenda over the next 10 to 15 years. That involves $91.3 million of new funding and that will be spent over the next 4 years as part of Budget 2017. That is going to mean a new embassy in Dublin and a new high commission in Sri Lanka both very important markets for us. There is $35 million to support primary sector exporters to succeed in accessing overseas markets and $27 million to boost Ministry of Foreign Affairs and Trade (MFAT) trade resources and to accelerate FTA work. There will be the new Clearing House for a single online point of contact for exporters encountering trade barriers and requiring support—that fundamentally is very important. Any business can access that from a small one- or two-person retailer that is just in a start-up phase to a big manufacturing company that has already got a strong export pipeline. There will be a cross-sector ministerial advisory group (MAG) to increase engagement on trade deals; this MAG will include exporters industry groups iwi NGOs and Mr Robertson unions.Grant Robertson: Yeah we had that actually in 2008. I just wonder why you got rid of it.Hon MARK MITCHELL: It is a pretty inclusive policy. I would just like to quickly move on to defence and just quickly respond to the points that Mr Iain Lees-Galloway made around our economic zone. Defence is doing an outstanding job in terms of policing and protecting our own economic zone and we should be very proud that there was a story on the front page of the national paper in Fiji this week just thanking and highlighting the work of our inshore patrol vessel that has been based up there supporting the Fiji military and the Fijians because they lost their own capability. The vessel has been doing some outstanding work. The numbers are phenomenal in terms of the area that it has patrolled and the number of vessels that it has stopped searched and checked and it has been recognised by the Fijians for the outstanding work that it has done.We are also recognised in leading in terms of our responsibilities in our patrolling the Southern Ocean and Antarctica. That is tough work but our navy has got a strong history. It knows how to operate down there. It is very good at it and for that reason we are seen as leading other countries that also have a responsibility to patrol the Southern Ocean in terms of how we are providing proper coverage and ability over the area that we are responsible for.In terms of the UN peacekeeping—you raised the UN peacekeeping Mr Lees-Galloway—yes we are very active in the UN peacekeeping sector. We have got a long proud history of deploying and supporting these UN peacekeeping missions. We have got five staff at the moment in South Sudan. Can I acknowledge one of the past members of the Foreign Affairs Defence and Trade Committee David Shearer who is doing an outstanding job from what I understand of leading that UN mission in South Sudan. He has got some big challenges but he seems to be making some good progress on them. I am very pleased that we are able to support him as a country through the New Zealand Defence Force (NZDF) in what he is trying to achieve up there. That is a very challenging mission without a doubt.We have just had 35 engineers come back from Sinai. They have been out there at the south base target hardening basically the base there. I was lucky that I met with the UN commander of the mission up there who was on his way through New Zealand about 3 weeks ago and he said that he would really love to have our guys back. They arrived there with the goal of actually rebuilding a perimeter fence around the camp but in true Kiwi fashion they ended up identifying a whole lot of other projects that they could do to help target harden and make the place safer for all the UN staff who are based out there. So they got on and they did that. I met with them down in Burnham. They were saying that they did not have a Mitre 10 up the road where they could go and get the equipment. There were lots of challenges in terms of sourcing equipment in the local market but again it just reiterates and supports the fact that our people are doing great work on these UN missions.Iain Lees-Galloway also mentioned procurement and actually Ron Mark from New Zealand First also mentioned procurement. Procurement is a big challenge without a doubt and if you look at the history of our New Zealand defence forces we have not always got procurement right. There were some big challenges in bringing the NH90s into operational use. But in actual fact—I just visited them last week and was having a look at some of the innovation that our people have done at Ōhākea in the workshops that we have there; world-leading technology—they have actually improved the NH90s and they are in full service now. Actually globally in terms of operational capability and use we are leading the world on about 70 percent operational usage or availability—I think the closest country to us is on about 45 or 46 percent—so that is actually outstanding. We are getting better. We are getting a lot better.That did require actually putting some more people into the Ministry of Defence. We did actually have to strengthen our ability in terms of the big programme that we have got coming in terms of procurement and the defence white paper has given us our own very clear road map in terms of that. There is going to be some significant investment into our people—to make sure that they get the right training support and career pathways to be able to keep them and give them a good viable career—and into our equipment. We have got a very big procurement programme over the next 5 to 10 years in terms of replacing a lot of our capability and a lot of our equipment which actually has now been in service for anything up to 50 or 60 years. And of course we are investing very heavily in our defence property to make sure that there is a complete upgrade and that our people have got the best facilities the best equipment to be able to use and have access to.Just on that if I could give you some figures in terms of the amount of investment that we are looking at the Defence Force will receive a $406 million boost in operating funding over 4 years and $576 million in capital as part of Budget 2017. The major increases in funding in the armed services will support a range of NZDF capabilities as I have just outlined through both procurement of equipment and also heavy investment in our defence estate. There will be $100 million to improve defence camps and bases throughout the country including upgrades at Auckland Manawatū and Canterbury. There will be $301.7 million for the littoral operation support ship and the frigate communications upgrade.I was very lucky in that when I was up in Singapore for the Five Power Defence Agreement meeting my Canadian counterpart invited me on to the Canadian frigate Winnipeg which has actually gone through a very similar systems upgrade to what we are proposing for our own frigates. It was hugely impressive. It means that it will give our navy a far advanced capability and also continue to make us a good partner and interoperable.