Key John: Injury Prevention Rehabilitation and Compensation Amendment Bill — Instruction to CommitteeCWH In Committee Speaker Recalled In Committee 
Key John: Injury Prevention Rehabilitation and Compensation Amendment Bill — Instruction to CommitteeCWH In Committee Speaker Recalled In Committee 
[Volume:609;Page:6490] 
JOHN KEY (NZ National—Helensville) 
: 
 I am delighted to engage in this debate during what is drive time for most New Zealanders as they go home. I am delighted that they will hear the shocking news—and this will be the first time they hear it if they have not caught up with the news already—that another levy is coming their way. How did Dr Michael Cullen the Minister of Finance once describe levies to the public in this House? He described them as back-door taxes. That is what the Minister said. 
Rodney Hide 
: I don’t believe it! 
JOHN KEY 
: Absolutely! He described them as back-door taxes. There is not much “back-door” about this tax. This tax is right out front—5.08c. 
But what is of such great concern is not so much the levy itself although that is concerning because it is up 120 percent. What is really concerning is clause 3(b) which my colleague Phil Heatley referred to. In effect the Government will have the ability to change the levy whenever that is required. Why is that important? Why is clause 3(b) so crucial to this legislation? Let me explain to the Committee. 
The first reason is that this levy has to cover the amount owing. Why is it 5.08c a litre not less? Because this Government chose to renationalise accident compensation. The Government said that it did not want competition that it did not want the ability to have competing firms which would drive down the costs for New Zealand motorists. The Government said that competition is not a good idea. It said it would renationalise accident compensation and bring in all the inefficiency that one gets with a monopoly—unless one socks it to the poor hard-working motorists of New Zealand who are going home to their families in drive time. That inefficiency will come back to roost year after year as people pay greater increases in their levies. 
That is not the only concern. The second and probably most alarming concern is that the rate of long-term claimants which had been falling dramatically has stopped fallingIn fact it is increasing. Why is that of such great concern? Why does that make a . 
Clayton Cosgrove 
: Why? 
JOHN KEY 
: I will be happy to tell Mr Cosgrove. As the number of long-term claimants rises— 
Phil Heatley 
: Darren Hughes is on his knees to Annette King. 
JOHN KEY 
: Darren Hughes is on his knees proposing to the Minister in the chair the Minister of Health. This is ground-breaking stuff. I feel like an anchorman for one of those television shows—breaking the news to the country. I could be Paul Holmes breaking news. No wonder the member is blushing. 
Brian Connell 
: I raise a point of order Madam Chairperson. I am sorry to interrupt my colleague. I was wondering whether the Committee could have the Minister’s answer! 
JOHN KEY 
: Why is it important that the number of long-term claimants is rising? It is because the levy—the back-door tax being socked to the hard-working motorists of New Zealand—will increase if the number of complainants goes up and the cost to the commission goes up. That is a fact of life. If the number of long-term complainants rises and it is rising as we speak— 
Brian Connell 
: Why is that? 
JOHN KEY 
: Because we are back into a monopoly— 
Brian Connell 
: No competition. 
JOHN KEY 
: That is absolutely correct. So that is of great concern. But equally of great concern and in this respect I give a backhanded compliment to the ministry is the outstanding job it has done of managing the reserves—$3.6 billion worth. Last year the ministry earned 3.6 percent return on those investments. That is a tremendous return if we take into consideration the very poor investment conditions. Can such a stellar performance by the ministry continue? 
Dr Paul Hutchison 
: Unlikely. 
JOHN KEY 
: There is silence from the Government and an “unlikely” from the Opposition benches. I say it is very unlikely indeed. If that return is poorer than it has been in recent years there will be less money to pump up the levy less money to help those wonderful New Zealanders who are in drive time going home to their families and less opportunity for them to defray the costs.