Wong Pansy: Standards Amendment Bill Testing Laboratory Registration Amendment Bill — Third Readings 
Wong Pansy: Standards Amendment Bill Testing Laboratory Registration Amendment Bill — Third Readings 
[Volume:634;Page:5526] 
PANSY WONG (National) 
: 
 National opposes these bills on three grounds. Firstly we do not believe that subjective standards should be introduced that raise expectations but are not able to deliver. I will expand on that later. The second reason we oppose these bills is that the Minister of Commerce Lianne Dalziel and the officials have not addressed the unacceptable position whereby companies that now seek accreditation from the new agency will have a tenfold fee increase without receiving any additional benefit from it. The third issue is the failure—or the officials’ acceptance that it is not possible—to quantify compliance costs. It is totally unprofessional for Government departments to say that as it is too difficult to quantify costs they will assume that additional compliance costs will not be incurred. That approach is simply not acceptable. Let me expand further on those three grounds. 
The Standards Amendment Bill expands the Standards Council’s objective to develop standards by including two additional objectives. One is to minimise environmental risk and the other is to promote social responsibility. Both of those terms are very subjective. I have a vision of our officials going overseas and continuing a very long discussion with other international delegates on how to achieve those objectives and then on coming back probably developing all sorts of standards—I cannot say “standards” because I do not believe that we can develop standards—to achieve them. We would end up with a whole lot of processes. Companies would be told that they had to have another folder sitting in their offices to demonstrate that they had gone through the process of adhering to those standards and that once the process was finished—that is when they had finished ticking all the boxes—somehow the environmental risk would have been minimised and the companies would have done their work. 
We were not able to get satisfactory answers about this matter from the officials during the select committee process. They admitted that it was a matter of “suck it and see” but I do not think that New Zealand businesses and consumers should be led to these false expectations and they should not be burdened with additional costs when there is no tangible of way of achieving those high expectations. 
The second point is more serious. It is about the unacceptable fee increases. The Commerce Committee heard a submission from Health and Disability Auditing New Zealand. That organisation is already in existence. It is approved by the Director-General of Health to audit all the service areas under the Health and Disability Services (Safety) Act 2001. It is already accredited under the current organisation International Accreditation New Zealand. One can assume that as the Auditor-General approved this agency to carry out the work we should be able to rely on the fact that the Auditor-General and the department have confidence in the competence of this organisation. 
In its submission to the Commerce Committee this organisation pointed out that the fee for certification by International Accreditation New Zealand for a 3-year period was $18915. But as soon as it has to get certification under the agency called the Joint Accreditation System of Australia and New Zealand the certification fee will jump 10 times to $155823. That is the question. What can be achieved by a fee increase of that amount? What value could the new agency add to the organisation that would warrant a fee increase of $130000? 
Sandra Goudie 
: They’ll go offshore. 
PANSY WONG 
: Yes absolutely; it will force people to go overseas. When Health and Disability Auditing New Zealand raised this problem with the Ministry of Economic Development the ministry asked the Joint Accreditation System of Australia and New Zealand to review its fees. Well there is some good news which is that the fee suddenly came down by $20000. That actually makes one worried does it not? One complaint and the fee drops by $20000. But even then the organisation is still faced with an overnight increase in the fee alone of $110000. And we can guess where that increase in fees will be recovered from. No doubt the organisation will charge all the health service providers additional fees for carrying out their audits. Also we can guess where the service providers will recover their additional costs from—and I do not see any additional benefit coming with it. I think it will be from the Government’s Budget. 
This afternoon we were told there had been a leaked email. We are told that if district health boards do not cut a fixed number of patients from the waiting lists they incur penalties of millions of dollars. So I can imagine that the $100000 would be recovered in the same way—by cutting the number of people waiting for operations from the waiting lists. But this organisation like others is facing not just this quantifiable fee increase; it is also facing compliance costs. 
I got really worried because the Minister of Commerce who is the Minister sponsoring these bills on the one hand said that she is carrying out a vertical horizontal dynamic review of compliance costs with the aim of cutting them and making life easier for small business and on the other hand said in the business compliance statement that came as part of the Standards and Conformance Bill that that is the best her officials can do. The officials say that people will adjust to rising compliance costs. 
But the worrying thing is what they went on to say which was that there may also be some confusion in the market. They said that as a result of these changes particularly for the clients who have been certified by the affected certification body it is not possible to quantify the size of these compliance costs. Well it is easy for officials to say it is not possible to quantify the size of these compliance costs; service providers—real people out there—actually have to live with the increases in compliance costs. 
The worst thing is the solution of the Ministry of Economic Development staff who reckon that these compliance costs will be mitigated by the officials writing to the clients who have been certified by the affected certification body to explain that. So somehow a letter from the Ministry of Economic Development to those business clients will mean that the compliance costs will disappear. I actually suggest that the Minister of Commerce should just instruct the officials in the Ministry of Economic Development to write a letter to all people who are in business in New Zealand because that seems to me to be their solution to cut compliance costs. 
The National Party is totally dismayed and disappointed with the Standards Amendment Bill. It protests on behalf of business particularly small businesses against this subjective piece of legislation that will increase costs without giving any benefit to them at all.