Mahuta Nanaia: New Zealand Productivity Commission Bill — Second Reading 
Mahuta Nanaia: New Zealand Productivity Commission Bill — Second Reading 
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Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
 Mr Deputy Speaker tenei e tu ake ki te tuku aku mihi ki era kaiwaro i tanumia kei Te Tai Tonga ki a ratou nei whanau. Ka nui te mamae kei waenganui i a ratou kei waenganui i a matou hoki. Kia tuku te aroha nga roimata mo nga tuahuatanga ki reira. Pai marire ki a ratou. 
[ 
Mr Deputy Speaker I rise to express my condolences to the families of those miners entombed in the south. There is much pain amongst them and us as well. In respect of the circumstances experienced by them over there I extend love and tears. Let goodness and peace prevail over them. 
] 
In acknowledgment of previous comments that have been made I too want to join my deepest sympathies with the families of the 29 miners. Coming from Huntly which is a mining community having uncles who still work in the mines and having gone into the mines myself I can understand just a small part of the despair that families are going through at the moment. I pass on my deepest sympathies to them. 
It is my pleasure to join previous comments of the Labour Opposition and add my support to the intent of the New Zealand Productivity Commission Bill. It was quite interesting to listen to the very short submission of the previous speaker Melissa Lee. She was quick to point out that Labour had been in Government for 9 long years and she asked what we did. Labour definitely believes that lifting productivity stimulates growth. Three pillars to lifting productivity and stimulating growth were achieved by Labour in those 9 years. 
One of those three pillars was skills—lifting the skills of our people. We had a skills strategy. National got rid of that. We invested in adult and community education because we recognise that there are many rungs on the ladder to ensure that people can go into further education training and employment. National got rid of that. We wanted to ensure there was a pathway for our kids from school into education training and employment. We had targeted strategies to ensure there was a pathway at every level for kids leaving school and invested in that. National is making it harder for people to choose to take up education. What is worse is that the place where investment is needed most in early childhood education—we know that if we give our kids a great start at the front end productivity is guaranteed—National got rid of that funding and shame on them. 
The second pillar was investing and getting the priorities for investment right. It is really not clear what National is doing to ensure there is a plan for growth. I ask National members what the plan is for growth. They are quick to talk about it but no one understands what the plan is for growth. We had a plan. 
The third pillar we had was investing in research and development. The tax credits and the Fast Forward fund was worked out by a Labour Government with the sector to ensure we were investing in our ideas and in innovation through the tax credit. The Fast Forward fund was something we were very proud of but National got rid of it. 
Over 9 years we were working towards a systematic plan to ensure we addressed all parts of the productivity landscape. It was not a short-term fix. We knew we needed long-term investment for real gains and outcomes. But what National is doing is appealing to short-term sentiments by taking from one and giving to the other getting priorities completely muddled up. 
I will come back to the bill. I sat on the Commerce Committee and it was interesting listening to comments from submitters. Some of those comments related to the independence of the Productivity Commission. Clause 12 as we know relates to the terms of reference for the commission. One of the issues raised with the select committee was that the commission should be able to undertake work on its own initiative. As I understood it the basis for that assertion was to ensure that the independence of the commission helped to establish a high level of credibility in its deliberations. That level of independence would help to achieve that aim. The bill in clause 12(1) originally stated that “In carrying out its functions under section 9(1)(a) the Commission must act in accordance with the terms of reference set by the referring Ministers for each inquiry review and regulatory impact analysis.” Some might have argued that this provision limited the ability of the commission to initiate its own work programme. 
We received advice from the Australian Productivity Commission chairman who said there was a level of negotiation between the commission and the Minister over terms of reference and it was more a practice than a legislative imperative. Members of the committee were quite warm and open to the ability of a free-flow opportunity to form particular aspects of the bill for review. That is why the committee recommended amending clause 12 and inserting a new subclause to make it clear that the referring Minister is to consult the commission about the terms of reference so there is a relative balance between the independence of the commission and Government policy. From my perspective and certainly from listening to the submission of the Australian commissioner the legislation probably does not go far enough but it could in time. 
The comment was made previously that we were surprised by the low level of interest in the bill with few submissions made to the select committee. We had expected there would be more. However of all the submissions that we heard the presentation from the Australian Productivity Commission chairman was very informative and helpful in the final deliberations that led to the select committee’s suggestions for the bill. We were particularly interested in the process undertaken to identify issues that would be considered for review which are very wide ranging in their content; the process for determining terms of reference as I referred to previously; negotiation between the Minister and the commission—significantly the Treasurer and the relevant Ministers and the way in which public consultation occurred. 
From the remarks we heard it appeared that there was a full level of public consultation through the release of a draft report. We felt that that was a bonus to the process and role of the commission because once a draft report was released it would go out for public consultation. Potentially recommendations could be outlined in that draft report and then a public debate could be had. The Minister would have time to listen to the public debate about recommendations coming from the commission and could be well apprised of all the various issues that he or she might need to consider in formulating a response. 
I am pleased that part of that intent was picked up on in terms of amending clause 13. Again it did not go far enough. We may have to reflect in hindsight on improvements in this area. I can say that we welcomed the Australian Productivity Commission chairman saying that that approach generated positive and informed debate and enabled Ministers to make informed responses. That can only be a good thing if one is trying to look at a sector-wide approach to improve productivity. 
I too like other members of the Labour team would have hoped for a stronger and greater alignment with the Australian Productivity Commission. However in saying that the bill will form the New Zealand Productivity Commission. We can only hope that at an operational level there will be constant and free-flowing dialogue and sharing of skills experience and advice between our two commissions. There will be much to gain from that front. 
Although Labour supports this bill we are concerned about the potential for the commission to be narrow in its focus and capture by Government policy could happen. But if that is not the intention of the Government then we could only expect that the types of questions coming up for review could be questions such as how a tax switch that shifts real gains to the top 3 percent of income earners will lift productivity or how the fire-at-will bill which will undoubtedly hurt those more vulnerable in the workforce will lift productivity. 
If the true intention of this bill is to ensure that a relative balance of independence is assured through this process then I am happy to continue to lend my support to this bill but I certainly look forward to the improvements. Kia ora koutou.