Cosgrove ClaytonHon CLAYTON COSGROVE (Labour): The Labour Party supports this bill but with a number of substantial reservations. If you listened to the previous speaker Andrew Bayly—who has obviously enjoyed a great evening at the Science Forum dinner tonight and I am glad to see he is a great supporter of science—you would think that this bill was nirvana. Except when you delve into the details the bill fails to implement the core recommendations of the Government's own inquiry into foreign tax disclosure rules: to immediately implement phase two of the anti - money-laundering law changes. I know a little bit about the anti - money-laundering law changes from when I was Associate Minister of Justice.The question for the Government which we will look at as we go through the stages of this bill is why that phase two a recommendation of its own inquiring body was never implemented. Those reporting requirements would have extended the scope of this to lawyers accountants and real estate agents. With no disrespect to any of those professions they are all vulnerable to nefarious behaviour within them. It is interesting that what this actually does is leave a massive gap within the reporting regime. It is a failure. It is a failure to meet not only the obligations put upon us by the international community because the anti - money-laundering changes are international obligations as we know but it also leaves a gap and a weakness within the legislation itself.Secondly we would argue that in order for New Zealand's foreign trust regime to play a useful and relevant part in cracking down on tax evasion and corrupt practices you need greater transparency and here again the bill is deficient. The rate of transparency for us means that there should be as a starting point a register—a publicly available register—of foreign trusts. The Government has never been able to identify where the difficulty in that proposition lies. After all of course you have just such a register for companies and other forms of trusts. So the question is why you would not have total transparency and why the Government would not support a publicly available register of foreign trusts. I have looked at the legislation I am on the select committee we have heard the submissions but I cannot understand—maybe one of the lawyers over there can tell us—why that would be deficient how that would negatively impact on either the beneficiaries or trustees in respect of foreign trusts. Again it is another recommendation and another recommendation that was not fulfilled.So it would be very interesting as we go through this if the next National Party speaker if there is one wanted to take a call or the Minister—we will be examining this of course in the Committee stage—to answer those two simple questions: why it fails to meet phase two why it does not include and extend to lawyers accountants and real estate agents why it does not fulfil our international obligations in terms of the anti - money-laundering legislation and why the Government has chosen a path that is less than full transparency by not having a public register of foreign trusts. It seems this Government when it comes to registers has an aversion to them for some reason—I do not quite know why. But I have not seen an argument that says to me that there would be a negative impact either on beneficiaries or trustees of having a register of these trusts. It assists in cracking down on international tax evasion and corruption. Surely that is the objective which the Government first denied was ever a problem of course but then set up an inquiry and was told it was a problem and then included a few bits and pieces of window dressing within this legislation.Finally I just want to touch briefly on what Mr Bayly said in respect of the so-called flexible tax options that he put forward. I have run a small business. I agree with Mr Bayly that they are the lifeblood of the economy. I just wonder why it was that the Minister at the time who I think put this proposal forward Mr Joyce waited until Labour had drafted released and had vetted by the former IRD commissioner Robin Oliver a policy for flexible tax that went far beyond this particular policy. As one official whom I will not name said to me: Well the day you guys released it Mr Joyce rushed into his office grabbed his officials and said 'How the hell are we going to respond to this?' ". Out of that came this.I say to Mr Bayly: congratulations. He came to the battle when the war was won the war was over or as a mate of mine used to say a day late and a dollar short but nice try."