Financial Review Debate — In Committee 
Text is incorporated into the Bound Volume 
Financial Review Debate — In Committee 
[Sitting date: 01 May 2012. Volume:679;Page:1788. Text is incorporated into the Bound Volume.] 
Financial Review Debate 
In Committee 
Debate resumed from 3 April on the Appropriation (2010/11 Financial Review) Bill. 
Ministry of Economic Development  ( 
continued 
)  
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 It is a pleasure to resume this call for the economic development section of the Appropriation (2010/11 Financial Review) Bill. For the sake of every New Zealand child growing up and wanting to work in a good job in New Zealand for the sake of the grandparents hoping to see their children grow up here for the sake of every Christchurch family and business waiting to see decisive action to lead the rebuild of Christchurch and for the sake of those patriotic businesses that have not yet sold up or been shipped out may the Government please please get a real plan to grow this economy. A real plan has strategy it shows a future state and a plan to get there it has performance measures and it tracks progress towards that. There is nothing—nothing—in the record of the Ministry of Economic Development that indicates that such a plan has yet been effected by this Government.  
I must however praise the ministry for this: its briefing to its incoming Minister has made very clear that a reliance on the negative politics of free markets hoping that cutting selling deregulating and tax cutting our way out of the hole will work is in the ministry’s words in no way sufficient in a small and remote economy. What it says quite rightly is that a much more ambitious plan is required. It must be common ground that a real plan does not rely on light-handed free markets where they are dysfunctional that neo-liberalism gave us the great financial crisis and that austerity economics is giving us a long recession to follow. A real plan does not imagine that balancing the Government’s books at the expense of businesses or the economy’s books is a way to get us out of the hole. As my colleague David Parker has said a billion-dollar Budget hole is a sure sign that the plan is not working.  
In the absence of a credible obvious clear economic strategy something that would guide the actions of Ministers in a transparent and credible way what we see from the Minister for Economic Development and the Prime Minister is a habit now of being involved in one-off questionable deals lacking transparent processes for some of the largest most powerful corporates in New Zealand: Skycity Casino—currently under way—MediaWorks Warner Bros selling the telecommunications company law to split Telecom and now the Dotcom scandal.  
This Government is showing all the signs of being a tired ragged third-term Government on its way to collapse. Will it last to the election? Yes you are looking like a third-term Government only 3 months into your second Mr Foss. “I can count to three” says the Minister of Commerce—wonderful! It is good that he is holding up three fingers. It looks like a third-term Government even though it is a second-term Government and that is the point.  
Third-term Governments sometimes looks ragged they sometimes do deals with their mates they run out of steam and they do not have a clear plan and this Government has got there in record time. It has got there in record time. It might be funny if it were not for the fact that it will impact the lives the careers the incomes and the families of real New Zealanders—the 1000-plus a week who are voting with their feet because they know that their opportunities are more limited here than they are across the Ditch the ones who listened to John Key 3 and a bit years ago when he told them that if he was elected the gap with Australia would be closed and the brain drain would be stopped. Well it has got worse. It has got worse. It is time for a plan time for some strong Government action to get the economy moving and time for growth and economic development before it is too late. 
Hon DAVID CARTER (Minister for Primary Industries) 
: 
 If that was a leadership bid by Mr Cunliffe it was certainly a third-rate effort. I am quite happy to talk to that member about the economic plan of this Government because this Government is absolutely focused on getting the economy performing. We need to do that for the benefit of our children and I need to remind the member that as a former Associate Minister of Finance he is responsible for the mess that this National Government inherited at the end of 2008 when for over 9 years his Government had lived through the most benign economic conditions that I have probably seen in a lifetime and it had squandered every opportunity. 
Hon Trevor Mallard 
: I raise a point of order Mr Chairperson. I just ask you to ask the speaker to come back to the debate which is a financial review of a particular year and going forward. It does not go back that far.  
The CHAIRPERSON (Lindsay Tisch) 
: I am very mindful of comments and I am listening very carefully. 
Hon DAVID CARTER 
: I am happy to outline for that member the economic plan of this Government. He should know it; it is mentioned time and time again in the House. But I am only too happy to outline the plan for him.  
We are absolutely committed to get this economy going so that we do create more jobs. But every time we come up with a proposal that member and his caucus object to it. We are absolutely focused on balancing the books. That Opposition has one solution and that is to borrow more money and pass more debt on to the next generation. Well that is unacceptable to me as a Minister of this John Key - led Government. This Government has an absolute commitment to the rebuild of Christchurch something we incessantly see the Labour Party members objecting to. But there is a great opportunity for economic development in Christchurch and I am proud of this Government’s commitment to Christchurch and that rebuild.  
That member talks about the ability to get the economy going and to get jobs in this country. Well I want to speak to one particular initiative that will deliver a lot of jobs to New Zealand. That is around the Skycity deal which has been the subject of a lot of press in the last few days. That member in his contribution a minute ago referred to it as questionable and lacking in transparency. Well when I was Acting Minister for Economic Development last year I had the ability to well and truly be involved in the process. What the Government did was call for particular proposals. From memory there were five. One stood out that was totally different to all the others. Skycity was prepared to deliver the convention centre to Auckland something that the Auckland City mayor is calling for but the difference between the Skycity bid and all the others was that it did not expect the Government to pay for it. It did not expect the Government to pay for it.  
This convention centre has the potential to deliver not hundreds of jobs but over time thousands of jobs to the Auckland economy and thousands of jobs to New Zealand. Mr Cunliffe shakes his head. Mr Cunliffe shakes his head. That is how bereft of economic ideas that man is when he says that a national convention centre able to take that number of delegates and able to bring that number of people into New Zealand would not create jobs. That is economically naive Mr Cunliffe.  
It will require us to address some issues around gaming machines but if we see the overall number of gaming machines decline from 25000 in the Auckland region when that member was a Minister in the Labour Government to around 18000 we are achieving a significant reduction. So I fully support what John Key as the Prime Minister is doing to develop this. It is a $350 million investment into the Auckland economy. That is just the construction cost and it will deliver jobs. And I say to Mr Cunliffe that if he thinks we can rebuild the economy from the mess that that Labour Government left at the end of 2008—if he thinks we can rebuild the economy and deliver sustained growth to New Zealand and sustained jobs to New Zealanders—and expect the Opposition to vote against every initiative we come up with then it is no wonder Mr Shearer languishes in the polls and it is no wonder the Labour Opposition languishes in the polls. Mr Cunliffe might have come out with a major speech over the last couple of days acknowledging that his Government got it wrong but what he should do is not object to every proposal that this Government has to really get the economy going. 
DAVID SHEARER (Leader of the Opposition) 
: 
 We are not objecting to every proposal; we are just objecting to the shonky ones—the shonky ones. That is what we are objecting to. And this hokey-pokey deal Mr Carter is one of those shonky deals that we are opposing. Let us just take a look at this particular deal because I am really pleased that you have brought it up. We are looking at increasing the number of pokies in Skycity by 500 pulling $42 million a year out of the pockets of ordinary New Zealanders—New Zealanders who cannot afford to give up that sort of money. That is what we are doing here—$42 million. That is how we are going to subsidise this big convention centre.  
But there are two things that really upset me about this—two things. One is how we are going to do that. Well we are going to change our law. We are just going to change our law to enable Skycity to bump up the number of pokie machines increase the number of gaming tables and increase the length of its gambling licence. Let us look at the maths of this—$42 million a year. Look at how much the convention centre will cost—$300 million - ish. After 7 years Skycity will have paid it all off. And then it will have another 13 or 14 years of $42 million - plus a year that it can pull out of the economy. That is good business—that is really good business! Skycity is not looking at this as a way of being able to have a convention centre; it is a way of being able to increase its gambling take. Ultimately it is a gambling organisation. And what is this Government going to do? This Government is going to give Skycity the opportunity by changing the law of New Zealand to enable it to pull massive amounts of profits out of ordinary New Zealanders’ pockets and of those people who are using those pokies 40-plus percent of them have got a gambling problem—40-plus percent of them.  
I happen to be very opposed to pokies as is Mr Banks by the way. Mr Banks spoke openly and outwardly against pokie machines. Mrs Collins over here spoke out against the monopoly that Skycity might have and what are we doing? Well actually we were handing a monopoly over to Skycity because the sinking-lid policy that the Minister of Justice talks about does not actually apply to Skycity; it applies to all of the pokie machines that are out there in the suburbs. This Minister has the audacity to stand up and talk about a sinking-lid policy out there in the suburbs. How did that sinking-lid policy come about? Well actually we changed the Gambling Act. Oh that is great. Who voted for that? Actually the Labour Government voted for that. What did National do? It voted against it. But now it is convenient to say that this sinking-lid policy is a great thing because ultimately we will end up with fewer pokies. But what it will mean is that we end up with more pokie machines in Skycity and fewer out there in the suburbs where they are actually contributing to community events and community facilities. So what an extraordinarily audacious and amazing plan that this Government has come up with: increasing the number of pokies in Skycity!  
But there is more to this deal. The way this plan was put together is that of the five companies that tendered for this Skycity got a wink and a nod and a dinner with the Prime Minister and it got across the line. The others did not. I was speaking with Vector the other day and they said: “Gee we wouldn’t have actually minded a bit of a conversation with the Prime Minister. We might have been able to have come up with a deal that would not involve putting pokie machines up as payment for a convention centre.”  
This Minister talks about a great deal. This is not a great deal; this is social harm in Auckland. This is about $42 million a year being pulled out by Skycity and this is about a shonky deal that did not give the same opportunities to every other company that had the opportunity to put up a tender. What if they had had the opportunity to sit down with the Prime Minister and say: “I think we can do a deal here.”? What about Infratil? If Infratil had the ability to sit down with the Minister it may have had a different deal but that did not actually eventuate.  
Hon DAVID CARTER (Minister for Primary Industries) 
: 
 I am going to attempt to explain to Mr Shearer again the necessity for New Zealand to have a national convention centre. Mr Shearer needs to realise that these things have been a huge success and have had a huge economic impact in any country that has been able to create one. That is the first point. The second point that Mr Shearer needs to understand is that these businesses do not make money on their own—these businesses do not make money on their own. So the Government went through a very transparent process— 
Jacinda Ardern 
: Oh! 
Hon DAVID CARTER 
: The Helen Clark aspirant there keeps yelling at me but the Government went through a very transparent process and the difference between this proposal and the other four is that one was proposing to build the national convention centre without expecting the Government to pay $350 million.  
There are three options here. One is that you decide not to have a national convention centre in which case it costs nobody any money. The second option is that you allow the Government to build it and put up $350 million. Well this Government has not got a spare $350 million. From Labour’s record over the previous decade it would just borrow $350 million and it could not care less about the ability to pay it back. Well that is not what the National Government is prepared to do. 
Hon Phil Goff 
: National’s borrowed $300 million a week. 
Hon DAVID CARTER 
: The third option Mr Goff was to see whether somebody else would do it. What we found of the five proposals was that only one was prepared to do it and it was asking for things like an extension to its current licence. It was asking for an increase in gaming tables. Mr Shearer quotes a figure of 500. Those negotiations are still ongoing; he is making it up Mr Faafoi—he is making the figure up.  
The important thing for me is that this will bring 1000 new jobs during its construction—1000 new jobs. How many times do we hear Jacinda Ardern saying that there are no jobs? Well if you do not create economic opportunity and economic activity Jacinda Ardern—I know this is hard for you to understand—there will not be jobs. There will be 1000 new jobs while they build it and then there are 800 jobs while they run it bringing hundreds of millions of dollars into the Auckland economy. 
Kris Faafoi 
: Who for? 
Hon DAVID CARTER 
: Who for? For the New Zealand economy Mr Faafoi. These international visitors will likely travel on Air New Zealand. They will likely dine out in some of the restaurants in Auckland. They will likely travel to places like Queenstown Mr Faafoi. That is what international conference delegates do. That is why it delivers economic opportunity.  
I know that it is difficult for this Labour Opposition to understand anything about the economy. Labour left it in a mess. This Government is absolutely determined that we will not leave the economy in a mess. We are determined to lift the economy. We are determined to balance the books and we are determined to deliver jobs so that young New Zealanders will see this truly as a land of opportunity. 
Report noted. 
Ministry of Justice  
TIM MACINDOE (National—Hamilton West) 
: 
 I just want to take a call if I may and commend the tremendous job that is being done by officials within the justice department. In particular I acknowledge the great start that our new Minister of Justice the Hon Judith Collins has made since she took over this role. It is significant that our Minister has taken over a very demanding role. Of course in the previous Parliament—and I also want to pay tribute to her predecessor the Hon Simon Power—this was an aspect of the Government’s legislative programme that was particularly demanding and particularly effective and perhaps most important particularly welcomed by the public of New Zealand.  
There is no question that for many many years there has been a concern that we have had a justice system that has to a large extent marginalised victims and put far too much emphasis on to the rights of offenders. In a civilised society of course offenders have rights. But one of the most distressing things for victims in quite serious trials in New Zealand has been that they arrive at court only to realise that they are completely marginalised and in many cases they are re-traumatised by the experiences that they are put through. So I want to canvass just a couple of the issues in the time I have available today to point out to the Committee just what significant progress is being made. 
 Before the House at the moment of course is the Victims of Crime Reform Bill. This is a very important piece of legislation that will ensure that victims of some of the most serious crimes in New Zealand are heard—have a chance to be listened to—particularly with the improvements to the victim impact statements that they are now able to submit or will be able to submit and also that they are assisted.  
One of the great achievements in the previous Parliament was the introduction of the offender levy. I point that out because our opponents on the other side of the House scoffed at it when we suggested it mocked it as it went through the House and told us it would not work. Well look at the results. In its first year the offender levy collected double what was anticipated and although it may not be a huge sum of money we are talking about in the region of $2 million that is now available for victims of crime to receive counselling receive assistance with accommodation costs when they have to move to a major centre in order to take part in a trial and to help with a number of other matters that are very expensive for them and just add to the huge hurt and suffering that they have all endured. So I want to congratulate everybody who was involved in that initiative and say what a fantastic way forward it is. I look forward to hearing that it continues to become more and more successful over the years ahead.  
We are as a Government reforming our justice system to put a stronger emphasis on victims because victims of crime find themselves caught up in the midst of our criminal justice system not only through no fault of their own but in circumstances that most of us absolutely shudder at the thought of. To find that a member of your family has been affected by one of the most gruesome crimes and then suddenly you are at the heart of a criminal trial is just the most appalling experience which all of us would naturally wish to avoid. Not only do we want to protect the interests of those victims and make the system a little bit more friendly supportive and sensitive to their needs but also we are very much committed to building a safer New Zealand. So we have embarked on a comprehensive programme of reform to protect our communities prevent crime and put victims first.  
I think it was a very appropriate step that the current Minister moved up from her previous role as Minister of Police and Minister of Corrections because while she was exercising those responsibilities which she also did with tremendous effect she was able to advance the cause of looking at laws that in some cases needed considerable strengthening to give the police more powers. Now as Minister of Justice she is able to complete the picture and ensure—[ 
Interruption 
] Thank you Mr Faafoi. I am so pleased that Mr Faafoi is enjoying this speech and I trust that in a moment he will rise to his feet and continue to sing the praises of the Minister because well do those praises deserve to be sung and I know that Mr Faafoi is an ideal candidate to do that. It is an important matter. Although it is good to have some humour in the discussion it is also really important that we focus on law and order and justice initiatives. They are absolutely right at the forefront of this Government’s agenda because they matter so much to all New Zealanders. 
Hon JUDITH COLLINS (Minister of Justice) 
: 
 Can I take a moment to thank the member who has just resumed his seat Tim Macindoe for the splendid chairing role that he is undertaking as the chair of the Justice and Electoral Committee. I know that his whole team on the committee is working very hard and I acknowledge all members of the committee because I know that they are doing their very best to undertake their duties with professionalism which is what we would all like to see from all members of the House.  
I need to record here that recorded crime for the 2010-11 fiscal year was a 7 percent fall on the year before 2009-10. The recorded crime rate in 2010 was 9761 per 100000 population the lowest it has been since 1982 and 25 percent lower than its peak in 1992. What we are seeing is a drop in crime that has not been seen at that level since the 1930s. We have prosecution levels in 2010 that were 13 percent lower than in 2009 and that is after they had grown and peaked in 2009 having grown by 25 percent over the previous 15 years. What we are seeing is that the Government’s policies the Acts that this Government has brought through are actually having a huge effect and so too is an attitude that actually crime should not pay that we do stand up for the victims of crime that we do stand up for law and order that we do support the police the Department of Corrections that we do support our court staff the ministry the judges that we get on and we support them and we do not give in to criminals.  
I actually think one of the best things that I can think of in my time in Parliament is what has happened to the crime rate. Of course the crime rate is not just about numbers; it is actually mostly about people and by people I mean victims of crime. When we have less crime we have fewer victims and that is something we should all be very pleased about. What that does mean too is that we have opportunities in the justice system to look at more innovative ways in which we deal not only with crime but in other areas of the court system such as the family courts and other courts to look at how we can do things better and more efficiently and how we can use new technologies. Certainly the audiovisual links that we have introduced in the last few years between corrections and the courts has meant that that has been a huge savings to corrections but it has also taken away a real source of danger for the public.  
We are looking at how we can use technology better how we can look at having an accessible justice system so that members of the public can for instance file their documents online or their lawyers can file documents online at any hour of the day or night and how they can access their own files in a way that is user-friendly. Judges and staff will not have to haul around great big thick paper files that they have at the moment. Things get lost and put in wrong files. We are looking at bringing in an electronic operating model that works well not only for the judiciary but actually for the lawyers and for those people who use the courts.  
None of this should be too much news for people because it is the sort of business operation that businesses undertake and have done for years now. It is important I think for instance that we look at how we use the very valuable dollars that we use in the justice system and that is actually looking at for instance whether we should have lawyers waiting around and waiting around and waiting around for cases to come up for trial when for instance a text message to the lawyer from the court staff would tell them when it is on so that they are not wasting their time and therefore wasting money either on legal aid or through their client.  
So there are ways that we can look at doing that. But that actually requires a really steep learning curve for a lot of people involved in the justice system and that is about working together. I have found that when I have talked to the judiciary and with lawyers that they are particularly keen to do that. They want to work with the police and corrections and the court system so that they can in fact get better outcomes for everyone involved. Better outcomes mean a quicker fairer trial. It means people being able to access the justice system without huge cost. But it also means that those matters that come into the court system are dealt with fairly and according to the law. I think it is also worth noting that we are very fortunate in New Zealand that we have a judiciary that is truly independent and free of corruption that we have a police force that is in a similar situation and we are very lucky in this country. I do sometimes despair at the odd media reports screaming headlines about these things. We do not give enough credit to those people who play their part in the justice system. We are very fortunate indeed. 
Report noted. 
Ministry of Health  
Hon MARYAN STREET (Labour) 
: 
 In an end-of-term review of the New Zealand Government’s actions on five major health risk factors undertaken by the University of Otago department of public health the scorecard of this Government in its first term is woeful. There were five top health risk factors that were assessed in the health portfolio. They go in descending order of importance and the first one was tobacco use. The summary around progress on that one was “Some progress but gaps remain which need to be addressed if substantive progress towards the smoke-free nation goal is to be achieved”. It says further: “there are unresolved issues around achieving the smoke-free nation 2025 goal notably the lack of any coherent strategy or milestones for achieving this goal.”  
The second risk factor that was at issue in this report was alcohol use. The report card says: “Some limited plans for legislative reforms that do not adequately utilise major interventions such as alcohol tax”. That is hardly a ringing endorsement of achievement in that area.  
The third one was high blood pressure and that received a “No progress” result: “No progress on reducing salt intake”. It further says: “This inaction is problematic given the many international studies suggesting how cost-effective interventions to reduce salt intake would be …”. So not even the cheap things have been done by this Government.  
Another is high blood glucose. Well we have just had diabetics lined up outside Parliament today furious at the possibility that they will be required to use an inferior blood glucose meter because of Pharmac’s provisional contract with Pharmaco to be the sole supplier of these critical devices. But even when it comes to high blood glucose what is the scorecard on the Government’s performance in health? “No progress on improving nutrition and mixed progress on supporting enhanced physical activity”. They go on to say: “Others have reported on the lack of a national strategy to address obesity and that in NZ ‘population approaches to reduce the burden of obesity have been systematically cut in the last 3 years; for example the National Healthy Eating Health Action Strategy is no more Mission On has disappeared [a physical activity programme] and the requirement for schools to provide healthy food has been abolished.’ ” 
This Government’s record in the health portfolio is not coming up to scratch. It is not passing. The fifth area was about overweight and obesity rates and the comments were exactly the same as the previous comments on high blood glucose. In other words there was no progress. This is an appalling indictment on what this Government has done in the health portfolio.  
But even more important than that if we go to immediate data—the data of the last year or so that is under consideration—it is clear that New Zealand is experiencing under this Government increasing levels of inequality higher rates of child poverty worse levels of housing provision and the consequent health risks that attend each of those factors.  
Another report that came out was from Otago University’s Michael Baker. The New Zealand Child and Youth Epidemiology Service said hospital admissions of children with serious bacterial infections doubled from 210 for every 100000 children in 1991 to 451 in the meningococcal epidemic in 2001. That fell back to 377 by 2005 after the epidemic was contained. How was the epidemic contained? It was because a Labour Government saw fit to invest in that meningococcal immunisation programme. But admissions have risen again since then since this Government has been in power.  
Dr PAUL HUTCHISON (National—Hunua) 
: 
 It is an absolute pleasure to be speaking on the financial reviews 2010-11 because under this National Government there have been some great gains in health which unfortunately the Opposition spokesperson the Hon Maryan Street has just failed to notice. Of course the health targets are an absolutely classic example of where they are. Firstly let us have a look at the list.  
Immunisation of course has been an absolute gain of the highest order over the last 3 years. Three years ago only 70 percent of under-2-year-olds were immunised. Today 92 percent are and we have almost got 95 percent being fully immunised. That is a huge achievement in health promotion and disease prevention.  
To add to that the National Government has instituted the rheumatic fever scheme which again should have happened under the Labour Government. All it did was talk about it for 9 years but the National Government has actually instituted this programme.  
Three or 4 years ago the average wait in emergency departments in this country was over 6 hours. Today 92 percent of patients get through emergency departments in under 6 hours. District health boards like Waitemata District Health Board where under the Labour Government we heard stories of patients wallowing in the corridors for 24 to 48 hours have just recently reported that 90 to 95 percent of them get into the wards or get discharged in under 6 hours. That is another tremendous achievement.  
Let us go to the issue of radiation therapy. I vividly remember that under the Labour Government only 4 years ago cancer patients were being sent to Australia because the waits in New Zealand were 3 months 4 months 5 months and 6 months. That was absolutely shocking. Today we have the gold standard therapy whereby every radiation patient is being treated in under 4 weeks. That is another tremendous achievement under this National Government.  
We can go on. Eighty-nine percent of hospitalised smokers are given help and advice to quit.  
Hon Maryan Street 
: What about helping them before they get to hospital?  
Dr PAUL HUTCHISON 
: That is an incredible achievement. We have Maryan Street saying that nothing has been done. This is the first Government to put in year on year significant increases in tobacco tax which we know is one of the most effective ways to diminish smoking in this country. Indeed it is working.  
But let us just have a look at some of the other achievements. Now 27000 extra people are getting elective surgery every year since the National Government came into office 4 years ago. That is another remarkable achievement.  
We do know that health systems around the world are characterised by almost infinite demand and finite resources. What we do know is that a Treasury study in 2006 showed no increase in productivity under the Labour Government in the health sector despite it increasing the vote by billions of dollars. Last night on TV we heard that over the last few years there has been an increase in productivity in the health sector by 5 percent year on year.  
Hon Phil Goff 
: That’s right. Across 2007. 
Dr PAUL HUTCHISON 
: This was in anticipation of the National Government. It is great to hear that finally this is being carried on because after all we heard in 1999 in the advice to the incoming Minister of Health that the greatest gains in health would come from health promotion disease prevention and the integration of primary and secondary health. Nothing had happened under that Labour Government year on year other than spending more money. We have established some absolutely great examples in immunisation in the rheumatic fever programme— 
Hon PETER DUNNE (Associate Minister of Health) 
: 
 Can I thank those members who have contributed to the debate thus far. Can I knowledge particularly the chair of the Health Committee and thank him for the contribution that he makes and the advice that his committee has delivered both on the report on the financial review but also more generally. The fact is as the member rightly pointed out the last year has seen significant additional achievement in the area of health. During the time that this Government has been in office— 
Hon Maryan Street 
: Depends what you measure. Depends what you want to measure Peter. 
Hon PETER DUNNE 
: —$1.5 billion extra spending has been allocated to the health sector. I heard the member—and I will come to her point shortly—say many times by way of interjection “What about prevention?”. I agree with her. Prevention is important but so too is providing effective care for those who have moved beyond the stage of prevention. That is why we have seen 800 extra doctors employed in hospitals and over 2000 more nurses. That is why we are seeing new elective theatres being developed: to make sure that people can see real tangible progress and that some of the more fundamental and basic health concerns that arise can be dealt with effectively.  
There was an interchange during the debate about the tobacco policy. Dr Hutchison rightly pointed out that during the last year we have seen significant increases in the excise duty which we all know will have a significant and profound downward impact on the level of consumption. We are also seeing now about 90 percent of hospitalised patients being given help and advice to quit smoking. My colleague the Minister of Justice reminded me as she left the House after her estimate was being considered that during her time as the Minister of Corrections prisons were made smoke-free and around 6000 prison inmates who were previously smokers had to confront giving up that particular habit. So when the member says that nothing much has been done I would say in response that a considerable amount has been achieved.  
There are a number of other areas in health where great progress has been made. Over the last 3 years there has been a $180 million increase in funding for Pharmac. What that has seen is some of the more difficult and rare cases in the areas of some of the cancers diseases like Crohn’s disease and Alzheimer’s disease are now getting the medicines that are needed to be able to give people a better standard of living a greater opportunity for the future and also some real prospect.  
All of this is being achieved against a background of two important things. The demand for health services in the Western World is insatiable. No matter what the level of provision people rightly and understandably are going to demand more. As the march of technology increases that is going to increase as well. We are operating against that general backdrop but also in an environment of the greatest economic crisis to hit the world since the Great Depression where every dollar has to be managed with care where every dollar has to be really scrutinised in terms of the value it achieves for the spend involved. I think it is great that we now see against that backdrop over 90 percent of patients who report to emergency departments are discharged within 6 hours. It is great to see people who require radiation therapy are getting gold standard world-class treatment within a 4-week period. It is great to see the immunisation targets being increased and achieved. It is good to see that we are getting a reduction in a lot of the duplication and wasteful and inefficient expenditure in back-office services and much more concentration collaboration and working together to achieve positive outcomes.  
I am delighted—and again I come back to the prevention theme that the Labour member spoke of—that we are seeing the extension of the free care-hours for under-sixes and that we are seeing also the extension of the number of children able to get the B4 School check. That is early intervention of the highest order. We are seeing more Well Child home visits for at-risk mums. Again it is a positive benefit. There is always a long way to go in health. People demand better services all the time. But this Government and this administration has seen dramatic improvements in the status of the health of New Zealanders over the last 3 years. I acknowledge the role of the Minister in leading this and I acknowledge the contribution of his colleagues in helping him achieve it. New Zealanders’ health is in good hands. 
Report adopted. 
Ministry of Education  
NIKKI KAYE (National—Auckland Central) 
: 
 I am very pleased to speak on this financial review. Can I start off by acknowledging the previous chair of the Education and Science Committee Allan Peachey. He was someone who had a huge respect in this House and I think all members would acknowledge the huge contribution he made to our country in terms of education. Can I acknowledge the Hon Hekia Parata our Minister of Education and the fantastic job that she is doing for us and this Government and the Hon Anne Tolley who also did an outstanding job.  
Many of us in the National Party believe in equality of opportunity not outcome. For many of us we will fight to the death in this Parliament to ensure that some of our most disadvantaged children get the best opportunities in life. A large part of that is access to good quality education. What we are very proud of in this Parliament is that not only have we raised standards but also we have focused on ensuring that we resource our education system properly. When it comes to the Budget we are very proud that the increases we have seen have been in both health and education.  
If we look at some of our achievements we have managed to fund 18 new schools we have managed to fund 400 school buildings we have employed 1600 more teachers and we have focused 50 education experts and $36 million to target those children who are falling behind. We know in this House that actually this country has some of the most outstanding educators in the world but we also know that there are a group of children who are not doing so well. So everything that we do whether it is better resources which we have provided in the last 3½ years or whether it is national standards is about ensuring that those kids who are falling behind get the best start in life that they can. We have also been very focused on programmes like the Youth Guarantee. We know that some children in New Zealand do not suit a classroom environment. We are focused in ensuring that those kids do not drop out of school. The Youth Guarantee offers free study at selected private training establishments and polytechnics and institutes of technology. We have seen 12500 Youth Guarantee places for 16 and 17-year-olds; that will happen by 2014.  
I want to talk about something that I am very passionate about and that is close to my heart which is ensuring that New Zealand schoolkids can lead the world in digital literacy. When you look at the last 3½ years we have committed an extraordinary amount of money through the ultra-fast broadband fund $1.5 billion to make sure that our kids can lead the world in digital literacy. As many members will be aware there is an inquiry in front of our Parliament to ensure that kids across New Zealand whatever school they may be in have equality of access to technology.  
We have also focused on service academies—that is military-style programmes for years 12 and 13 which are run at schools with the Defence Force. We have already opened eight new academies for over 800 students with 13 more opening in 2012.  
We have been absolutely focused as well on ensuring that rural kids get a good education. That has been partly through the Ultra-fast Broadband Initiative and Rural Broadband Initiative. We have committed that over 97 percent of our schools will have ultra-fast broadband access by 2015. The Rural Broadband Initiative will put $300 million into this. I am very proud to be part of a Government that is not only providing extra and additional resources—and we have seen that through the new schools that we have opened we have seen that through the many school buildings that we have built and we are seeing that through the investment that we are making in new technology—but is also saying that we are unashamedly focused on raising standards for our most disadvantaged children.  
Can I acknowledge that this does not just happen. It is not just about money; it is not just about good policy. It is also about leadership. Those members of the House who look at their schools and see that some of their schools are failing know how important leadership and governance is. Can I say that I am very proud to be part of an education team led by the Hon Hekia Parata who has made some hard calls in the last period that she has been in there. She is not afraid to say that this Government has standards and that this Government will not let children be left behind. We have seen some of those hard decisions and I am sure there will be more challenges that we will have in this area. But what we are very clear on on this side of the House is that when it comes to future Budgets we are absolutely focused on ensuring that education is a priority but we are also focused on ensuring that we get good value for money. We are also focused on the fact that we understand— 
MOJO MATHERS (Green) 
: 
 I rise to speak to the 2010-11 financial review of the Ministry of Education. I first would like to note that it is New Zealand Sign Language Week and I want to take this opportunity to acknowledge the many teachers who will use this week to introduce New Zealand Sign Language into the classroom and thereby introduce our children to this beautiful visual language which is the third official language of New Zealand.  
We all know and are agreed upon the importance of investing in education for our children. We know that this means for children with a disability providing appropriate early intervention and adaptive technology so that they do not fall behind their peers. So I am very concerned that the Ministry of Education has changed its policy and is now choosing not to fund remote microphone hearing aids for children with the hearing impairment called auditory processing disorder unless they are also receiving special education support. What this means in practice is that these children have to have another recognised disability such as autism or to have developed a serious learning need. I consider this policy to be both unfair and illogical.  
Auditory processing disorder is a hearing impairment where children are unable to process and understand sound in the same way as others despite the fact that they may pass conventional hearing tests. It is linked to glue ear which is a condition linked to poor housing and poverty and it affects more boys than girls. It also is higher amongst Maori and Pacific Island children—the very children who are often falling behind in classroom situations. I consider the decision to cut funding to be unfair to the child with auditory processing disorder who will be struggling to understand and follow classroom instructions and is likely to be on the path of underachievement. It is unfair to parents who have to choose between watching their child fall behind in the classroom or paying privately for the remote microphone hearing aids themselves assuming that they have the ability to do so. It is unfair to teachers and other children in the classroom because children with remote processing disorder are unable to follow what is happening in the classroom to the same extent as their peers and will therefore often have behavioural problems causing disruption in the classroom. So I consider this decision to cut the funding to be wrong and short-sighted.  
It also makes it impossible for schools to meet their obligation to provide an appropriate learning environment for these children as they are required to do by the National Education Guidelines. Children with auditory processing disorder should not have to be failing the system before they receive the support and the technology that they are entitled to. So although I applaud the ministry for saying that it wants to focus on children who are underachieving it also needs to make sure that children with a disability are given the support they need before they are completely failing in the school system and that I hope will be addressed. Thank you. 
Hon HEKIA PARATA (Minister of Education) 
: 
 Kia ora tatou tena tatou te Whare e whakawhaiti nei i tenei ahiahi. First of all I would like to acknowledge my predecessor the Hon Anne Tolley for her clear focus and tenacity over the last 3 years and also in particular over the year in review. She led a number of changes that we now need to progress and embed in the system and of course those include not only national standards at the primary school level but also trades training academies and a number of other initiatives that have been referred to. 
I also want to acknowledge the former Secretary for Education Karen Sewell who during this period retired from a very long and distinguished service of contribution to the education sector not only as a teacher and principal but also distinguishing herself having been the head of every sector agency: the Education Review Office the New Zealand Qualifications Authority and the Ministry of Education. So I would like to thank her. 
I want to acknowledge our colleague the former chair of the Education and Science Committee Allan Peachey and his passing and I want to thank him at this time for the contribution he made. In so doing I would like to welcome the new Secretary for Education Lesley Longstone who joins us with a considerable and significantly successful career from the United Kingdom and other parts of the world. She brings to New Zealand that experience from which we can benefit. One of the particular points that she made during the select committee review of education was that with a fresh eye she has observed that although many significant changes and valuable contributions have been made as a result of the education reform that we all know as Tomorrow’s Schools one of the changes that she wishes to effect and which I completely agree with her on is that the ministry needs to be repositioned away from administering the system and into one of leadership—one of leadership that focuses on the best evidence that tells us what it is we should be doing in order to raise achievement in New Zealand. 
I would like to acknowledge the work of our new chair of the select committee Nikki Kaye who has already contributed to this debate and who brings a fresh and ebullient approach to the education arena and to her role as chair. She has already focused on as she indicated in her speech digital learning and learning environments for the 21st century. We have as a vision in education that we shall equip our young people to be able to successfully navigate society and the economy of the 21st century. Implicit in that and important to that is that they are able to use all of the social media tools that are available to us. Nikki’s stewardship of the select committee will I am sure be able to guide us successfully through those new and foreign waters for some but of course they are ones that I share confidence in with her. 
We have an education system that is able to deliver a world-class education to the vast majority of our students. That is a great credit to them to their families and to the education profession which delivers that year on year. Last week I had the great pleasure to share with the Governor-General the Rt Hon Sir Jerry Mateparae at Government House the celebration of our top scholars. These young people from across New Zealand and from schools across all deciles have topped the academic excellence in our schools. I want to make particular mention of the fact that— 
Andrew Little 
: How many were from charter schools? 
Hon HEKIA PARATA 
: Well if that member kept up he would know we have not yet introduced charter schools so that would be a little impossible to be able to yet celebrate. We look forward to that but if we could instead focus on the significant numbers of Christchurch students who were top scholars. Despite all the challenges that they were beset with over the last 12 to 18 months their level and quality of education and their own aptitude and application were reflected in their success at the highest level and I want to yet again congratulate them.  
Andrew Little 
: Which just goes to show you don’t need charter schools. 
Hon HEKIA PARATA 
: However we also have challenges in our system if the member cared to listen for a cohort of students who are underserved by the system. Too many of those are Maori and Pasifika come from low socio-economic homes and/or have special education needs. We are particularly focused using the work of the past year and the successes of the past year on how we can raise achievement for all New Zealand students and that will be done by the thing that we know best which is quality teaching and professional leadership. Thank you. 
Report noted. 
Ministry of Social Development  
Peseta SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I just want to thank those involved in the financial review of the Ministry of Social Development including my parliamentary colleague Jacinda Ardern and others seeking the call here today. I want to commend the report that has been put to the House. That report details explicitly the range and the scope of the services that the Ministry of Social Development undertakes. The breadth and depth of the services are quite remarkable.  
We all know that the ministry deals with the care and protection of vulnerable children. It deals with income support superannuation services funding to community service providers social policy and advice to our Government and student allowances and loans. It administers well over $21 billion—yes that is $21 billion—a year easily the largest Government spend and one-third of all Government expenditure. The running costs of the ministry are around $1 billion a year. It has over 300 sites scattered across our nation and 9300 staff are committed to the effective implementation of programmes and distribution of services.  
The revenue is approximately $1.2 billion and the expenditure of the ministry was $1.198 billion; so as with this Government this particular Government department is operating within its means. It is operating a $5.9 million surplus. The Social Services Committee noted that the Office of the Auditor-General gave the ministry a “very good” rating for its management control environment as well as “good” ratings for its financial services and service performance information and associated systems.  
One of the real tests for the ministry in the last financial year was how it responded to the earthquakes in Canterbury and I will quote the committee’s report: “this was a very good indication of the capability of the organisation its adaptability and its willingness to cope with a crisis and its ability to respond to change which will be important as welfare reform is implemented.” It set up welfare centres. It provided extra staff. It flew in and drove in 800 extra staff from around the country. It ran the Government’s helpline. As people were calling in asking and pleading for help during this crisis the ministry and its employees and its agents stepped up to the mark and assisted over 50000 Cantabrians. It also distributed $10 million through various non-governmental organisations that responded to the crisis in Canterbury.  
The committee also commended the ministry for seeking capability improvements through the use of technology. It is working hard to share better information and this will be demonstrated in the new welfare reforms. Information sharing is a critical part of our welfare reforms. It is working with the Ministry of Education—and I know that the Minister is here today—working between the ministries to deliver services to our young people in particular. An example of this demonstration of the uptake of technology is shown in the Value-for-Money programme. For example Child Youth and Family social workers are currently trialling iPads and the global positioning system feature which improves the security of staff who are out on the front line who are distributing those front-line services.  
Our committee also looked at Future Focus and noted the overall decline of beneficiary numbers. The committee noted that youth unemployment had fallen by 4000 and since that report the March benefit figures show that more than 5000 people who were on the unemployment benefit around New Zealand went off welfare and into work just last month. I just want to repeat that for Miss Ardern: 5000 young people who were on the unemployment benefit around New Zealand went off welfare and into work last month. That is commendable to the Minister for Social Development. It is certainly commendable to the Ministry of Social Development.  
JACINDA ARDERN (Labour) 
: 
 Sometimes I wonder whether or not Mr Lotu-Iiga and I sit on the same committee the Social Services Committee and hear the same pieces of information and reports from the community. It is clear to me that a zero Budget is what you get when you fail and in the social development field we see the repercussions of a failed economic plan—or no plan indeed. 
Although I absolutely acknowledge the hard work that those who work in the social development field particularly Ministry of Social Development staff and Child Youth and Family staff put into their jobs and their roles they are doing it under increasing pressure. One of the things we saw in the briefing to the incoming Minister from this department was the clear message that something has got to give. The ministry is asking its staff to do more with less. The demands on them are increasing not decreasing. Something has got to give and I ask the Minister for Social Development what that thing is. What is that thing that is going to give? Already I am seeing an increasing number of cases coming across my desk of Work and Income staff absolutely stretched treating clients poorly as a result and people finding it very difficult to get the support they need. Although Mr Lotu-Iiga may claim that as a success there is actually an increasing number of cases of people who are going unsupported and in dire need but I will return to that.  
Of course there are major issues in this portfolio. It is one of the most significant that any Minister could hold not just because of sheer budget but because of the impact on people’s lives and no more so than in the area for instance of employment or unemployment as the case may be. The reason we continually refer back to the measure of those not in employment education or training is the unemployment benefit statistics do not pick up young people who are not eligible for benefits. So that is why we continually come back to the figure of 83000 young people not in employment education or training.  
What has the Minister’s response been to deal with those young people? It has been to say: “Let’s focus just on the 16 and 17-year-olds. We are going to spend $13 million just targeting 16 and 17-year-olds.” What I say to that Minister is that you are now saying we will get less and spend the same amount because currently we spend $13 million and we cater for 16 to 20-year-olds. The Government is now cutting out almost 60 percent of the young people that Youth Transition Services deals with in New Zealand and is instead funding them on a bonus payment cycle essentially incentivising the people who are tendering to work only with the easy young people—not the hardest not the most at risk but the easy wins. It is a failed policy. We have seen it before in the UK. It failed. Why are we repeating those same mistakes again?  
I move more broadly to the Government’s other response to the current situation. Just to remind Mr Lotu-Iiga we have seen 67197 more people on a main benefit now than in 2008. We have seen an increase in main benefit rates and why is that?  
Hon Hekia Parata 
: Recession.  
JACINDA ARDERN 
: Quite simply it is the economy. Of course the economy has had an impact. I see that the Minister in the chair the Minister of Education has acknowledged that the economy has had an impact. Why then is the Government’s reform focused solely on some kind of idea that there has been this dramatic change in attitude to work? There has not been yet its reforms are focused on this conception that people do not want to work. They do want to work. That is why we see queues of people lining up for a handful of jobs at supermarkets. They are desperate to be in work.  
 And also that is why in 2006 20 percent of lone sole parents had declared earnings—20 percent of DPB parents were in part-time work in 2006. What is the figure now? Well the Minister has put in place part of her Future Focus reforms. She has started work testing people earlier. And how many are in part-time work? Sixteen percent. It has decreased since she has ramped up her reforms. And why? Because of the economic environment. If you want to fix welfare fix the economy. She claims that 30000 people have come off the DPB. Well 32000 have gone on. And why? Because these are people working in low-wage jobs in the service economy. It is fragile work and it is insecure work. Fix the economy is my message to the Government and then you will genuinely help these people. 
The biggest issue though is poverty—270000 children living in poverty. Three out of five of them are in the homes of people reliant on Government support; two out of five then are in working poor families. The Government’s response is to set up a ministerial committee. I see no result from that and I see no real action from this Government.  
JAN LOGIE (Green) 
: 
 I would like to speak today in support of the concept of an investment approach to welfare but at a Government and a societal level rather than an individual level. The proposed welfare reforms from this Government are missing both the big picture and the individual detail. They are trying to present the welfare reforms as new and innovative—an actuarial approach to welfare and an investment approach. But when you drill down and look at the language and the shape of the reforms in fact it becomes quite clear that there is not much new in this approach.  
Today I would like to focus on just one small aspect of the reforms but a key one: work testing which started with the Future Focus reforms and is now being extended. It is work testing for women on the DPB. I would like to draw attention to the problem of domestic violence in this country. The nature of domestic violence which we know affects one in three women in this country means that its female victims are often unable to work to work in their preferred career or to stay in a job long term. International studies have shown that victims of domestic violence have 15 percent more chance of being jobless and 55 percent more chance of being on a benefit. International research indicates that over a third and up to half of women on the DPB are likely to be in or more important escaping violent relationships—up to a half of the women on the domestic purposes benefit leaving violent relationships.  
To institute mandatory work-preparedness requirements and to pressure women leaving these violent relationships to go into work flies in the face of generations of work in this country to enable women to leave these violent relationships. Admittedly Future Focus does have a work-test exemption for women leaving violent relationships and I assume that this will be in place in the new reforms. But for me this actually heightens my concern with the reforms because it is being used as an excuse: “Don’t worry we’ve got an exemption.” And yet this exemption is not being accessed. When I asked the Ministry of Social Development officials about why such low levels were reported in the ministry’s statistics they noted that staff do not ask. They noted that women may not want to disclose which is my point exactly. These reforms do not protect women. One of the dynamics of abuse is that victims often blame themselves and that makes disclosing difficult. If we are serious about bringing down the rates of family violence in this country and getting women off the DPB then we need to make it as easy as possible for women and children to leave and stay away. Otherwise we are damning women for staying and damning them for leaving. When the Government talks about the decline of the numbers of women on the DPB that is actually something we should be afraid of.  
We need to invest in the structural issues that lead people to need welfare. We need to invest in respectful relationship education strengthening our response to family violence and helping women to leave and get into sustained employment. Reducing family violence and creating jobs will get women off the DPB.  
In 1996 economist Suzanne Snively estimated that the costs of domestic violence in New Zealand then were between $1.2 billion and $5.8 billion a year. More recent research in Australia estimates that there it is $8.1 billion a year in costs. I say to this Government that if you are serious about an economic strategy to bring us into the future address the fundamentals; do not blame the victim.  
TIM MACINDOE (National—Hamilton West) 
: 
 I am delighted to pick up on exactly the point that Ms Logie has just finished on because I can assure her that this Government is not blaming the victim at all. But we are absolutely passionately determined to sort out the problem—the very real problem that this country has had for far too long—of long-term welfare dependency. That is not a question of beneficiary bashing or attacking that person; it is about saying that we are going to put some support structures around them and we are going to intervene in ways that are going to be effective.  
That is what Future Focus is all about and that is what the reform bill that is before the House at the moment—the Social Security (Youth Support and Work Focus) Amendment Bill—is all about. It was very interesting during the adjournment that we have just had to be on the Social Services Committee which heard some of the submissions from people on that bill. I have to say that some made some points that naturally we have taken note of but quite a number showed that they do not really understand this point or they are so ideologically blinded by their party affiliation that they refuse to look at the fact that welfare dependency is an absolute scourge on this society. Long-term welfare dependency causes huge suffering in communities particularly the communities that are most deprived in our country. I would have thought that they would cheer and welcome strongly the Government’s initiatives to do something about that. The wraparound services that we are putting around our young people are long overdue. I am very proud to be a part of a Government that is addressing that problem.  
While Ms Ardern was speaking before Ms Logie she made the extraordinary comment that we should fix the economy. Well as Mr Hayes replied at the time that is exactly what this Government has spent the best part of 3½ years doing. Why? Because the Labour Government made such a hash of things. The Labour Government has to take responsibility for the position we find ourselves in. Let us not for a moment allow the spin doctors on the other side of the House to fool anybody into thinking that it is somehow a creation of this Government. At a time when the Dutch Government has collapsed the Irish are in trouble the Portuguese are in trouble and Greece is in deep trouble what we see around the world is a huge problem with global recession and this is a Government that is really focused with a terrific plan to do something about it—and the results are clear.  
That is why we have taken tough decisions. That is why we are so determined to balance the books. That is why we will get the country back into surplus. And when we get this country back into surplus following on from the 9 years of ineptitude by Mr Goff and his colleagues then we will have choices to be able to do the things that the whole country wants. But in the meantime while we are getting there we can intervene for those who are troubled by this long-term welfare dependency.  
The Ministry of Social Development is ably led by the Hon Paula Bennett and gee she deserves a pat on the back for the fantastic job that she is doing. This particular focus of our Government is one of the most important things that the whole country is firmly behind. I made the point when I was speaking on the reform bill that I believe that it is one of the most important challenges facing not only this particular Parliament but also this particular generation of politicians. There are not many issues more important than this that we will face during whatever time we are given to serve in this House.  
I am absolutely 100 percent behind the welfare reform bill to ensure that we can help young people particularly from going down the path of long-term welfare dependency because all the evidence tells us that if they drop out of school without qualifications and they go on to a benefit at the age of 18 or even younger within several years they will still be on it. That cannot be acceptable. I am amazed that there is a single member of this House who is happy that that is the case. 
 I am absolutely proud of the fact that we on this side of the House are determined to change that. And change it we will because by giving incentives for going on a budgeting course doing a parenting course learning all of those life skills that are so vital for a young person—[ 
Interruption 
] Mr Twyford scoffs at that. You do not want young people to know how to budget? It is unbelievable that Mr Twyford would take that position and he shakes his head. Mr Twyford does not want young people to learn how to budget. Does he not want young people to know how to parent? What could be more important than being able to look after a child to raise a baby to become a healthy young person? I believe that that is an absolutely vital skill and we cannot just expect it to be something that is understood instinctively. In many cases it has to be taught and so we will and we are putting in place incentives. That is not knocking; that is not discriminating. 
Report noted. 
Ministry of Agriculture and Forestry  
Steffan Browning 
: Mr Chair I would like— 
The CHAIRPERSON (Eric Roy) 
: The member must call. You say “Mr Chair” then I respond. 
Steffan Browning 
: Mr Chair. 
The CHAIRPERSON (Eric Roy) 
: I call Steffan Browning. 
STEFFAN BROWNING (Green) 
: 
 I note that the new ministry is now the Ministry for Primary Industries and now includes the Ministry of Fisheries and the whole works. In fact unfortunately some of the parts of what was the Ministry of Agriculture and Forestry and what were the New Zealand Food Safety Authority MAF Biosecurity New Zealand and all that are even losing their identities into this new super-organisation that effectively is a “develop for trade” organisation maybe rather than being focused on the New Zealand consumers and communities. But this particular report is pretty specific. We have got biosecurity and forestry in particular that came up in there but there were also some issues that came up during the questioning of the then ministry’s personnel of both organics and genetic engineering so I would like to cover two or three items.  
One thing that stood out and does stand out with both the old and the new bodies is that there is no holistic approach to agriculture forestry and fisheries in New Zealand. There is no overview as to why you might go down a particular path in terms of sustainability because of the interconnections with the environment and the community. It is all about milk powder and beef it would seem primarily. I wondered and I have asked and will continue to push as to why the Ministry of Agriculture and Forestry and this Government dropped any effort towards the organics sector in New Zealand. The organics sector is showing best practice in terms of sustainability in this country which can actually resolve many many of the issues that we see in our environment which the community at whole is effectively propping up for the primary producers who are doing a bad job. There are plenty who are doing a good job but unfortunately there are a hang of a lot who are doing a very very bad job in terms of our environment. But this Government chose not to reboot the Organic Advisory Programme and the ministry is doing nothing effectively apart from a dribble occasionally with a Sustainable Farming Fund application if we are very very lucky. But at the same time we are still seeing money going into genetic engineering. 
John Hayes 
: Great! 
STEFFAN BROWNING 
: It is definitely not great in any sense of it. We have a fantastic brand and we had one before our current Prime Minister sold it out as Minister of Tourism—“100% Pure New Zealand”. He went to “New Zealand 100% Pure You”. There is no aspiration in there and I have talked on that in this House before. Genetic engineering has no part in Brand New Zealand. It will do us no good in terms of Brand New Zealand and the export of our primary produce. We are very very fortunate at the moment. We only have one field trial—that is the only legitimate genetically engineered material existing in New Zealand at the moment—and that is through animals at Ruakura. No doubt there will be some pine trees replanted when Scion gets over its last breach. That is a really good opportunity for New Zealand. We can actually remove that last field trial and New Zealand will be GE free like so many places in the world at the moment are trying to become again after seeing the problems with GE in their countries.  
Another thing we spoke on and looked at was around biosecurity and the problems we are having with biosecurity. Again we have seen it with this Government allowing border control staff to drop by 60 because trade had dropped off and it did not see the need. Yes we have got some smart new systems in terms of risk analysis but in fact what we are doing is dropping the game big time. We have had the strawberry seed incursion and it will be very interesting to know just how bad that was because I suspect there was an issue in terms of contamination of that because so much of that was suppressed. I have just been talking with the pork industry. 
Hon DAVID CARTER (Minister for Primary Industries) 
: 
 I want to thank that member Steffan Browning for his contribution on the Ministry of Agriculture and Forestry report. Can I first of all say that yes as of yesterday the Ministry of Agriculture and Forestry was finished with. We named a new organisation the Ministry for Primary Industries and I want people in the Chamber to take particular note of the word “for” primary industries. There was a branding issue once the Government had decided to bring three Government departments into one. The Ministry of Agriculture and Forestry already operated under a number of brands. We have taken the opportunity with the integration of the Ministry of Fisheries with the integration of the New Zealand Food Safety Authority and with the integration of the Ministry of Agriculture and Forestry to come up with a new name that is all-embracing: the Ministry for Primary Industries. I want that new ministry to be absolutely focused on the New Zealand economy on the fact that the very base of this New Zealand economy is the agricultural and primary sectors of New Zealand. That organisation now has to be very focused on working with all aspects of the primary industries to make sure that we deliver the greatest potential to the New Zealand economy.  
I do note the member’s comments around organics and the fact that the Government does not now put a considerable amount of money into the organics industry. But the Government has done so and there are a lot of other aspects and farming systems here in New Zealand that if they want to promote themselves are expected to do so. At some stage it is necessary for this Government to cut the umbilical cord and say to the organics industry that if it is so successful if it is so successfully meeting the demands of New Zealand consumers and the demands of international consumers then it should be able to command a premium for its product and in commanding that premium for the product it is time it put some money back into the industry to allow it to expand and grow.  
Mr Steffan Browning shakes his head because he knows that despite considerable money going into organics the industry is not gaining significant premiums for its product either in New Zealand or elsewhere—or elsewhere. I will give you one example that should bring that home to Mr Steffan Browning even though he is a Green member of Parliament. Fonterra used to run an organics operation. A prior president of Federated Farmers Tom Lambie ran an organic dairy farm in South Canterbury. Fonterra said to him and to other organics suppliers here in New Zealand that it was not getting a significant premium for the product. It was uneconomic for it to continue to collect that milk and it abandoned the programme.  
Mr Steffan Browning made some very interesting comments around biosecurity and I say to every audience I get the chance to speak to that that is the greatest risk to the New Zealand economy. It is absolutely paramount that the Ministry for Primary Industries and the Government work hopefully with Opposition parties to deliver the most effective biosecurity systems we can at the border. Yes we did reduce some staffing when trade dropped off through the global financial crisis but I say to Mr Steffan Browning that those services at the border are cost recovered and it would be inappropriate to continue to charge other importers of goods excessive charges simply as a means of maintaining staff at the border.  
The other thing I stated Mr Steffan Browning is we must continually look at the way we manage our borders. Systems change threats change and technology changes and although everybody I speak to around biosecurity concentrates on the system they have at the airports because that is the system most people interact with the greatest risk is actually at our seaports and we need to continue to be vigilant there. We will have incursions occurring sadly—that is a fact. In fact we have had particular insects that have flown over from Australia and landed in New Zealand and no amount of X-ray technology at the border will stop it Mr Browning.  
What we do need when we get an incursion is a means by which we can ascertain how critical it is to any industry. That is the very reason we are engaged so significantly with industries around the Government-industry agreements. Then if it is an economic pest that we have the ability to control we must act and act quickly. The biggest lesson I have had in that regards the  
Pseudomonas syringae  
pv.  
Actinidiae 
 incursion in the Bay of Plenty where the Government has worked very very well with the industry realising we could not eliminate it once it arrived but working with the industry to find means by which that industry can move forward with varieties that are resistant to or tolerant of the disease. I want to take this opportunity in my closing comments to congratulate the kiwifruit industry on the way it has come through what were very very dark days for it. 
Report noted. 
Ministry of Foreign Affairs and Trade  
Hon PHIL GOFF (Labour—Mt Roskill) 
: 
 I want to focus today on the botched job that this Government has done in cutting the Ministry of Foreign Affairs and Trade and supposedly reforming it but in the process destroying it. It is a little bit like the Viet Nam War slogan “We had to destroy the village to save it.” Well they have destroyed the Ministry of Foreign Affairs and Trade. If anyone is in any doubt about that or thinks that that is hyperbole have a look at what the 49 top diplomats in New Zealand the heads of mission had to say to their own ministry about what the impact of those restructuring reforms has been on the ministry. One thing that stands out above anything else is the huge damage done in demoralising and disillusioning the people who work for one of our finest ministries. I can say that with some passion because I have worked with them for 9 years and John Hayes can agree because he worked for them as an employee for a lot longer.  
You know we are a little country we cannot bully our way in the world. We certainly cannot bribe others to make them do what we want them to do so what do we rely on? We rely on the innate skill and ability of the most talented people we can find in our Ministry of Foreign Affairs and Trade. When I became Minister in 2000 I read a great article in the  
International Herald Tribune 
 that said that our ministry was tiny but it outperformed a neighbour five times our size in every category.  
I have always thought that there is a lot of truth in the old saying “If it works don’t fix it”. They have fixed it all right! They started off in September last year doing an independent review and what did that review find? It found that the ministry was able to obtain and retain talented and committed individuals. It found that it had a distinctive professional diplomatic culture that delivered some remarkable successes. Who said that? It was the Department of the Prime Minister and Cabinet Treasury and the State Services Commission.  
What has been the result of this botched reform effort? First of all we have lost some of our best people in the ministry. Crawford Falconer who would outperform any other trade negotiator in the world the former chair of the agriculture committee at the World Trade Organization—gone. Nigel Fyfe the head of the trade negotiations division a very competent ambassador in Chile and a really competent trade negotiator—gone. What I find when I talk to any of my contacts in foreign affairs is that they are either putting their notice in or they are getting their references ready to put their notice in. They are leaving in their droves and it is the best the brightest the most talented and therefore the most mobile who are going and that is the achievement of Murray McCully.  
What does Murray McCully say in response to this? He knows that it was botched. They are now back-pedalling so fast it is hard to know where they are going to end up. But he says that it is all the fault of the Foreign Secretary Mr Allen. Mr Allen is a civil servant. He was actually plucked out of the private sector by Murray McCully to cut the Ministry of Foreign Affairs and Trade and restructure it. But there is this about a chief executive officer: he cannot answer back to lies and criticisms made about him by a Minister. He is defenceless. I cannot remember a time in 30 years Mr Chairman—and nor can you—when a Minister blamed his civil servant in a way that he knew that that civil servant could not fight back. But the ministry answered that. They said that it was the Minister who appointed John Allen and it was the Minister who set the directions and it was the Minister who gave constant oversight. He cannot help himself—he is a micro-manager. Murray McCully is responsible for this and no matter how much he hides behind blaming his chief executive for the botch-up he is responsible and he needs to go.  
Jenny Shipley decided that in 1999 when she sacked him as Minister of Tourism. She sacked him because of his inappropriate interference in the running of the Ministry of Tourism. He did it then and he is doing it now and what upsets me and makes me passionate about this is that he is destroying an agency that has worked professionally capably and competently to serve the interests of our country. We should be proud of that ministry. It has fine people and now they are falling over each other to go because they see that they have no future in that ministry. It is a shocking disgrace what has happened and it is unprecedented that the 49 heads of mission would actually come out and say that what is happening to their ministry is destroying it. It is taking away its fundamental strengths. It is a shame that it has come to that and Murray McCully is to blame. 
JOHN HAYES (National—Wairarapa) 
: 
 No hyperbole in that speech at all—none whatsoever! It is interesting though that there is no public announcement of what the decisions are within the Ministry of Foreign Affairs and Trade and its change until 10 May. No hyperbole at all? What nonsense Mr Goff! Let me say to you this: our Government inherited a situation where the economy was out of control and you Mr Goff—and Mr Peters; you were Foreign Minister at this time in your last year of office—put bucketloads of money into the ministry which this country could not afford. You opened posts in all directions and I know because staff talked to me and they were saying: “We have been given so much money we don’t know where we should put it.” Meanwhile that money was actually coming out of the pockets of your workers and my constituents. This money does not grow on trees and this Government has been put in place by the community after 9 long years of mismanagement to put things right.  
Labour increased spending by $22 billion in the last 5 years it was in office. So we employed a Secretary of Foreign Affairs and Trade and he was given quite clear instructions about looking at the management of that sector and trying to work out how to move resource from the back office to provide services to the community and to provide foreign affairs services. 
Andrew Little 
: Instructed by the Minister of Foreign Affairs. 
JOHN HAYES 
: What happened? A consultation document— 
Andrew Little 
: Instructed by the Minister. 
JOHN HAYES 
: Of course it was constructed by the Minister of Foreign Affairs; that is why you have Ministers. I realise the member has not been in the House sufficiently long to understand how it works but that is another problem.  
The ministry staff were invited to comment on the range of changes that were being proposed back in February and a number of people reared up on their hind legs. The day the document was put on the table people went berserk and leaked documents to Mr Goff who said that he was getting leaks in triplicate. And then Mr Goff started saying that the consultation document a draft document was the end result. Well it is not.  
All of the ministry’s heads of mission were brought back to Wellington about a month ago and their views were taken into account. The Minister was involved through that process as was the secretary and I commend the Minister actually for doing an excellent job. He would be here in this Chamber this afternoon defending himself if he was not doing a particularly good job with his other forum colleagues in Fiji right now. I can assure this Committee that Mr McCully has been doing an absolutely outstanding job helping bring normalisation of events back into Fiji.  
So after the consultation document went to staff there was a considerable amount of feedback from them and from other stakeholders including the Government. Many of the proposals were revised by the ministry’s management. In essence the initial proposal perhaps contained too many moving parts at one point in time and it is good I think that the Minister has said to the ministry that it needs to look at that issue.  
The decision document will be available to staff on 10 May and at that point we will be interested in Mr Goff’s comments because in my conversations with the same staff who talked to Mr Goff it is quite clear to me that younger staff members see huge opportunity in the changes that are coming up and they are really excited about the process. We have to follow the rest of the world. The only way in this country that we are going to move ourselves forward to pay for health and education is if the money coming into the country exceeds the money that goes out for things that we export and the Ministry of Foreign Affairs and Trade has a really important role in this area. This is why we are trying to make sure that we are doing our level best for the ministry to operate in a focused way.  
We are interested particularly in two issues: trade and economic issues. That is why we have strengthened the promotion of New Zealand’s export goods and services through our “New Zealand Inc.” approach of coordinated Government agencies. That is why the Prime Minister the Minister of Foreign Affairs and the Minister of Trade have led trade missions to the Gulf region China Hong Kong Brazil Mexico India Singapore Malaysia and Indonesia. That is why we continue to work with developing a single— 
ANDREW WILLIAMS (NZ First) 
: 
 This is an unmitigated disaster and New Zealand First opposes the manner in which this National Government is decimating the Ministry of Foreign Affairs and Trade with the effect of undermining and placing at huge risk the credibility of New Zealand in our important markets and with our strategic allies and partners.  
I rise not only as a member of Parliament but as someone with previous experience having been a trade commissioner and vice-consul for Belgium for 10 years between 1998 and 2007. During that period of time I had personal experience in the consular corps and in the diplomatic corps of the value of our trade commissioners of the value of our diplomats and of the value of having front-line people in foreign posts around the world. I certainly saw the impact that Belgium had around the world in terms of its posts. I was its representative here in New Zealand and I certainly saw the value and the gains in its economy as a result of having front-line people and properly resourced posts around the world to do that work.  
Also in my former life in the meat industry for many years I saw the importance of the Ministry of Foreign Affairs and Trade in terms of getting access to many of our markets around the world. I started off in the days of Amalgamated Marketing when it opened the markets in Russia Iran Jordan and all those other places. It was very much working hand in hand with the likes of the ambassadors and the ministry people around the world to help open those doors for the early markets for New Zealand around the world.  
That continues and it is a continuing important part of the New Zealand economy. This is an economy that depends on trade. This is an economy that depends on us playing our part in the global market and quite frankly this is a complete undermining of New Zealand’s front-line troops. The Government keeps talking about keeping our front-line troops; this is the undermining of our front-line troops around the world.  
This is also a situation where the Minister of Foreign Affairs Mr McCully has basically hung his chief executive out to dry. He brought in Mr John Allen to restructure the ministry—and certainly there was some fat in the ministry and there was some need for some restructuring—but basically now having held that chief executive on the end of a string for several years he has hung him out to dry. This is the first non-diplomat to head up the Ministry of Foreign Affairs and Trade and now Mr McCully is blaming that very first non-diplomat for the fiasco that we see within the Ministry of Foreign Affairs and Trade now.  
Forty-nine of our 53 most senior diplomats signed a letter protesting the change process that identifies major risks with the proposals including “the absence of any analysis … of the net impact of the changes … on NZ’s external interests”. This is our top diplomats saying this that there was an “absence of any analysis … of the net impact of the changes … on NZ’s external interests”. That is almost verging on treason—the situation where we are seeing our external interests undermined in this manner. Also the wives and partners of our diplomats those important support people around the world have complained bitterly about the way this change process is being executed.  
What was meant to be a way of clearing out some of the extravagant dead wood in the diplomatic corps has backfired on this National Government and this Minister and this Government are responsible. We are now seeing an exodus of some of the best in the Foreign Service who are finding better jobs outside the diplomatic corps such as in academia in the private sector in commerce and in trade. There is a serious loss of institutional knowledge and experience that is of immense value to New Zealand. Morale in our Ministry of Foreign Affairs and Trade is at an all-time low.  
Meanwhile the Meat Industry Association Fonterra and other major export groups have expressed grave concerns at the impact on our Foreign Service and on our nation’s ability to foot it on the global stage where diplomacy and trade are vitally important to a small trading nation like New Zealand. If we do not grow our exports and contain our imports then we as a country will continue on a very slippery slope of ever-increasing deficits.  
Under the details of this Appropriation Bill I note that it says: “This appropriation is limited to the purchase of policy advice and representation directed to the management of New Zealand’s foreign trade relations with other countries bilaterally and in regional organisations including using New Zealand’s international connections to facilitate …”. 
Report noted. 
Department of Corrections  
Hon ANNE TOLLEY (Minister of Corrections) 
: 
 Can I take this opportunity to congratulate the Department of Corrections on a really outstanding year’s performance. If we go through a few of the notable achievements I think the Committee will see that there has been a huge amount of work and the department deserves the congratulations.  
Participation in drug treatment and rehabilitation increased dramatically in that year with the opening of new facilities and the implementation of a new shorter programme. As a result it had the highest recorded number of prisoners participating in drug and alcohol rehabilitation courses and I think that is an area that this Government is really focusing on and looking to grow. We know that that is one of the most significant impediments to those offenders when they go back out into the community and it is one of the most significant behavioural addictions that they have to deal with and that sees them reoffend and come back into our prisons.  
We saw the start of two Whare Oranga Ake with the work of the Associate Minister of Corrections the Hon Dr Pita Sharples. They were established in this financial year and are particularly focused on Maori prisoners—who of course make up too high a number of our prisoners—partnering with local service providers. The early results of this—and I stress that it is very early days—are very encouraging. The majority of prisoners who have left those whare have been gainfully employed in the community and remain gainfully employed. So we are continuing to support them closely.  
The escape figures were at an all-time low in this particular year with only four escapes—two breakouts and two from an escort—compared with nine in the previous year.  
The positive random drug-tests are at an all-time low—an all-time low for those random drug-tests. It has been interesting to watch the Opposition climbing into the figures showing the numbers of people that the Department of Corrections is actually finding who try to enter prisons with contraband. The Opposition has actually been criticising the Department of Corrections for that. I say all power to the department. I think it is fantastic that it is stopping so many people trying to bring contraband into our prisons and it is to be congratulated.  
The other thing that we need to look very closely at is the smoke-free environment that was instituted throughout the department. That followed a long planning period and 5500 prisoners were supported to give up smoking—5500 prisoners. That is outstanding work from this department over this year. There has been a 79 percent reduction in fires. There are lots of pluses in addition to the personal health of prisoners.  
At the same time we have seen an enormous change programme through the probation service. We know that when we came to Government the probation service was in a pretty awful state. The previous Government had lost the plot and we had some awful awful risks being taken with our prisoners out in communities which resulted in lives being lost. So the department has gone through an enormous change programme. The old manual seemed to grow and grow year on year. Every time something went wrong there would be another set of rules added which really constrained the probation service to having to act in accordance with a whole manual of rules. So systems have been put in place now that have some mandatory standards but allow those highly trained people who are working with offenders on a day-to-day basis to use their initiative and be able to make judgment calls on how to manage some of these people whom they are responsible for out in the community.  
So it has been an outstanding year’s work and that was reflected by I think the conversation in the Law and Order Committee when the Department of Corrections appeared before it. The big decision of course is around the public-private partnership at Wiri and the Government has now made that decision which is a unique contract—a unique contract—that focuses not on building prisons but on getting great results— 
Report noted. 
New Zealand Police  
MARK MITCHELL (National—Rodney) 
: 
 I would just like to open by congratulating first of all the Hon Judith Collins who was the Minister of Police from 2008 to 2011 and of course the Hon Anne Tolley who has now taken up the reins and is doing a fantastic job and is continuing the same brilliant work that the Hon Judith Collins started in 2008.  
Andrew Little 
: Tell us about the brilliant work! 
MARK MITCHELL 
: I will tell you a little bit about it Andrew. 
The CHAIRPERSON (H V Ross Robertson) 
: Order! The member must refer to members by their full names or titles not their first names. 
MARK MITCHELL 
: Sorry Mr Chair. I will tell you a little bit about it Andrew Little. I served in the police for 14 years. Unfortunately I served under a Labour Government.  
David Bennett 
: Shame. 
MARK MITCHELL 
: It was a shame. Morale dropped and we were always pressed to fight for funding and equipment. I left the police in 2002 and went overseas. I came back last year and I have started touching base with a lot of my colleagues and I have looked very carefully at what has been happening in the police. I am very very proud to say that morale is at an all-time high. I met with the newly appointed area commander for Rodney Inspector Scott Webb. He was saying he is now commanding a force in the Rodney area that is highly motivated and is contributing to incredible results. We keep seeing our crime statistics drop year on year. 
Phil Twyford 
: Labour policy. 
MARK MITCHELL 
: No it is nothing to do with Labour policy—Mr Phil Twyford is it? Yes. 
Phil Twyford 
: Very good. 
MARK MITCHELL 
: Thank you. It is absolutely nothing to do with Labour policy. It is to do with a National Government that has come in and understood the importance of providing a strong law and order service to our communities to make our communities safer. And our communities are feeling safer. They are seeing more police on the beat. They are seeing police response times decreasing. They are seeing cases being investigated and completed in quicker times. They are seeing new initiatives like the neighbourhood support teams that are going to be out in the communities—what I see as a development of our historical community policing systems. I see a police dog section that is highly motivated and is delivering the best results it ever has. I see a police force that is providing to Kiwis a service that we probably have not seen in the last decade.  
I am very proud to be a member of this Government and a member of the National Party. If you go out and talk to the guys in the street and if you go into the mess room and actually have a chat with them they will tell you they feel supported. They feel that they have a Government that is behind them. They feel that they have a Government and a Minister of Police that are listening to them and resourcing them and are putting the resources in the right place—on the front line. That is where the resources should be—on the front line out there protecting and delivering services to our communities.  
It is with great pride that I took this call and was able to speak to the performance of our police and the services that are being provided by our police. I was very proud to be a member of the police. I am very proud to see the type of leadership that our Ministers are providing to our police and I am very proud to see the services that our police service is providing to our community. Thank you very much. 
Hon ANNE TOLLEY (Minister of Police) 
: 
 I would have to follow on from Mr Mitchell by saying that I am very proud to be the current Minister of Police. I also want to pay tribute to my colleague the Hon Judith Collins who was the Minister in charge during the year we are discussing. During that year we saw a significant fall in crime. 
Andrew Little 
: How many boy-racer cars has she crushed? 
Hon ANNE TOLLEY 
: Well it is “three strikes and you’re out”. Do not hold your breath too long but it will come it will come I can assure you. During this time offences per head of population fell 7 percent—25000 fewer offences. We can talk all we like about offences but actually we are talking about victims. When we talk about 25000 fewer offences we are talking about a large number of people in our communities who were not victims in that financial year and that is to be applauded.  
 The police are working extremely hard and it shows in their public confidence results. Public confidence in the police is on the up. It was at an all-time low as I understand under the previous Government. But in this year they were up to 77 percent and 82 percent of the public were satisfied or very satisfied with the quality of service that they received from the police in 2011. That does not happen without a great deal of effort.  
The road toll in 2011 was 284 deaths. That is the lowest we have had since 1952. Again there are a whole lot of reasons for that like better cars and better design of roads but a huge amount of effort has been put into road policing by our policemen.  
You have to say that during this period of time the police were under enormous demands—enormous demands. We had the Christchurch earthquakes and police from all over the country went down there. I have read some of the reports of some of the individual efforts and we had outstanding service from all of those policemen but from some in particular who were nothing less than heroes and deserve recognition for that. At Pike River who were the first ones there? Our police force. And of course we had the Rugby World Cup. While those of us who did so enjoyed that wonderful time all around New Zealand and went on fan trails and things who were the ones who were out there so evidently working so well with the crowds? It was the New Zealand police. They had a fantastically difficult year to face with huge demands on their resources but they managed to still see a significant drop both in the road toll and in the crime stats.  
How is that happening? Well that is through things like Policing Excellence and Prevention First. They have nothing to do with the previous Government; they have been implemented since this National Government came to pass. They are about making sure that yes we have more front-line policing hours so that we get rid of some of the paperwork so that we give them modern technology so that they do not have to go back into the office and fill an hour’s worth of forms every time they do something. We must acknowledge that this is the 21st century and that these guys need to have access to firearms. By the end of this financial year all the cars will have lock boxes. All of that was started during this financial time.  
Prevention First is around some old-fashioned policing ideas—that is you use modern technology to see where the crime is being committed at what time and where you need to put your resources in. When I went out with the police in Wellington about a month ago on a Friday night I was amazed at how many police there were and the spread that they had throughout the downtown central business district. They were making sure they were on the spot stopping crime stopping incidents from happening through being there and being visible and using the skills that they have to understand where trouble was going to start. So I want to again take this opportunity— 
Andrew Little 
: How many recruit intakes have you stopped this year? 
Hon ANNE TOLLEY 
: —to congratulate the New Zealand Police. This year was an astounding year for them. I am not sure what all that nonsense is about and I would be amazed if there was not a politician in this House who was not convinced that we have the best police force in the world and wanted to take this opportunity. If that member would just use all that energy to say to these cops: “Thank you for the job you’ve done. You’re doing a great job. You are protecting the city that I am supposed to live in which is New Plymouth and let’s have unanimous support for our New Zealand police.” 
Report noted. 
Ministry of Defence  
Hon Dr JONATHAN COLEMAN (Minister of Defence) 
: 
 Thank you very much for the opportunity to speak in this financial review debate. I must say it is a great honour to be the Minister of Defence in this Government. New Zealanders can be very very proud of the efforts of the New Zealand Defence Force wherever it is serving around the world and here in New Zealand.  
I had the honour last week of spending some time with our people in Afghanistan and I can tell you that it was very very impressive to see what our people have achieved there over the course of the last decade. I spent some time in Bamian Province talking to some of the young soldiers who were there and the ones who were back for a second or even a third deployment remarked on how much better things were in the province since they had been deployed there previously. So our people are making very real progress there. They are operating in conditions that are spartan to say the least. We visited a Kiwi base and although the facilities there are certainly adequate for the Defence Force’s needs the fact is that these people are there for 6 or 7 months at a time and what really struck me was the total focus they have on their work over that period. There really is no let-up. There is relatively little recreation. But what struck me also is the absolute enthusiasm of these young men and women to get on with doing the job. If you are in the New Zealand Defence Force the highlight for people at the moment is the chance for that overseas deployment to Afghanistan and I can tell you that those young people coming in as Task Group Crib 20 which is the 20th rotation which changed over from Task Group Crib 19 while I was there were absolutely enthused about the work that lay ahead.  
I want to point out though of course that this is work that carries a high risk for our people and while Task Group Crib 19 was there it unfortunately lost Corporal Dougie Hughes towards the end of that rotation. That certainly had a real effect on the people who were there. But they just got on with the job. They were very professional and continued on their way. Two days after getting back from Afghanistan I had the privilege of going to the ceremony at Government House where Lieutenant Tim O’Donnell’s parents were awarded a memorial cross in recognition of the ultimate sacrifice that their family made in terms of their son losing his life in the service of New Zealand. It just brings home to you that our people in the Defence Force put up with a lot and carry severe risks on our behalf.  
So in that context I just want to speak briefly around the defence white paper launched in 2010 by my predecessor Dr Wayne Mapp. It laid out the vision for the Defence Force over the next 25 years. At the core of our Defence Force will be an amphibious task force. What that paper lays out is the plan for how we are going to configure the resources that we have as a country in terms of defence to meet the expectations of the New Zealand Government. If you look at the range of activity that our people are engaged in in defence a lot of it is actually around humanitarian and disaster relief. If you look at the work they have done in the Pacific and have been doing for many many years now a lot of it is in that sphere. But here of course domestically in New Zealand the New Zealand Defence Force has played a major role if you look at the Christchurch earthquakes. The New Zealand Defence Force has been at the fore of providing a first line of response. Indeed the Territorials have been manning the cordon there right from the start—so a very important role. 
The Defence Force is also very important in maintaining our international reputation overseas. I can tell you that the work that the SAS has done has meant that New Zealand’s reputation at the highest levels of NATO and the International Security Assistance Force which is the body of coalition forces is absolutely up there with the best. So when these people are overseas they are representing their country in a way that reflects very very well on all of us. Of course the challenge for all defence forces around the world is to find savings within their baselines to fund future capabilities. What we are aiming for—and are on track to deliver—are savings of $350 million to $400 million over the next 4 years. That is what the Australians have to do what the US have to do and what the UK is doing. That money is being invested back into new capabilities. I want to tell you that the future of the Defence Force—[ 
Interruption 
] 
The CHAIRPERSON (H V Ross Robertson) 
: Is the member seeking another call? 
Hon Dr JONATHAN COLEMAN 
: I will if I may. 
The CHAIRPERSON (H V Ross Robertson) 
: I call the honourable Minister. 
Hon Dr JONATHAN COLEMAN 
: What I want to say is that those savings are reinvested back into funding new capabilities. If you look at that 2010-11 financial year which was the first year of the savings plan that produced $47 million of savings that year. What that went into is funding upgrades for the Hercules upgrades for the P3 Orion and of course the helicopter acquisition projects. So it is all going back into the front-line equipment that we need in order to have the best possible Defence Force and the close-in weapon system for the Anzac frigate project.  
If you look at what we need into the future from the Defence Force we will need a Defence Force that is flexible and is configured for our needs here in our immediate area of strategic interest which is in the Pacific. Of course the Defence Force is able to make the impact that we need it to make at home but also it is able to contribute internationally to defence efforts in places like Afghanistan. We have of course two people in Syria at the moment who are contributing to UN missions. We have over 400 people deployed around the world in 19 countries and they are making a real international impact. But the key really if you look at this financial review is about making the savings that fund the capabilities that the New Zealand Defence Force needs into the future. Without those savings without the continued investment in new capabilities we would not have the Defence Force that we are going to need in the decades to come. So the outlook is good. I am very proud to take this call as the Minister of Defence. Thank you. 
Report noted. 
New Zealand Defence Force  
Department of Building and Housing  
Reports noted. 
Department of Conservation  
Hon KATE WILKINSON (Minister of Conservation) 
: 
 Thank you for the opportunity to speak in the financial review debate on the Department of Conservation. Can I say from the outset that we will never have enough money to pay for all the conservation that needs to be done in New Zealand. There was an exercise that was done in relation to biodiversity and they were adding up the figures— 
Andrew Little 
: What about the staff? 
Hon KATE WILKINSON 
: —and when they got past the health budget they had to stop. It is interesting when you have the Labour Opposition quite willing to spend $150 million on extending paid parental leave which is about half the budget of the Department of Conservation but Labour will be the first ones—or maybe the second ones after the Greens—to say that we are not spending enough money on conservation.  
But what this means is that we have the opportunity to look at conservation and look at the opportunities that conservation provides to New Zealand. I do not think we should be afraid of saying that conservation is everyone’s responsibility. Nor should we be afraid of saying that conservation is good for business and business is good for conservation.  
Can I say at the outset—because I acknowledge that the Green member is wanting to take a call—that the memorandum of understanding that we have with the Green Party which is to protect our native species and fund research into 1080 alternatives sets aside $4 million for self-setting traps. When we look at the 1080 debate—and I thank the Parliamentary Commissioner for the Environment for actually putting some common sense and some science around that debate—and if we look at the trends and the learning over the years we see that the standard application rate for 1080 used to be 20 kilograms per hectare. Now the standard is down to 2 kilograms per hectare and they are looking now to go down as low as 200 grams per hectare.  
There is a stunning example of biodiversity in a biodiversity partnership up in the Wanganui area where I was just last week called the Kia Wharite project where they are trialling the 200 grams per hectare. But what this project does is demonstrate several things: first a fantastic partnership between the Department of Conservation the landowners and the Horizons Regional Council—I think it is one of the most significant partnerships with a regional council—but also a partnership with iwi.  
It is one of the largest biodiversity projects in this country. It is focused on an area of 180000 hectares of which something like 157000 is under active pest control and predator eradication. Up in that area there are probably the largest populations of our North Island brown kiwi and also the endangered blue duck. It is also the second-largest stand of lowland native forest in New Zealand. But I think what is exciting about that is the way that the other partners are working with the Department of Conservation. It is a very successful partnership programme. In fact one of the farmers markets his own beef which he markets as “conservation beef”. I think that is just a wonderful reflection on the importance of conservation to New Zealand.  
One of the other exciting recent developments is of course the announcement of our partnership—it is not a sponsorship programme—with Air New Zealand. For many years Air New Zealand had actually enabled some of our flightless birds to fly. It has taken the kakapo from one end of the country to the other. It transports the kiwi to translocated areas to assist in their ability to thrive. This partnership which was announced with the Prime Minister just recently formalises that it is worth about a million dollars annually but actually for New Zealand it is worth a lot more than that. It is worth a lot more in branding. It recognises that conservation is one of the largest if not the largest tourism providers in New Zealand.  
We have the opportunity to really showcase our great walks and showcase our national parks. We have direct investment in conservation programmes. We have thousands of Air New Zealand staff who are now buzzed up about conservation. The walks alone which will be promoted through this partnership bring in about $3 million a year. But it is more important that that; it is more about our brand.  
Our Department of Conservation staff are fantastic people. They are passionate about what they do. 
EUGENIE SAGE (Green) 
: 
 Tena koe Mr Chair. Last month the Department of Conservation celebrated its 25th anniversary and that is a small miracle given this Government’s penchant for expensive chopping and changing of Government agencies. The department’s establishment in 1987 brought together for the first time all of the “green dots” in the former Wildlife Service Department of Lands and Survey and the New Zealand Forest Service into one organisation with a clear mandate to protect and preserve our wild landscapes our native plants and our wildlife. That was significant internationally. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
EUGENIE SAGE 
: I record my and the Green Party’s appreciation of the commitment energy and skill of Department of Conservation staff around the country over the last 25 years who have worked and are working with the community and with the public to protect and preserve our natural areas and historic places. But when we should be celebrating the department’s achievements including the establishment of four new national parks we are seeing instead retrenchment and restructuring in the face of the Government’s funding cuts a failure by the department to focus on the breadth of its statutory purpose and the welcome mat being put out for destructive commercial enterprises such as Bathurst Resources’ major proposed coal mine at Denniston and large-scale tourism developments such as the mad monorail proposal in the southwest world heritage area. 
The Government is miserly when it comes to conservation. It slashed conservation funding by $54 million over 4 years with more cuts to come. The organisational review which the department initiated during the 2010-11 financial year in response to these funding cuts has resulted in at least 96 fulltime-equivalent jobs going with more likely in the current phase of restructuring. Such organisational reviews create morale-sapping uncertainty. They create churn and destabilisation amongst the department’s major asset its staff. They cause a loss of productivity and performance as staff focus on whether they will have a job or not and the redundancies mean a loss of institutional knowledge a loss of expertise and a loss of capacity. It also means that large sums are being spent on organisational reviews and consultants’ reports rather than on real conservation.  
These restructuring costs to date include $1.48 million on the first phase the review of financial services and another $5 million on the review of what departmental managers call “support services”. Support services are in fact the planners the lawyers the technical specialists and the ecologists who are absolutely crucial to the department’s advocacy under the Resource Management Act to protect conservation values outside the conservation estate to protect our rivers against dams and to protect wetlands on private land that are threatened with drainage. It is this advocacy that the department is retreating from—vital work. 
The department is predicting that it will spend another $5 million in the current financial year on the next stage of its restructuring proposals and that will target the kahikatea face of conservation—the field centres and area offices—and further job cuts there are likely. That is $11.5 million over 2 financial years on the costs of restructuring that is not being spent on real conservation work and that is nearly 3.6 percent of the department’s budget. 
There are around 3000 threatened species in New Zealand and many continue to decline because of the impact of introduced predators. The department is on the cutting edge of pest control with its expertise for control on large islands like Campbell and its success in rat eradication there being sought after internationally. Yet with the reduced funding the department is able to actively manage only 10 percent of our threatened species. About 216 species have active threat-management plans in place and the department is only able to sustain possum control over 13 percent of the conservation estate. Information that the Department of Conservation provided to the Local Government and Environment Committee showed that the amount spent on possum control in the 2010-11 year had declined by $1 million compared with 2009-10 and the area under control had declined by 38000 hectares. That is serious because of the impact that possums have both on the health of the forest and on species—a lot of our bird species—by their predation on eggs. So while the planners the lawyers the botanists and the ecologists are being cut through restructuring we have the establishment of a new commercial business unit. And what is its focus? On delivering and extracting value from business and visitors. Thank you. 
NICKY WAGNER (National—Christchurch Central) 
: 
 The National Government has taken a moderate and balanced approach to Government finances. We all know that the economy is tight and we are determined to do more for less to increase productivity and to get better results from everything that we do. We want to get our finances on an even keel because we want to avoid the horror austerity measures that we are seeing overseas. We need to be disciplined and we need to have a willingness to prioritise and to make trade-offs. We have got a plan and we are sticking to it. In terms of conservation this means that we are determined not only to honour our conservation and environmental responsibilities but also to stretch our dollars as far as possible and to develop new ways to support conservation work.  
We all know that New Zealand is a magnificently beautiful country with a unique and hugely diverse fauna and flora. The Department of Conservation is charged with managing and overseeing our natural and heritage assets on land in the marine environment and also in the freshwater environment. It directly manages the public protected land and marine reserves and it facilitates agreements with regard to protection on private land. But it is also responsible for managing protected wildlife and marine mammals and it has a role in fostering recreation in the wonderful public lands that it manages and I believe that the Department of Conservation is particularly good at its job. It is also particularly good at finding ways to get more conservation work done for less. New Zealanders are keen to protect and conserve our environment. Huge numbers of them work closely with Department of Conservation staff as volunteers and increasingly businesses are getting involved with more conservation work.  
The Department of Conservation is absolutely focused on protecting endangered species. There are many successful breeding programmes right across the country. They include the breeding of the takahe the kakapo and kiwis. As a matter of interest my husband was down in Stewart Island just a couple of weeks ago on a yacht. He was anchored out in a bay looked across the bay and there was a kiwi just sauntering along the beach eating up the grubs at 10.30 in the morning. There are not many places in the world where you can see kiwis and there are not many places where you can see them just as you are going about your ordinary business.  
So we are being very successful with some of our breeding programmes. We have done fantastic breeding programmes for kakariki. We have got breeding programmes in Canterbury at Lady Diana Isaac’s property which has got tuatara kakariki skinks and all sorts of things. She is working very closely with the Department of Conservation. There are also good programmes for fairy tern for whio and even for kereru in some places of the country.  
The department also works with the species that are hard to protect from mankind in terms of smuggling. It was very interesting in the weekend. We were talking to Robin Thomas from the Department of Conservation in Otago about the smuggling that has been going on out of Central Otago particularly of skinks and lizards. It is pretty frightening when you think that if you sell a jewelled gecko on the international market you might get $25000 for it and even selling an ordinary skink will give you US$2000. Just recently someone was caught leaving New Zealand with 53 skinks in his underwear. The point is that the department is being very vigilant about that and it is looking at how to increase penalties and at how to protect those creatures.  
Just last weekend I was on the Otago Peninsula and I saw the work that the Department of Conservation has been doing protecting all the fauna and flora out there. There is a magnificent array of wildlife on that peninsula—little blue penguins Stewart Island shags seals and sea lions—but I was particularly interested in the work that the Department of Conservation has been doing with the royal albatross. The colony there has developed to over 260 breeding pairs. That is a pretty amazing exercise when you think that back in the 1930s one egg was there and it was stolen by a member of the public.  
The work that the Department of Conservation has been doing over probably about 80 years is a really good example of how man and nature can complement each other. The observatory is there and tourists go there but the birds seem to manage that fine and without man’s intervention I think it is unlikely that that colony would still exist because as the temperature is warming we are finding that some of those eggs on the very exposed nests can actually be cooked. So I commend what the Department of Conservation has been doing. 
JACQUI DEAN (National—Waitaki) 
: 
 Thank you for the opportunity to speak on the work of the Department of Conservation. There are some pretty notable successes down in the Otago region. My colleague Nicky Wagner has just talked about the royal albatross colony and the ongoing work of the Department of Conservation both in species management and protection but also in allowing the public of New Zealand to have access to what is pretty special and precious to us in New Zealand. As Nicky Wagner said with regard to the royal albatross colony it went from one egg back in the 1930s I believe it was and people used to throw stones at the albatross because you know people were people back then. But these days it is a colony that is well protected and enhanced and you can all go and see it. It is managed by the Department of Conservation and the Otago Peninsula Trust and what it means is that New Zealanders and visitors to our country alike can go and visit the royal albatross without disturbing them. Of course this has become a major tourist attraction for Dunedin.  
So too has the little blue penguin colony in Oamaru which were 15 years ago almost known as a pest. The little blue penguins used to cross the road and get run over by the milk truck and the bread truck and nobody particularly cared and then one woman Lorraine Adams saw that they were indeed special. She was the one who initiated along with the Department of Conservation the little blue penguin colony in Oamaru. Here we are 15 years later and the town rather than just being a place to stop and fill up with gas and buy an ice cream maybe on your way to somewhere else has become a destination. A lot of that has to go down to the work not only of people like Lorraine Adams and the various trusts that started looking after these animals but also of the Department of Conservation because on the ground it takes a great deal of care and a lot of interest in the development of both the species management and the protection. It can identify what needs to be done but also enthusiastically enables those colonies to be made available to and accessible for the general public.  
There are three yellow-eyed penguin colonies along the Otago coast. Again they are maintained and that species is protected and enhanced by the work of the Department of Conservation. Again this is done with a weather eye to how we can make what is precious to us in New Zealand available to other New Zealanders and also to visitors around the world.  
I want to move on to something slightly different because this is another role that the department has been very successful in and continues to be so. It is not so much about species management but its involvement with the Otago Central Rail Trail. The success story of the Otago Central Rail Trail cannot be underestimated. The benefit goes to the national economy because it is now an international tourism destination. But also many of us in this House have either cycled a stage or a leg of the rail trail—or indeed done the whole thing if they are lucky enough—and would have made a wonderful contribution to the economy of Middlemarch or of Clyde and I thank them for that. In the last figures I read and they may well have increased by now around $7 million goes into the local Central Otago community because of the Department of Conservation’s involvement in the Otago Central Rail Trail. It is people like Robin Thomas who is the area manager for the Department of Conservation who have that commitment and that foresight to get involved in that kind of initiative which not only has spin-offs for the local species in the area in terms of their protection and development but also has that economic spin-off. It is incredibly important to this Government to recognise that our natural heritage and those things that are precious to us can go hand in hand with economic development. I think the rail trail is a spectacular example of how those two things can should and do go hand in hand. Thank you. 
Report noted. 
Department of Labour  
Report noted. 
Clauses 1 to 10 and schedules 1 to 7  agreed to.  
Bill reported without amendment. 
The CHAIRPERSON (Eric Roy) 
: I move  
That the report be adopted 
. 
A party vote was called for on the question  
That the report be adopted. 
Ayes 64 
New Zealand National 59; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 57 
New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1. 
Report adopted.