Volume 663 Week 42 - Wednesday 19 May 2010 
Volume 663 Week 42 - Wednesday 19 May 2010 
[Volume:663;Page:10955] 
Wednesday 19 May 2010 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Business of Select Committees 
Reporting Dates 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I seek leave for the time by which the Commerce Committee must report the Financial Service Providers (Pre-Implementation Adjustments) Bill to be extended from 24 May 2010 to 14 June 2010. 
Mr SPEAKER 
: Is there any objection to that course of action being followed? There is no objection. 
Points of Order 
Budget Lock-up—Access for Parliamentary Library 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 I raise a point of order Mr Speaker. I bring this point of order to your attention because of the short notice involved; otherwise I would not take your time here. I am seeking your support for the Parliamentary Library staff to have access to the full Budget lock-up. Currently they do not have access to the full Budget lock-up. It is important in order for the Opposition to keep the Government to account that we are able to rely on the parliamentary team in our analysis of the Budget as part of the Budget process. Currently Treasury is keeping Parliamentary Library staff out of the full Budget lock-up. It has agreed to let them into the short Opposition Budget lock-up but currently they do not have access to the full Budget lock-up. It would be tremendously helpful if you could prevail upon the executive Mr Speaker to let the parliamentary team into the full Budget lock-up. 
Mr SPEAKER 
: This is a matter for the Government. How it handles the lock-up prior to the Budget is not a matter for the order of this House and it is not a matter that this House can make decisions on. 
Questions to Ministers 
Budget 2010—Focus 
1. 
AMY ADAMS (National—Selwyn) 
 to the  
Minister of Finance 
: What will Budget 2010 deliver for New Zealanders? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The Budget tomorrow will focus on delivering a stronger economy. It will include a package of tax reforms to make the system fairer and more sustainable to support a stronger economy and to help New Zealanders to get ahead. It will continue with a wide-ranging programme of investment in infrastructure and it will maintain firm control of the Government’s finances so that we can return to Budget surpluses sooner and pull back our rising debt. 
Amy Adams 
: Why are those things important for the economy and for New Zealanders? 
Hon BILL ENGLISH 
: It is important that we focus on growing the economy more quickly so that we can create the new jobs that will provide work for those who have lost their jobs so that we can lift incomes and so that we can get back to having surpluses. The Government will then have more choices about how to use public money to improve public services. We also need to tilt the economy towards savings investment and exports and away from the excessive consumption the unsustainable increases in Government spending and the excessive borrowing that characterised the last 4 or 5 years of the previous Government. 
Metiria Turei 
: Which of the seven deadly sins does he expect Budget 2010 to deliver New Zealanders from: envy or greed? 
Mr SPEAKER 
: I suppose the Minister has responsibility for the Budget. 
Hon BILL ENGLISH 
: The Budget will express the virtue of earning more than one spends. That will be a new experience. It will be a necessary change for this economy to undo the years squandered under the previous Government when the country spent more than it earned. 
Amy Adams 
: How will New Zealanders be able to find out how the Budget’s tax package will affect them? 
Hon BILL ENGLISH 
: From about 2 p.m. tomorrow New Zealanders will be able to go to the website www.taxguide.govt.nz where they will be able to put in their own information and assess the impact of the tax changes on their weekly or annual income. But I point out that the tax changes are not just about what people get in their pocket on the day; they are about a long-term need for this economy to focus more on investment savings job creation and exports and less on excessive consumption borrowing and property speculation. 
Hon David Cunliffe 
: When New Zealanders have looked at the website can the Government explain to them why Budget 2010 will deliver nothing for those on the bottom of the income scale small change for those on $70000 and a windfall gain of over $300 a week for those on $500000? What right does this Government have to lecture New Zealanders about being jealous when they watch their aspirations going down the toilet? 
Hon BILL ENGLISH 
: The member is wrong. New Zealanders have a right to a Government and a Budget that do not squander the opportunities that this country had when the economy was very good. And they have a right to a Budget that undoes the damage caused by Labour when it was in charge of the economy. 
Hon David Cunliffe 
: I seek leave to table the  
Financial Stability Report 
 that has just been released which shows— 
Mr SPEAKER 
: The member will resume his seat. This document is already available to members of the House—[ 
Interruption 
] I am on my feet and that is the end of the matter. 
Amy Adams 
: What will the Budget tomorrow not do? 
Hon BILL ENGLISH 
: The Budget tomorrow will not increase personal income taxes; it will not fiddle with the GST system acclaimed as being one of the best in the world; it will not jump back on the treadmill of unsustainable Government spending; it will not unnecessarily increase our debt beyond the ability of this country to service that debt; and it will not pin its hopes on unfunded commitments such as those left by the previous Government. All those measures are ones followed by the previous Labour Government. 
Hon David Cunliffe 
: I seek leave to table a copy of the Budget that gutted KiwiSaver and suspended— 
Mr SPEAKER 
: The member knows that Budget documents are available to all members—[ 
Interruption 
] Whoever interjected then should desist from doing that. I will not go any further into that. There will be no further interjections while I am on my feet. We will not be going down that track. 
Budget 2010—Tax Package 
2. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: When he told Kiwis that they should not be envious if the rich get more from the Budget tax package because they were in core and critical categories for the economy what was he telling middle and low income New Zealanders about their importance to New Zealand? 
Hon JOHN KEY (Prime Minister) 
: 
 What I actually said on Monday was that people paying the top personal rate included skilled professionals like doctors engineers scientists and the like who fit into some core and critical categories in the economy. Those people are in demand all around the world and we need to have their careers here and for them to be put to work in New Zealand. I did not mention the rich at all because the rich by and large do not pay the top personal rate. Really wealthy people will probably find that they are paying considerably more tax as a result of the Budget tomorrow not less. 
Hon Phil Goff 
: If the tax switch that the Prime Minister talks about is to be revenue-neutral as he claims why is he telling middle and lower income Kiwis struggling to meet rising costs that they should get less so that higher-income earners can get an even bigger slice of the pie? 
Hon JOHN KEY 
: For a start even taking all the aspects of the package put together middle and low income New Zealanders will not be getting less. The good news for them tomorrow is that they will be getting more. The interesting thing is that someone earning $60000 a year with no children who waited 10 years under a Labour Government to get absolutely not a cracker will be getting more in the Budget tomorrow than he or she might expect. 
Hon Phil Goff 
: Why does the Prime Minister think it is fair that chief executives who as we saw in the media last week were getting pay increases of more than $1000 a week last year and getting very handsome tax cuts last year should get $700 a week more this year under his proposed tax cut while middle and low income earners such as families earning under $40000 got nothing last year and will get very little this year in net terms? 
Hon JOHN KEY 
: There are two things. Firstly the chief executives the member is talking about had pay increases locked in under his Government not ours; and by the way New Zealanders earning $40000 who have two children do not pay any tax in this country because of Working for Families. 
Mr SPEAKER 
: I apologise to the Hon Jim Anderton but I have no chance of hearing his supplementary question while that amount of noise remains. 
Hon Jim Anderton 
: Is the Prime Minister aware that New Zealand has one of the worst income gaps between rich and poor in the developed world; if so why is he planning to make that situation even worse while asking the poorest New Zealanders not to be envious? 
Hon Phil Goff 
: I raise a point of order Mr Speaker. I do not know how you heard that question because I am closer to the member and I did not hear it at all over the interjections from the Government benches. 
Mr SPEAKER 
: I did hear the question. 
Hon JOHN KEY 
: All I can say to the member is that if it was something that concerned him so much why was he part of a Government that for 9 years made it worse? 
Hon Jim Anderton 
: I raise a point of order Mr Speaker. I think my question to the Prime Minister was very clear. I know he was talking to the Minister of Finance to try to get some help but he did not address the question in one single way at all. What he did was abuse the questioner. 
Mr SPEAKER 
: What I will do on this occasion—because members complained that they could not hear the question and I am not totally surprised by that—is invite the member to repeat his question so that no one can be in any doubt about it. 
Hon Jim Anderton 
: Is he aware that New Zealand has one of the worst income gaps between rich and poor in the developed world; if so why is he planning to make it even worse while at the same time asking the poor not to be envious? 
Hon JOHN KEY 
: I am aware that it became worse under the previous Labour Government and Jim Anderton was a member of that Government. I am also aware— 
Mr SPEAKER 
: I apologise to the Prime Minister but members were concerned about the previous answer given. I allowed the questioner to repeat his question. The House showed courtesy in hearing it in virtual silence. The Prime Minister is answering the question which I heard very clearly and he should be able to do that without a total barrage of interjections. 
Hon JOHN KEY 
: I am acutely aware that there are low-income New Zealanders who would like to earn better wages and the fastest way to do that is to have good economic leadership. For 9 years we waited for that and it never came. Tomorrow the bus is arriving here in Parliament. 
Hon Phil Goff 
: How will average wage earners and salary earners be better off when banks are forecasting that with GST increases inflation will rise to or above 5 percent over the next year and when the same forecasters are saying that the average wage will go up probably by less than 3 percent; so how will they be better off? 
Hon JOHN KEY 
: As that member is aware because he has been in the situation before if there is to be an increase in GST then the Reserve Bank looks through that and the economic implications in terms of inflation from that will not have a bearing on interest rates. What I will say though is that if I recall correctly the last 4 or 5 years of the Labour Government was a time when we saw not only quite high inflation but very high interest rates and we did not get any answers from that Government at that time. 
Hon Phil Goff 
: How does the Prime Minister intend to stop any increases in property tax simply becoming a rent tax that is passed on and adding to the burden of the 30 percent of New Zealanders who rent their homes? 
Hon JOHN KEY 
: Although I cannot give indications today for obvious reasons I can say that the Budget will spell out clearly tomorrow what Treasury’s advice was on that matter. I can advise the member that the effect is negligible. 
Hon Phil Goff 
: How does he explain to Henry Lindsay who is 84 and suffering from critical illnesses that he and thousands of other elderly New Zealanders have suffered cuts to their home help because the Minister of Finance regards that as low-quality expenditure while apparently it is high-quality expenditure to make the biggest tax cuts for the wealthiest New Zealanders? 
Hon JOHN KEY 
: I can explain in two ways. Firstly tomorrow that man will be able to celebrate the fact that we will be spending on health the highest amount ever spent in this country and be spending more on aged care than ever before. Secondly while he was having a cup of tea this morning he was hopefully reading the  
Dominion Post 
 headline “How the wealthy dodge tax” and seeing that tomorrow we will be making sure that all New Zealanders the wealthy included pay their fair share. 
Hon Phil Goff 
: Can the Prime Minister confirm that the article in the  
Dominion Post 
 states that the way we close the loophole is we open it up so that everybody can get through it—it is a bit like saying we close a breach in a prison wall to stop one prisoner getting out and knocking down the wall so everyone can get out? 
Hon JOHN KEY 
: No actually but I am aware that that very article in this morning’s  
Dominion Post  
states: “Financial author Martin Hawes said he would be surprised if any of the richest Kiwis paid the top income tax rate and if they did it would be on only a tiny fraction of their worth.” John Shewan the highly respected tax partner and rightfully so said that trusts were “breeding like rabbits in the South Island”. The  
Dominion Post  
has quite rightfully worked out that a lot of high-income earners are not paying the top personal rate and maybe we should tighten up the tax system so they pay their fair share. 
Emissions Trading Scheme—Introduction 
3. 
NICKY WAGNER (National) 
 to the  
Minister for Climate Change Issues 
: What reports has he seen on the introduction of the ETS in the last week? 
Hon Dr NICK SMITH (Minister for Climate Change Issues) 
: 
 In the last week I have read reports from the Opposition that there has been a dramatic increase in the cost to taxpayers from industry allocations. That claim from Charles Chauvel is not true. Although more small and medium sized businesses have become eligible for allocations under our fairer model some larger firms have not. The total allocation to industry remains unchanged at 12 million tonnes. 
Nicky Wagner 
: How can the claim from Charles Chauvel that Nick Smith’s changes to the emissions trading scheme will add an extra 5 percent to the price of power be true when the Government’s amendments passed last year reduced the impacts of the emissions trading scheme on power prices? 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. Do I need to explain it? None of that question was the Minister’s responsibility; the whole question was based on how he can explain Charles Chauvel. None of us can do that and the Minister certainly cannot. 
Mr SPEAKER 
: I guess—[ 
Interruption 
] I will hear from the Hon Gerry Brownlee in a moment once I have restored order to the House. It was my fault that that got out of hand. 
Hon Gerry Brownlee 
: I think it is a perfectly legitimate question because it asks the Minister to comment on Mr Chauvel’s comments about the Minister. In that case it is perfectly legitimate. 
Mr SPEAKER 
: The interesting thing is that on the face of it the question would normally be out of order. One would normally argue that the Minister is not responsible for any comments Mr Chauvel might make. But as I heard the question it asked how those comments relate to the actual policy the Government is pursuing. I would have thought so long as the Minister’s answer confines itself more to how those comments relate to the policy the Government is actually implementing that it would seem in order. The answer should not focus totally on Mr Chauvel’s comments as the Minister does not have responsibility for those per se. But how they relate to the Government’s policy I believe is within the Minister’s responsibility. 
Hon Dr NICK SMITH 
: The amendments that the Government made to the emissions trading scheme have more than halved the cost to power consumers. We have done that by halving the obligation and including in our amendments a price cap of $25 per tonne. [ 
Interruption 
] It is extraordinary that members are shouting out to complain about increases in power prices when they voted against the amendments that more than halved them. 
Nicky Wagner 
: Has the Minister seen any reports of differing views on the $1.6 billion worth of carbon credits from post-1990 forest owners? 
Hon Dr NICK SMITH 
: Yes I have. I have seen a report that states that post-1990 forest credits are a property right that they belong to the forest owners and that they must not be confiscated by the Government. I have also seen a statement that described the same credits as a subsidy and said it would be criminal of the Government to allocate them to the foresters. The first statement is from Rodney Hide; the second is from John Boscawen. Those dramatically opposed positions tell us why we cannot take ACT’s policy on the emissions trading scheme seriously. 
Charles Chauvel 
: Does the Minister endorse the views expressed in Christchurch on Friday at the Australian Institute of Company Directors annual conference: “I have always been fairly sceptical actually that Kyoto is the right way to go.” and “From New Zealand’s point of view we’re really trying to have a gentle glide path that takes us into a logical way of addressing that.”? 
Hon Dr NICK SMITH 
: It certainly is the view of this Government that we need to take a steady and consistent approach to climate change. We campaigned on a policy of pulling back on the very ambitious emissions trading scheme that the previous Government put in place which would have had a very high impact on power prices and on consumers. I think New Zealanders support the very moderate approach that this Government is taking to this important issue. 
Charles Chauvel 
: When the Prime Minister said that he had “always been fairly sceptical actually that Kyoto is the right way to go.” did he seek any advice from the Minister prior to making that statement? 
Hon Dr NICK SMITH 
: The Prime Minister is very much on top of the balanced approach that this Government is taking towards climate change. The part that I am particularly proud of is that we do not have a Prime Minister going around the world and saying that we are going to be the first carbon-neutral country in the world at the same time that our emissions are going up at a faster rate than those of any other country. 
Charles Chauvel 
: I seek leave to table a transcript of the Prime Minister’s comments on Friday at the Australian Institute of Company Directors annual conference. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? 
Hon Gerry Brownlee 
: As long as it’s the whole document. It’s a great speech. 
Mr SPEAKER 
: I take it there is no objection as long as it is the whole document. 
Document by leave laid on the Table of the House. 
Hon Rodney Hide 
: Has the Minister seen any reports of the National Party’s central North Island conference in which over 300 members unanimously passed a remit demanding that the National-led Government defer the introduction of the emissions trading scheme; and is this not an example of the pragmatic honest hard-working grassroots members of the National Party simply wanting National to stick to its promise of not leading the world on climate change? 
Hon Dr NICK SMITH 
: National campaigned on a policy of in 2009 amending the emissions trading scheme and of in 2010 proceeding with an emissions trading scheme. That is exactly what we are doing. I was privileged to give a speech to the conference of the central North Island members and I was very well received by delegates; the member’s report is not correct. 
Hon Rodney Hide 
: Who is right: the Minister who says that New Zealand should stick to its emissions trading scheme no matter the facts and no matter what the rest of the world does; or National Party members up and down this country who say that National should stick to its promise tuck in beside Australia and not run ahead of the rest of the world? 
Hon Dr NICK SMITH 
: Firstly I say that the member should reflect on his promise to foresters in which he said that they belong— 
Mr SPEAKER 
: The Minister was asked a question that did not involve the Hon Rodney Hide at all yet his answer is saying what the questioner should do. I do not think that that is a fair attempt to answer the question. 
Hon Dr NICK SMITH 
: The policy that National is progressing on the emissions trading scheme is exactly what we said when we campaigned in 2008 which was to proceed with a moderated emissions trading scheme. The member makes the claim— 
David Garrett 
: I raise a point of order Mr Speaker. The question although not a yes or no answer was a very simple: “Who is correct: A or B?”. This is a disquisition on something completely different; it is about National’s policy. It is still not an attempt to address the question. 
Hon Dr NICK SMITH 
: The member who asked the question made the claim that National was not following policy and I was setting out exactly what the policy was and the way in which the Government was implementing it. 
David Garrett 
: Point of order— 
Mr SPEAKER 
: I do not need endless points of order on the question. The fact is that the Minister has spoken to the point of order and believes that the questioner asked something that I did not actually hear in the question. I will invite the Hon Rodney Hide to repeat his question. 
Hon Rodney Hide 
: Who is right: the Minister who says that the Government should stick to its emissions trading scheme no matter the facts and no matter what the rest of the world does; or hard-working ordinary National Party members up and down this country who say that New Zealand should actually stick to its promise and tuck in beside Australia rather than heading off and leading the rest of the world? 
Hon Dr NICK SMITH 
: There are two points. The first is that New Zealand is not way out ahead of the world. There are 38 countries with Kyoto commitments and 29 of those countries have emissions trading schemes. The second important point is that Australia’s Budget announced $5.1 billion of subsidies for renewable energy and that is a cost on Australian taxpayers and businesses. It is this Government’s view that our approach of an emissions trading scheme is more efficient and will better serve New Zealand’s interests of reducing emissions at least cost. 
Hon Phil Goff 
: I seek the leave of the House to table an excerpt from the OECD report of 2008 entitled  
Growing Unequal? Income Distribution and Poverty in OECD Countries 
— 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Hon Phil Goff 
: —which totally contradicts the Prime Minister’s statement. 
Mr SPEAKER 
: The member should not do that. The member normally does not abuse the privileges of the House and therefore I will overlook that. He knows the House has given leave to table a document and there should be no further comment on it. 
Document by leave laid on the Table of the House. 
Question Time 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I raise a point of order Mr Speaker. I am sorry to bring up this matter at this point but today at least two questions have had to be repeated because you were unable to hear them and a number of other members have expressed the view that they could not hear them. That again points to the problems with the sound system in this House. We had a discussion about this matter a couple of weeks ago. I wonder what information you might be able to report about improving it because it does seem to be an ongoing difficulty. 
Mr SPEAKER 
: Indeed the matter is being addressed. The designers of the sound system have been called back to look again at the performance of the sound system to see what can be done to make it work better. It is my view actually that this week the sound system has been working a little better. I have to say in honesty that I feel that some of the difficulties today have been caused by just the amount of noise in the House. There is a danger that the more we turn the sound system up the louder members will be in their interjections and we will progress towards bedlam. 
Although I accept absolutely that we should try to ensure that the sound system performs better there is an induction loop system available in the Chamber. I am aware that in particular some members at the back of the House who sit under the gallery find it very difficult to hear. They can pick up a receiver from the Serjeant-at-Arms and I understand that it can be plugged in and members can use it to hear. But I do not consider that to be an adequate long-term solution at all and that is why I am taking steps to make sure the sound system performs better. But I stress that I think the problem today has in large part been caused by members making a lot of noise. 
Budget 2010—Tax Loopholes 
4. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: What are the most significant ways in which the wealthy avoid tax and will these loopholes be closed in Budget 2010? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The taxation system has been allowed to fall into a state of disrepair. Some areas are under-taxed. There has been a proliferation of tax rates and incomplete measures of income and this has meant that many hard-working salary earners such as doctors scientists and engineers are paying a higher rate of tax than wealthy property speculators. We do not think that is fair and tomorrow the Budget will address those issues. 
Hon David Cunliffe 
: Will the Budget address the $2.3 billion in tax losses claimed by loss attributing qualifying companies in 2008? 
Hon BILL ENGLISH 
: The member will have to wait and see. I am surprised that when that member was in Government that Government allowed these situations to arise. People were provided with proliferating opportunities to avoid paying higher income tax rates so why is he crying crocodile tears about fairness now? 
Hon David Cunliffe 
: If the abuse of trusts costs the Government $300 million in tax revenue as highlighted by the Tax Working Group why will the Budget make this loss larger by reducing every top tax ratepayer to the current trust rate? 
Hon BILL ENGLISH 
: It is a principle of good taxation policy that if one allows obvious opportunities for people to avoid tax rates it undermines trust in the whole system. So the question for that member is why he allowed high-income earners to avoid the top tax rate in such straightforward ways. There are legitimate reasons for trusts; we want to make sure that there are no tax reasons for them. 
Aaron Gilmore 
: How will the Budget make the taxation system fairer? 
Hon BILL ENGLISH 
: We will make the taxation system fairer by applying the principles of a broad base and a low rate. In particular we want to make sure that sources of income for higher-income earners who are now subject to quite low effective tax rates are taxed in a manner that is more fair. That means extending the tax base beyond simply the current definition of income. 
Hon David Cunliffe 
: When the Minister said it was unfair that half of those on the rich list avoided paying the top tax rate why is he intent on dropping the top tax rate to allow all of those on the rich list to claim the same benefit? 
Hon BILL ENGLISH 
: Well the point of the tax package is to move this economy in favour of saving investing exporting and creating jobs. That is really important because under the previous Government the growth of this economy was characterised by consuming too much and borrowing too much in a country that spent more than it earned. We have to change that. 
Stuart Nash 
: Does he agree with the Prime Minister that Kiwis will be envious of the tax cuts in tomorrow’s Budget; if so why does he not deliver a Budget that fairly distributes tax cuts to all? 
Hon BILL ENGLISH 
: The Prime Minister did not say what the member said he did. The Budget is aimed to ensure that New Zealand is competitive with Australia. We know that in a number of areas—in fact unions are making exactly this claim right now—our doctors teachers and engineers need to be paid more so that they will stay in New Zealand. The member should talk to the Council of Trade Unions about it. 
Stuart Nash 
: I raise a point of order Mr Speaker. I do not think that any of the unions are making the contention that tax cuts— 
Mr SPEAKER 
: The member cannot make that argument by way of a point of order. He can raise— 
Hon John Key 
: Oh privately they do. 
Mr SPEAKER 
: The honourable Prime Minister must cease doing that. There have been problems on both sides of the House but I would ask members please when points of order are being raised to hear them in silence. However members should not abuse the point of order system. 
Question No. 2 to Minister 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 I raise a point of order Mr Speaker. I draw your attention to Speaker’s ruling 167/7 with regard to the Prime Minister’s earlier reply and the document that has been tabled in the House. I ask seeing as there will be no opportunity tomorrow as there will be no question time for the Prime Minister to make his correction— 
Mr SPEAKER 
: The member will resume his seat. I have just made it clear that members cannot abuse the point of order system. It seems to me that the member is seeking to relitigate the answer to a question. 
Hon Members 
: No. 
Mr SPEAKER 
: That is what I heard the member doing. He was implying I believe that there was something wrong with the Prime Minister’s answer in this case. If I am wrong in the way that I have interpreted what the member was saying then I apologise for that but the member must not abuse the point of order system. If it is a matter of order then I will hear it. If it is relitigating an answer given by a Minister or the Prime Minister then it is out of order. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 I understand what you are saying but this is a very clear case. I am not relitigating and I am not suggesting that the Prime Minister was deliberately in error but it is now clear from documents— 
Mr SPEAKER 
: No no. The member will resume his seat. The Speaker’s ruling that the member has referred to is that where a Minister becomes aware of an error in an oral answer he or she normally takes the earliest opportunity to correct it. It is not an opportunity for another member of this House to relitigate an answer. That is very clear. This is not a valid point of order. 
Investors Small—Promotion of Confidence in Financial Markets 
5. 
MICHAEL WOODHOUSE (National) 
 to the  
Minister of Commerce 
: What is he doing to promote “mum and dad” investor confidence in financial markets? 
Hon SIMON POWER (Minister of Commerce) 
: 
 Among other things the Government has decided to create a new consolidated regulator for our capital markets to be known as the Financial Markets Authority or FMA. The Financial Markets Authority will consolidate functions currently fragmented across the Securities Commission the Ministry of Economic Development—including the Government Actuary—and NZX. The authority will have a clear focus on surveillance and enforcement designed to help rebuild mum and dad investor confidence in our financial markets. 
Michael Woodhouse 
: When does he expect to make further announcements on the proposed Financial Markets Authority? 
Hon SIMON POWER 
: I intend to introduce legislation to establish the Financial Markets Authority later this year to enable the new authority to be up and running early in the new year. In the meantime I expect that I will be in a position to make further announcements regarding the establishment board very soon. 
Offenders Supervised Release—Maka Renata 
6. 
Hon CLAYTON COSGROVE (Labour—Waimakariri) 
 to the  
Minister of Corrections 
: Does she stand by her statement in November last year about convicted rapist Maka Renata that “an intensive plan has been put in place to manage this offender’s reintegration which involves police. Agencies will be taking every step possible under the law to ensure the safety of the public.”? 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 Yes. 
Hon Clayton Cosgrove 
: On both occasions when the rapist Maka Renata absconded this year on what dates was she first advised that he was on the run? 
Hon JUDITH COLLINS 
: I cannot say the exact dates on which I was advised but I can say that I was advised in due time. I can also remind that member that it is not permissible under the law for the Minister of Corrections to instruct any department in relation to an offender but I have absolute confidence that the department has acted completely within the law and responsibly. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. I raise two points with you. Firstly given that this question was on notice and it contained a quote specific to the case in question the Minister had a number of hours to perceive that she might be asked about the detail of the case. Secondly my supplementary question did not have the word “instructions” in it. It simply asked—and I am happy to repeat it—on what dates she was first advised that the rapist had absconded. She has had a number of hours to prepare; it was a specific question. 
Mr SPEAKER 
: One has to be reasonable. The Minister obviously does not have that information. If she had that information I am sure she would have told the House. She made it clear that she did not have it. I was listening carefully. Had she gone on to add any criticism of the Opposition I would have been concerned but she did not. She went on to simply explain the Minister’s position in all of this. 
Hon Clayton Cosgrove 
: Mr Speaker—[ 
Interruption 
] 
Mr SPEAKER 
: I say to the Hon Simon Power on this occasion—he is normally very good in complying with the Standing Orders—that I am on my feet. We have got into a bit of a mess there because of an unnecessary interjection from the Hon Shane Jones. The House needs to be a little more reasonable. We know that the sound system is making it hard for members to hear. That kind of interjection makes it impossible. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. The same member who earlier called you childish when you were on your feet called out “Out! Out! Out!” while you were on your feet again. I have a feeling that if someone over here including myself had said “Out! Out! Out!” in those circumstances when you were on your feet we might have been gone 
Mr SPEAKER 
: The House needs to settle down a bit. The member who is raising a point about what might have happened on the other side will remember that I was sufficiently courteous to him to allow him to repeat what he had claimed was a point of order when I was pretty certain it was not. I presume that the member is referring to the very loud voice at the back of the House. I ask the owner of that very large voice at the back of the House who is looking everywhere else but at himself at the moment—I refer to Mr Quinn—to please be a little more respectful to the House. He has a large voice and should not interject when the Speaker is on his feet. 
Hon Clayton Cosgrove 
: On each occasion when the rapist Maka Renata absconded how long was it before his victims were advised that he was on the run? 
Hon JUDITH COLLINS 
: I cannot answer that question but I can say this to the member: if he expects me every time an offender escapes or goes on the run to strap on my little Taser and go charging after him or her I can tell him that I have far more faith in New Zealand police than he clearly has. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. It is similar to the last point of order. This question was on notice. It is clear from the primary question that the Minister was being asked whether she stood by her statement regarding the case of Maka Renata a man who has been on the run for 3 weeks. She had ample time to prepare an answer. Are we going to waste further supplementary questions by asking very specific questions to which the Minister says that she does not know the answer because she has not prepared and has not done her job? 
Mr SPEAKER 
: I hear the member’s point of order but he is really questioning the quality of the Minister’s answer. The Minister answered the question. She said that she does not have the information the member was seeking. The quality of the answer may be something for the questioner and the public to judge but in respect of the Standing Orders the Minister has answered the question. 
Hon Clayton Cosgrove 
: I will try again. On each occasion when the rapist—[ 
Interruption 
] Well you might laugh but— 
Mr SPEAKER 
: I say to the Leader of the House now— 
Hon Gerry Brownlee 
: Well come on! 
Mr SPEAKER 
: That is unacceptable and the Leader of the House should not set a bad example like that. I ask both sides to settle down or someone will be taking an early shower. We cannot allow that kind of disrespect to the House. 
Hon Clayton Cosgrove 
: On each occasion when the rapist Maka Renata absconded what action if any did she take or request of agencies to ensure the safety of the public? 
Hon JUDITH COLLINS 
: I asked the agencies to make sure they were taking every action that they could. I remind that member that the offender whom he is referring to has finished his sentence. In addition to that—[ 
Interruption 
] Does the Opposition want the answer or not? 
Mr SPEAKER 
: I invite the Minister to resume her seat. I say to members on both sides of the House that the solution to this noise problem is in their own hands. When the Hon Clayton Cosgrove was seeking to ask his supplementary question there was a barrage of loud interjections from the Government benches. I am looking right now at the member who was particularly involved; she knows who she is. When the Minister is answering the Government cannot expect the Opposition to be silent when the Government was very noisy during the asking of the question. Ultimately the standards in this House are for the members to set. If members want me to start applying the Standing Orders a few people may be leaving the House pretty pronto. I do not want to do that. 
Hon JUDITH COLLINS 
: I will continue for the Opposition’s benefit. An extended supervision order was applied for in November when the offender was still in prison. It has not yet been granted by a court. The member should know that all that the Department of Corrections can do is apply for such an order; it does not grant it. It is before the court and that member should respect the court process. 
Hon Clayton Cosgrove 
: Why did she wash her hands of this issue palming it off as an operational matter and refusing any further comment about Renata’s most recent disappearance when she was asked for comment by the  
Herald on Sunday 
 given the fact that she was very willing to publicly comment about this prisoner following his release in November last year? 
Hon JUDITH COLLINS 
: That member might not realise it but there is an ongoing police investigation right now. I think we should support the New Zealand police to get on with their job. That member might want to be the puppet of the  
Herald on Sunday 
 but I am not. 
Hon Clayton Cosgrove 
: I raise a point of order Mr Speaker. I request a considered ruling from you on a matter. [ 
Interruption 
] 
Mr SPEAKER 
: Ministers should know that they do not interject when a point of order is being heard. I say to the Hon Judith Collins that it is not good enough for a senior Minister to treat this House with contempt. 
Hon Clayton Cosgrove 
: I request a considered ruling because I do not want to waste the time of the House. It is simply this and I am not challenging your ruling. If the benchmark is that Ministers answering questions on notice can come down here and say that they do not know if that is your considered ruling then those are the rules of the game. But I would have thought given other rulings that you have made—very fair ones—that questions on notice require a level of detail. To come down to the House and say that one does not know the answer and to not offer even to provide— 
Mr SPEAKER 
: The member is now verging into criticising the Minister’s answers. Had the member wanted detail around the dates he has referred to in his supplementary questions he could have put that in his primary question. His primary question just asked whether the Minister stood by a certain quote. The remedy is in members’ hands if they want precise answers. The Minister clearly did not have the information that the member was seeking in his subsequent supplementary questions. In his final supplementary question the member made an unnecessary allegation about the Minister’s actions and got a pretty political response from the Minister. Again that was in the member’s hands—that he asked that kind of question. If the member had put down on notice a question about those dates I would have made sure that he got the answer but he did not and that limits my ability. We cannot judge the quality of an answer in this House but I will do my best to make sure that the member gets an answer to questions when they are put down. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. During the last answer of the Minister—and I have waited till after my colleague had raised his point of order—there was a reference by the Minister to my colleague being the agent of a particular news organisation and it was not a nice description either. Mr Speaker I thought that in the end you were going to rule that out of order and I think it should be. I think it was offensive and I ask for it to be withdrawn and apologised for. 
Mr SPEAKER 
: The difficulty I have as Speaker is that with the noise going on I did not hear what the Minister said. I cannot rule if I cannot hear. [ 
Interruption 
] Look the House is wearing my patience today. We will not waste further time at all. If the member is as sensitive as that the Opposition will be quieter so that I can hear what Ministers are saying—and that applies to the other side as well. I am a little tired of the disrespect to the House from both sides. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. We have a real problem. If an offensive remark is made—if I have to write it down and show you what it was I will—you cannot hear it and the Minister gets away with it— 
Mr SPEAKER 
: We will not waste further time on this. I ask the member to sit down. I ask the Hon Judith Collins whether she made an offensive remark—I just want her to tell the House. 
Hon JUDITH COLLINS 
: I do not think it was offensive. 
Mr SPEAKER 
: The Minister does not think it was offensive? 
Hon JUDITH COLLINS 
: No and anyway— 
Mr SPEAKER 
: That is sufficient. I have asked the Minister whether she made an offensive remark. She does not believe she made an offensive remark the member involved did not appear to have taken offence I as Speaker did not hear it and that is where the matter lies. 
Hon John Key 
: I raise a point of order Mr Speaker. The member opposite may well make a very genuine point: if offence is taken of course a member should apologise. I would make just one point though and it is that on this side of the House when either I or other members near me are answering questions we are subjected to Mr Mallard making comments constantly using for instance the word “liar”. He did that on numerous occasions through questions Nos 1 2 and 3 today. If Mr Mallard is such a sensitive little daffodil as he is proposing he is that is totally fine but I would ask him to be consistent with his own comments. 
Hon Trevor Mallard 
: Speaking to the point of order— 
Mr SPEAKER 
: No I do not need to hear further on this. The member will resume his seat right now. I apologise to the House that as Speaker I allowed that situation to go on. What the Prime Minister said was absolutely correct and it is intolerable. I have tolerated that from the Hon Trevor Mallard day after day and I do not intend to do that any more. I want this matter now to be treated as both sides of the House having been offended and I will not take any further points of order on this issue. I remind members though that henceforth if I hear members alleging the other side of the House to be lying or liars—[ 
Interruption 
] If the member is disputing that I can absolutely assure him. If he is not aware of what he is saying then let us deal with that separately but I will not consider this matter any further. 
Hon Chris Carter 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: I warn the member. I have ruled on this matter and the member risks— 
Hon Simon Power 
: An overseas trip? 
Mr SPEAKER 
: Order! A point of order has been raised. 
Hon Chris Carter 
: I am concerned about my colleague’s reputation. I have to confess that it was I who said it and not Mr Mallard and I withdraw— 
Mr SPEAKER 
: I have heard the Hon Trevor Mallard make those accusations across the House day after day on several questions a day. I have tolerated it and that is my fault and I apologise to the House. I believe that it perhaps is what has led to more disorder. It is my fault as Speaker and I will clamp down on it. Now we will be moving on. 
Hon Trevor Mallard 
: Point of order Mr Speaker. I am going to leave the House now but I refuse to accept that I called the Prime Minister a liar today because I did not. 
Mr SPEAKER 
: The member will be leaving the House right now because he has disputed my ruling and he will leave. 
Hon Trevor Mallard 
: I have. 
Mr SPEAKER 
: And he will not comment as he goes or I will be naming the member. 
Hon Trevor Mallard withdrew from the Chamber. 
Question No. 2 to Minister 
Hon PHIL GOFF (Leader of the Opposition) 
: 
 I seek leave to table a document showing that inequality decreased for the only time in 25 years in the last term of the Labour Government. 
Mr SPEAKER 
: The member has not given the source of that document. 
Hon PHIL GOFF 
: It is the  
Social Report 
 from 2009. 
Mr SPEAKER 
: The social report of— 
Hon PHIL GOFF 
: It is the  
Social Report 
 a New Zealand publication from I think the Ministry of Social Development. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Question No. 7 to Minister 
KANWALJIT SINGH BAKSHI (National) 
: 
 My question is to the Minister of— 
Mr SPEAKER 
: I have said to the House that members are treating this place with absolute contempt at the moment. I called Kanwaljit Singh Bakshi and we just had a barrage of noise from the Opposition benches. I require a little more discipline on both sides of the House. I made it clear that it has been my fault. I am blaming myself as Speaker that this situation has developed. But we will from now on show more respect for this place. 
Question No. 2 to Minister 
Hon JOHN KEY (Prime Minister) 
: 
 I seek leave to table a document from the OECD handed to me by the Deputy Prime Minister which shows that from 2000 to 2008 poverty had actually risen in New Zealand. 
Mr SPEAKER 
: Leave is sought to table—[ 
Interruption 
] This will stop. Leave has been sought to table a document. It seems to me to be a legitimate document. Leave is sought. Is there any objection? 
Hon Annette King 
: Point of order Mr Speaker. Can I just inform you Mr Speaker— 
Hon Gerry Brownlee 
: You can’t take a point of order. 
Mr SPEAKER 
: Before I put this leave the member is keen to— 
Hon Annette King 
: Can I inform you Mr Speaker— 
Hon Gerry Brownlee 
: No no. Mr Speaker you cannot do that. The Standing Orders are very clear. 
Mr SPEAKER 
: Both members will resume their seats immediately. We are getting into a problem. Leave is sought to table a document that has been identified. I will put that leave. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 I raise a point of order Mr Speaker. If I had been given the opportunity to explain to you I would have said that it is the same document that we tabled 5 minutes ago—and you accepted it. 
Mr SPEAKER 
: The House did not give any objection to it being tabled. 
Methamphetamine Precursor—Border Seizures 
7. 
KANWALJIT SINGH BAKSHI (National) 
 to the  
Minister of Customs 
: What reports has he received on seizures of methamphetamine precursor at the border? 
Hon MAURICE WILLIAMSON (Minister of Customs) 
: 
 For the first 4 months of this year the New Zealand Customs Service reports that it has seized more than half a tonne of methamphetamine or P precursor at the border. This amount of precursor would produce up to 151 kilograms of P with a street value of up to $227 million and would cause around $61 million worth of harm to the community. This means that the Customs Service is on track to better last year’s already big record haul of 1.2 tonnes of precursor intercepted strangling the supply to those who would peddle this disgraceful product in our community. 
Kanwaljit Singh Bakshi 
: What further action is the Government taking in its fight against P and the illicit drugs trade? 
Hon MAURICE WILLIAMSON 
: Budget 2010 provides $5.9 million of capital funding to the Customs Service over the next 2 years to fight the illicit drug trade through enhanced tracking and surveillance equipment. This funding will give the Customs Service technology not previously available to any agency in New Zealand and will allow it to move into the digital age with new more advanced tools to detect the activities of drug criminals. Budget 2010 also provides additional operating funding of $1.2 million rising to $1.7 million per year over the next 4 years to fight the illicit drug trade. 
Te Urewera National Park—Proposal to Vest Ownership in Tuhoe 
8. 
Hon MARYAN STREET (Labour) 
 to the  
Minister for Treaty of Waitangi Negotiations 
: Does he agree with the Prime Minister’s comment reported by Tamati Kruger that Tuhoe ownership of Te Urewera National Park was “complex but workable”? 
Hon CHRISTOPHER FINLAYSON (Minister for Treaty of Waitangi Negotiations) 
: 
 The Prime Minister does not recall making that statement and I am not going to speculate on this issue on the basis of hearsay. 
Hon Maryan Street 
: Who decided to abandon that line of negotiation if it were one the day before the paper was expected by Tuhoe to go to Cabinet: the Prime Minister Steven Joyce or the Minister himself? 
Hon CHRISTOPHER FINLAYSON 
: The Prime Minister has explained the sequence of events and the circumstances giving rise to the paper being withdrawn from Cabinet. It is actually quite offensive to make that kind of comment about Mr Joyce who is a very good Cabinet Minister. 
Hon Maryan Street 
: Should we assume the Cabinet decision was influenced by focus groups conducted on the North Shore during the week or weekend prior to the paper going to Cabinet as reported by the  
Whakatane Beacon 
 today? 
Hon CHRISTOPHER FINLAYSON 
: My advice to the honourable member is not to rely on tittle-tattle in local rags. I think the important thing is that this Government is committed to a—[ 
Interruption 
] They do not want the answer. This Government is committed to a just and durable settlement with Tuhoe that serves the interests of both parties and we are determined to achieve that. 
Hone Harawira 
: What feedback has he received from other iwi about whether the Prime Minister’s recent Tuhoe outburst has had any effect on their ability to negotiate their own Treaty settlements? 
Hon CHRISTOPHER FINLAYSON 
: The feedback I have received is the feedback I always receive: iwi are keen to settle just and durable settlements with the Crown and they are very pleased that this Government has applied additional resources to the task and is enthusiastic about getting on with the job in comparison with the previous administration which achieved 1.6 settlements per year. 
Hon Maryan Street 
: Given the disquiet that a number of iwi leaders have expressed about the collapse of the negotiation with Tuhoe does the Minister expect to use focus groups to determine negotiating parameters in Treaty settlements in the future or does he intend to take a more principled position in negotiations? 
Hon CHRISTOPHER FINLAYSON 
: No. We are getting on with something that the member’s Government singularly failed to do which is to get just and durable settlements. The evidence for that—[ 
Interruption 
] They do not like the truth. The evidence for that is that in the first 8 months of this year we are running at 133 percent of target when it comes to achieving agreements in principle. 
Rahui Katene 
: What is the precedent for the use of reversionary interest within a settlement as suggested in this morning’s  
New Zealand Herald  
as a possible mechanism for the Tuhoe settlement? 
Hon CHRISTOPHER FINLAYSON 
: I have an idea that the  
New Zealand Herald  
could have been referring to a similar sort of reversionary arrangement in the Ngati Ruanui settlement over the Makino Scenic Reserve but I do not know the detail of that arrangement because I was not involved in that settlement. It was one of those very rare occasions when the other lot actually did a settlement. 
Immigration—Silver Fern Visa 
9. 
JOHN HAYES (National—Wairarapa) 
 to the  
Minister of Immigration 
: What interest has there been in the Government’s recently introduced Silver Fern visa? 
Hon Dr JONATHAN COLEMAN (Minister of Immigration) 
: 
 There has been phenomenal interest. The 300 places were filled within 30 minutes of applications opening. It is a clear indication that the Government has the right policy settings to attract skilled young people to New Zealand. 
John Hayes 
: How does the Silver Fern visa work? 
Hon Dr JONATHAN COLEMAN 
: The Silver Fern visa provides applicants with a 9-month job-search permit. Once they find skilled employment they can stay for a further 2 years while they apply for residence. This provides employers with the security of knowing that their employee can remain here long term. 
John Hayes 
: Whom does the visa target? 
Hon Dr JONATHAN COLEMAN 
: The visa is specifically targeted at people aged between 20 and 35 with a bachelor’s degree or a trade qualification and 2 years’ work experience. The visa is designed so that people who meet the requirements upfront will be likely candidates for residence under the skilled migrant category. It is a great policy which will help to provide the skills that our economy needs. 
John Hayes 
: I raise a point of order Mr Speaker. Because of the noise it was impossible to hear the answer to the question. I wonder whether the Minister might repeat it. [ 
Interruption 
] 
Mr SPEAKER 
: A point of order has been raised. I think the House has wasted sufficient time today. 
Auckland Local Government Reform—Minister’s Statements 
10. 
PHIL TWYFORD (Labour) 
 to the  
Minister of Local Government 
: Does he stand by his statement regarding his Auckland reforms that “in my view all aspects of the reform process are progressing well …”? 
Hon RODNEY HIDE (Minister of Local Government) 
: 
 Yes. In fact the full quote was: “all aspects of the reform process are progressing well considering the size and complexity of the task.” I would like to say today that the reform process is going extremely well and I am particularly looking forward to the report back of the Local Government (Auckland Law Reform) Bill on Monday. 
Phil Twyford 
: Does he think that the nearly 60 percent of Aucklanders who according to the  
New Zealand Herald’s  
recent poll are against his handing over three-quarters of council business to unelected council-controlled organisations will agree that the reforms are progressing well? 
Hon RODNEY HIDE 
: I think that a lot of the concerns that Aucklanders have expressed have been heard loudly and clearly by the Auckland Governance Legislation Committee when hearing submissions and I think that Aucklanders will be pleased with the results of the select committee’s deliberations which will be announced on Monday. 
Phil Twyford 
: Does he consider it to be good progress that well over half of Aucklanders believe that his super-city will be a worse place to live in? 
Hon RODNEY HIDE 
: What I can say is that a comment— 
Hon Shane Jones 
: Answer the question. 
Hon RODNEY HIDE 
: In commenting about Aucklanders one Aucklander said the reforms were well overdue and that the previous Government had done nothing. That commentator was Phil Twyford and I am actually very pleased that Aucklanders are on board. There are some concerns about the change that is occurring and I am sure that those concerns will be addressed firstly on Monday and then as the changes are progressively announced through to 1 November. 
Phil Twyford 
: When he thinks he has made good progress but well over half of Aucklanders as reported in the  
New Zealand Herald 
 
believe that he has made a mess of the changes which viewpoint is more credible? 
Hon RODNEY HIDE 
: We are concentrating on getting a good result. I have to say that for that member who cannot actually get a seat from his own colleagues in which to stand in Auckland to suggest—[ 
Interruption 
] I am pointing out that if Mr Twyford could get just half of his party’s members in Auckland to support him he could have a seat. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. I point out that that kind of answer is quite unnecessary and leads to disorder. 
Mr SPEAKER 
: I have to point out that that kind of answer will lead to disorder. I say to members who are asking questions that when they frame their questions by asking what the Ministers thinks about certain things or what he believes about certain things it is very difficult to stop a Minister from saying what he or she thinks or believes especially if it is a fairly broad question. That is the dilemma that members need to think about when asking questions. If they invite Ministers to say what they think about something they may not like what a Minister says. That said I think the Minister’s answer was unnecessarily gratuitous and unhelpful. 
Government Borrowing—Priorities 
11. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
 to the  
Minister of Finance 
: Does he stand by his position that the Government should not borrow in order to make contributions to the New Zealand Superannuation Fund; if so will the Government have to borrow to pay for tax cuts for the wealthy new motorways that may have no financial return and for subsidies to greenhouse polluters? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes I stand by that position; I note to the member that the Government is borrowing money to invest in a range of infrastructure including modes of transport favoured by the Greens. We have a significant investment programme in roads. We announced major investment the day before yesterday in KiwiRail. We have also been investing in cycleways around New Zealand. So that pretty much covers the field. 
Hon Tony Ryall 
: What about skateboards? 
Hon BILL ENGLISH 
: We have not invested in skateboards! 
Dr Russel Norman 
: At a time when the Government is borrowing heavily is it fiscally responsible to borrow further to pay for pet motorway projects such as Steven Joyce’s “holiday highway” north of Auckland which the Government’s own figures show will lose the country money? 
Hon BILL ENGLISH 
: We have not actually got to the motorway north of Auckland but the Government does stand by its extensive investment in roads. We need to complete the Auckland motorway network. We need to deal with the bottlenecks and traffic risks in the Auckland-Hamilton-Tauranga triangle and with other bottlenecks around the country so that we can have efficient delivery of our export products to our ports and this country can earn more than it spends for a change. 
Dr Russel Norman 
: At a time when the Government is borrowing heavily is it fiscally responsible to borrow further to pay for free allocation credits otherwise known as subsidies to greenhouse gas polluters? 
Hon BILL ENGLISH 
: The Government has a pretty balanced fiscal strategy where we are borrowing money to absorb the shock effects of the global recession and the mismanagement of the previous Government. That will help us through tougher times. At the same time we are investing in the future and investing in infrastructure and skills in order to lift the growth performance of this economy. 
Dr Russel Norman 
: I raise a point of order Mr Speaker. The question was about greenhouse gas subsidies. I wonder whether the Minister could address why that is a priority for his spending. 
Mr SPEAKER 
: I do not believe that that was the only aspect of the member’s question. There was more to it than that and the Minister as I recollect correctly answered the first part of the question. 
Dr Russel Norman 
: I raise a point of order Mr Speaker. It was a one-legged question so to speak which asked why the Government was borrowing to pay for free allocation credits. It was a one-part question. 
Mr SPEAKER 
: I will allow Dr Russel Norman to repeat his question without penalty. 
Dr Russel Norman 
: Thank you Mr Speaker. At a time when the Government is borrowing heavily is it fiscally responsible— 
Mr SPEAKER 
: That was what I thought. The member made a statement at the start of the question. If a member makes a statement at the start of a question the Minister is just as likely to pick up on that statement and respond to it. If the member wanted to ask a question he could have asked why the Government was borrowing for certain things and I would have backed him. He may ask his next supplementary question. 
Dr Russel Norman 
: Is it fiscally responsible to borrow further to pay for free allocation credits otherwise known as subsidies to greenhouse gas polluters? 
Hon BILL ENGLISH 
: As is often the case with this Government we have about the right pragmatic balance in the case of greenhouse gas emissions where we have obligations under the Kyoto Protocol. The Government is picking up some of those obligations and some of them will be spread through the economy through the emissions trading scheme. So the Government is doing its bit and the rest of the community will do its bit. It is about the right balance. It is a better balance in our view than the previous Government’s emissions trading scheme which would have imposed very significant costs on all New Zealand households and businesses. 
Dr Russel Norman 
: Is it fiscally responsible to borrow further to pay for tax cuts for those at the top? 
Hon BILL ENGLISH 
: The member will have to wait and see what is announced in the Budget tomorrow in respect of that matter. We have said for some time that any tax package the Government puts together will be broadly fiscally neutral. It cannot be a lolly scramble because for every dollar the Government gives out it has to take in a dollar from somewhere else. 
Dr Russel Norman 
: Will he assist Opposition MPs to understand how borrowing for tax cuts is fiscally responsible by pushing Treasury to allow economic analysts from the Parliamentary Service to attend the full media Budget lock-up tomorrow? 
Hon BILL ENGLISH 
: Judging by the statements made by various Opposition parties I do not think we will ever be able to persuade them that irresponsible borrowing is bad for New Zealand. 
Dr Russel Norman 
: I seek leave to table photographs from the 2008 Budget lock-up which show that even National Party blogger David Farrar was let into the full media lock-up. 
Mr SPEAKER 
: Leave is sought to table those documents. Is there any objection? There is no objection I take it. 
Documents by leave laid on the Table of the House. 
Ministers—Disclosure of Conflicts of Interest 
12. 
Hon PETE HODGSON (Labour—Dunedin North) 
 to the  
Prime Minister 
: Does he believe that his Government should be transparent in all matters where conflicts of interest or perceived conflicts of interest may occur between his Ministers’ personal interests and matters before his Government? 
Hon JOHN KEY (Prime Minister) 
: 
 Details regarding conflicts of interest and advice sought in relation to them are not generally disclosed in order to ensure the confidentiality of Cabinet proceedings to maintain the effective conduct of public affairs and in some cases to protect personal privacy. That has been the approach of successive administrations including the previous administration of the questioner and I do not intend to depart from it. 
Hon Pete Hodgson 
: Why does such non-disclosure enhance the public’s confidence that all is above board? 
Hon JOHN KEY 
: There are a variety of reasons why that approach has been adopted by successive Governments including the one that the member was a Minister in for 9 years. As I said I do not intend to depart from it. 
Hon Pete Hodgson 
: Why is he much happier to disclose publicly assertions that there are no real or perceived conflicts of interest as for example in the case of the Hon Dr Nick Smith the Hon David Carter or indeed himself but so reluctant to advise the public whenever there is a real or perceived conflict of interest? 
Hon JOHN KEY 
: There is a long-standing set of guidelines and procedures in the  
Cabinet Manual  
on how Ministers should approach conflicts of interest. They are well understood by Ministers and in my view followed. From time to time members will get up in this House and wrongfully assert that there has been a breach of conflict of interest— 
Hon Gerry Brownlee 
: As the member just did. 
Hon JOHN KEY 
: —as the member often does for scurrilous reasons and not for accurate reasons. When that happens in the interests of protecting the Minister I often go to seek an opinion from the Cabinet Office and if that opinion is given I release it. That is on the basis of protecting a Minister upon whose name aspersions would otherwise be cast by the sorts of accusations cast by that member who spends a lot of time thinking— 
Mr SPEAKER 
: The Prime Minister should not be going down that track. 
Hon Pete Hodgson 
: On roughly how many occasions has he as Prime Minister dealt with actual or perceived conflicts of interest involving one of his Ministers over whatever time frame he chooses—1 month 3 months 1 year or since the election—a rough numerical estimate? 
Hon JOHN KEY 
: In that last 24 hours the answer to that is nil. 
Hon Pete Hodgson 
: On roughly how many occasions has he as Prime Minister dealt with actual or perceived conflicts of interest involving himself since the last election? 
Hon JOHN KEY 
: I do not know the answer to that question. 
Points of Order 
Chamber Lobbies and Galleries—Audio System 
H V ROSS ROBERTSON (Labour—Manukau East) 
: 
 I raise a point of order Mr Speaker. Question time has been quite robust as it should be in a vibrant democracy but listeners on the cross benches and the backbenches often have a great deal of difficulty in hearing. Might I suggest—the issue was raised by the Hon Peter Dunne in the last session I think—that listeners aids might be appropriate as we once had in this Chamber before the installation of these grotesque overhead ugly-looking sensors. I endorse what the Hon Peter Dunne said on previous occasions and I request respectfully that you as the Speaker look at that possibility. 
Mr SPEAKER 
: The member may not have been in the House when I explained earlier today that in fact there is an induction system available in the Chamber. The Sergeant-at-Arms has receivers. If the member wishes to avail himself of that system he can use the earpiece that is used for simultaneous interpretation and can get a direct feed from the floor of the House. I explained to members that that is available. However having said that I am not happy with the performance of the sound system especially for members at the back of the House and I might even say for the Speaker too for that matter. Work is ongoing; we are identifying dead spots in the House and the designers of the system will be doing more work—it is a very sophisticated system—to try to get it to perform better. 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 Just on that matter I think one of the other problems is that under the systems that have operated here in the past a lot of the interjections were not picked up by the microphone system. Subsequent to your suggestion today that perhaps it was just members being rowdy—and I think that was certainly part of the problem today—I did notice that a lot of the interjections are just as audible as the comments that are coming from whoever might be answering or asking a question. It was particularly evident in the case of Minister Collins when she was answering her questions. It was much easier to hear the comments from the other side of the House than it was to hear her answer and she is only four seats down from where I am sitting. I am not sure whether the whole system in here has ever been tested by the designers with the House in full session. It would be a very different Chamber with only one or two people sitting in it. 
Mr SPEAKER 
: The point that the honourable Leader of the House makes is absolutely valid. Live microphones are very sensitive and we are concerned that they are picking up a lot of interjection and background noise that adds to the difficulty in hearing. I think that what the member says is absolutely right and that the final solution to this problem may involve bringing technicians on to the floor of the House while question time is under way. I have already sought the approval of the Business Committee to allow that to happen because normally someone who is not a member is not allowed on to the floor of the House while the House is in session. But I have already sought approval for that to happen so that technicians can listen from the floor to what is going on during question time. 
We ought to get better performance out of the system. It is meant to be a good system; it is meant to perform at a high level. But there is a wide degree of dissatisfaction with its performance because it is not good enough. Members need to be able to hear. I think that what both members have said is right and that especially what the Hon Gerry Brownlee has said is valid—that the system is picking up a lot of background noise which makes it even harder to hear the person on his or her feet. I apologise to members that this is happening. I regret that it is happening and we will move now. We have the designers I think. If they are not here then they are arriving very shortly and we will be moving on it as quickly as we can. 
General Debate 
CRAIG FOSS (National—Tukituki) 
: 
 I move  
That the House take note of miscellaneous business 
. The National Government led by Prime Minister John Key and Minister of Finance Bill English is focusing on the things that matter. The Opposition finance spokesman is focused on the mirror. The Opposition leader is focused on the Opposition finance spokesman who is focused on the mirror. The Opposition leader is focused on his back. Tomorrow’s Budget is a step-up and a step change for New Zealand. It is a step towards real growth real incentives and a sustainable on-growing and brighter future for the New Zealanders whom Labour punished so badly for so long. Labour hurt so many and sent so many overseas looking for a brighter future. There were 9 long years of punishment for all from the “rich pricks” to the poorest but the game is up. It is over; fairness and equity are coming back. Economic leadership and economic confidence for New Zealanders are coming back and that will be evidenced in the Budget tomorrow. 
As the Reserve Bank noted this morning in its  
Financial Stability Report 
 New Zealand’s economy is so much less vulnerable now than it was just 2 years ago. We are in such better straits and such better form than we were just 2 years ago and we know in a global context with threats all around the globe the importance of prudent fiscal management and the management of our debt in encouraging New Zealanders to move away from bricks and mortar investment to financial assets. National’s solid economic credentials are stronger and it is a responsible economic manager with a growth plan and improved tax system which will be outlined tomorrow. There will be a tax system that removes the distortions the imbalances the shenanigans and the shambles that were created—and in fact encouraged—then ignored by the previous administration. 
New Zealand is borrowing $250 million per week simply to keep the economy turning over and the lights on—$250 million in the current situation. We have no room for any more borrowing whatsoever. There is a pretty long queue out there. We all know what is going on in Europe and that situation is also stressing our system. We have already brought spending under control. After crazy shambolic spending over many years we are bringing spending under control. We have a $1.1 billion cap on operational new spend and a $1.4 billion cap on capital investment. That is quite a change a focused change from the spend of the previous administration. 
We inherited a shambles. Over a year before the global crisis hit the previous Labour Government took New Zealand into recession. In fact the private sector of the New Zealand economy was in recession in 2004. That is the sector that creates jobs and feeds families but it was in recession for 4 or 5 years under the previous administration. What an oil tanker we are having to turn round but we will do it. Can anyone remember Export Year? It was a joke. We inherited a decade of deficits—10 years forecast borrowings to fund the promises the commitments and the unsustainable spending that that previous administration had put in place but did nothing about. We will be fixing the tax system under which anyone earning more than $50000 was deemed a “rich prick” by the previous administration. Well I remind members opposite that those supposedly rich pricks included the engine room of the New Zealand economy such as doctors teachers scientists police and even journalists. 
The previous administration created massive holes in our income tax rates trust tax rates corporate tax rates and portfolio investment entity tax rates and in the treatment of investment property. Labour members talked about that issue quite a lot to be fair to them but they did nothing about it other than perpetuate it and try to put band-aids on it. The tax system is about to be fixed. This Government is about fairness and equity and this Budget is about delivering fairness and equity to New Zealand. This Budget will deliver a historic rebalance of the New Zealand economy; fairness and equity are coming back. We have even pulled a decade of deficits back to about 6 years. After only 18 months the decade of forecasted deficits is down to about 6 years and in the current global environment that is very very good indeed. The New Zealand economy is already in so much better shape than it was just 2 years ago. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 Budget 2010 should be about the many not the few. It should be about investing in the future not whining about the past. Tomorrow the Budget excuses will run out for the National Government. After 9 years in the wilderness it did nothing last year except wreck superannuation. A year later the public wants to know what is under the bonnet of its clapped-out car. Tomorrow the public will find out. The National Government promised aspiration it promised a brighter future and it promised not to raise GST. The Government promised Tuhoe. What has it delivered? 
This Government is becoming known as the Government of broken promises. Tomorrow we will find out what fairness means to the National Government and I think it is the same as it has always meant—be fair to the top 5 percent. Give them a windfall gain while rape victims cannot get counselling. Borrow to fund tax cuts for the Business Roundtable while elderly people cannot get home help. Tell someone on $70000 who will be getting 50c a week if he or she is lucky that someone on half a million dollars who will be getting $350 a week that that is fair. 
National has forgotten that New Zealanders do not like to be told that they are just jealous. Well they cannot be both jealous and fair. One thing New Zealanders know is that not only is the Government inherently unfair but it does not have a solution to the underlying structural problems of this economy. The Government promised a step change it promised courage it promised leadership to address the savings problem to rebuild our export base to lift the incomes of all New Zealanders and to stop the drain to Australia which has worsened in the last year. New Zealanders know we are not even standing still; we are slipping backwards. We are seeing our dairy farms being bought up by foreigners. We are seeing private assets being sold to fund the slip-slide away of an economy that does not balance and a Government that is out of ideas as to how to fix it. 
This has not been a good week for the Prime Minister. He told Tuhoe what he really thought of them. He told middle New Zealand what he thinks of them. They are not core and critical. They are just the jealous whingeing whining battlers on which his mates stand. He has even given up pretending that tax cuts drive growth. He knows that the literature shows they do not. Anyway New Zealand has the third-lowest tax rate in the OECD—far lower than in Australia—so why would people go to Australia for lower taxes? They would go there to have higher incomes; to earn higher wages. The task facing the Government is to lift the wages of ordinary Kiwis to get more Kiwis in jobs to put more food on the table of ordinary New Zealand families who face—wait for it—higher GST; property taxes which are driving higher rents; increased accident compensation tax; higher tobacco tax; higher costs for student loans; petrol going up; power prices going up; and mortgage rates going up. And the Government says it stands for fairness. What is fair about that? 
Fairer tax cuts would put money in the pockets of hard-working New Zealand families. They would create jobs. They would create the future that New Zealand needs—more jobs and better incomes—by boosting exports by boosting savings and by boosting the smart economy. [ 
Interruption 
] As my colleague Mr Shearer has pointed out that Government is putting back into research and development less than half of the amount it stripped out. It is preaching savings after stripping half the funds going into KiwiSaver and half killing New Zealand superannuation. New Zealanders know truth and they know lies. Tomorrow we will meet the truth. 
AMY ADAMS (National—Selwyn) 
: 
 This week we will have Budget 2010. This Budget will be yet another major step by this Government to fix the economic damage done by Labour. In 2008 New Zealanders elected the National-led Government for a couple of very good reasons. They know that National is the best economic manager for this country and that has been proven time and time again. They know that National members do not stand here talking hollow words and crying crocodile tears about jobs and living standards while presiding over an economy as Labour did that consistently went south during the best economic times this country ever had. Mr Burns it was your party that cost every New Zealand family an average of $5000 a year because Labour mismanaged the economy. You presided in the Labour Party— 
Mr SPEAKER 
: Members need to remember—although I realise they get pretty worked up in debate—that they cannot refer to members across the House by saying “you” did something because they are referring to the Speaker. The reason for that is to avoid personalising debate. It is in the Standing Orders for good reason. 
AMY ADAMS 
: The previous Labour Government put in place the structural problems that even Mr Cunliffe now acknowledges. He stood there and asked what the Government is doing about the structural problems. Mr Cunliffe they are your problems. I can tell you Mr Cunliffe— 
Mr SPEAKER 
: I realise the member is very enthusiastic in her speech but she cannot say that they are the Speaker’s problems. Members get into difficulties when they try to personalise the debate. The rules are the way they are because the debate should not be personalised. Members should be debating the issues. 
AMY ADAMS 
: The structural problems that this economy faced were caused by the last Labour Government; that is what we all know. Even today the Reserve Bank in its financial stability report talks about the fact that to get this economy back on track we have to address the underlying imbalances. That is what we have seen this Government not only talking about but doing consistently since 8 November 2008 and Budget 2010— 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. The member on her feet has referred to the Reserve Bank report which was made public today. I will not seek leave to table it but I will draw attention to the fact that— 
Mr SPEAKER 
: The member will resume his seat immediately. How does the member believe that that has assisted the order of the House? I have twice tried to make sure the House stays in order by interrupting the debate when a member was speaking which is something I do not like doing. The member has now just interrupted the debate further with a spurious point of order. How does he expect me to view that? I invite the member to think a little about what he is doing. The House has been too disorderly today and I will not put up with it for much longer. 
AMY ADAMS 
: Budget 2010 will be yet another step whereby New Zealand will see this National-led Government take control of the economy and get this country back on to the path that it deserves to be on. We are aspirational. We are ambitious for New Zealand. We want and unashamedly so New Zealand to be the wealthy country that it used to be and that it should be. We want better jobs for New Zealanders that are sustainable. We want higher incomes. The difference is that we know that those things come from a strong productive economic base. 
For the Government to do its part we have to put in place the conditions that will allow business to thrive. We have to get a handle on the out-of-control Government spending that was all Labour knew how to do—keep spending keep throwing the money around ignore the underlying issues and pretend everything is fine. It was head-in-the-sand politics for 9 years under the previous Labour Government and now New Zealand is paying the price. This Government will get on top of the economic challenges. We are seeing New Zealand recover far faster than the rest of the world. We are seeing strong GDP growth. We are seeing excellent reductions in the unemployment numbers. That is just the beginning of what we will see under the economic management of this Government. That is why New Zealanders put their faith in us. 
Budget 2010 will continue to deliver on our goals of financial restraint and rolling out the infrastructure that will allow this country to grow. In my own electorate of Selwyn we are looking forward to the roll-out of extensive broadband into our rural communities which are heartland New Zealand. We are looking forward to the completion of the Christchurch Southern Motorway which we have waited for for 20 years. My electorate of Selwyn will now get the road that we have been waiting for for nigh on 20 years. That is the sort of infrastructure spending that this Government is committed to which will see the New Zealand economy finally live up to its potential so that New Zealanders can have sustainable jobs good incomes and the public service we want to give them. What we will not do is continue to spend more than we can afford to spend. We will not keep living beyond our means. While Greece and the UK are dealing with the problem of massive debt what does Labour want us to do? It wants us to borrow more and spend more. Labour members say that we should ignore the problems and just keep borrowing. They say we do not need to worry about production in the economy. No no; they say we should just keep borrowing. Every other country in the Western World knows the damage done by having crippling Crown debt. Members should remember that if it was not for this Government we would have a 70 percent debt-to-GDP ratio. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Speaker. Tena koutou katoa. There are 216000 children living in poverty in this country. To add to that shame we have a Prime Minister who says that the poor should not envy the wealthy. I ask the Prime Minister what they should do. Should they be grateful that the wealthy may let them mow the lawn or clean the house for the minimum wage? I ask whether the Prime Minister has heard the expression “eat the rich” because eating properly is certainly an issue for those 216000 children. 
Tomorrow is another moment of truth for the Government. We do not know all the details yet but some directions have already been heralded and they will not do a single thing for the children who are living in that kind of poverty. The tax cuts for the rich have been constantly justified by saying that much of the tax take comes from the rich. It is not rocket science to understand that when a person earns a huge amount of money paying lots of tax does not affect that person’s standard of living in the same way that it affects people on the minimum wage. Some people who have lots of everything seem incapable of grasping the simple fact that there is in this country a huge and growing gap that rewarding the rich will not fix. The rich—and I include myself right now—do not need a tax cut. 
John Key’s Government has already initiated or signalled some very big spending including $10.7 billion on new motorways in the next 10 years an estimated $500 million per year from cutting the top tax rate from 38c to 33c and potentially hundreds of millions of dollars on taxpayer subsidies to protect businesses from the emissions trading scheme. It is a question of priorities. A Green Government would make reducing inequality in this country one of its highest and most urgent priorities. We need a safe and fairer society where no one feels the need to build barbed wire fences between the haves and the have-nots—hence the Green Party’s Mind the Gap policy which we launched this week. This Green New Deal on inequality was launched because we have an analysis of the problems and we have some solutions. We do not just stand up in this House and blame each other. We believe that a Government could take actions that would help to close the gap between those who earn the top 10 percent of income in this country and the 20000 children who currently need to be fed food in school from one of the groups that came to our Mind the Gap launch—a group called KidsCan. 
We are not just wringing our hands about poverty; we are proposing some costed items that we could afford as a country if we were to stop building ridiculous motorways to nowhere. Our package believes inequality could be reduced by a series of practical interventions. The total cost would be $4.46 billion and in the long term it would save us paying for more new prisons paying more benefits and paying for more hospital beds to mention just a few of the benefits of a far more equal society. 
Specifically we are proposing that the first $10000 of income should be tax-free that a capital gains tax should be put on property but not on the family home that an in-work tax credit be extended to families on the benefit with dependent children and that the special benefit should be reinstated. We should have progressive electricity pricing to address fuel poverty; secure housing which would mean 6000 new State houses; and investment in community housing and we should make changes to create some long-term rental tenure security. 
I will not outline the whole package but I will talk about one issue which is the extension of the in-work tax credit to all low-income families including people on the benefit. This single act would help 145000 of the poorest families to meet the essential needs of their children. It was mean-spirited of Labour to have excluded those families and it is absurd of National to ignore and punish them through the Future Focus package. It would cost another $300 million per annum which could be partially offset by the reduction of the supplementary assistance that would be required from the Ministry of Social Development. It would help the families that are in the greatest need. Maybe talking about the children of beneficiaries is not popular and maybe it is not sexy to talk about the people who are really poor; maybe we should just talk about those who are in work. But we need to face up to the issue of who is suffering and who is poor and that extra $60 a week would make a huge difference to those people. 
I will talk about one story in particular from my experience as an advocate for the poor in Tai Rawhiti—Gisborne—when I was working there from 2004 to 2008. The story is about fuel poverty a term that people in this House may not be familiar with because we are kept nice and warm here. Fuel poverty is a reality for many people. 
DAVID BENNETT (National—Hamilton East) 
: 
 Tomorrow we will announce the next Budget from this Government and it will be the Budget that will set the vision for this country in the next decade as we grow this economy. We take pride in the fact that we want to see our country grow and be successful. We do not want to see a country that has stagnated and has not achieved its goals and ambitions which is what we saw under the previous Labour Government. National sees a future for New Zealanders where they see the strength in getting a good education in working hard and in getting value and success from that hard work. We see in the future a country that has a strong economic base. We see a country that competes on the world market and delivers products. 
National members do not see the future that Labour sees where one just borrows money for whatever one needs to buy an election with. We do not see a future in killing growth in our country during our best economic times. We do not see the future in the way that Labour did. Labour spent recklessly and bought things on the basis of the ideological visions it thought this country should have. National members look at the economic reality—we need to build a country and deliver results for New Zealanders. 
I have great confidence in this Budget because finally we will have meaningful tax reform in New Zealand. We will give the right incentives to those people out there who work hard and who get a good job. They will get the rewards from tomorrow. They will know that the signals and incentives are there to do that. Under the previous Government the signals and incentives were not to work hard; the signals and incentives were to take advantage of the system. That is what the previous Labour Government set up. 
Labour’s finance spokesman talks about delivering for the many not the few. When did Labour deliver for all New Zealanders? Never. Labour members delivered only for those who got them back into power each time there was an election. That is all that they cared about whereas we are looking at what is constructive what is right and what is in the best interests of the New Zealand economic system. The tax reform that will come tomorrow will be crucial to delivering that future for New Zealanders. 
We have seen a country that has not achieved under Labour but we now have a country that can achieve under National and it will. We will see the investment in infrastructure pay dividends. Infrastructure investment is going on through all areas and sectors of the economy from broadband to roading infrastructure to rail and to public transport. 
We have seen the investment in the Waikato region in the Waikato Expressway—that great road that Labour did not deliver on and still would not have delivered on. It took a National Government and the National MPs in the region to deliver that great road and to provide that infrastructure so that we can grow the export heart of New Zealand. The people of the Waikato will also be pleased to know that as exporters and hard-working Kiwis they will get the rewards they deserve from this Government. They know that they go out there and earn some serious dollars for this country. This Government will enable them to earn more and to invest that money in this country not in things that are there just because of the way the tax systems and structures have been put in place. 
Kelvin Davis 
: Tell us about unemployment. 
DAVID BENNETT 
: OK I will tell members about unemployment. The unemployment rate is coming down because we are growing this economy. Members should look at the most recent unemployment figures. They are coming down. 
Let us look at what Labour did. It put this country into recession before the rest of the world went into recession. It increased debt before the rest of the world increased debt. It is only because we have had prudent financial management since the election that New Zealand has come through and it will deliver in the future. I look at what Labour would have done if it had been putting together a Budget with its Green colleagues. It would have borrowed incessantly just to keep its social spending going while thinking it was leading the country. Well New Zealand would have been in the category of Greece and those other countries because of Labour’s economic management. In fact Labour does not know what it would have done. It would have been listening to the Green Party because it cannot work out how to manage an economy since Dr Cullen left. Labour has no vision. It has no strategy to grow this country. 
We look forward to a successful Budget tomorrow. We look forward to a Budget that will show New Zealanders that there is a future that is based on hard work education and success. We believe that that is crucial for growing this country. It is a different message from that which New Zealanders have been given in the past by previous Governments. 
Hon MARYAN STREET (Labour) 
: 
 It is said there are two certainties in life: death and taxes. Two additional certainties arise from National’s Budget tomorrow. The first certainty is that it will not be fair and the second certainty is that it will not work to give decent jobs and better incomes. How can National Government members sit there and talk about fairness and equity when their own leader just a day or two ago was cautioning New Zealanders not to be envious or jealous? How does that possibly square with an idea of fairness or equity? It does not. It asks all New Zealanders to let the rich off the hook and say yes the rich may be getting hundreds of dollars a week more in a tax cut but they will not be cross with them about that because of course the rich are the wealth producers of the country. I remind members opposite that the wealth producers of this country who may well be amongst the most wealthy have not done that—not achieved that—on their own. They have typically achieved it with the work and effort and cooperation of people who earn a lot less than them. So let us see where fairness and equity fall tomorrow in this Budget. 
I will pick up where the last inadequate speaker David Bennett left off and that was in the area of education. 
David Bennett 
: I raise a point of order Mr Speaker. That member is an established member of the House and I find offence in her last comment. I would like her to withdraw and apologise. 
Hon MARYAN STREET 
: I withdraw and apologise. 
Mr SPEAKER 
: I am very grateful to the honourable member for saying that although really I think we are getting a bit too sensitive altogether if we consider “inadequate” to be highly offensive. But I am grateful for the honourable member’s goodwill. 
Hon MARYAN STREET 
: The inadequate speech of the member who spoke previously is where I wish to pick up from. I am concerned about the signals or the policies that have already come out and been announced depending on the extent to which one wishes to trust Mr Joyce that apply to tertiary education. Where is the fairness in making it harder to get into tertiary education? It will be harder to get in because some of the institutions’ funding will be pegged to their pass rates. That will create a disincentive for institutions to enrol the very students who need to be better equipped to cope with the recession and our emergence from it. 
But my concern relates not only to the recession but also to the plan that is needed for the next 10 20 and 30 years. That is what I will be looking for in the Budget tomorrow. Already Mr Joyce has shut down the options. It will be not only harder to get into an institution of tertiary education but also harder to stay there. There will be time limits on student loans. There will be fees applied by the lifting of the cap to those institutions so it will cost more to stay there. It will cost more to pay off a student loan because a little administration fee will go to everybody who has a loan. So whom does this hit the hardest? The thing that is important which this Government continues to overlook is that the number of Maori and Pasifika people in this country will double between now and 2050. Maori and Pasifika combined have the highest youth population. 
Last year this Government took $638.5 million out of tertiary education funding. That does not bode well for tomorrow’s Budget because everybody including the Institutes of Technology and Polytechnics of New Zealand anticipates that the cuts will be just as severe again. That provides us with no hope no future no fairness and no equity in this country. If that comes to pass then this country will reap a decade two decades and three decades of unfairness and inequity as we see Maori and Pasifika young people piling up in unemployment and being unable and unassisted to succeed in tertiary education. Therefore when those members opposite have retired there will be nobody to support them. 
KATRINA SHANKS (National) 
: 
 It is my pleasure to take a call in this debate this afternoon. It is very interesting to listen to Opposition speakers say that it will be a bad day tomorrow when Budget 2010 is delivered and that it will be horrific for this country. I tell members this: a million people voted for this Government and they are waiting for this Budget. A million people believe that the National Government is a better economic manager than the previous Labour Government. A million people believe that this Government can deliver a much brighter future for them their parents their grandchildren and their children. A million people want to see their children come back to New Zealand because we offer globally competitive salaries we offer cutting edge jobs and we have cutting edge industry. This Government understands business and knows how to get that growth. 
This country was tricked for a very very long time. It was tricked for 9 years into believing that we were prosperous and that because we were in surpluses we were doing well. But we were not. This country was tricked. This country was held up by excessive Government spending with very poor outcomes. This country was held up with the promise that we were doing better when in fact we were not. One of the key indicators that this country never heard about was our exports and the way they were trending down. For 5 years the Labour Government hid the fact that our exports were declining. What can this country do without exports? Nothing. We borrow and we get more and more into debt. 
This Government is backing businesses in New Zealand. This Government is bringing back highly technical recognised people from other fields to grow our economy. This Government is backing the people and the businesses of New Zealand to make a difference. We will not hide it like the previous Government did. We will not keep on spending and spending and spending because we do not have surpluses. We have responsibility for taxpayers’ money and how we spend every dollar. We want good outcomes when we spend that taxpayer dollar. We know that when people pay their taxes they have worked hard to earn that money. We should give that money the respect that they give it in their own homes and we should spend it as wisely as they do. We should not spend it on pet projects. We should not worry whether it will produce any good for this country. 
This Government in the 2010 Budget will send some very clear messages to New Zealand. It will send the clear message to New Zealanders that we want them to invest we want them to save and we will reward them for working hard. That is the clear message this Government will send. 
The previous Government did not do that. It said that it was fine to spend money: “You earn it; you spend it.” But what did we end up with? We ended up with a country where people believed that they could borrow money off their property increases and then spend it. So a society was created in New Zealand that thought that debt was OK and that it was OK to spend money on consumables when one is in debt when we all know it is not OK. Debt is good if people can get an income off it and if it can create an asset but it is not OK to get into debt to purchase consumables. 
This Government is sending a clear message to New Zealanders that we will reward them if they invest if they save and if they work hard. The Government will show constraint along the way and will look after people’s money but we want people to look after their money as well and we want them to invest wisely. The Government has already put a huge range of regulations in place to ensure that people can invest and feel safe in New Zealand. 
This Government has done a lot of pre-announcements for this Budget which is pretty new such as some research and development announcements. We are growing the economy. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 It is has been a great pleasure to be part of this Government to support this Government and to work with the many fine Ministers on public policy and the Budget. A particular pleasure has been the opportunity to travel around New Zealand to speak at National Party functions and to meet the many decent hard-working people good people who support the National Party. And I stand up in this House on behalf of the hard-working National Party membership and make their case for them—what they are telling their MPs what they are telling their chairman and what they are telling their leader of the National Party. 
National supporters are asking National to defer the emissions trading scheme. They do not understand why their party is leading them ahead of the rest of the world. They know that Nick Smith is wrong when he says that there are all those countries implementing an emissions trading scheme because in Europe it is only big businesses that are paying and then there are so many exemptions it affects only 4 percent of their output. The National Party membership who are the dairy farmers the small-business owners the householders—the backbone of the productive economy of New Zealand—do not understand why their party in Government is moving to put a tax on them through the emissions trading scheme that will hit every business in New Zealand touch every household in New Zealand reach every family in New Zealand and extend its tentacles into every New Zealander’s pocket. On 1 July electricity will be going up 5c a unit petrol will be going up 4c a litre and in 2013 that will double. 
Helen Clark as Prime Minister was keen to look good as far as the UN went and she wanted New Zealand to lead the world in climate change policies. One of the reasons people swapped their vote from Labour to National at the last election was that they were sick of the nanny State and they were sick of a Government that was telling them what to do. They were sick of a Government that wanted to lead the world who knows where and they voted for the pragmatic honest decent National Party to put an end to that. The membership of the National Party cannot understand it. Whether in Invercargill or Kaitaia at every electorate meeting that is being held people are asking why we cannot follow the rest of the world why we cannot tuck in beside Australia why we cannot take account of the evidence and the facts that are now apparent and stop the madness of the Labour Party’s emissions trading scheme for New Zealand which will—and I see Jacinda Ardern with a big smile on her face—put farmers out of business in this country. It will tip farmers over in this country. 
Jacinda Ardern might think that is funny but I see that no National member thinks it is funny because they know that on this issue the ACT Party speaks the truth. The ACT Party is reflecting what the National Party membership is telling the National MPs and the ACT Party is reflecting what New Zealanders want which is the emissions trading scheme stopped deferred postponed ended and not introduced on 1 July this year. Why we should be ahead of the rest of the world is beyond comprehension. The member for Pakuranga knows it the member for Waimakariri knows it the member for the West Coast - Tasman knows it the member for Coromandel knows it and John Key knows it. Why on earth are we heading off to put this intolerable cost on to New Zealanders? 
SUE MORONEY (Labour) 
: 
 Tomorrow we get to learn the exact nature of the betrayal. Tomorrow we get to know the exact nature of the betrayal of preschool and early education children. Before the election it was a high priority and even into last year John Key still said that early childhood education was a high priority. But suddenly the sentence slipped out of his speeches. Suddenly that went and what has it been replaced by? It has been replaced by the Minister of Finance telling us that it now constitutes low-value spending and must be cut. It must be cut in tomorrow’s Budget because suddenly our 3 and 4-year-olds constitute low-value spending when once they were a high priority under this Government. The families and the parents of those children believed the Government but they are about to be betrayed. 
Let us listen to what the National members said prior to the election about early childhood education. I quote Paula Bennett who said before the election “we want to assure parents that our policy is not going to mean an increase in fees for them”. That was Paula Bennett National spokesperson on early childhood education before the 2008 election. But what has changed? This week the Prime Minister John Key confirmed that some parents will pay more for early childhood education. “All I can tell you” he said “is that some parents may be affected in the Budget but certainly not the majority … some may pay more.” 
Well let us have a look at what that majority might look like. One of the things the media has been speculating on is that the funding cut for early childhood education will come for those centres that employ 80 to 100 percent of qualified staff. What would that mean? Currently 2211 early childhood education services access that funding band. So what does that mean for families? It means 108000 children—I say that again 108000 children—and their families will be affected if that funding cut is made to early childhood education tomorrow. I notice that all of the National Government members across the way have gone quiet with the exception of Paul Quinn. He may think that it is OK for 108000 children and their families to face the prospect of increasing cost to their families because that is what will happen if that funding cut goes ahead tomorrow. Sixty percent of all the children in early childhood education services in 2009 were in services that would be affected by that funding cut. 
If National goes ahead with that funding cut could it still claim that it has not touched 20 hours’ free early childhood education? It could not. Parents with their children accessing 20 hours’ free early childhood education if they are in one of those 2211 centres will face the prospect of higher fees even for those 20 hours. That is the nature of the betrayal that we could well be seeing tomorrow. What will we see in return? We will see the wealthy getting wealthier. That is a thing that I think is disgraceful about the prospect of cutting funding to early childhood education. Suddenly all we hear from National is that that is too costly. It used to be a high priority but suddenly it is too costly. What is it too costly for? It is too costly because the Government wants to give whopping-big tax cuts to the wealthiest people in this country. That is where the money will be going from early childhood education. Make no mistake about it: it will be money out of middle and low income families for their children’s education into the pockets of the wealthiest people in this country. That is what we will be facing. 
I was interested to hear National members talk about how they will judge their own Budget on fairness and equity—well so will I. The fairness and equity I will be looking for is where the money goes from early childhood education—how many millions. The prospect I am laying out is that possibly 108000 children and their families will be affected by this. That is on top of and as well as the 11000 families we already know that the Government has made a decision to disadvantage by cutting the childcare allowance. That is a totally different entitlement but it affects the same group of families as well. Tomorrow we will learn just the extent of the betrayal. 
AARON GILMORE (National) 
: 
 When I was a kid I was pleased to be told something which I remember vividly. I was told I should leave New Zealand a better place than when I inherited it. That was one of the vivid things that stayed in my mind when I was living in a State house with my grandmother. This Budget is not about rich and poor; it is about getting our economy growing and leaving it better than when we inherited it. It is not right that one-third of New Zealand’s tertiary-qualified people do not live in New Zealand. It is not right that when I was born New Zealand was richer than Australia on a per capita income basis but now it is not. It was not right that under the prior Government we were looking at bloated State sector employment ballooning deficits and ballooning debt. Back in November 2008 people decided that that was not right and they voted in a National Government. 
They want New Zealand to grow and prosper. Budget 2009 set the platform. It set the platform for us to prosper. We made some big calls in Budget 2009 in curing what was the worst recession New Zealand had had in 70-odd years. We made some tough calls. Yes we deferred expenditure into the Cullen fund. Yes we changed the expenditure on the research and development tax credit because it was not working. Yes we refocused large amounts of money into infrastructure to unclog the arteries in our towns and cities up and down the country into our roads into our electricity supply and into our communication networks. Economic growth means that incomes increase for all. It means more dollars for health care education and welfare. It means more and better jobs. It means choices. 
Since Budget 2009 despite the worst recession in 70 years what have we seen? Well I was recently given a book called  
Rescuing the New Zealand Economy: What Went Wrong and What we Can Do to Fix It 
 
authored by that well-known Tory Bryan Gould. This book was published in the dying throes of the previous Labour Government. He knew that the economy was broken then and we have gone out of our way to fix it. After years of stagnation the economy is now growing employment is growing migration to Australia is down 22 percent in the last 12 months and incomes are growing from jobs funded not by taxpayers but by real businesses up and down the country. 
There is a plan. We have a plan to stop borrowing and instead to invest. Tomorrow in Budget 2010 members will hear Bill English talk more about some of those plans. We have heard of some of the great plans we have already. We have heard more about the road to recovery and what we will see. We have already heard that $1 billion dollars—$1 billion dollars—will be spent on fixing leaky homes by the great Minister sitting behind me Maurice Williamson. We have heard that $30 million will be spent on tourism by the Minister of Tourism Prime Minister John Key. We have heard that $134 million will be spent on Whanau Ora. I was pleased to be at a meeting only last week in my part of Christchurch where 650 people came to hear the Minister responsible for Whanau Ora Tariana Turia. They heard what she had to say about that policy. No Labour Party members were there because they do not care. We will spend $24 million on fighting bowel cancer. I think that that is a wonderful thing. As a son of somebody who went through that horrible disease I think that greater testing and things in that area will be wonderful and it will help some people get through it. All we have heard from the other side has focused on tax reform. The issue that we care about is refocusing in the productive sector encouraging investment in production and not in consumption. 
This is a Budget on a path to prosperity. Tomorrow we will see another step along that path so that the time will come in the future when my children will decide that they want to stay in New Zealand and that they want to raise their children in New Zealand. They will look back at our Budget tomorrow and say that it made steps that put New Zealand on a path to prosperity put in place incentives and did not leave them with a decade or more of deficits or with a mortgage before they even started high school—let alone got into the workforce. The investments that we have made and have announced already will do that. We have announced that $321 million will go into the research science and technology sector. That is $321 million to allow our smartest New Zealanders to stay here and to create more wealth. But what do we hear from the Opposition? We hear bluster and rubbish that all we care about are tax cuts. I think those members may be surprised tomorrow. We have heard that $250 million will be invested in KiwiRail—the thing that Labour tells us we are going to shut down. Yesterday we heard about a plan to invest $4.6 billion in KiwiRail. I think that is a wonderful thing. 
SU’A WILLIAM SIO (Labour—Mangere) 
: 
 That performance by the previous speaker Aaron Gilmore indicated to me why his senior members are lobbying hard so that he will not have a safe seat in the upcoming election. 
For the past 18 months this Government has sat on its hands pointed the finger and blamed the Labour Party for its inadequacy to address the struggles of the working population of New Zealand. I say that tomorrow will be judgment day for this Government. The Government’s first Budget was a slash-and-burn Budget despite the words that it would be mana-enhancing. So tomorrow’s Budget will be one that I suspect working-class New Zealanders throughout this country will say is not fair. The rest of this country will say that what the Government is about to implement will not work for New Zealand. Tomorrow’s Budget will be about this Government giving more money to people who already have money but giving very little to those who are struggling with unemployment and struggling to make ends meet. 
The Government talks about a step change and Mr Foss says that the Government’s focus is on the things that matter. I ask the Government what are the things that matter. It is jobs I say to this House—it is jobs it is jobs it is jobs. It is jobs that provide an income that can sustain families now and into the future. But what has happened to the unemployment rate? Under this Government it has ballooned to 7.3 percent—it has ballooned under this Government to 7.3 percent. Sure there was a 1 percent drop in the last quarter but there are still about 140000 people who are unemployed. Highest amongst that unemployment number are Maori and Pacific peoples. The Pacific unemployment rate moved up to 14.4 percent. So how will that ensure that the rest of the population will be able to sustain a quality life in this country? That is why Labour will continue to hold this Government to account and continue to ask it what it is doing for the many New Zealanders; this Government is about only the few. 
Mr Foss has said that the Budget is a step up and a step forward. But I ask where the step up is for Pacific communities when the Government raises the taxes on tertiary education. Where is the step up for Pacific communities when nine early childhood centres have closed in Manukau and in Mangere since this Government came into power? Where is the step up for the Pacific communities who are working in factories who are working in jobs that are essential for the economy and who are being paid the minimum wage of $12.25 an hour? Where is the step up for that population the many who earn $48000 or less a year and who will not get anything out of the tax cuts that this Government is proposing? 
Mr Foss has also said that the Government’s Budget is about fairness and equity. Where is the fairness in those who are earning $70000-plus getting the bigger tax cut while those who are earning $48000 do not get anything at all? Where is the fairness that those earning $14000 or less get the same reduction in taxes when this Government is proposing to increase GST by 20 percent? The Government will increase GST by 20 percent. That means that the rest of the population on low incomes will see increases in goods and services that will far outweigh any proposed tax cut that this Government wants to give. 
Mr David Bennett says that workers can get ahead under this Government and under tomorrow’s Budget. I ask this Government how workers can get ahead under this Government when there are no jobs and many are struggling to find work. There are families where only one person is now working whereas before two people were working. They are now at risk of losing their houses they are at risk of being evicted and they are at risk of having their power cut. How does a worker get ahead when there is no workplace training and no skills development and the rate of GST is rising? 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I will not stand here and talk about the previous Labour Government because there is much to say about this National Government which is actually doing things. I must respectfully disagree with the previous speaker Su’a William Sio who said that this Government is sitting on its hands. It is not. I will outline a few things that we have accomplished over our last 18 months of Government. We inherited an economy that was in trouble. We inherited an economy that had 5 consecutive years of negative export growth. We inherited an economy where the recession had taken a great chunk out of the Kiwi psyche and confidence. On 8 November 2008 the people of New Zealand spoke; they wanted change they wanted hope and they wanted jobs. That is what this Government will do for the people of New Zealand. 
Under the previous Labour Government we had uncontrollable bureaucratic growth. Government spending doubled in the 9 years of the Labour Government yet some of the outcomes went backwards in a number of areas. The previous speaker talked about Pacific unemployment and Pacific aspiration. Under the previous Labour Government we did not improve in terms of housing in terms of income or in terms of education. I challenge the previous speaker and say that before Labour members throw the barbs they should take a hard look at their record. This Government has kept core bureaucracy as $2 billion has gone towards the front line. That means that every day there are more police more nurses and more doctors. That is what the people of New Zealand demanded and that is what this Government is delivering to them. 
Billions of dollars are going into critical infrastructure in this country. The previous Government bought a train set for just under $700 million. This Government has undertaken to invest in that train set for it to be at least profitable and at break-even level. In my own electorate of Maungakiekie I am proud that this Government is finishing off State Highway 20. It is a 10-lane highway and guess what? It is going ahead 6 months ahead of schedule—6 months ahead of schedule. I thank the Minister of Transport for putting the emphasis and the energy into getting such projects done. I stand next to the Minister of Housing who put $53 million into the Tamaki transformation project. This Minister of Housing believes in the people of Tamaki and Maungakiekie. He believes in investing in the so-called poorer people whom previous speakers referred to. We believe that we have an obligation to look after those people through their housing means. 
Last year we had a $500 million relief package to make life simpler for small businesses. As I travel through Mount Wellington Penrose Te Papa and Onehunga and meet the people running the light industrial businesses and manufacturing businesses that operate in those areas of Maungakiekie I see a glimmer of hope in their eyes. The manufacturing numbers and the primary agricultural numbers in the latest  
Financial Stability Report 
 from the Reserve Bank which was released this morning do not lie. The economy is expanding under this Government. We inherited a recession but now the economy is expanding. For the first time in 6 years we have a trade— 
Dr Cam Calder 
: A surplus we call it. 
PESETA SAM LOTU-IIGA 
: We have a trade balance that is positive. Current account deficits have halved since this Government has been in place and that is the only way that this country will get out of the situation we inherited as a National Government. 
This Government has also reformed the Resource Management Act’s processes. When we talk to developers and builders we hear that the Resource Management Act had become an imposition on them. Tomorrow is a historic day; we will see a Budget that will make a difference on the road to recovery. Mr English will do that for this country. Thank you very much. 
The debate having concluded the motion lapsed. 
Courts and Criminal Matters Bill 
First Reading 
Hon GEORGINA TE HEUHEU (Minister for Courts) 
: 
 I move  
That the Courts and Criminal Matters Bill be now read a first time. 
 At the appropriate time I intend to move that the bill be considered by the Law and Order Committee. 
The Courts and Criminal Matters Bill presents the most comprehensive set of legislative improvements for the recovery of unpaid fines reparation and civil debt in 12 years. It addresses a number of issues including a general concern about the levels of overdue fines the dissatisfaction of victims when offenders do not comply with reparation orders and the frustration of creditors and debtors using the court’s civil debt enforcement process. The development of the bill commenced under the previous administration as you know Mr Assistant Speaker Barker and I take this opportunity to acknowledge your work as my predecessor when you were Minister for Courts. The present Government enacted an initial set of reforms to improve fines enforcement last year as part of a package of measures responding to the problem of illegal street racing. The Courts and Criminal Matters Bill extends those measures as well as introducing new initiatives. 
As at 30 April 2010 $778 million worth of fines and reparation remain unpaid. Through the sterling efforts of the staff of the collections unit of the Ministry of Justice on behalf of the courts over recent years and as a result of the Government’s recent policy changes the growth in the level of unpaid monies is slowing. Further improvements are necessary however if monetary penalties are to remain a credible measure to encourage compliance with the law. 
The Courts and Criminal Matters Bill is an omnibus bill that amends 20 statutes. The main statutes to be amended are the District Courts Act 1947 the Land Transport Act 1998 the Summary Proceedings Act 1957 and the Sentencing Act 2002. These amendments will enhance the court’s powers for the collection of fines and reparation and will improve the processes for collecting civil debt. 
The bill contains three major initiatives that will increase the collection of fines and reparation. The first new major initiative introduces driver licence stop orders through an amendment to the Land Transport Act 1998 contained in Part 2 of the bill. This enforcement measure will allow a fines defaulter’s driver’s licence to be suspended when the defaulter fails to maintain payment of outstanding traffic fines. The licence will remain suspended until the defaulter pays the overdue fines or enters into an arrangement to pay the monies owed. Traffic offences make up approximately 99 percent of all infringements filed in the court each year for collection. A driver licence stop order has proved to be a very effective sanction in Australian and Canadian jurisdictions. In Queensland an estimated 50 percent of fines defaulters pay or enter into a payment arrangement with another 25 percent doing so when their licences have been suspended. This measure will create an effective simple but powerful incentive for people to resolve their fines. 
The second new enforcement measure is credit reporting. Under Part 3 which amends the Summary Proceedings Act 1957 credit reporting will enable information on overdue fines and reparation to be released into the private sector credit-reporting system by the Ministry of Justice. The amendment will also enable the Ministry of Justice to use relevant information—for example updated address information from the credit industry—to assist the enforcement responsibilities undertaken by the courts. The bill includes provisions to address the privacy concerns that may arise in relation to the release of such information from the credit-reporting agencies to the Ministry of Justice and from the Ministry of Justice to the credit-reporting agencies. Clause 69 sets out the provisions for the exchanges of information. The Minister for Courts must consult the Privacy Commissioner before recommending any regulations to implement the exchange of information between the Ministry of Justice and the credit-reporting industry; as well the Secretary for Justice is required to monitor compliance with the legislative conditions and to report regularly to the Privacy Commissioner. Fifty-five percent of people with overdue fines owe less than $500. Credit reporting will provide a strong incentive for defaulters to resolve their fines. In addition costly enforcement actions by the courts will be avoided thereby freeing up resources for the Ministry of Justice to concentrate on collecting the more significant penalties. Credit reports will also enable the credit industry to make better more informed decisions about whether to lend money to individuals. This measure is closely linked to the third major initiative. 
The third new measure is super priority which will increase the collection of monetary penalties. This initiative which is also in Part 3 will give the court priority over secured creditors when a person’s overdue fines balance was reasonably discoverable at the time that new credit was granted. Super priority will occur when the court has seized secured property to sell in order to resolve overdue fines. If there were overdue fines at the time that new credit was offered by a provider the court will get priority for an amount up to the value of those outstanding fines. Super priority will provide the credit industry with a strong incentive to request overdue fines information from the Ministry of Justice. It will also help to clarify who is entitled to the funds realised when the property is seized and sold. 
The payment of reparation is an important method of holding offenders to account. Currently offenders may receive a reduced sentence if an offer of reparation is accepted by the court. If the reparation subsequently proves to be uncollectable the offender cannot be resentenced on the original offence. The bill amends the Summary Proceedings Act 1957 to provide for an offender to be resentenced if he or she subsequently cannot pay the reparation. Another change will allow the court to hold an offender in custody for up to 2 hours until a payment plan has been set or any reparation ordered. Payment conditions will be able to be set by court registrars as well as by judges. These changes are designed to assist victims. 
Vehicle confiscation provisions enacted last year by the Vehicle Confiscation and Seizure Bill are further enhanced by amendments to the Sentencing Act 2002 and the Summary Proceedings Act 1957. Appropriate vehicle seizure provisions will be extended to apply to all seized property. For example registrars will be required to search the Personal Property Securities Register for financing statements registered against all seized property instead of seized vehicles only. Ownership of confiscated vehicles will not have to be transferred to the court before the vehicle is sold or disposed of. 
The civil debt enforcement system can be procedurally onerous for creditors and debtors alike. The most common enforcement process requires personal attendance of both parties at a hearing to examine the debtor’s ability to pay a debt. This can be an inconvenience for both parties especially if they live in different parts of the country as the law requires that the hearing be held in the court closest to the debtor. The amendments to the District Courts Act 1947 set out in Part 1 will provide greater flexibility for all parties. For example creditors will be able to request that the court examine the debtor’s means on their behalf. Not only will such changes improve the experience for creditors and debtors but also they will free up resources needed to support the court’s enforcement processes. 
When a person does not comply with the law a monetary penalty is the most common sanction imposed. The Sentencing Act requires the courts to assess a person’s ability to pay before imposing a fine or reparation order ensuring that the penalties imposed are credible. Most monetary penalties are however imposed by way of an infringement notice. Approximately 2.7 million notices are issued each year mostly for traffic offences. Unfortunately 1.1 million notices remain unpaid each year and are filed for enforcement as fines by the court. By agreement with the collections unit of the Ministry of Justice acting on behalf of the courts offenders can tailor their payment arrangements to reflect their ability to pay. Many do so; others do not. This bill will increase the enforcement options available to the court to collect overdue fines and other monetary penalties. 
The three new major enforcement measures are designed to create a strong incentive for people to proactively resolve their overdue fines and reparation. Changes to existing provisions will strengthen the currently available enforcement tools and processes. The bill will also provide creditors and debtors with an enforcement system that is better tailored to their needs. This bill delivers a comprehensive package to enhance the collection of fines reparation and civil debt. I therefore commend this bill to the House. 
Hon DAVID PARKER (Labour) 
: 
 The Labour Party will support the referral of the Courts and Criminal Matters Bill to a select committee. I thank the Minister for Courts the Hon Georgina te Heuheu for her acknowledgment of the efforts of the previous Minister the Hon Rick Barker in this area. I think that perhaps the most successful innovation in respect of fines collection in recent years has been the change made to the law while he was the Minister to allow information to be processed at the border from people who were trying to travel overseas. Those people were not allowed to board their aircraft if they had unpaid fines in New Zealand under the New Zealand fines system. That has been a very successful measure which has improved the collection of fines. 
I agree with the Minister that it is important that we have a system that holds people to account for penalties that have been imposed upon them; otherwise the system stops working if people can effectively avoid the sanctions imposed upon them for breaches of the law. If I were to be a little critical it would be that the policy behind the major change here which is the introduction of driver licence stop orders was agreed on back in the middle of 2008. We are 2 years on from then before now seeing the introduction of this legislation despite the fact that the policy was agreed to by both the previous Government and this Government and that seems to be a bit slow. 
I think that driver licence stop orders will be the most effective part of the changes made in this bill. There is a process that is followed and that is fair. Liable persons are sent a warning notice giving them 14 days to resolve the issue between them and the fines authorities before their licence is suspended. People can make an arrangement with the collection agency for the proper payment of their fine over time. It does not have to be paid in one lump sum; they just have to have an arrangement in place. If they do not do that the people who are in default will lose their licence. They will lose their right to drive. 
People who are in default will also lose a limited licence. I am not convinced about that provision; I think that is something that the select committee should look at. I am not sure whether it is in society’s interest that we should cause people to lose their job as a consequence of this legislation. I think they should lose their licence for non-work purposes. But I am not convinced that it is always in their interests— 
Sandra Goudie 
: If they have a job they will be able to pay their fines. 
Hon DAVID PARKER 
: We hear another erudite contribution from Sandra Goudie. That would be unusual I know. I am not sure about depriving people of their livelihood because that is the means by which they would pay a fine and meet their other obligations to society to look after their families or to pay family support if they have children. If people need a limited licence in order to drive for the purposes of their employment it might be going a step too far to deprive them of that limited licence and therefore of their livelihood. 
Sandra Goudie 
: I did not say that. 
Hon DAVID PARKER 
: Sandra Goudie said that she did not say that and I do not want to misrepresent her. I just acknowledge— 
Sandra Goudie 
: If they have a job they will be able to pay the fines. 
Hon DAVID PARKER 
: A job can often require someone to drive and that is the only reason that someone has a limited licence I remind Mrs Goudie. I am sorry that she did not know that and I see some of the members of her party smiling at the fact that she thinks people get a limited licence in order to go down to the pub every night. They get a limited licence only if they need it for their employment. It is a bit of a shame that the member does not know that. Given that she chairs one of the select committees that deal with law and order matters I would have thought that she knew that already. In any event I think that the select committee should look at that issue. I am not sure whether the balance is quite right. It may be but it needs to be looked at carefully. 
I want to talk about a couple of other measures. An order of priority has been created in respect of the priority that fines have against assets that are secured—for example under a hire purchase contract. It is a really good provision that the information that the justice sector has about unpaid fines will now be made available to credit agencies. That is a really good step. Credit agencies will want to know that because it will be reflected in their opinion as to the reliability of a person who is being lent money. So that provision is good for credit agencies and it is also good for fines enforcement. In respect of the creation of an automatic super-priority for fines we again have to be a wee bit careful. I see the attraction of it but I can envisage a situation where we might have a solo parent living on a pretty modest income who needs to enter into a hire purchase contract for a washing machine. I would want to make sure that that could still happen. 
I think it is very fair that there has to be an arrangement for the payment of fines. However I am not sure whether it is right that the fines should have to be paid in full because that might be beyond the means of the person and have consequences that are a little too Draconian. At the select committee we will be checking to see that the legislation enables the advancers of hire purchase contracts—in the example I gave of the washing machine—to be able to do that safely in reliance upon their security so long as there is a fines payment arrangement in place rather than the whole of the fine having to be paid. 
Another issue that needs to be checked is in respect of driver licence stop orders. My understanding is that those orders apply only to traffic offences. From my reading of the bill that appears to include all traffic offences specified in regulations made under the Transport Act which I presume includes the parking fines imposed by councils. We should check on that because I know that it is a matter of concern to councils that they do not have the ability to enforce the collection of those fines. They have to do that through the Ministry of Justice. I would hope that council fines are also captured through this process because the current system is a source of frustration for them. As in the case of central government we should have proper collection processes for those small amounts of money which none the less ought to be paid—or generally they are small amounts of money. 
Another idea that I have heard mentioned by the Hon Rick Barker and that I have also had reflected to me by councils—including the chief executive of the Dunedin City Council—is their concern that there should be some sort of trigger in the system when fines accrue past a certain level. We know from the statistics that when fines accrue to quite high levels say $2000 thereafter the likelihood that those fines will be paid diminishes significantly. It becomes such a burden for people that they almost think they cannot pay their fines off so they will just give up. If that is the case there should be a trigger in the system that flags a person who already has fines of over $2000 if that person comes before the courts again. There should be a measure that causes such cases to be pulled out and looked at again to assess whether the amounts are realistic or whether the cases will sit there for ever as debts theoretically owed to the Crown that will never be paid. Such debts clog up the system hang over people and show up as an asset of the Crown which is in reality a loser. In those sorts of situations it may be better to get such people back before the courts and resentence them to community service or another penalty in lieu of that which has been already conferred. It disappoints me a little that that issue is not addressed in this bill. 
The other area that is improved in this legislation is the collection of civil debts. I agree with the Minister that some of the processes around obtaining attachment orders can be arcane. An attachment order is an order by the court that an amount is owed by a debtor where the creditor has proved to the court that he or she is owed money and therefore has a judgment against the person. To enforce that judgment one can go to the court and seek an attachment order on someone’s wages and that order then requires the employer to pay a certain amount each week in reduction of the judgment debt. Those attachment order processes are at the moment quite complex. They can be simplified. The Minister has already clarified to the House how they can be simplified including not necessarily requiring people to appear in person in order to make an attachment order but to be able to do it on papers: statements that ought to be provided by people as to their means and their income. So I welcome that as an improvement in the law as well. 
Overall this bill looks as though it is good legislation. It will help with the collection of overdue fines and the collection of civil debts. Subject to the comments that I have made about certain issues that I think the select committee will need to look at I am pleased to support the bill. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I applaud the Hon Georgina te Heuheu for bringing the Courts and Criminal Matters Bill to the House. It will be my absolute pleasure as chair of the Law and Order Committee to progress this bill through its process in the select committee. 
I invite David Parker from the Opposition to swap with Clayton Cosgrove because that would be really good. We would love his expertise and it would create a whole new dynamic at the select committee. That would be really great; it would be tremendous. We would love the expertise that David Parker would present especially as he has spoken so well of this bill and has applauded the Minister in the words he expressed in the House. 
I am sure the other members of the Law and Order Committee would also appreciate the expertise of Mr David Parker and his presence on the committee. I am sure that Mr Cosgrove would absolutely relish a stint on the Justice and Electoral Committee. Would that not be marvellous? [ 
Interruption 
] Just a moment; I hear the members of the Justice and Electoral Committee objecting to that suggestion and I cannot understand why that would be. 
As other speakers have said the Courts and Criminal Matters Bill is an omnibus bill. It amends a number of statutes to enhance the court’s powers and processes for the collection of fines and other monetary penalties and civil debt. It will enhance the court’s powers to collect fines reparation payments and civil debt and it will strengthen the enforcement measures available when people do not arrange to pay or continue to pay outstanding moneys as ordered by the courts. That happens all too often—people do not arrange to pay outstanding moneys or continue to pay outstanding moneys. 
I pointed out to the previous speaker when I interjected that if a person has a job his or her vehicle should not be seized. If a person has a job he or she should be able to pay the fine or arrange to pay outstanding moneys. People can arrange to pay over a period of time so that they are not putting themselves or their families in a difficult position. If they have a job they should be able to make those arrangements so that their vehicle is not seized. 
I understand that about 2400 vehicles are seized by the courts each year. However that may continue because National is committed to working towards accountability. People must be accountable for their behaviour and if they transgress and break the law they must be made to take accountability for their actions and pay the fine. This bill will ensure that court-ordered payments or reparations to victims are paid sooner thus continuing National’s focus on a more victim-based justice system. As at 30 April 2010 there was $778 million of reparation— 
Dr Cam Calder 
: How much? 
SANDRA GOUDIE 
: $778 million—that is KiwiRail is it not? Of reparations fines other monetary penalties and court costs $778 million remained unpaid. 
Simon Bridges 
: Outrageous. 
SANDRA GOUDIE 
: That is pretty outrageous. Some people just keep building on one fine after another. The tragedy of that is that those fines get wiped so they are never held to account for those fines. I know it absolutely incenses the good honest hard-working individual Kiwis—who may have one or two transgressions but they will pay. 
Simon Bridges 
: Salt-of-the-earth Kiwi battlers. 
SANDRA GOUDIE 
: Yes that is it—good solid Kiwi battlers. But we get the odd one who just racks up one fine after another and gets them wiped and it is just a blight on justice. Despite increases in the amounts recovered by the collections unit of the Ministry of Justice acting for the courts the total debt continues to grow. Those unpaid fines and monetary penalties just continue to grow. That is why this bill is such an important bill. 
The Minister for Courts is definitely to be commended because this bill will help turn round that situation. Then that $778 million will be put to a good use. The total number of fines and other monetary penalties especially infringement notices filed with the court for enforcement has increased 47 percent between 2001-02 and 2008-09. That is a huge amount. Unpaid traffic fines are a significant concern. We want that $778 million and that is what this bill will help to deliver. 
JACINDA ARDERN (Labour) 
: 
 I am pleased to follow the member who just spoke Sandra Goudie. I think one of the more significant omissions that she made in her address was not acknowledging the work of the Assistant Speaker the Hon Rick Barker as the drafter of the Courts and Criminal Matters Bill which Labour will obviously be supporting. I acknowledge that it is good to be here discussing a sensible law and order policy. It was a Labour bill courtesy of Rick Barker. 
I have been disappointed with the debate in this House of late on law and order and justice matters. Probably the most recent bill that comes to mind is the “three strikes” legislation. I have to acknowledge my disappointment in the position of the Minister of Justice Simon Power on that legislation. Although members like Sandra Goudie may be all for things like “three strikes” I think that members such as the Minister of Justice may acknowledge that it is a retrograde backward step. All of the international experts are clamouring to come to New Zealand and help us before we go down that— 
Jonathan Young 
: I raise a point of order Mr Speaker. I wonder whether we could just focus on the correct bill. Thank you. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: I will respond to the member by saying that National’s previous speaker according to my calculation with the clock here spent 2 minutes discussing the membership of the Law and Order Committee to the merriment of the National benches. I could have taken a point of order because that discussion was well outside the scope of the bill. So I am allowing a little bit of latitude; there is a bit of give and take here. Having taken the point of order I will not give the member the ruling but the point has been made to the member speaking. 
JACINDA ARDERN 
: I note I have 1 minute and 30 seconds left then to dwell on other matters and I will save that for a little later on in my speech. I think that the point has been made. 
I come back to the bill. It is obviously an omnibus bill. It amends 20 bills in total so I acknowledge that it was a significant piece of work for the Ministry of Justice. Ultimately this bill focuses on the recovery of unpaid fines. There are two elements within that recovery. I think the efficiency with which those fines collections take place should be primary in our discussion; some parts of Labour’s original bill have not been picked up in that regard. I might touch on them briefly. Also there are elements here where the Ministry of Justice—rightly I think—has pointed out that we always have to take into account the difficult balance between inserting realism into our fines collection system whilst not allowing offenders to abdicate their ultimate responsibility as part of their punishment as awarded by the court. There is always a very difficult balancing act. In all of that mix we have to make sure we maintain a credible fines system both in terms of the awarding of those fines and in terms of their collection. 
I touch just briefly on Labour’s position. Obviously we support the bill but I express some disappointment at the lack of speed at which the bill which was essentially ready in 2008 has been brought before this House and as I mentioned briefly at the omissions in the bill. One in particular that I will touch on is the overarching agency that was originally proposed to have responsibility for fines. At the moment we have multiple points of fines collection and multiple agencies involved in that role. We sought to address that point which for some reason has not been included in this bill. I hope if there is not some discussion about that in the select committee that perhaps in the Committee stage the Minister for Courts might like to address that point further. 
The Government though in the absence of addressing that point has said that this is the most comprehensive set of legislative measures for collecting unpaid moneys in 12 years. The Hon David Parker touched on the other significant actions that Labour took when we were in Government. The Government now claims that this bill demonstrates its determination to address the high level of unpaid moneys but again I find the timing of it quite interesting. Some of the statistics we already know are that between July 2008 and June 2009 the courts wiped $95.1 million of the total $806 million in unpaid fines. I would have thought perhaps that at the same time the Government was looking at making that decision it might have spent some time making sure it was progressing this legislation so that it had a dual track on fines collection. Also given the large and growing amount of outstanding penalties I think perhaps there is a wider debate to be had over the role of monetary penalties as a sanction for offending and whether it is being eroded as the level of unpaid monetary fines continues to accrue. That is a significant debate I think and one probably best had at the select committee. 
I think as well it is a worthwhile point that the regulatory impact statement states: “As at 31 May 2008 Credit Reporting would have affected over 270000 people who owed more than $400 million in overdue penalties.” I think we are seeing a concentration of individuals much in the same way that we see a concentration of individuals committing a large amount of the crime in New Zealand particularly in the youth justice sector. A small amount of individuals are responsible for a large number of overdue fines and penalties. Perhaps that is why the number of unpaid fines remitted to community work has more than tripled over the last 5 years. 
I will pick up on that matter a little later on but it points to the question of whether when the court is handing down a fine it is taking fully into account some of the provisions of for instance the Sentencing Act which requires that the ability to pay is taken into account. I again highlight that it should not be used as a tool to abdicate from an individual’s responsibility to make amends through our sentencing regime but if individuals have been awarded fines when it is blatantly obvious at that point that their ability to pay is limited that is the point at which it would be best to hand down sentences under which they would be obliged to fulfil their debt to society rather than having the fines fall upon them stagnate go through unpaid and eventually translate into community work. That is why I think that that front-end process is very very important. 
I think it would be useful if at some point the Minister for Courts could perhaps share with us why there was an extension of time. If this bill was ready in 2008 why have we had a delay? Did some redrafting take place or was some extra information required? It does not seem immediately obvious to me. 
Colin King 
: Busy hard-working Government. 
JACINDA ARDERN 
: If indeed it is because the Government has been busy implementing legislation like “three strikes” then the only assumption I can make is that its priorities are all wrong. 
I will touch on some of the main provisions of the bill. I think my colleague David Parker did a very good job of pulling out some of the issues that the select committee may like to spend a greater amount of time on. We have obviously had attachment orders which have allowed deductions to be made from wages and benefits to pay debts. The Justice and Electoral Committee touched on that matter briefly when we were looking at the Government’s proposal to impose a blanket $50 tax I guess on individual offenders. I just point out to the Law and Order Committee members who I understand will be considering this bill that it may be useful to look at the impact of deductions if for instance they are coming from small businesses. It is a cost on them that we have not considered that is perhaps worth looking at. 
In relation to the credit-reporting initiative—which again David Parker pointed out was useful—and the super priority by which the District Court can obtain high priority over the secured property of a credit provider if the loan was advanced when the overdue penalties could have been released under the credit-reporting proposal I want to throw in there an unintended consequence or a related matter that the Government may wish to consider. If we are dealing with individuals who find themselves in an economic situation in which they are not paying their fines despite being pursued and we are putting an order of priority on their repayments we may find situations whereby some of those debtors look to other channels in order to pay off their debts. That may lead to their seeking out for instance unsavoury loan sharks. 
If the Government wanted to be truly comprehensive and to make sure there were no unintended consequences of what are otherwise good measures perhaps its members would consider supporting Carol Beaumont’s member’s bill the Credit Reforms (Responsible Lending) Bill which cracks down on loan sharks which often have uncapped interest rates and ultimately impact severely on some of our low-income citizens in New Zealand including members of the Pacific Island community. I would say that that bill stands on its own merits in fact and in many ways we do not need another bill prompting us to make that reform. But if this is the avenue in which I have to raise it I extend that challenge to all members: please explain to me why we should not support her bill. 
Dr KENNEDY GRAHAM (Green) 
: 
 The Green Party has given extensive consideration to the Courts and Criminal Matters Bill. It is always difficult we think to form a single policy on such a wide-ranging omnibus bill and I acknowledge the work initiated in this respect by the Hon Rick Barker earlier. Forming a policy is difficult because the bill’s key provisions would amend various pieces of legislation and in particular four Acts. So let me consider each one in turn. 
First the bill would amend the District Courts Act 1947 to make it easier to recover civil debts by setting up mandatory deductions from wages and benefits. The mandatory fines deductions could disproportionately affect low-income and beneficiary families. If a system were developed to means test convicted defendants it could be a worthwhile proposal. 
Secondly the bill would amend the Land Transport Act 1998 to allow for drivers’ licences to be suspended for failure to pay traffic fines. Suspending licences for failure to pay driving fines could also be seen as excessively punitive if the incidence of malfeasance rested disproportionately on the poor. If not an argument exists for suspension. Those two proposed changes raise the whole matter of the degree to which legislation rests on empirical evidence. In the explanatory note of the bill the Government provided no evidence about which income groups were primarily affected by fines. 
The issue of the facts that we have at our command as a country on this kind of issue is quite frankly unsatisfactory. Green members have for example sought to research the question of whether fines exacted on convicted defendants in New Zealand fall disproportionately on lower-income groups overall. Neither the Parliamentary Library nor the Ministry of Justice was able to ascertain that fundamental fact pertaining to social equity within our judicial system. 
Reports we are told indicate that young people have difficulty in paying their fines presumably in part because of their lower incomes. But that presumption is not based on any rigorous research. Indeed no research along those lines appears to have been done. Yet through our collective intuition we strongly suspect even if we cannot prove it conclusively that fines are exacted disproportionately on the lower-income group. That of course correlates with two categories: age—young people—and ethnicity. With regard to youth it is a telling story. As of June 2008 we find that over half a million individuals—about 16 percent of all Kiwis over 15 years of age—owe fines. That is one in six. The amount owing as has been noted totals $783 million. About 7 percent of the individuals owe 52 percent of that sum. Half of those are under 30 years of age. Most of them we are told cannot afford to pay those fines so the fines remain uncollectable. Some who can afford to pay choose not to do so until resource-intensive enforcement action is undertaken. Some 54 percent of fines by value are passed to the courts for enforcement action. About 41 percent by value of those unpaid fines is owed by people under 25 and 60 percent of that relates to just two categories of offence: vehicles that are unlicensed or lacking warrants and drivers who have violated their licence permits. 
The Ministry of Justice concludes that with young people default is partly due to inability to pay but more fundamentally to a matter of inability to deal with the regulatory system. Let us set aside for a moment the major crimes of violence drugs and property. Let us simply take traffic offences which are after all the most likely specific crimes to result in a fine—about 55 percent result in fines. For traffic offences we are given statistics relating to ethnicity and gender but not to age. What is more the statistics date back only to 1998. Setting aside that shortcoming we find that fines as opposed to other penalties are imposed less frequently on Maori and Pasifika than on Pakeha. With Maori it is 34 percent with Pasifika it is 49 percent and with Pakeha it is 58 percent. The conclusion is that other sentences either more severe such as preventive detention or less severe such as community service are imposed relatively more frequently on Polynesians than on Europeans. So what is to be our conclusion with regard to those two proposed amendments? The Green Party finds that there is an unacceptable shortcoming in the data pertaining to means testing for fines. But we conclude that there is strong indirect evidence that incapacity to pay is correlated with lower-income groups and that it affects particularly both young people and our Polynesian people. 
The third change introduced in the bill would be to amend the Summary Proceedings Act and it would do so in three ways. First it would authorise the release of the amount of overdue penalties by the Ministry of Justice to potential creditors and the release of credit applicant information to the Ministry of Justice to assist with fines enforcement. The release of credit information to and by the Ministry of Justice seems to us to be reasonable. Secondly the Summary Proceedings Act would give courts priority over secured creditors for seized property when the overdue penalties could have been discovered before finance was advanced. In that respect giving courts priority over secured creditors if they knew about overdue fines makes sense to us. Thirdly the Summary Proceedings Act would authorise home detention or prison sentences to be substituted for “unaffordable and unenforceable” reparation orders. In that respect the provisions that would allow prison sentences when people cannot pay reparation orders seem to us Draconian and inappropriate and they would place a further burden on our stretched prisons. Putting people in jail also increases the likelihood that they will commit further crimes. It will add to an already overstretched prison population and an already overstretched public purse. 
The final change that would be introduced by the bill is to amend the Sentencing Act 2002 and various other Acts to improve the operation of reparation and vehicle confiscation as penalty regimes. The Green Party has previously opposed the vehicle confiscation and crush regime as being ineffective and in breach of human rights. It follows that we would oppose those sections of the bill. 
Given the dubious implications of some of the provisions of this omnibus bill the Green Party will vote against it. Thank you. 
JONATHAN YOUNG (National—New Plymouth) 
: 
 I rise to speak to the Courts and Criminal Matters Bill presented by the Hon Georgina te Heuheu. The Minister recently congratulated the court staff who participated in a highly successful joint operation with the police in Waitakere which saw 10000 vehicles stopped and thousands of dollars of fines recovered. This issue of unpaid fines is one that many people get upset about. Even this year I received correspondence from a very upset constituent when a large number of fines were cancelled because of the inability of the courts to recover them. This bill goes a long way towards making the recovery of fines a more thorough process in order to see accountability and responsibility placed upon the shoulders of people who firstly infringe the law and incur a fine and secondly do not step up to the plate and take responsibility for the payment of their fines. 
It has been stated that a great percentage of fines issued to young people are not paid voluntarily and are filed in the court for enforcement—90 percent of infringements in fact and that is a very high percentage. Local authorities report an 80 to 90 percent voluntary payment for parking infringements and the police report that 75 percent of speed camera infringements are paid voluntarily. We must note that a very high proportion of fines particularly fines incurred by young people are unpaid. The issues that lead to the fines in terms of vehicle usage the speed of the vehicles and like matters are obvious to all of us. Huge expense is incurred in the purchase and the running of vehicles but there needs to be the responsibility that is essential for the safe driving of motorcars in our communities. Fines are a very good way to bring a disincentive to bad behaviour. 
A huge amount in fines is outstanding as other speakers have mentioned and $778 million represents a lot of extra police on the beat or more elective surgery or better classrooms. It can mean that our deficit is lower and less of our tax revenue goes towards paying interest on overseas debt. 
We do not like to see a huge number of people receiving infringement notices but it is a fact and a reality in our society. But what we do expect and which this bill will go a long way to assist is a responsible attitude to the payment of those fines. I believe that this is a good bill that will bring improvement. I acknowledge the work of the Hon Rick Barker and look forward to the bill proceeding to the Law and Order Committee. Thank you. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 There is some legislation about which I can stand proudly in this House hand on heart and say that it is what our people want. I am thinking of legislation like the repeal of the Foreshore and Seabed Act 2004 or the members’ bills that just happen to be in my name such as the legislation to remove GST from healthy food and the legislation that is coming up to remove 1080 poison. I am sorry to say that the Courts and Criminal Matters Bill is not one of those bills. Not one of the Te Tai Tonga constituents whom I have spoken to has written to me called me or knocked down my door pleading that we do something about enhancing the powers of the court to bring about the collection of fines. 
To be quite frank the issue of overdue fines will inevitably have a disproportionate impact on Maori because as this House well knows Maori are four to five times more likely than Pakeha to be apprehended prosecuted and convicted for a criminal offence. One of the great realisations of the work proceeding under the Drivers of Crime strategy is the absolute complexity involved in addressing the overrepresentation of Maori in this area. It is vital that the courts system is under the same scrutiny that we should demand all levels of the criminal justice be exposed to. But this is not the time to analyse the causes behind such a disproportionate overrepresentation of Maori in the criminal justice framework. Our focus instead must be on recognising that this inequality exists and recognising also that socio-economic circumstances provide a particular backdrop for understanding the precise impact of the Courts and Criminal Matters Bill. 
With a median income of approximately $20000 per annum Maori will inevitably be adversely affected by court-imposed fines and the offender levy. There is a virtual avalanche of evidence about the barriers that low-income people already experience to obtaining access to credit to rental tenancies to employment and to bridging finance to put towards homeownership or even a decent car that will not end up costing more than its worth through unpaid fines. 
The possibility therefore that this bill will bring about a whole new tranche of pressures upon whanau is something that we have to take very seriously. Over the passage of time Maori Party MPs have brought to this Parliament devastating stories of families dealing with precarious financial difficulties and falling prey to ruthless lenders getting away with obscene rates of interest. We would hate to think that one solution to address the millions outstanding in reparation and penalties forces our poorest communities to turn to unscrupulous moneylenders whose only concern is profit. 
I acknowledge the responsible and wise counsel of the Minister for Courts who has received these concerns both from the Maori Party and also I believe from the Minister of Maori Affairs and his agency Te Puni Kokiri. She has made it very clear that the purpose of this bill is not about more penalties and punishments but is about creating incentives for those with overdue fines to contact the court. The Minister made a statement that has enormous meaning. It is that all impacts from these initiatives can be avoided by a person with overdue fines contacting the court to resolve them. This sounds so easy and we hope it will be. 
We welcome the initiative of establishing an 0800 telephone number to encourage people to pick up the phone and subsequently for the court to help them with options for getting the matter resolved. I need to talk about this 0800 number because I remember when I was in a community law centre that people were not able to use 0800 numbers because the phone had a toll bar and as soon as they dialled 0 it would switch off. I hope that in this case that problem has been taken care of that that is no longer the case and that people will be able to call an 0800 number even if a toll bar has been put in place. 
The ability to go to the court and discuss unpaid fines is a culture shift and it will require a significant investment in public relations to inform people of the helpline and to make the message clear to people that if they contact the court to resolve their fines they will cease to be put through the credit-reporting queue. I say it will be a culture shift because it will require considerable effort on behalf of the courts to convince the public that they are not on the chase to slap an even greater fine on a lapsed offender or worse yet to pack them off to jail. 
I make it known that the Maori Party is the first to promote the value of collective responsibility and we understand the concept of paying one’s dues. If money is owing and fines are due it is a responsibility that must be met. But we also understand the dire situation of too many families and we want to ensure that they are fully informed of the chain of events that might be triggered if they do not take action. The key is in getting the message through that if a family is facing financial hardship then options are available to help it resolve its debt and the options do not involve loan sharks in any shape or form. The options are all about taking the responsibility to talk to the courts about ways to resolve debt while taking into account financial circumstances. It might be about setting up a time payment option or there might be the possibility of having the fines remitted and an alternative sentence imposed. 
Of course ideally we would want to take the preventive approach of ensuring that the crime does not happen in the first place. I give praise where praise is due in respect of a story relayed to me about the police in Kaitaia. They have been helping young people to stay safe and on the right side of the law by running programmes that help them to get their driver’s licence. I believe that there are even programmes in practical car maintenance. Such basic strategies are an excellent investment that we hope avoid further criminalisation. 
We are concerned about the exchange of information that this bill will authorise in the amendment to the Summary Proceedings Act. The amendment will authorise the Ministry of Justice to release the amount of overdue penalties to credit-reporting agencies in order to assist with fines enforcement. There will also be provisions to give the courts priority over secured creditors to seize property where the penalties were overdue before the property was purchased. We understand from the Minister that there will be a review of these provisions in 2 years’ time but we are not convinced that sufficient measures are in place to prevent the capacity for abuse by the authorities. We will be looking forward to hearing from the Privacy Commissioner during the select committee process as to the precise extent of the invasive powers. 
Another part of this bill is the intervention to approach an employer or Work and Income when a fine is overdue rather than approaching the person him or herself. We wonder about the balance between privacy concerns and the public good. We worry that this bill could place whanau in the situation of having to turn to marginal lending agencies so another expectation that the Maori Party has is that the select committee turn its attention to the detail of the communications strategy to ensure that the information is out there to encourage people to proactively contact the court. 
We balance the onus of collective responsibility with other values such as rangatiratanga and manaakitanga. We are acutely aware that we would not want to further disadvantage victims so we support the notion of creating strategies to encourage the payment of debts or of compensation that is owed. We are prepared to let this bill go before a select committee but we will certainly be keen to hear all of the arguments and all of the evidence that will come from those who are potentially most affected by this legislation. Thank you. 
LYNNE PILLAY (Labour) 
: 
 It is a pleasure to stand and speak in support of the Courts and Criminal Matters Bill. I join many colleagues from all sides of the House in congratulating Rick Barker because the drafting of this bill was done under the previous Labour Government. I do not want to be churlish but it is a pity perhaps that this bill was not brought forward. It could have been in the raft of bills that was rushed through under urgency when this Government first came into office; I think this bill would have been far more effective than many of the bills that were passed at that time. Labour is supporting this bill not just—but mainly—because Labour drafted the bill. However one thing missing from the bill that Labour drafted is an overarching agency with responsibility for fines. There is no provision for it in the legislation. Like other members I welcome the bill’s referral to the hard-working Justice and Electoral Committee I think— 
Hon Member 
: Law and order. 
LYNNE PILLAY 
: —no it is the Law and Order Committee. It is a relatively hard-working select committee. It is not quite as hard-working as the Justice and Electoral Committee of course but the bill will go to that select committee where as members who have spoken earlier have said the public will be able to make submissions and the bill will be given very careful scrutiny. It amends at least 20 pieces of legislation. I know that with the support of the hard-working staff of the select committee and officials extra bits are often picked up during that process to enable the legislation when it is enacted to work effectively. This bill is certainly long overdue and members on this side of the House support it. 
Basically the bill introduces the driver licence stop orders proposal that we have seen in other countries. If I can use Australia as an example it has increased the success rate for the collection of fines there. I will pause and look at how large the amount of unpaid fines is. Between July 2008 and June 2009 the courts wiped $95 million in fines and that was out of a total of $806 million in unpaid fines. The amount wiped was absolutely substantial. As we are all aware if fines are not paid then the penalties mount up and it becomes an ever-decreasing circle for offenders. Given the large and growing number of outstanding penalties the effectiveness of having monetary penalties as a sanction becomes eroded because it almost becomes impossible once the fines are not paid and the penalties mount up for offenders to look realistically at paying them. Also if we look at the number of unpaid fines that were remitted to community work we see that their monetary value has more than tripled over the last 5 years from $16.6 million in 2005 to $55.7 million last year. We are talking about a substantial amount of money and it is very important that we retrieve that money. 
I will talk briefly about some of the amendments to Acts made by the bill. Part 1 amends the District Courts Act 1947 to allow deductions to be made from wages and benefits in order to pay debts. The bill is aiming to streamline the enforcement process by enabling judgment creditors to file a financial statement to enable deductions to be made. This is obviously of assistance in terms of getting the money but it also assists someone who is in trouble. As there is a process for paying off those fines then obviously there will not be an escalation of penalties for the offender that would only escalate the problem of paying back the money. 
Part 2 amends the Land Transport Act 1998. That part authorises driver licence stop orders. This is a new enforcement measure. As I said before it is successful. It will allow for the suspension of drivers’ licences where the driver has not made any arrangements to pay overdue traffic penalties. Under this new measure liable persons would be sent a warning notice so there is that warning. The bill gives them 14 days in which to resolve those penalties before the suspension of their licence. If that does not happen then the driver licence stop orders would suspend all drivers’ licences held by people in default and that would include limited licences. So it is getting quite tough. There is the warning. You have to—not you Mr Deputy Speaker; certainly not you—but offenders have 14 days in which to pay those penalties. But if that does not happen then the regime is able to be followed through. Following a driver licence stop order until all the overdue traffic penalties are resolved through payment or there is a negotiated payment agreement that order stays in place. If a person drives in breach of that order then his or her vehicle will be impounded for 28 days. So there are behavioural consequences. There is some clarity in terms of how to get the penalties paid—to either pay them or enter into an agreement. If those penalties are breached there will be actions taken against offenders. 
Part 3 relates to amendments to the Summary Proceedings Act 1957. There is also streamlining of the infringement system. The Act will be amended to improve the operation of the infringement system the court collection and enforcement processes by addressing inconsistencies that are already in place and by increasing operational efficiency and flexibility. That operational efficiency and flexibility will be very very positive. It is not all Draconian; it will actually enable offenders to take responsibility for their actions and at the same time not have mounting debt because they face up and get that debt paid off. As I said before it is a pity that there is no single agency that has responsibility for fines. It will be interesting to see whether it is within scope that some amendments can be made. But history has shown us and I think the Ministry of Justice research shows that when people cross a certain threshold of money owed—and that is around $2000 for a young person—they become unwilling and unable to even attempt to pay off those fines. That is a lose-lose situation. There are no winners in that. If we can address this matter and begin to get those fines paid off then it will obviously be to the advantage of offenders because they will not have escalating debt and it will also be of advantage to the Ministry of Justice coffers. 
So along with my colleagues I again offer my congratulations to Rick Barker and even to the National Government—being perhaps a little tardy but none the less picking up this bill. I am very happy to speak in support of it. 
MELISSA LEE (National) 
: 
 It is a pleasure to speak to the Courts and Criminal Matters Bill in its first reading. I commend the Minister for Courts the Hon Georgina te Heuheu who brought this bill to the House. Without her it would be languishing on the Order Paper. As at 30 April 2010 we have $778 million worth of unpaid fines reparations court costs and penalties—three-quarters of a billion dollars or 778 Lotto jackpots of $1 million—that have not been paid by the New Zealand public. We know how elusive Lotto jackpots can be. It seems that our fines are also as elusive as that; $778 million worth of unpaid fines is a huge amount of money. The total amount of fines and penalties grew by 47 percent while Labour was in Government. A significant amount of that total sum 82 percent relates to unpaid traffic fines worth about $637 million. 
The other day I got a $40 parking ticket. We know how annoying parking tickets can be. I was at Auckland University for a breakfast meeting—if one gets there before 8 o’clock and leaves before 8 o’clock one does not have to pay the $2 or $4 but my meeting ran slightly over time and I was 10 minutes late. To my annoyance I got a $40 parking ticket. We know how it is: one gets a parking ticket and then one panics. One thinks that one has to get to the Auckland City Council site and pay the parking ticket. I went to the website to pay my parking ticket but it was not loaded yet. So I had to wait for a notice in the mail to pay the fine. I might be a little bit neurotic about fines unlike some people and I have to pay that parking ticket. But it seems that an awful lot of New Zealanders are not that way. We need to make them understand that we will get tougher. 
Previous speakers have said that the previous Government tried to get tough. It postulated the situation and even ran an advertising campaign saying that if people do not pay their fines they may get stopped at Auckland Airport or wherever they are travelling from when they take an overseas trip. But even that scare tactic did not work. The campaign served the purpose of educating the public on the consequences of non-payment but it did not do enough to address the problem. In 2008 the previous Government had 6000 suspended drivers still on our roads. Lack of accountability means that the rest of us who are responsible and accountable carry the burden of those who do not. 
So how will we get tough? We will get tough in several ways. This omnibus bill amends the District Courts Act 1947 the Land Transport Act 1998 the Summary Proceedings Act 1957 the Sentencing Act 2002 and 20 other Acts. One way in which this bill takes action is to routinely release the amount of overdue penalties by the Ministry of Justice to credit-reporting agencies to assess fines enforcement. This bill gives priority over secured creditors for seized properties where their overdue penalties could have been discovered before finance was advanced to purchase the property. 
One of the things I really like about this bill—some members have said they are worried about it—is the driver licence stop order as a new penalty enforcement measure in relation to people who have not made arrangements to pay overdue fines for traffic offences. It does not say “pay”; it means arrange to make the commitment to pay the bill. That means they are taking the onus; they are taking ownership of their fines. Their licences will remain stopped until the offender makes arrangements to pay the fines. This instils a sense of ownership which I think is a great thing. They need to become accountable for their actions. 
This bill also improves the operation of reparation and vehicle confiscation as penalty regimes. This National Government is committed to ensuring the matter of unpaid fines is successfully addressed and this bill will see improvements in the operation and efficiency of the courts enforcement systems. This bill is about accountability for action. As a member of the Law and Order Committee I look forward to the submissions on the bill. I commend the bill to the House. 
CARMEL SEPULONI (Labour) 
: 
 The Courts and Criminal Matters Bill we are debating today is another bill that was developed by the fifth Labour Government. I acknowledge the excellent work done by the previous Minister for Courts my colleague the Hon Rick Barker. Although not all of his proposals made it through to this bill it is still a reflection of his hard work as the previous Minister. I congratulate Mr Rick Barker on his work. 
Before I get stuck into the detail of this bill I need to point out a slight contradiction that was just made in the House by the previous speaker from the Maori Party Rahui Katene. The Maori Party is voting for this bill but it disagrees with the measures for collecting fees. 
Rahui Katene 
: We want to make sure the education is done. 
CARMEL SEPULONI 
: Well there was something in Rahui Katene’s speech concerning the disproportional effect on Maori with regards to where the collected fines go. I remind the House that in December 2008 there was an Education (National Standards) Amendment Bill through which we saw a doubling of the fines for truancy. The Maori Party supported that bill even though there could have been an argument put at that time that Maori would be disproportionately affected by it. I think in some ways there is a slight contradiction with that matter. 
According to the current Minister for Courts this is the most comprehensive set of legislation measures designed to strengthen the recovery of unpaid fines and penalties in 12 years. It is “critical to the credibility of the justice system” as it establishes better processes for monetary penalties. We on this side agree that it is worthwhile legislation; that is why Labour developed it when we were in Government. Unfortunately National has been in Government for almost 18 months and it has taken this long for National to bring it to the House. We struggle to understand why if it is that important as the Minister for Courts the Hon Georgina te Heuheu pointed out it took 18 months to bring about its first reading. The legislation was almost ready to go when National took office as Rick Barker had done the lion’s share of work on it. Something that National consider as important as this Courts and Criminal Matters Bill still took a year and a half to come to Parliament despite the Government’s “tough on crime” rhetoric. 
We heard that empty rhetoric when we were debating the “three strikes” legislation the Sentencing and Parole Reform Bill yesterday. We have been told by the Ministry of Justice that that bill will do nothing to act as a deterrent to crime. We have had advisers and other people tell us that that bill will see more taxpayers’ money going towards punitive measures rather than taxpayers’ money being freed up to put into places like education health or rehabilitation programmes. We were also told and we heard it from this side of the House that with the “three strikes” bill we will see a lot of money going into the private companies the Government will give contracts to in order to run our private prisons. That legislation was seen as urgent enough to push through despite the fact that it was incredibly controversial; however this bill which members agree with took 18 months to bring to fruition and to the House for its first reading. We on this side have to be glad that at the end of the day it made it here; we just wonder why oh why it took so long. 
Labour will support this bill as it is a result of the work that Rick Barker did as Minister for Courts—work that we consider to be very important. It is important to recognise that courts are wiping millions and millions of dollars a year of unpaid fines; meanwhile the amount of outstanding money owed continues to grow. It is a problem that needs to be addressed. We saw figures released earlier this year that showed that between July 2008 and June 2009 the courts wiped $95.1 million of the total $806 million of unpaid fines. Common sense tells us that if we are going to charge these fines we should collect on them as well. The amount of outstanding fines is increasing each year. Given the large and growing amount of outstanding penalties the effectiveness of monetary penalties as a sanction for offending is being eroded. 
The regulatory impact statement to this bill states that many people can afford to pay their fines but choose not to until costly enforcement action is taken. I think that often the line is run that people cannot afford to pay the fines and in some cases that is the case but research says that a large number of them can afford to pay the fine; they just do not get around to doing it until action is taken. The amount of unpaid fines remitted to community work has more than tripled over the last 5 years from $16.6 million in 2005 to $55.7 million last year. There are a few other things that I will touch on with regard to this. The fines and monetary penalties are only effective if there are procedures in place to enforce the penalty as without that these penalties are just empty threats and will do nothing to deter criminals. We do not want legislation put through that is purely aspirational with regards to fines—and that could involve fines like we saw in the Education (National Standards) Amendment Bill with the truancy fine doubled—and with no intention to ever collect them. 
One of this bill’s major policy proposals is the driver licence stop orders initiative. I would like to take the time to discuss this in a little more detail. The driver licence stop orders initiative is a new method of enforcement that would allow the suspension of driver licences if people have not paid or given intention to pay outstanding traffic penalties. The driver licence stop orders scheme was approved by the previous Labour Government in July 2008. It is based on similar successful initiatives notably in Australia where these orders have greatly improved the rates of collected fines. In Queensland the scheme is successful in collecting three-quarters of fines owed by people who are threatened with licence suspension or who have their licences suspended because of unpaid fines. As well as Australia other countries such as Canada and the US have driver licence suspension as a fines compliance measure. 
Another major policy proposal in this bill is credit reporting. Through this system private sector lending companies and others will be able to find out if someone has overdue penalties. This will encourage people to pay fines and will make them accountable for the money they owe. It also means that the Ministry of Justice can use information stored by credit-reporting agencies to collect fines. This system will affect people who can afford to pay fines but choose not to because they have not previously faced any serious consequences for not paying. 
We will be supporting this bill but I make it clear that it is not the bill that the previous Labour Government would have passed. We would have liked to have seen a great deal more ambition and reach in this bill. It has potential but it stops short of addressing some of the more pressing matters related to the issue of unpaid court fines; for example there are over 80 issuing authorities dealing with these fines. That is crazy and it hinders a successful collection of fines. If this bill were to create a single agency to deal with court fines—which is what Labour Government and what this side of the House would have preferred—it would have been a great improvement and we would see a much better rate of fines collection. Labour suggested that but it has been left out of the bill before the House today. I am unsure of the logic or the reason for that and it is an example of the kind of forward-thinking that we would have liked incorporated into the bill. 
Another important matter that seems not to have been considered is the feasibility of huge fines especially when the person being fined is young. Research from the Ministry of Justice showed that once people cross a certain threshold of money owed—and for young people this threshold is usually around $2000—not only are they unable to pay the amount but also they become unwilling to even try to pay off some of the fine. The last thing we want is for our young people to be burdened with unnecessary fines so it would have been good if this bill had taken that into consideration in some way or another. I go back to what my colleague Jacinda Ardern was talking about before when she made the connection that our Minister for Courts is also the Minister of Pacific Island Affairs. 
Dr CAM CALDER (National) 
: 
 I am thankful for the opportunity to speak on this most important Courts and Criminal Matters Bill. It was with some surprise that I heard the previous speaker ask why it has taken 18 months to bring this bill to the House. If my memory serves me well Labour had 9 years in Government to bring this bill to the House. 
This bill is necessary because under the late unlamented Labour administration—those loquacious lobbyists for lassitude and legislative lethargy—the amount of outstanding penalties continued to grow unchecked so as to seriously erode the very effectiveness of monetary penalties as a sanction for offending. It is fair to point out that year on year the value of fines collected grew but the total amount of fines owed continued to increase. 
I pay respect to my colleague the Hon Rick Barker. We know that he attempted to restrict international travel for those with unpaid fines but he was a lone voice crying in the wilderness. I hear people ask how useful the previous Government’s efforts were to combat this. They were as useful as a sticking plaster to replace a tile on the hull of the space shuttle! As useful as a ticket to The Checks concert for a lover of Debussy! As useful as a unicycle when climbing Kilimanjaro! 
The public have understandably reacted to recently released figures that state that there are outstanding unpaid fines of $778 million. This National-led Government is listening and is taking steps to address this iniquitous situation. I commend this bill to the House. 
A party vote was called for on the question  
That the Courts and Criminal Matters Bill be now read a first time. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a first time. 
Bill referred to the Law and Order Committee. 
Electoral (Administration) Amendment Bill 
Third Reading 
Hon SIMON POWER (Minister of Justice) 
: 
 I move  
That the Electoral (Administration) Amendment Bill be now read a third time 
. This bill is part of a suite of legislation that gives effect to National’s commitments to reform the electoral process. The bill transfers the functions of the current Chief Electoral Officer and Electoral Commission to a new Electoral Commission which will be fully functional from 1 October this year. I am pleased to say that this bill received widespread parliamentary support during its passage through this House. Such consensus is a longstanding convention for progressing significant electoral reform and it also embodies this Government’s general approach to such matters. I acknowledge and express my appreciation for the cooperation of all parties throughout this process. 
The new Electoral Commission will be established as an independent Crown entity overseeing the administration of the electoral system. The bill seeks to maximise existing resources and to reduce costs by combining the functions and powers of the two agencies into one entity. Some submitters to the Justice and Electoral Committee proposed that the new electoral agency should be established as an Officer of Parliament instead of as an independent Crown entity. I gave that matter serious consideration before introducing the bill and the select committee gave serious consideration to it while it was before that committee. However for the reasons canvassed in this House and in the select committee’s report I remain convinced that an independent Crown entity is the best fit for the new Electoral Commission. 
There are a number of protections in the bill that will ensure the commission’s independence. First the Electoral Commissioners will be appointed and removed by the Governor-General on the recommendation of the House. Second the Electoral Commission will have a statutory duty of independence. The commission’s objective under this bill includes a specific direction to administer the electoral system impartially effectively efficiently and in a way that maintains confidence in the system. Third the Electoral Commission will be able to provide information and advice to the Minister of Justice or to the House at any time and of its own volition or during its regular post-election report. Finally as the responsible Minister the Minister of Justice is unable to direct the Electoral Commission to give effect to or have regard to Government policy. I am therefore assured that the public and this House will be able to hold full confidence in the new Electoral Commission proposed by the Electoral (Administration) Amendment Bill. 
I signal to the House that should this bill pass its final reading the Government will proceed with a further electoral administration bill to implement the second stage of electoral agency reform. That bill will provide for the transfer of the functions of the Chief Registrar of Electors to the new Electoral Commission in 2012. The new Electoral Commission will administer the 2011 general election and a simultaneous referendum on the electoral system. This is as was pointed out in the Committee stage by various members a very large task. The new Electoral Commission will therefore need to be fully functional in a relatively short period of time. For this reason I wrote to the leader of every party in this House to advise them in advance of the approach that I intend to take to appointments to the commission and to invite them to take part in that process. 
I will take a moment to express my thanks—on behalf of the Parliament I hope—to the Chief Electoral Officer and to the current Electoral Commission. I know that their consummate professionalism will continue during the transition to the new commission. I also thank existing staff and management in advance for their assistance. 
The new Electoral Commission will provide an independent cohesive and transparent regime for the administration of elections in this country. It will contribute to the maintenance and to the operation of a core element of New Zealand’s democracy being the electoral system. I commend this bill to the House. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 I rise to thank the Minister of Justice for his contribution to this debate and to reassert Labour’s support for this bill the Electoral (Administration) Amendment Bill. We think that it is a good measure. The objectives described in this bill are certainly ones that we support. We certainly feel that the new Electoral Commission which will take over the functions of the Chief Electoral Officer and the current Electoral Commission will improve confidence in our electoral system. The timetable is challenging. I think the Minister indicated that with 1 October I think it is intended to be the date when the new commission takes effect. I believe that it was right for the Government to make the decision to hold off the second tranche of administrative changes until after that process is established and for the remaining functions to transfer to the commission after the holding of the next general election. That makes very good sense indeed. 
However it would not be appropriate to end the contribution I am making on this bill without reinforcing the deep and abiding concern I have about the impact of this new body having to focus its attention on its first general election—its knowing that many of the personnel will be the same personnel and knowing that they will want to do that really well for the first time—and at the same time having to administer an incredibly important constitutional referendum with no spending limits on third parties. That is a serious issue which this House needs to take a good look at. Even though that provision is contained within another bill the fact that this commission will be looking at the detailed application of MMP and different parts of MMP if MMP survives the referendum means that is right and proper that we raise this in the debate on this bill as well. 
If MMP as a system of electing MPs into Parliament is retained then this commission will have a vitally important role. It will be one that we have previously assigned to a special committee of Parliament chaired by the Speaker and in this future case under the Electoral Commission. I personally support that. It is better to have an independent Crown entity taking up that role. The public can have confidence in that. That will be one of the advantages that we will go with into the referendum on MMP. But the strong disadvantage that we will continue to have is that people can spend anything to achieve their objective. I am sure they will not be as unsophisticated as putting paper bags over the heads of a few unidentified list MPs which was the best they could manage last time. This time the campaigning will be much more effective and it will be tied up with an election campaign which will be a pretty major test between two parties and the other parties competing perhaps for the second to last time if we end up without a proportional system in Parliament given the timetable that has been proposed. I am just reinforcing how important it is to have caps on spending on the referendum. I am very strongly of the view that we need to have caps on spending on parallel campaigns as well. But on that note I am pleased that the bill is receiving its final reading. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
CHESTER BORROWS (National—Whanganui) 
: 
 It is with some satisfaction that I rise to take a call in the third reading of the Electoral (Administration) Bill. It is a bill that has taken some time to come together but it is one that enjoyed support across the House. All members of the Justice and Electoral Committee contributed to its work on the bill with everyone being in accord. 
As has previously been outlined the only real issue was whether the authority should be an independent State entity or an Officer of Parliament. It was decided after taking advice from a number of experts and consideration of advice from officials that it should be an independent State entity as suggested in the bill. We decided for a number of reasons that that was the best fit and that it should stay as that. It seems good sense and submissions along that line expressed the same opinion that the various three agencies be amalgamated over time—initially the first two and the third joining at a subsequent date. I am pleased to report that submissions were in favour of that albeit there were a number of submissions that suggested the authority should be an Officer of Parliament. 
I commend the bill to the House. Thank you. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 It gives me extraordinary pleasure and something of a surprise actually to be able to take the opportunity to speak in the third reading of the Electoral (Administration) Amendment Bill. As always it is a pleasure to follow the member of Parliament for Whanganui Chester Borrows. Mr Borrows never fails to acknowledge the work of the select committee in what I think is a genuine way particularly where there has been cross-party agreement as there clearly has been on this issue. 
It is somewhat rare for both Labour and National to be supporting the passage of a bill but in the area of electoral administration it is particularly important that the parties put aside any game playing or any opportunity to score political points—tempting though it may be—for the greater good of the process of democracy which we obviously hold very dear. 
This bill establishes the new Electoral Commission. It is proposed that it be an independent Crown entity and I was very interested in the debate about the options that were considered during the select committee process and during the Committee stage. So from 1 October this year the new Electoral Commission the independent Crown entity will carry out the functions of the Chief Electoral Officer and the current Electoral Commission. 
I understand that again on 1 October a second bill will transfer the responsibility of the Chief Registrar of Electors for the electoral roll to the new Electoral Commission and that is something that we will all be greatly interested in. The integrity of the data on the electoral roll is obviously very important not just to us as members of Parliament but to our entire process of democracy. 
As well as acknowledging Chester Borrows and his comments I also want to acknowledge the Minister of Justice Simon Power. He made a rare foray into question time today and he made a very interesting contribution. It is not often that we have the Hon Simon Power able to take questions but I think there was a shortage of questions today and perhaps that was because the Hon Wayne Mapp did not have questions for oral answer at question time today. Suddenly we seemed to have a lot of new Ministers popping up instead of the Hon Wayne Mapp hogging question time. And of course Mr Boscawen had not lodged any questions about the National Institute of Water and Atmospheric Research. So the Minister who is responsible for this bill the Hon Simon Power was able to take an oral question. 
I want to acknowledge that the process of development of this bill has been genuine and consultative and that is to the Minister’s credit. There will be more rigorous debate I am sure about aspects of the Government’s proposed electoral reforms especially issues like the regulation of parallel campaigners but on this particular issue it is my pleasure to offer Labour’s support and to commend the bill’s progress. 
PAUL QUINN (National) 
: 
 It gives me pleasure to stand and speak to the third reading of the Electoral (Administration) Amendment Bill. I think it is appropriate that in speaking we canvass just the key issues because I have noticed a tendency particularly from the Opposition benches to focus on matters that are not part of this bill and to canvass issues around campaign financing and third-party financing which have nothing to do with this bill. So I would like to focus my comments on the key issues of this bill because those other matters are being dealt with in other bills two of which are currently before another select committee. 
This bill is really a reorganisation bill that focuses on restructuring the current two organisations namely the Chief Electoral Office’s functions and the Electoral Commission’s functions into one consolidated organisation. Like any efficient Government we look to bring together and reduce overheads and reduce bureaucracy and this is just another simple example of what this bill does. In due course there will be a second phase which will occur after the next election when the electoral rolls will be moved under the umbrella of this organisation. The reason that has been delayed until after the next election is simply the magnitude of the task required. 
During the select committee deliberations there was only one contentious issue. I guess it was not even contentious but it was one issue that engaged robust thought and discussion—the appointment process and whether the organisation should come under the purview of Officers of Parliament or whether it should be a Crown entity. As has been referred to at various stages of the bill’s passage through this House we received a number of very thoughtful considered and concise submissions from well-qualified people. Having given due weight to those thoughtful considered and concise submissions in the end it was the unanimous view of the select committee that for reasons best captured by the submission of David McGee QC the organisation should not come under the purview of Officers of Parliament but rather should be a Crown entity. 
For the record I note the main reason for that and will read the relevant part of his submission: “Unlike the other Officers of Parliament”—here we are talking about the Auditor-General the Commissioner for the Environment and suchlike—“who are not themselves primarily deliverers of programmes the Electoral Commission would have a major programme to deliver at least once every 3 years—the administrative arrangements for a general election. Even with its other functions … the Commission is an active player in this area of activity. This contrasts with the existing Officers of Parliament whose involvement in government is more as an auditor of how agencies have performed rather than as performers themselves.” It was really over this business of the Electoral Commission having to administer a programme as opposed to auditing and commenting on other programmes that the select committee was swayed by this very thoughtful and considered submission of David McGee QC. So with those few words it gives me great pleasure to join with all sides of the House in support of the third reading of this bill. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 I am delighted to stand today in support of this third reading of a very important bill the Electoral (Administration) Amendment Bill which will create an amalgamated electoral administrative entity that will improve the effectiveness and efficiency of our electoral system. The Maori Party has been pleased to support this bill throughout its passage in the House and we thank the Minister of Justice for his good work in making such good and rapid progress. 
The quality of the administration system is fundamental to improving and increasing Maori electoral participation—a goal that is of course of the utmost importance to our party. I bring a particular experience with me to this bill in light of the history of Te Tai Tonga electorate. Te Tai Tonga or its predecessor Southern Maori has suffered more than its fair share of administrative complexities over the years. It is easily the biggest electorate in the country. In fact I tried to tell some Australians that it was the biggest in the world but they just laughed. It covers 161000 kilometres and we have had ongoing issues in relation to access and administration. 
Dr Tiopira McDowell has presented a historical overview of Southern Maori recording that in the 19th century the number of polling places in the south declined in comparison with other Maori electorates. So although in 1868 Southern Maori was assigned along with the other Maori electorates the grand total of 11 polling places by 1887 Southern Maori had only 25 polling places compared with 35 in Northern Maori 61 in Eastern Maori and 86 in Western Maori. So it was a huge electorate with only 25 polling places which was totally unfair. According to Dr McDowell the iwi of the south made up for those difficulties by sending some of their most articulate outspoken and tireless members to take on that seat. They were people of the ilk of H K Taiaroa Tame Parata who was a whanaunga of our colleague Hekia Eruera Tirikatene and Whetu Tirikatene-Sullivan. 
I raise this history today because I think it is important that one of the first tasks of the new Electoral Commission will be to look at equity and parity across all electorates to ensure that there is a coordinated overview that makes a priority commitment to effective administration for all electorates and subsequently for all voters. It is somewhat dispiriting to know that in the 2005 inquiry into the general election the Maori Party raised a very similar issue to the one first mooted in 1887 in recommending that the Chief Electoral Office review its organisation and resourcing of polling places. The view from the Maori Party was that all polling places should have sufficient supplies and trained staff to cope with the demands they face on polling day and that this standard must be equally applied across all electorates. 
In a previous reading of this bill I raised the views of the Nelson Bays Community Law Service which raised a range of issues that the new Electoral Commission could look at to ensure the health of democracy and the electoral process. That excellent community law service raised issues such as an insufficient number of Maori roll voting papers and a lack of Maori roll data as being issues that could have been easily rectified. A point raised by Dr Helena Catt during the Justice and Electoral Committee hearings was that she welcomed the inclusion of a clear education role for the new entity. That is something that the Maori Party holds as critical to the effective functioning of electoral democracy. We were interested too in the comments from Dr Catt suggesting that in time the education role should be expanded to include all elections for public office. Although we note that a cost saving to the Government of 3.19 percent is expected from this bill it does make me wonder about a broader value that we could expect to emerge from improved representation and participation in the electoral process. Better services for voters candidates and political parties should we hope result in a more reliable and fuller participation at the polling booths. 
Finally we are happy to support this bill as a sound platform for future development. If I can I will share just one more topical snippet from the impressive records of Dr Tiopira McDowell: “History records the fate of one Deputy Returning Officer J T Large who was sent on a 15 day trek from Lake Waikaremoana to record votes in the remote Urewera ranges. After being lost and injured on his journey he arrived to find that most of the community had left to go to Whakatane and was told to count the trees for votes.” From time to time issues of administrative overload or error continue to confront us. Indeed sometimes they have been so significant that we literally cannot see the forest for the trees. I can only hope that at the 2011 elections we can see a way forward through the forest and through the trees to a future in which all voters have the benefit of being able to participate in a healthy democracy in an effective electoral system. We are pleased to support this bill. 
SIMON BRIDGES (National—Tauranga) 
: 
 It is good to speak on the third reading of the Electoral (Administration) Amendment Bill. It is a bill that provides us with a new unitary Electoral Commission. It has also been good to listen to what the member Rahui Katene said. I was intrigued to hear about Mr Large’s 15-day trek through Waikaremoana. He would not have been so large by the end of it no doubt. 
The House is proceeding through this third reading without controversy and with substantial agreement by all parties that having three entities dealing with the matters that our new unitary Electoral Commission will deal with was not efficient or strategic that it held possible confusion for various actors involved with electoral matters and that there were increased costs. There are a number of reasons why what we are doing here makes eminently good sense. There is no controversy at all. 
The only area of what my colleague Paul Quinn called controversy—I would not put it as highly as that; rather the only issue of substance—that we came across at the Justice and Electoral Committee was whether the office we are creating should be an Officer of Parliament or an independent Crown entity. As Paul Quinn has traversed we went to and fro on this issue. There was a lot of discussion and we heard from not just experts but the best experts in the field of electoral law procedure and practice in this country. In the end we came down squarely on it being an independent Crown entity. 
I finish by commending the Minister of Justice Simon Power for the style with which he conducts electoral affairs. He manages with aplomb to get these bills through Parliament with agreement and without acrimony which is exactly as it should be when dealing with important electoral matters. Thank you. 
CHARLES CHAUVEL (Labour) 
: 
 As previous speakers on this side of the House have indicated Labour will be supporting the Electoral (Administration) Amendment Bill. It is sensible legislation and on balance we think it will see more effective regulation of elections by the new Electoral Commission. It is appropriate to note that it has come about through a consultation process that has been thorough and fair. 
The Electoral (Administration) Amendment Bill will establish a new independent Crown entity called the Electoral Commission—not to be confused with one of the bodies that it takes over from the current Electoral Commission—to regulate elections. In passing it would be appropriate to record the House’s gratitude—and hopefully other members will agree with this sentiment—to the bodies that have supervised elections in the past given that we are effectively bringing those bodies to an end and replacing them with a single entity. I do not think there can be any doubt from any member that the country has been extremely well served by the entities that regulate elections in New Zealand. I certainly think it is appropriate to put on record our gratitude to them for the work that they have done. 
Under this bill—if the House passes it which it gives every indication that it will—from 1 October the new entity will carry out the functions of the current Electoral Commission and the Chief Electoral Officer. This bill is the first part of a two-step reform of electoral administration. The second part—which we are told will be enacted by a second bill—will on 1 October 2012 transfer the responsibility for the electoral roll to the new Electoral Commission. It seems that this two-step approach is sensible as it ensures that the general election next year will not be disrupted in any way by complications in the transfer of the roll. 
Although Labour agrees that merging the institutions is the best way to streamline our election processes as I said I do not want anything in this speech to be taken as demeaning or discrediting the work that has been done to date by the current Electoral Commission or the Chief Electoral Officer in their administration of elections which has always been done to a high standard. We should as a House celebrate their integrity. It is important that we never take for granted the free and fair elections that we have largely seen run in this country. It is a matter of celebration also that the new entity will adopt all of the functions of the predecessor entities: conducting elections; dealing with the donations to and expenditure of parties and candidates; informing the public about election matters; apportioning broadcasting time and funding; registering parties and logos; and maintaining the electoral roll. There can be every hope that the new body will do those tasks in a way that reflects the very high standard to which they have been performed to date. 
I join with other speakers across the House in congratulating the Minister of Justice on the consultation process over the bill. It was introduced on 22 October last year had its first reading a week later and was reported back from the Justice and Electoral Committee on 26 April this year. My colleagues who sit on the committee tell me that the submissions heard were extensive and that people had a fair chance to have their say so it is appropriate at this juncture to also acknowledge the work of the chair of the select committee who ensured that that process could be followed. It is a lesson I think that other select committee chairs and other Ministers could take some learning from. 
Although Labour supports this bill and thinks it is a sensible one that has passed through this House so far with good process we hold serious concerns about some of the other aspects of the Government’s electoral reform. I follow the example of our first speaker Lianne Dalziel in reminding the House what those concerns are. The first relates to the upcoming referendum on MMP. The rules surrounding parallel campaigning as I have said in previous contributions should be a cause for serious concern. If the Government were serious about fairness and transparency across the board then there would not be just one decent process of consultation—such as I have acknowledged we have seen via the bill that we are discussing today—but instead that approach would be adopted wholesale in respect of electoral reform. We have not seen that approach around the parallel campaigning issues. It is not appropriate that there be no spending cap in respect of the upcoming referendum which is to be held in conjunction with the next general election. That is inherently unfair and non-transparent as it neither allows voters to see the real deal of what is going on nor allows everyone to have a fair and equal say. I repeat what I have said in respect of that matter in previous contributions: if we are to have a proper consensus about what is going forward fair and meaningful electoral reform the issue of parallel campaigning must be dealt with. 
Although this is a good bill we need to look at the bigger picture. One successful piece of legislation—this is one and I have paid appropriate tribute to the Minister and the select committee chair—does not justify the failure to consult widely in respect of many other issues. One good piece of legislation does not allow the Government to draw a line in the sand under the issues of fairness and transparency when other aspects of electoral reform like the parallel campaigning issue— 
Hon Members 
: And donations. 
CHARLES CHAUVEL 
: —undermine those values; and there is the issue of donations as my colleagues remind me. I challenge the Minister to extend the good process that he has without a doubt adopted on this issue to every piece of legislation that he introduces to the House but I am not holding my breath. 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 I want to read into the record only a few remarks. First I acknowledge the role of the Minister of Justice in the lead-up to this phase of the legislation. Not only has he been consultative but also we have something resembling a consensus on this legislation. I acknowledge the Minister’s role and his consultative behaviours and I want to return soon to the issue of consensus in respect of other aspects of electoral law reform. 
Second I endorse the remarks of my colleague Charles Chauvel in respect of the regards that he paid to the two organisations that are being taken out by this legislation and being replaced by one and thank them for their efforts including during the really rather interesting phase in our electoral history when we made the move from first past the post to proportional representation midway through the last decade with the challenges that arose for those organisations. In fact one of them was set up precisely because we had made that change—the Electoral Commission. 
Third I point out that the good work and the harmonious and accurate nature of our elections have not always been the case. Although we have had 150-something years of elections during which time no shot has been fired and we can be pretty pleased about the long history of change of Governments backwards and forwards over those decades the second leg of the double for this amendment bill is to fold in the Electoral Enrolment Centre. In recent times the electoral enrolments processes in this country have been a joke—not that recent; actually I am referring to the 1978 election when the rolls were hugely inflated by hundreds and hundreds of thousands of people who were either non-existent or who were double counted on more than one roll. In the event I suspect the amount of dual voting that took place was not huge but the reason that happened was that in the 1975-78 period the then Government decided to give the job of putting the rolls together to the then Department of Justice. To cut a long story short the department stuffed it up. Post-1978 the process was put out to tender and it was taken up by New Zealand Post or whatever its predecessor name was and since then the process has been managed by the Electoral Enrolment Centre as part of New Zealand Post. 
I make that point because it is within living memory and things can go wrong in modern democracies and sometimes they do. Whether it is the “hanging chads” of Florida or the mess that we saw a few decades ago in our country these are very expensive mistakes. I say that to the House because I hope that the next piece of legislation the second leg of the double is one that is being written with the lessons of that history in mind. 
I want to make a point about consensus and to say that we do not it appears yet have consensus in this House. In fact by one perspective we have never particularly had it—I will explore that a little—and we do not have consensus or broad consensus or mostly consensus on what I think will be the next few bills regarding electoral reform as it applies to donations spending caps parallel campaigning and all of these things. We know what we are talking about here. I do not want to talk about the issues; I want to talk about the value of consensus. I acknowledge we have never had it but in the 1980s and in the 1990s when there was near-consensus throughout those decades—and they were turbulent enough in general but as far as electoral law was concerned they were rather quiescent—the main point of contention was when the rolls should close. Should they close 28 days prior or should they close the evening prior? As Governments changed in that time so did the electoral law. 
The point of that is that the electoral law is part of our constitution. We always say that we have an unwritten constitution; in fact we have it written in several places and the rest of it is just tradition or by arrangement. It is part of our written constitution and it is not a good idea for the written constitution to change reliably upon the change of Government. If one is to address that the question is how we get somewhere close to a near consensus on it. We are some distance away in respect of donations spending caps and parallel campaigning. 
Let me put it on the record that the electoral law that existed in this House at the time of the last election is not one that I think Labour would die in a ditch over. That is to say we would be up for negotiation. I think that is the mood on this side of the House; we will see whether other speakers condone that sentiment. It is also important that the Government’s opening bid is not its last. We do need to make some sort of attempt to partially close the gap. 
Hon David Parker 
: But that’s not consensus. 
Hon PETE HODGSON 
: No it is not consensus. It is a movement towards some sort of agreed plank that is broad enough that all parties can find— 
Hon David Parker 
: They just want the status quo. 
Hon PETE HODGSON 
: Well the status quo is not consensus. Members will see that the thing about the status quo is that if one reflects on the status quo and says that because we do not have consensus about where we can move to we cannot move at all—if that is the line that the National Government takes and I hope it does not—then we will be changing our constitution every time we change the Government. That is a bad idea because it changes reliably. 
Paul Quinn 
: You should have thought of that last time. 
Hon PETE HODGSON 
: Indeed indeed; I accept the member’s comment absolutely. We have our set of truths which I will not rehearse here about whether we attempted to achieve consensus. But certainly whether or not we attempted to we failed; there is no doubt about that. I think that saying that we cannot move anywhere from the status quo because we do not have the perfect position to land is not very smart. I think that we should think afresh about whether we can move closer so that if you will parties are equally unhappy about the way that the electoral law stands. Then there is more or less a balance of terror and quite possibly the electoral law would withstand endless changes of Government without having endless big changes. 
So if it is to be part of our constitution one of the things about our constitution is that it is supposed to be reasonably reliable. If we do not manage to get somewhere closer to agreement broad agreement equal unhappiness or something like that we will be in a position where we as a nation are going to change part of our constitution every time there is a change in the Government. That is just wrong. So I say to the National members opposite that I do not think we have got that aspect of our electoral law correct or anywhere near it. I am saying that for me anyway I think we would be wide open to a negotiating position that left us somewhat uncomfortable. That is the nature of a deal. I think that defending the status quo on the basis that there is no consensus on the point of destination is just wrong. 
HEKIA PARATA (National) 
: 
 Tena koe Mr Speaker. Tena tatou ki te Whare. I am delighted to stand and take a short call on the Electoral (Administration) Amendment Bill. Unlike the previous speaker I will confine my remarks to the bill at hand. But like the previous speaker I also emphasise the need for constitutional integrity because that is the basis for confidence and certainty by the New Zealand polity in the democracy that we have in New Zealand. It is important that we have institutions upon which people can rely and this bill focuses on an institution that is central to the constitutional arrangements that we have here in Aotearoa New Zealand. 
This bill will provide first-class electoral services. Ongoing reviews have found that the existing electoral arrangements have some flaws and the select committee process or indeed the consensus consultations by the Minister that preceded the select committee process found that some flaws needed to be addressed. I join with members on both sides of the House in acknowledging the leadership of the Minister and the approach that he has taken to ensuring that there could be consensus on this. I equally join with members on both sides of the House in commending the chair of the select committee for navigating the process to the point that we are at now. 
I joined the Justice and Electoral Committee at the tail-end of discussions about this bill and was impressed with the submissions and the commentators who participated in the process. Some very distinguished and very experienced people brought that experience to bear in helping the committee report back to the House on this bill. 
The current structure though generally effective has created some problems including duplication increased costs and complexity for people dealing with the three agencies and the disjointed decision-making on electoral matters. I am aware that speakers on this bill have commented in some detail on those particular flaws. However there has been longstanding support across the board for a better integrated form of electoral administration and we are confident that the proposal for a single entity will address the existing flaws and will alleviate the pressure on current agencies political parties and candidates and of course on the all-important public. As I said this bill will provide for first-class electoral services. 
National is confident that the new Electoral Commission will provide better access to electoral services and encourage a more integrated efficient and strategic approach to electoral administration. Having one agency will remove duplication and confusion over responsibilities. Of course that is very important in the critical area of ensuring that the electoral process can withstand the scrutiny of all people involved in it and that it continues to stimulate interest both for participants at our level who are interested in the representative capacity and for voters who turn out on election day. It will also save costs and reduce complexity for political parties constituency candidates and the public. Of course it is all-important that the Electoral Commission will be an independent Crown entity that is separate from executive Government. The adoption of an independent Crown entity for electoral administration will provide the best balance of a high level of independence with good accountability and the ability to administer the electoral functions to a high standard. 
Comment has already been made on the fact that the reform is in two stages to ensure transition to the new commission does not create risk for the administration of the 2011 election. It is clear that all speakers tonight are confident that that will indeed be the case. I join with the other members of the House in commending the bill to the House. Kia ora. 
Hon DAVID PARKER (Labour) 
: 
 The Labour Party as has been noted by previous speakers is supporting the Electoral (Administration) Amendment Bill. I will follow on from some of the previous Labour speakers including Charles Chauvel and Pete Hodgson. I will talk first in relation to the issue of the dangers of a simplistic view of agreement as to what should be our electoral law. If we view consensus as being a desirable attribute of electoral law—and I certainly do—we have to go under that word and define what we mean by appropriate consensus. This bill is an example of consensus because its provisions improve the administration of New Zealand’s elections in a way that is acceptable to all political parties and in a way that is patently fair. 
New Zealand has as Pete Hodgson said a very proud history of having election processes that our public have confidence in. That is one of the reasons that New Zealand has one of the longest histories in the world of fair and non-violent elections. That is something that we ought to treasure in New Zealand as one of the essential features of our country because we know that countries that do not have fair elections are more likely to descend into uncivil violence and disorder. Democracy and fair elections are fundamentally important to peace and to freedom from violence in society. The importance of the democratic process and fair election processes cannot be overstated. 
This bill has broad cross-party support because it improves the administration of justice but the issue does not end there. In order to have fair process we have to have fair rules as to the running of elections. Those fair rules do not relate just to the agencies that administer elections but also they relate to the rules that apply to the participants in elections. 
This Government has been very critical of the rules that the previous Labour Government made in relation to election finances. National members were so critical that they said that if they were ever elected they would repeal the law. That is fair enough; that is their right as members of an incoming Government. But then they said that they would proceed by way of consensus to new laws. That is fair enough as an objective but if they sit there as the Government and refuse to be part of any change they can say if that is their definition of consensus that there is no consensus; therefore the status quo will prevail even though the status quo is patently unjust. 
The status quo in New Zealand in respect of electoral financing is wrong. Charles Chauvel in his contribution gave one example. In respect of the upcoming referendum on MMP there is absolutely unlimited spending permitted for any interested party in pursuit of its position. Freedom of expression does not mean freedom to buy an outcome. Freedom of expression in New Zealand would be retained if all people were able to spend 100 percent of their time out there in pursuit of their political ideals. But freedom of expression does not mean that we can go so far as to say that corporates for example should be able to spend unlimited amounts of money in respect of their pursuit of an electoral outcome that might be in their financial interest. That point was made very wisely I thought by—I forget the name of the Supreme Court Justice in the United States who is about to come up to retirement— 
Charles Chauvel 
: John Paul Stevens. 
Hon DAVID PARKER 
: Thank you Charles. John Paul Stevens made that point very eloquently in a decision of the Supreme Court of the United States of America by saying that if corporates have the same rights as individuals—which they have in New Zealand in respect of electoral financing laws—why do they not have the right to vote? Plainly a corporate cannot vote. There is a difference between corporates and individuals. There is a difference in principle between a corporate being and an individual. In New Zealand we blur that distinction by allowing unlimited spending by corporates—for example in respect of the referendum on MMP. 
The Royal Commission on the Electoral System which reported many years ago at the time of the introduction of MMP made the very obvious point that if we do not have some control on non-political party spending at elections then we make a mockery of any controls we have on the political party. If the political party can spend to its limit and then through a separate entity that it controls—and under New Zealand law it can control it; it does not have to be independent from it—it can spend unlimited amounts of money in pursuit of its political ideals to buy an election outcome then we make a mockery of having any limits in respect of a political party. If we as a country agree that there ought to be controls on political parties buying election outcomes rather than competing in a contest of ideas and if we believe in the principles that underlie our limits to election spending then we must agree that there has to be some control on non-party expenditure. Otherwise we make a mockery of the controls that there are on political party expenditure. That is what the royal commission said and it is patently true. The commissioners were right. 
That is why I make reference to the consensus approach that the National Government says it favours. Consensus does not say just that we all have to agree in respect of any change from the status quo. If that is the approach then any one party in this Parliament can withhold its consensus for a necessary change. Consensus requires give and take from all political parties. In respect of the issues of campaign financing third-party campaigns and transparency of donations it is abundantly clear that Labour is willing to give and take. We have agreed to the repeal of the legislation that we passed. We have acknowledged that it is not perfect and we have said that we are willing to look at changes. But if National is not willing to look at changes from the status quo then its members are the ones who are withholding consensus. They ought not to pretend that they are on some plane higher than that of Labour based on the assertion that there is no consensus to change because it will be those National members who are withholding consensus. 
I endorse Pete Hodgson’s comments that said that it is beholden on us as a Parliament to carry forward the long tradition we have in New Zealand of fair elections of peaceful elections and of non-violent elections a tradition we have in New Zealand that is very rare in world terms. In fact I have heard it said that there is only one country in the world that has a non-violent non-revolutionary and uninterrupted democracy that is as longstanding as the one we have in New Zealand. Underpinning that is the confidence of the people that we have fair election processes. As a consequence we have a duty in this Parliament to reach across our political self-interest and to reach reasonable compromises as to what is in our nation’s interest. There seems to be general agreement in New Zealand that we ought not to have US-style elections where money buys a result and that there ought to be limits on the amounts that political parties can spend. 
Charles Chauvel 
: There’s general agreement in the US. 
Hon DAVID PARKER 
: There is general agreement in New Zealand on that even if not in the US. Charles Chauvel says that there is general agreement in the US—and that 80 percent of Americans agree to it—but that country cannot achieve that. We have achieved it in New Zealand; we must hold fast to that as a principle. For that to be real there have to be limits on how much we as political parties spend and on how much non-political parties also spend. 
There is also a need for more transparency as to donations. I quite like the idea that National is floating at the moment about disclosing donations below a certain amount in bands. That is good. But if we are to have transparency around donations to political parties and if we have third non-political parties that are electioneering and spending millions of dollars in a campaign then they have to have transparency as to their sources of funds as well. Without that political parties can never escape the imputation that they are being funded by a particular lobby group that is advocating a particular policy outcome. That is wrong; that is corrosive of public confidence in election outcomes. 
So yes I support this bill but I really encourage the Government to depart from the fiction that in the absence of universal agreement as to change we stick with the status quo. That is not consensus; that is the Government hiding behind the status quo to avoid consensus. Thank you. 
DAVID GARRETT (ACT) 
: 
 I was not planning to take a call on the Electoral (Administration) Amendment Bill but I have been moved to do so by listening to the speeches of two speakers who preceded me. 
Mr Parker and I share a profession. Mr Hodgson and I do not—neither profession nor political persuasion—but I agree with him very strongly that it is most undesirable to have electoral law all over the place. We have a limited written constitution and are heavily dependent on convention. I do not think that anyone could disagree that it is a bad idea to have electoral law changing with Governments whatever hue they may be. 
I thought that Mr Parker’s contribution also made some very good points particularly on the absence of complete consensus—if that is not tautology—not precluding any movement at all. Pete Hodgson used the phrase “equally unhappy”. I do not know Mr Parker’s specialisation in the law but as a litigator I know that oftentimes when both parties are equally unhappy at the end of a case the judge has fairly well got it right. It was certainly the case when I practised employment law. The employers were often very unhappy about what they had to pay out and the employees thought they should have got twice as much so the adjudicators had fairly well got it right. 
I agree with many of the points that have been made by those two speakers. The ACT Party for that reason and obviously for others will happily support the bill along with the rest of the House. Thank you. 
Bill read a third time. 
New Zealand Public Health and Disability Amendment Bill 
First Reading 
Hon TONY RYALL (Minister of Health) 
: 
 I move  
That the New Zealand Public Health and Disability Amendment Bill be now read a first time. 
 At the appropriate time I will move that the bill be considered by the Health Committee. This bill is not about a major restructuring of our district health boards or the New Zealand public health service. Rather it is about taking the health board system and making it work better. The way forward to meeting our clinical and service challenges is not by having 20 district health boards operating independently duplicating functions often inefficiently. This bill is about increasing district health board and clinical regional cooperation. 
This is the first health bill that the new National-led Government has introduced to the House since its election 18 months ago. In this time important improvements have been delivered in a number of public health services despite the fact that we are experiencing the worst world economic recession since the 1930s. These improvements include a quadrupling of the average annual increase in the number of people getting elective surgery from under 3000 more a year to an increase of nearly 13000 in our first year. We have also seen improved emergency department waiting times and a massive reduction in the number of people waiting for more than 6 weeks before commencing cancer radiation treatment. We have also seen the successful capping of the growth in the health sector bureaucracy with a management administration cap being set for both district health boards and the Ministry of Health; and 1 year on both the ministry and the district health boards have responded by stopping that growth freeing up more resources for patient services—and these are only a few examples of progress. 
Although these gains are positive it is clear the wider public health system faces many challenges. The election of the new Government saw it inheriting a public health system that had many strengths such as a committed workforce but many serious challenges. Among the most important of these were workforce shortages district health boards supplying around $155 million in health services for which they were not funded and intensifying pressure on a number of services. An example of this was the pressure on elective waiting lists which has seen the previous Government culling over 30000 patients from the system many of whom were promised operations. 
It is clear that the public health system faces huge future challenges and a potential doubling in demand over the next decade. How do we best meet the health needs of our population which is both growing and ageing and a population that is expecting increased access to particular health services such as elective surgery and rightly aspires to benefit from medical and technical advances? These sit us alongside the need to upgrade and expand our health infrastructure including our hospitals information technology and equipment and above all to grow our health workforce in the face of competition from neighbouring countries with greater wealth. All this in a time of short-term decline in Government revenue and forecast moderate medium-term growth caused by the world’s recovery from the worst economic crisis. 
An early priority of the new Government was to establish an expert ministerial review group made up of experienced people with health and management expertise from across the health sector to give their advice on reducing bureaucracy and improving front-line services. This ministerial group consulted widely met with a wide range of health groups and individuals deliberated and returned to many groups to test their thinking. Building on the developing consensus on the need for improvement the ministerial review group developed a forward-looking set of over 170 recommendations. These recommendations covered both very specific recommendations such as reducing the plethora of committees we inherited and higher-level major advances such as the establishment of a national health board and consolidated planning of information technology in the health sector. 
Most recommendations have been subject to ministerial and official examination and progressed as rapidly as possible. This bill progresses some of those recommendations more specifically to stop reinventing the wheel 20 times through a better focus on shared services and the power of bulk purchasing. It also focuses on the need for a more regionalised approach to district health board planning of services and a stronger commitment to ongoing improvements in quality. 
The bill amends the New Zealand Public Health and Disability Act 2000 to support improvements that are required to meet those challenges. The bill provides the framework to improve national and regional cooperation and reduce duplication of back-office functions. The bill also supports a greater focus on patient safety across the health sector and responds to calls from health professionals across the nation for an independent clinician-led agency to establish quality improvement across the whole health service. 
Cooperation between district health boards can improve quality of care reduce service vulnerability and improve cost-effectiveness by reducing the transaction costs of district health boards conducting their own individual processes. When the current district health board model was introduced in 2000 the intention was that district health boards would collaborate and the Minister of Health would be able to use accountability arrangements and policy settings to reinforce the importance of collaboration. Although some steps have been taken by district health boards towards regional collaboration and planning such as through healthAlliance in Auckland progress has been limited and it has become increasingly clear that there are barriers including legislative barriers preventing district health boards from making genuinely collective decisions consistently and in a timely manner. To address these problems the bill seeks to improve national and regional service planning and decision making by ensuring that district health board planning takes into account national and regional as well as local requirements and this includes freeing up various reporting requirements to reduce needless administrative costs. 
The bill will also amend district health board objectives and functions to ensure they work collaboratively to meet national regional and local service needs provide dispute resolution measures to support district health boards working collaboratively and enable elected district health board members to be appointed to other district health boards. These amendments will ensure that district health boards collaborate to ensure a better balance of district regional and national priorities in decision making which will allow the most efficient use of available resources. 
The bill also includes proposals to accelerate improvements in quality and safety by establishing a health and safety commission. High levels of quality and safety are the cornerstone of an effective trusted and efficient health service. To support this the Government has decided to establish a Health Quality and Safety Commission as a stand-alone Crown entity. This will bring a focus on quality and safety not previously achieved. The commission will be clinician-led. It will empower clinical leadership and foster the necessary clinical engagement to achieve our aims of continuous improvement quality and safety in health and disability services including services and private providers like rest homes. 
In addition it is estimated that avoidable adverse events cost the public health service between $500 million and $600 million a year. Realistically we cannot save all of that overnight but even a 20 percent reduction in errors arising from a greater focus on quality and safety could save us $100 million a year that could be reinvested in other front-line services. 
Finally the bill seeks to minimise administration costs and reduce bureaucracy in the public health service by supporting shared administrative support and procurement services across the public health service. The bill includes a backstop power for Ministers to direct greater collaboration and use of shared services by district health boards. We have identified that improving the national approach to shared services could yield significant cost savings reduce personnel ensure more efficient systems and provide a better health service. At the moment while district health boards can be encouraged to use shared services or processes to obtain administrative support and procurement services they cannot be compelled to even when there are clear benefits to that approach. 
The bill contains a last-resort power that enables after due process and consultation the Minister of Health and the Minister of Finance to direct district health boards as to how to obtain administrative support and procurement services as well as whom those services will be required from. This provides the opportunity for a dedicated shared services agency for the public health service to realise the benefits of bulk purchasing and the gains that could come from that. 
In conclusion this bill is not a major restructuring of our district health boards or the New Zealand public health service. Rather it is about taking the health board system set up by the previous Government and making it work better. It is about recognising that the way forward to meeting our clinical and service challenges is not through having 20 district health boards reinventing the wheel—duplicating functions often inefficiently. Rather it is about recognising that the way forward is through increasing district health board and clinical regional cooperation. A greater emphasis on regional planning and cooperation with the accompanying ability of the Government to move district health boards in this direction if necessary is part of the plan for protecting and growing our New Zealand public health service and for meeting tomorrow’s health challenges. I commend the bill to the House. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 This is a Tui billboard: “The New Zealand Public Health and Disability Amendment Bill is not about restructuring in the public health system and the reason for that is that National promised it would not restructure. The bill is about an administrative shake-up.” It is like the cuts in health services that every single week we have reported in the House. Every single week there are cuts to front-line health services and the Minister of Health says that they are not cuts; they are changes. 
Well the Minister of Health should tell that to the 3000 older people in Otago and Southland an area that is very familiar to your good self Mr Assistant Speaker Roy. He should tell them that the cut to their home support—which is no longer funded by Vote Health—is not a cut; it is just a change. Well change has been pretty awful for them. 
The other interesting thing is the sort of expectation the Minister built up. He did not build it up a lot in that speech actually. I was not sure that he would not doze off part-way through it. It was not a very lively presentation but he did talk about the huge savings potential to be made in health. He said that huge dollars would be saved by making more efficient use of our taxpayer dollar in the health system and he talked about all the things that we would be able to buy with that saved money. 
I refer to a similar report that was presented to this House and to the public of New Zealand and they fell for it only once. The report stated that savings made yearly by health reforms could provide an extra 10000 to 20000 coronary bypass operations or fix half a million children with glue ear. That was said by the then Minister of Health Bill Birch. Did we ever see any health savings in the 1990s? Did we see any New Zealander getting better access to more affordable public health services? 
What we saw in the 1990s and what we are seeing now are absolute cuts. In fact I have some very attractive cartoons and I am happy to present the Minister of Health with a copy of them after this debate. The cartoon I am holding is from the time of the National-led Government in the 1990s. It shows a surgeon with a facemask on but the mask is a $100 bill. The caption says “Welcome to your regional health authority. Pop up onto the bed and take off your clothes. One of our accountants will attend to you shortly.” That is the health system that the previous National Government foisted on New Zealand and it is the health system that Tony Ryall now wants to force on New Zealand. There will less access fewer services and it will be more expensive. 
Here is another very attractive cartoon. This is another one by Tom Scott. He will probably charge me for flashing his cartoons around tonight. It is headed “Behind the scenes in a typical New Zealand hospital.” It says “Scalpel. Clamp. Blood transfusion. Can we afford it? Calculator.” Do members remember the so-called great health reforms of the 1990s? All we got was cash registers in our public hospitals. New Zealanders did not like it. They did not think it was fair. They knew they had paid their tax dollars week in week out to get access to public health services and they did not want to pay again when they walked in the door of their local public hospital. 
Minister Ryall did not refer much to the bill. It was a political rant from the start to the finish dull though it may have been. But the bill does a couple of things. The first thing it does is establish a Health Quality and Safety Commission. This is the second new bureaucracy we have had in just 18 months under this Minister of Health. The National Health Board is chewing up thousands of dollars and we are not sure at all what it is doing at the moment other than replacing what the Ministry of Health used to do. So we are not quite sure what the Health Quality and Safety Commission will do but I imagine that it will have appointees from the Minister. The Minister’s handpicked personnel will be running the show and they will probably do the bidding of the people who are giving the Minister the key advice in the health sector. 
If the aim is to improve quality and safety in our health system in New Zealand then there would be no argument from this side of the House but it is not at all clear why a new body is needed to do that. Will it be just a new bureaucracy? Will it just chew up more of the precious health dollars that we are seeing taken away from our families and communities and will we see any improvement in health quality and safety as a result? That is not at all clear. 
We have heard some outrageous financial claims from the Minister and he made them again in his speech. Even though the key part of this bill is to set up a new bureaucracy the Minister was still claiming in his speech immediately prior to my taking the call that we would see $700 million saved in the health system over 5 years. Nowhere in this legislation is there any indication of exactly how that money will be saved. 
We have the idea of shared services. I am not quite sure what stage the establishment board is up to now. We have a ministerial dictate. No longer will the district health boards be required to work together until they get agreement on a pathway forward. If the Minister is intolerant of any disagreement then he will make the call and he will decide. So all our local democracy has gone out the window. 
If the people at Tairawhiti District Health Board are having a discussion with MidCentral District Health Board about how to provide better services locally and if the Minister decides that that is not what he wants to do then he can just step in and say that they have had enough discussion. He can tell them he does not want them to collaborate in that sort of way and he can tell them what they will do. 
That ministerial determination and dictate is something that we have not seen in New Zealand since the days of the Hon Bill Birch— 
Hon Member 
: Right Honourable. 
Hon RUTH DYSON 
: Correct; I thank the member—the Rt Hon Bill Birch. I offer my apologies for incorrectly appropriating his title to him. Actually his retirement was one of the best things that could have happened to the health system in New Zealand. 
It is not at all clear—the Minister did not elucidate on it at all—how the new Health Quality and Safety Commission will fit in with the Health and Disability Commissioner. We have recently had a new appointment. The Minister of Health announced a new appointment to the commissioner’s position but no relationship at all is explained in this legislation. It is a big puzzle as to why we need a new bureaucracy when a large part of the work that is described in the legislation is already under the mandate of the Health and Disability Commissioner. The idea of resolution of protection and of learning is the driving force behind having the commissioner and this just seems to be an absolute duplication of that. 
I thought that the Minister in his 10 minutes may well have had the opportunity to apologise to New Zealanders for the significant number of health cuts to front-line services that they have had to endure in the last little while. As I mentioned earlier we have seen huge cuts in Otago and Southland particularly to home support for older people. In South Canterbury health cuts for older persons have again been rife but we have also seen a significant reduction in the number of people who are being allowed to access the accident and emergency department at Timaru Hospital. In Gisborne a programme that worked with people with mental illness and people who had been violent—a community-based programme with extremely good results—has been cut because of health funding cuts.  
Mental health services in Nelson have been cut back. Gisborne Hospital decided to close its theatre for 6 weeks to save money. So for 6 weeks the people in the Tai Rawhiti district had no access to surgery. Of course that would save money. If every hospital in the country was closed it would save a huge amount of money but it would not do much to assist health outcomes for New Zealanders. 
In my own town of Christchurch we have seen week after week older people being treated in a disgraceful way because of the health cuts that Tony Ryall has signed off. At the MidCentral District Health Board—Palmerston North and Horowhenua—we are going through a consultation process now where one shift of the district nursing service an entire 8 hours of service provision will be cut and the assessment treatment and rehabilitation beds at Levin’s health centre are under threat. 
This bill does nothing to address that. I look forward to the debate at the select committee where local people will be able to tell the Minister of Health directly what they think of his health cuts. 
Dr PAUL HUTCHISON (National—Hunua) 
: 
 It is with great pleasure that I speak on this very timely New Zealand Public Health and Disability Amendment Bill. But it is with profound regret that I had to listen to the Hon Ruth Dyson give a speech that she probably gave in 1992. She has failed to move on to the reality of the legacy of the previous Labour Government which basically left our health system bloated with bureaucracy and absolutely fragmented all over the place. It had the lowest productivity score that one could possibly imagine and I will go on to that in just a minute. 
It is highly relevant that this bill is a response to many of the recommendations of the ministerial review group that was so ably led by Murray Horn. In that review he pointed out that the sustainability of our public health and disability system is under serious threat. That by no coincidence follows the 9 long years of the previous Labour Government. The review group noted a variety of things. It noted that New Zealanders want to have a public health and disability system of the same standard as that of other OECD countries yet we do not earn as much as those countries so our system needs to be more effective and productive than the OECD average in order to bridge the gap. That is exactly why we have this bill today and why the National Government will be introducing tomorrow a Budget that is committed to putting in a system that focuses on achieving economic growth and on encouraging saving exporting and investing rather than the rampant consumption and spending seen under the previous Labour Government. In order to achieve a sustainable health service we need firstly sustainable economic growth which we did not have under the Labour Government and secondly an efficient and effective health system which was totally forgotten during the 9 years of the previous Labour Government. 
The ministerial review group also said the public health system still struggles to sustain itself financially despite the substantial increase in funding over recent years. In 2009 the district health boards were running deficits of about $150 million and had significant unfunded capital requests. It is absolutely rich for the Hon Ruth Dyson to go back to the 1990s given the abysmal performance under Labour during the previous 9 years. In fact the Treasury review report of 2005 showed that real hospital expenditure between 2001 and 2003 was 13.4 percent higher than at the beginning of Labour’s term in Government which basically meant that hospital efficiency fell by 7.7 percent between 2001 and 2003. During the previous 3 years it had had a modest increase in efficiency of about 1.1 percent. But that absolutely clearly outlines the problem of the Labour legacy whereby hospital efficiency fell by 7.7 percent and consequently cost billions of dollars to the New Zealand taxpayer. We know that during that time an extra $6 billion was put into the system and we know that there was hardly any increase in elective surgery. Yet in the last year under this National Government there has been an increase of 11800 elective surgeries carried out. 
But to emphasise the point ever further it is relevant to look at the Auditor-General’s report on primary health care in 2008. Primary health care was going to be one of the flagships of the previous Labour Government. I freely acknowledge that an extra $1 billion worth of funding made access to primary health care more affordable. However the Auditor-General points out the hopeless lack of tools that Labour put in to accurately measure the result of its investment. In fact Labour brought in a radically new system but failed to ensure that there was value for each health dollar spent. 
If Labour members are to be critical of this bill’s aims—which include amending the objectives and functions of district health boards to ensure that they work together for the most effective and efficient delivery of health services to meet national regional and local needs; and supporting the provision of shared services across the public health system—I remind the Hon Ruth Dyson of what Annette King said in August 2000 in the first reading of the New Zealand Public Health and Disability Bill. She said “District health boards will be expected to work together and to enter into cooperative and collaborative arrangements … to ensure service delivery for their populations.” That failed to happen under the 9 years of the previous Labour Government. Annette King said that back in 2000 but she missed out the words “efficient and effective” before “service delivery”. That is precisely what Labour failed to achieve in its 9 years in office and precisely what this bill is about: efficient and effective health service delivery to individual patients throughout New Zealand. 
But more than that this bill is about the National Government’s determination to develop new modules of care that see the patient rather than the institution put at the centre of service delivery and that emphasise clinical leadership. This bill is also highly appropriately creating a Health Quality and Safety Commission to improve the quality of individual patient care. I very much look forward to this bill progressing through the House to the Health Committee and being enacted in a timely manner. 
IAIN LEES-GALLOWAY (Labour—Palmerston North) 
: 
 It is a bit of a novelty to speak on a health bill. As the Minister said it is 18 months into the term of this Government and finally we have health legislation before the House. But as the Minister said that is not to say that things have not been happening in the health sector. He took some time to discuss what he thought was happening out there in the health sector and I intend to follow his lead by talking about what is happening in my electorate. The cuts—changes as the Minister likes to euphemistically call them—that have been occurring at MidCentral District Health Board have been extensive and varied. They have all come about because the Minister wandered up to Palmerston North read the Riot Act to the district health board and then wandered back to Wellington to leave them to it. 
So it is good to finally see the Minister of Health taking some accountability for his efforts. But what is happening at MidCentral District Health Board? Well as Ruth Dyson said probably the biggest and most significant cut is that to district nursing services. We see a cut to the overnight service which is particularly important to those people who are most vulnerable and who receive palliative care from our district nursing staff. They are wonderful nurses who will respond to any call-out in the middle of the night and who will go and deal with people in their homes so that those people do not have to go through the discomfort the agony and the trouble of going all the way into hospital and being admitted. 
People do not want to see that service disappear. So instead of the district health board taking responsibility for it the core Government responsibility will have to be shifted to the hospice—a hospice that is already stretched and a hospice that welcomed the additional funding which this Government promised and this Government actually did give it. But of course the Government did not say that the hospice would have to fund a whole extra service with that money. The hospice thought that was a kindly gesture to help it balance the books and to help it maintain its current services but no it was not that at all it was a little sweetener before it got hit with the information that it was going to have to provide another service. 
Another service that is going is the Diabetes Lifestyle Centre along with sexual health services. That is about right for this Government because it seems to have no interest whatsoever in public health and health promotion. These are two facilities that help to keep our population well so that people do not end up having to go into hospital but this Government seems to have no interest whatsoever in keeping people well. It wants to see people arrive in hospital get an acute admission so that it is easy to measure and easy to tick the box to say that that person has been through hospital. 
Rehabilitation services will be cut as well in Palmerston North as are the assessment treatment and rehabilitation services in the Horowhenua. So yes the Minister is absolutely right there is a lot going on. There has been a lot going on in the health sector in New Zealand even though this is the first health bill we have seen before the House and none of it is good. It is all about cuts to front-line services. 
I suppose this is where we have to call into question the accountability of the Minister. The bill refers a lot to the accountability of the district health boards but what about the accountability of the Minister? He has studiously avoided any requirement to be accountable with nothing going through the House so we as MPs do not get to scrutinise his work. His work never goes to the Health Committee so the public do not get to scrutinise his work and all the difficult decisions and all the bad news are passed off to the district health boards. That is probably why we saw 500 people in Levin attend the MidCentral District Health Board meeting this week. Those 500 people wanted to go along to the district health board—the people whom they see as making the decisions—and plead their case. Why? Because the Minister is not listening. He does not accept responsibility for his actions and he would rather pass it off on to other people. 
But the Minister has responsibility because before the election National made two promises in particular—two promises to do with health care. One was about front-line services. Well we have seen so many cuts to front-line services it is not funny. And the second of course was less bureaucracy. What have we seen? We have seen the establishment of a National Health Board and now we are seeing the establishment of the Health Quality and Safety Commission. These are two more layers of bureaucracy flying directly in the face of the promises made by National before it was in Government—two more broken promises to add to all the other broken promises we have seen from this Government. 
Setting up the Health Quality and Safety Commission is one part of the bill and the other part includes amendments to support the provision of shared administrative support procurement services across the public health system. Listening to Dr Paul Hutchison and to the Minister members would imagine that this is something they just dreamt up all by themselves and that it was not happening in any way whatsoever before the National Government came into office. This is part of the mythology that the National Government is trying to create about the previous Labour Government which is that it was overloaded with bureaucracy and had no interest in effective outcomes and shared services. 
We have already seen the two district health boards down in Southland and Otago reach a point where they are in merger. That did not happen just overnight; collaboration between those two district health boards was happening long before National came into Government. It has not all suddenly happened since Tony Ryall became the Minister. It is an utter myth to say that there was no collaboration between district health boards before this Government came into power. Again in my own area in the lower North Island there is an awful lot of regional collaboration between Wairarapa Hutt Valley Capital and Coast and MidCentral district health boards all the way up to Wanganui Taranaki and Hawke’s Bay. They do an awful lot of collaboration and they have been for some time. In fact Wanganui and MidCentral entered into an alliance perhaps the first step towards merger—we do not know. That may or may not be the best thing for those district health boards. We would like to see more coming from the clinicians and from the public there to tell us what they think about whether this is the right path for them. 
But it is an utter myth—and Dr Hutchison attempted to reinforce it—that collaboration was not happening before the National Government came into power. So yes this bill does extend it and perhaps brings it into a more formal structure. I look forward to the opportunity to discuss it at the Health Committee. It is about time we had public discussion about what this Government is doing. 
But make no bones about it a lot of this bill is about coercing the district health boards into amalgamation—because another one of the myths is that 21 district health boards are too many. Well if that is too many how many is enough? What is the right number? If this Government thinks that the Labour Government brought in 21 district health boards and that was too many how many is enough? We have not heard from this Government how many it thinks is the right number of district health boards. But we are seeing through this bill and other measures a coercion of district health boards and primary health organisations—much more strongly amongst primary health organisations; if one wants a primary health organisation to merge according to this Minister one just cuts its funding off. Perhaps it is a little bit more subtle with the district health boards but that is the direction this Minister wants to go in. 
Well that is wrong. Our communities and our clinicians should have the say over the direction of our district health boards. If they think they would benefit from closer relationships with other district health boards or going as far as merger then that is fine. But as we have already seen from Southland and Otago if we do not get the consultation right then we will get a backlash from the clinicians and we will get a backlash from the public. 
I am very pleased to see the New Zealand Public Health and Disability Amendment Bill referred to the Health Committee. It is about time we got some public scrutiny of what this Government is doing in health and I hope we see many submissions from all the people who have expressed their concern to me and other MPs on this side about the disastrous direction in which this Government is taking our health sector. 
KEVIN HAGUE (Green) 
: 
 The New Zealand Public Health and Disability Amendment Bill as the Minister of Health said makes the legislative changes arising from the Government’s response to the ministerial review group the Horn report. I am pleased to say that the Green Party will support the bill tonight. 
Hon Member 
: There’s a rarity. 
KEVIN HAGUE 
: It is indeed a rarity. 
The Horn report itself was a bit of a mixed bag; I do not think I could share the Minister’s glowing praise for the report. Although it contained some good analysis it also contained a significant amount of needless reworking of things that the health sector was already doing and an awful lot of ideological structural ideas looking for a home. We were certainly relieved when the Government did not proceed with many of the recommendations from that review. 
This bill sets out effectively to do two things. It overhauls the quality improvement structure that is in the principal Act upgrading the structure from an advisory committee through to a commission and it provides the machinery for closer collaboration between district health boards. We support both of those objectives. 
First of all in relation to quality the first iteration of the structure was the advisory committee that had the brief of dealing with both epidemiology and quality—an unusual marriage of subjects and one that despite the best efforts and intentions of those involved and those behind the committee did not really work. That committee received a shot in the arm from the previous Minister of Health the Hon Pete Hodgson. I pay tribute to the work of the Minister in establishing the Quality Improvement Committee on which I had the pleasure to serve for a time. I think that the Quality Improvement Committee did a great job in accelerating the quality improvement agenda in health. I pay tribute to Pat Snedden the chair of that committee to the other members of the committee to the ministry staff who supported it and to all of the district health boards and others in the sector who took on board those quality improvement projects. They picked up the ball and ran with it as it were. 
The last 5 or so years have really seen a quantum leap in quality improvement in health perhaps starting with Peter Davis’ research work. That work really highlighted the extent of errors occurring in our hospitals. The work of the Office of the Health and Disability Commissioner has also been important in pinpointing the places and the mechanisms involved where things go wrong and also in establishing a culture of open disclosure and an approach of analysis of the root causes of errors with a view to health improvement. District health boards have been very willing partners in this work and have made concerted efforts both individually and collectively to improve the accessibility acceptability effectiveness efficiency and above all safety of health services. So I think this new commission has the potential to move that on to the next stage and I think that is a good thing. 
I sound a note of caution that in providing this greater central capacity to coordinate and steer quality improvement it is really important that we do not end up disempowering those who work at the coalface on quality improvement because it is really at that level that the big gains can be made. It is critical that the commission gets that balance right. 
The bill also provides the machinery for requiring collaboration between district health boards. I guess that from the beginning of our current iteration of health sector organisation there has been debate on how many district health boards there should be. Iain Lees-Galloway has just spoken about that issue. The fact is that whether it is 21 20 10 or one the number will be right for some things and wrong for other things. In broad terms the tension is this: the more locally services are organised the more sensitive those services will be to local need and the more innovative those services are likely to be yet on the other hand the bigger the unit the greater the potential for economy of scale and for coordination of highly specialised services. Those are the tensions. The trick is to find a system where we can base our health services organisation at local levels but then have the capacity to aggregate up where appropriate. That has occurred already quite a lot in the health sector as others have mentioned. 
The basic problem is one of asymmetry of need: in general a smaller district health board—and I have some experience in this area—will have need of collaboration where a larger district health board may well not. One of the obstacles to progress on that issue has been the wording in the current New Zealand Public Health and Disability Act. The Act requires district health boards to act in the specific interests of their people and of their region. That means that we end up with collaboration occurring between district health boards only when it is to the universal benefit of all. That means that situations where most people would benefit from closer collaboration do not necessarily result in that collaboration occurring. That is a problem that we must fix and I think this bill provides the machinery and the mechanism to fix it. 
The other important aspect to it is another that Iain Lees-Galloway touched on and that is the solution that some have advocated: amalgamations either encouraged or forced. Certainly it is not a solution that I favour. I favour instead the idea of an intelligent network of smaller district health boards or perhaps district health boards around the same size that we have now that have good mechanisms for collaboration. I think that although amalgamations have some potential to fix the central problem of collaboration not occurring they also have some costs. They have the cost of the change itself and they also have the cost of the loss of innovation. I think that we would face those costs at our peril. 
We support those two central thrusts of the bill. I say in relation to collaboration that it is a shame that the same approach is not being adopted in relation to primary health organisations because exactly the same dynamics apply with primary health organisations. The Ministry of Health undertook some analysis a couple of years ago of what the right size for a primary health organisation was. It found that small primary health organisations and big primary health organisations both have strengths and weaknesses so it could not come up with an optimum size. A smart solution to that problem would be better than the Minister’s intent of requiring primary health organisations to amalgamate. 
We supported other changes in the Government’s response to the Horn report. One of those was the change to Pharmac’s role: expanding it into medical devices. It is not in this bill but as I read the Act it does not require legislative change to facilitate it. So we are confident that it is still on track. We also support the change to the role of the National Health Committee. I am reminded of Gareth Morgan’s recent book where he talks about the fundamental problem that every health system in the world faces: potentially unlimited need. His solution has two elements. He says that one of the things that we need to do is to prioritise health spending and the change to the National Health Committee facilitates that. The other is to prioritise expenditure and investment in public health and primary care. It is unfortunate that the Minister has chosen not to do that. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 Today is a very good day to speak to the New Zealand Public Health and Disability Amendment Bill and to share the good news for Te Tai Tonga health. The district health board results for the third quarter which were released today show that in four of the Government’s six health targets district health boards in the Te Tai Tonga rohe featured in the top four results of performance. That is great news. It is fantastic. In fact there were some exceptional results for the Southland District Health Board which has improved access to elective surgery by 110 percent and for the Canterbury District Health Board which has improved access to elective surgery by 109 percent. In the area of increased immunisation Otago Southland and South Canterbury district health boards took up first second and fourth places in improving the targets for 2-year-olds to be fully immunised. 
There is a bit of bad news though I am sorry. The results were not as good in comparison with other district health boards in respect of the target of providing better help for smokers to quit. As members know that is an area of considerable interest to the Maori Party and I for one will be keeping a good eye on that one over this next quarter. Hopefully those district health boards will pick up their performance in those measures. 
But with this bill such accountability and transparency will become par for the course. The Maori Party welcomes the initiatives in this bill to respond to the challenge of providing high-quality health care and disability support services. I want to establish from the outset the context in which we read this bill. We read it in the context of the emphasis on Maori health and the principles of the Treaty of Waitangi expressed in the primary bill. Importantly we see many of the initiatives specified within the bill as being closely aligned to Whanau Ora. 
Much of the thrust of the bill is about increasing efficiency by removing duplication between corporate and administration functions. In this way it is a clear expression of a policy commitment we campaigned on which was to review the duplication of corporate and administration functions between hospitals primary health organisations and district health boards to see whether any savings would be available if these duplications were removed. As the Minister of Health would say it is about working better smarter and sooner. 
It is also about a system in which public services have to be monitored by reports against targets. The bill amends the objectives and functions of district health boards to ensure that they work together for the most effective and efficient delivery of health services to meet national regional and local needs. In these three key points—streamlining bureaucracy monitoring against targets or more appropriately outcomes and provider collaboration—there is a tight synergy with Whanau Ora. We absolutely believe that district health boards should work together for the more effective and efficient delivery of health services. 
But I want to make it quite clear that although the changes are positive we do not believe that it is necessary to legislate for such change. Collaboration to work more effectively and efficiently should be done naturally without people being forced into it. As members will know my colleague Minister Tariana Turia has been zooming around the rohe to Whanau Ora hui and she has been sharing with us the amazing response that has accompanied the hui throughout— 
Hon Tony Ryall 
: 3500 people already. 
RAHUI KATENE 
: That is amazing. There is so much interest in the Whanau Ora approach; it is fantastic an amazing response. One of the most exciting aspects of those hui has been the willingness of providers to consider collaboration in the interests of a cohesive and comprehensive approach to whanau well-being. 
Another aspect of this bill is the structural changes to enhance quality improvement activity including the establishment of a new Crown agent the Health Quality and Safety Commission. The Maori Party health policy includes the notion that the community must receive accurate information about the performance of hospitals primary health organisations and district health boards including the public reporting of adverse results. Although we welcome the emphasis on quality improvement we have some questions about the structural change and we would like to know the impact that setting up the commission may have on the Public Service. How many jobs will be cut as a result? 
While talking about personnel another initiative in this bill is to enable the appointment of elected district health board members to the boards of other district health boards. In Te Tai Tonga for example Tahu Potiki is a member of both the Southland and Otago district health boards so in many respects this bill reflects current practice. This is a positive development and will certainly assist in reducing duplication. Our only question around extending this approach to the nation is that we must ensure that we elect the right people to the board in the first place. 
Finally there is just one question that we would like to raise and that is the concern about whether this legislation will give the Minister of Health a lot more power over district health boards; if so what controls are in place to ensure that power is used wisely and not abused? 
There is a great deal of change activity currently occurring within the health sector and in most respects this legislation reflects the direction by investing in a system where outcomes matter where whanau matter—a system in which Whanau Ora becomes the norm. On that note we are very pleased to note that at one of the hui the former Minister of Health Annette King was present with her husband and was showing interest in the Whanau Ora approach. We support this bill at its first reading. 
NICKY WAGNER (National) 
: 
 I rise to support the first reading of the New Zealand Public Health and Disability Amendment Bill. 
There is no doubt that the provision of more than just adequate public health and disability services to the people of New Zealand is one of the biggest challenges in our country now and in the future. New Zealanders expect that living in a First World country they should have access to the very best cutting-edge health services available. But as our population ages and as our economy struggles in comparison with those of other nations this is a real economic challenge. We all want a champagne health service on a beer income. But this is not new in New Zealand and I take inspiration from Ernest Rutherford’s quote “We haven’t got the money so we’ve got to think.” Back in the early 20th century at Cambridge University when Rutherford was working on splitting the atom he had funding challenges but he used his money intelligently and well and finished up with a Nobel Prize for his work. New Zealand’s health services face similar funding challenges today. 
The Government’s responsibility is to use the funding we have in the most efficient and effective manner. This bill introduced today is a drive for better value for money out of our public health sector with the intention of providing a framework to foster economies of scale through national and regional cooperation in the sector and to reduce duplication and bureaucracy. Just like Ernest Rutherford “We haven’t got the money so we’ve got to think.” and I would add nearly 100 years later that we have to think smarter. 
New Zealanders want and need more for their money out of the health system but we definitely do not want to sacrifice quality and that is a tough call. But fortunately it is not always impossible. Different groups within the health system are working hard to find ways to simplify processes to reconfigure premises and to work in different ways to improve both efficiency and effectiveness. There are situations where we can maintain quality but spend less money doing it. Sometimes if organisations are particularly creative they can even find new ways to improve services that still cost less. 
Members of the Health Committee have seen a number of examples where district health boards have managed to improve their services without additional cost. In my home town of Christchurch we have seen the Canterbury District Health Board focus on the patient’s journey and that has meant that patients can move through the system more quickly and therefore at less cost and often with better health outcomes. Canterbury District Health Board’s emphasis on better and more convenient health-care sooner is showing real benefits for my community. 
The bill will provide a range of amendments to the way that administrators run the health system and I can see particular benefits in the amendments that support the provisions of shared administrative supportive and procurement services. It is just a matter of economy of scale. New Zealand is a small country and our health system is particularly fragmented. To provide goods and services to a multitude of small organisations is enormously costly. So members can be sure that right now the district health boards will be paying top dollar for their products and their delivery. 
Organisations that work closely together to share the overhead costs of procurement and supply chain will cut costs and if they can collaborate over efficiency measures such as integrated information technology systems they will certainly be able to stretch our health dollar further. 
I support this bill. It is a good step forward in providing a framework to help New Zealand bridge the gap between our expectations of health care and the dollars that we need to provide it. 
LYNNE PILLAY (Labour) 
: 
 I am really pleased to take a call on the New Zealand Public Health and Disability Amendment Bill. As everyone in the House knows now Labour is supporting this bill’s referral to the Health Committee but we do so with some concern. I listened to the speech made by Nicky Wagner which was pretty much in line with the speech notes that were given out the other day. The same thing happens. The notes go to all members of caucus— 
Nicky Wagner 
: Actually you’re wrong. 
LYNNE PILLAY 
: Wow Nicky made them up herself; we really have underestimated her! But in terms— 
Hon Tariana Turia 
: It’s Labour that sends around the notes. 
LYNNE PILLAY 
: If I were the Maori Party I would not talk about notes. We have notes here. 
Labour supports the bill going to a select committee to enable the public to have their say which is the most important thing. Some pretty sweeping statements are being made and some pretty big promises are being made in terms of what will be delivered. I have a headline here stating: “Really big health savings estimated”. Whoops! Sorry that is a 1993 statement from the National Government. It was its statement then about how it was going to save money and put it into health etc. Then we have this statement: “Big savings envisaged in health reforms efficiency”. When was that statement made? It was in 1993. It was made not by Tony Ryall but by that champion of health reforms Bill Birch. 
I am saying to the House that we need to be very careful about this bill going forward. As I said we support this bill going to a select committee but with caution. It is really important that the Health Committee enables New Zealanders to have their say and that the committee ensures that all New Zealanders are given ample opportunity to do so. Unlike many things that have happened with this Government this bill should not be rushed through. The process should be very prolonged to enable Kiwis to have their say on what their expectations are in terms of health reforms. 
I heard the members of the Maori Party talking about Whanau Ora. We in Labour certainly do not disagree with the principles of Whanau Ora but we have not heard National agree with them in the past. Usually they refer to them as race-based funding but on this occasion National is on side with the Maori Party. That is what happens with a Government that works together with its coalition partners and that is fine. We have no problems if this programme delivers for Maori but we are saying that we need to make sure that the funding does not come from other well-meaning organisations that are delivering very very good health-care. I say to the Government and to the Maori Party that we are keeping a very watchful eye on that. 
Hon Tariana Turia 
: Oh we’re sure you are. 
LYNNE PILLAY 
: Pardon? I did not hear that. 
Hon Tariana Turia 
: We’re terrified about it! 
LYNNE PILLAY 
: They are terrified. I know that the Maori Party has such a cosy relationship with the Government. It is really good. I just hope that it delivers because some very big promises have been made at the cost of tremendous stuff. Where do I hear the Maori Party protesting and making noises about the health cuts for elderly people whether they are Maori Pakeha or Indian? Where do I hear the Maori Party talking about the health cuts we are seeing throughout the country? That Minister has a bit to say. 
I ask about this because I am talking in this debate with my disability hat on. I am saying quite clearly that the principles of this bill are about public health and disability. We have heard a lot about how district health boards are going to work much more efficiently how things will be much better and how we will have so many more savings. For example this statement says: “Big savings envisaged in health reforms efficiency.”—sorry that was from 1993. “Health cut savings estimated.”—sorry that was from 1993. I have a diagram from the 1990s that says it all. It shows people around the operating table looking for a scalpel and clamps but at the end of the day they find a calculator. 
On this side of the House we have real concerns about that. We support efficiencies in systems. When Labour was in Government we worked very hard to get efficiencies but not at the cost of care. I notice that the Maori Party does not have much to say on this but we clearly see some real areas of cuts under this Government. Where do we see the Minister for Disability Issues advocating in respect of the cuts to disability services in this country under the National Government? 
Hon Tariana Turia 
: Name them. 
LYNNE PILLAY 
: Name one? There are cuts in terms of support for children with disabilities in schools for people with disabilities who live at home and for older people with disabilities who live at home. The cuts are across the board. If the Minister for Disability Issues is sitting in the House and saying that she does not know what I am talking about then clearly she has to get off the Whanau Ora bandwagon and listen to the other things that are happening. Whanau Ora will not deliver everything for all New Zealanders. We need to look at a health system that delivers for all New Zealanders whether it is in the hospital system whether it is in primary health care whether it is for people with disabilities whether it is in maternity services or whether it is support for our young children. I tell members that that does not happen when money is pulled out of the health system. 
I come back now to the bill after that small interlude away. Members on this side of the House support the bill and we look forward to the select committee process. We know from members of Parliament visiting from other countries that our select committee process is second to none. It is second to none because it is another level of scrutiny that takes the legislation away from a Government that says that it is the one true way and that it is what we are going to do to get big savings in health reforms efficiencies. It takes it back to the grassroots. It means that people can come along to the Health Committee whether they are providers clients people with disabilities or young people. Those things are really really important and I know that the Health Committee will have a very big task on its hands. There are planning requirements and some real efficiencies to be made around district health boards working together which is what the Labour Government did while it was in power. Labour is completely behind anything that enhances procurement and the most efficient way of purchasing and service delivery. We will go with the people of New Zealand on that. 
I say clearly to this Government that it is accountable for what it does. In terms of the cuts that have happened we have seen them all too often. We have challenged the Minister of Health; I see that he is hanging his head in shame. We have challenged the Government because it is not accountable and is not fronting up to the public about the cuts that it has made in primary health care and in the delivery of services for elderly people. From the efficiencies proposed under this bill we want to see real money going into real services for real people in New Zealand. That is why members on this side of the House welcome the fact that the bill will go to the select committee so the people of New Zealand can front up and tell this Government the areas where things are lacking and why those efficiencies have to be made. 
MICHAEL WOODHOUSE (National) 
: 
 I wonder whether I am in a time warp because of all of the speeches we have heard from the Labour side on the New Zealand Public Health and Disability Amendment Bill 80 to 90 percent of them have been talking about things that happened 18 years ago. It is a huge compliment to the Government and this Minister of Health that not a single bad word could be said about what has happened over the last 18 months. 
Iain Lees-Galloway 
: I found some. 
MICHAEL WOODHOUSE 
: Mr Lees-Galloway tried but I am afraid it was a pretty weak attempt. 
About 18 months before the 2008 general election the Opposition spokesman on health Tony Ryall went around the country listening sharing and discussing matters relating to health issues and that informed the National Party’s policy going into that election. I was the chief executive of a surgical hospital and president of the Private Surgical Hospitals Association so I was in the unusual position of submitting to that process that informed the party’s policy and then being part of the Government charged with delivering on National’s commitment to provide better and more convenient services sooner. 
I think he was expecting a diatribe on the issues facing the private sector but we did not spend much time at all on that. We focused almost entirely on the issues facing our public system and we agreed on just about all things. We agreed on retention strategies for our young doctors and nurses improving primary care less bureaucracy—let us remember that under the previous Labour Government the number of district health board managers and administrators went up by 50 percent—more elective surgery shorter waiting-times and most important re-engaging clinicians who had become increasingly disenfranchised from the decision-making process as they were wrapped under layer upon layer of bureaucracy. 
But there was one matter that we did not really see eye to eye on at that time and that was structural reform. I thought it was needed but Tony Ryall said no. Although the structure we had may not have been perfect the appetite for such reform was very very low and the National-led Government needed to deliver and focus on service delivery not structural reform. I think that very much informed the National Party’s policy and I am interested in reflecting on what that policy said. It stated that we would continue the growth in health spending we would reduce bureaucracy we would shorten waiting-times and we would ensure that doctors nurses and other health professionals would have a say on what was going on in their health services. We would improve maternity we would provide more services to at-risk mums and we would bond doctors and nurses to keep them here for longer. Well that has a pretty familiar ring to it because all of those things have been done and they have been done without a single change in the legislation. 
So this bill is not about a major restructure of the health system; it is about some minor adjustments that will continue the Government’s relentless path towards improving clinical service delivery. I think the planning frameworks and the collaboration proposals are extremely sound. But the one that I am really very interested in and encouraged by is the establishment of the Health Quality and Safety Commission. I am not sure whether it was Ms Dyson or Mr Lees-Galloway who somehow tried to— 
Hon Tony Ryall 
: Ms Dyson. 
MICHAEL WOODHOUSE 
: Ms Dyson tried to say that it was somehow inconsistent with what the Health and Disability Commissioner was doing. Frankly it is a completely different thing. I see no crossover there except to the extent that the Health and Disability Commissioner does step in when things go wrong and does have an educative role. This is a much much different beast. It will continue the really good work that has been going on in our district health boards and in particular the Counties Manukau District Health Board which has taken the lead on a number of excellent quality initiatives. I look forward to that improving and continuing with the establishment of the Health Quality and Safety Commission. 
This is a really good bill and it continues the Government’s efforts in health service delivery. I commend it to the House. 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 The New Zealand Public Health and Disability Amendment Bill is a rather small piece of legislation. It has some good bits in it I think. It is confused in other respects and there are one or two pieces that are frankly alarming. It is small and the proof of its size I suspect is that all of the speakers from the Government side have pretty much spoken about things other than what is in the legislation. I hope to depart from that. 
We had in the speech from the Minister of Health the Hon Tony Ryall a great deal of mythology about what the previous Labour Government had done for health and that mythology was repeated— 
Michael Woodhouse 
: Another rewriting of history. 
Hon PETE HODGSON 
: Another rewriting of history; indeed it was as the member who has just interrupted me has said—by Dr Paul Hutchison. That was not so however in the case of Rahui Katene who did not bother to rewrite the mythology of Labour’s involvement in health but decided that this bill was a warm endorsement of Whanau Ora—a bow that was drawn a little long in my view. Then we had Nicky Wagner from the National Party who decided that we needed to learn just once more the history of the splitting of the atom. So those members were involved in talking about anything except the legislation although Michael Woodhouse did talk about it a little I must acknowledge. That is because the legislation does not contain a lot. 
The bill does contain some measures and I want to dwell on a couple of them. The first is that I want to pick up on the word “quality” as other members have and say a couple of things to the Minister and to the National Government. The legislation repeals EpiQual the predecessor of the Quality Improvement Committee. Section 17 of the parent Act the New Zealand Public Health and Disability Act is repealed by clause 6 of the bill and that committee is replaced by a new commission the Health Quality and Safety Commission. It also has the word “quality” in its name but its functions are different from those of the committee. Although Kevin Hague thought they were quite different from those of the committee I think they are only slightly different. We will see whether that is so. The point I would like to make is that the EpiQual the predecessor of the Quality Improvement Committee was put into the public health and disability legislation just after the turn of the millennium when it was first introduced by the previous Labour Government. The EpiQual part of the Act in my view did not work very well. What is more I reckon that I have worked out why that was the case. I fear that the Government might be about to repeat the mistake that was made then. 
Here is my story. EpiQual did not work well precisely because its findings its results and its work were not driven down through the existing accountability structures. That is to say EpiQual sat off to one side of the district health board system. It sat off as a quango on its own and therefore quality sat off in a quango on its own almost absolving the district health boards from taking a more headstrong view on issues of quality. I do not want to overstate that because of course many district health boards were and are very quality-focused. But it was not until the Quality Improvement Committee got going which Kevin Hague was on and Pat— 
Dr Paul Hutchison 
: Snedden. 
Hon PETE HODGSON 
: —Snedden chaired and which had some very significant champions driving quality that we had some progress. Again the reason for the progress was that those quality programmes were driven through the existing accountability channels. 
Now if the current Government has left the Quality Improvement Committee or some variant of that committee—some son or daughter of that committee—in place that is fine and dandy. But if it has not then by repealing section 17 and replacing EpiQual with another stand-alone entity—this time called a commission not a committee—we run the risk of repeating history which will not be pretty. At the moment we are getting runs on the board with regard to quality. The Minister in his opening remarks decided to try to monetise the value of quality. That is fair enough; people do these things. There will be no gains unless the current accountabilities are used to drive the quality agenda down through to hospitals and to other district health board functions. 
That is not all I want to say about the repeal of section 17 of the parent Act because one of the things that that section states is that the committee must specifically deal with morbidity and mortality issues concerning the perinatal infant and child and adolescent sectors. Those mortality and morbidity studies which are now a permanent feature of our health and disability system are themselves big drivers of quality. If we can identify why we have for example an increase in sudden infant death syndrome or why we have an outbreak of alcohol-related deaths in youths we can improve the quality of our health system. That part of section 17 is gone. I do not know whether it is gone on purpose and certainly section 18 says mortality review committees can be appointed by the Minister. But the section requiring that has gone and it is not being replaced by the new sections. I am drawing that to the House’s attention because I think that might be a mistake. 
The thing I will concentrate on next is the issue of procurement. I just say there is money to be made from procurement and money has been made there. Money has been made first of all through Pharmac and it is serious money. Tribute goes to the National Government back in 1993 for setting up Pharmac. It was a good move and Pharmac has survived successive Governments and will survive successive Governments—at least until the United States starts talking to us about a free-trade agreement. But there is no reason to stop there. When Annette King was the Minister we decided that we would go for joint procurement across a range of things—for example insurance. There is no reason to stop there. We could go on to telecommunications or to all manner of things. Some of those things have huge gross profit margins in the system. To give one example prosthetic companies make a lot of money; it is in essence a racket. The racket can be dealt to if we end up with a bit more monopsony behaviour by the system and district health boards all decide to buy one form or only three or four forms of hip prostheses instead of buying 30 of them. 
So I think that part of the legislation which is amended by clause 9 of the bill in front of us will receive quite a lot of support from members around the House. I do not expect however it will make a lot of difference by itself. There is a lesson there because there are very many instances of situations where the current legislation has been treated with “ignore” by people within the health sector and the Minister will have to have not only this legal avenue available to him but also a great deal of determination to push it through. I can remember saying at length to district health boards that progress on that issue would need to be made or funding would be cut. In fact I took 0.5 percent off them at one point in order to get their attention and gave it back to them only when they had started to procure a little more sensibly. 
The thing that really concerns me is that clause 9 inserts new section 33B. That is a new section which states that the Minister may give directions to all district health boards—not about procurement and not about existing services as the Act currently states but about effectiveness and efficiency. On the face of it that is not a bad thing—who will argue against effectiveness and efficiency—except that the Minister is largely untrammelled by the legislation as introduced and therefore is in a position where he can force should he choose to do so more or less anything on to district health boards. I have two comments about that. The first is he should bring it on. If the Minister is going to get gung-ho about requiring this and that he will find there will be a political backlash. The second is that at some point the Minister if he overplays his hand under that new section will start to abrogate the democratic parts—district health board elections and all that—of the original parent Act. You see we do have a hybrid system: it is part elected part appointed; part local responsibility part central responsibility. The Minister has decided—and it is a very strange thing for a centre-right Government to do—that he will give himself command-and-control powers. That is what they are; they are broad indeed. The Minister can smile; those powers are very broad. I just say to the Minister that further unpleasantries in this regard are eagerly awaited. 
Dr JACKIE BLUE (National) 
: 
 I am pleased to speak to the first reading of the New Zealand Public Health and Disability Amendment Bill. The bill proposes legislative amendments necessary to support reforms recommended by the ministerial review group earlier this year. 
Importantly the bill is not about a major restructure of the health system; it is about trying to get the health system working. The health sector has been struggling. There are 21 district health boards working in 21 different ways. There has been duplication they have been working inefficiently and they have been reinventing the wheel in 21 different ways. One provision of the bill is to provide shared administrative support and procurement services across the public health system including additional powers such as ministerial direction to enhance ministerial ability to require greater system collaboration and use of shared services. 
The Minister of Health has already made a number of changes to help improve the way the health sector works. He introduced six health targets so that the district health boards could focus on the urgent issues of reducing excessive patient waiting-times in public hospitals and providing more elective surgery faster cancer treatment and shorter waits in emergency departments. The Minister has been concerned about our health workforce. Too often New Zealand seems to be a training ground for Australia. New Zealand has had a health workforce crisis with too many clinicians disengaged and leaving the country. The Clinical Training Agency was established to unify workforce planning in New Zealand and to ensure coordination of workforce training planning and funding for our nurses doctors and other health professionals. The Minister has also gradually increased the number of appointed district health board members who sit on more than one neighbouring board particularly people with health and financial expertise. 
The ministerial review group report was a landmark document. It recommended how New Zealand might improve the quality and performance of the public health system. It was a comprehensive report with 170 recommendations on how to reduce bureaucracy improve front-line health services and improve value in the public health and disability sector. The report recognised that to improve front-line services we need more input from front-line staff and there were recommendations to strengthen clinical leadership and clinical networks. The report proposed consolidating back-office functions across the 21 district health boards to harness the power of bulk purchasing. It also proposed reducing the number of committees that advise the Ministry of Health from 157 to 54. The Minister is right on track with the report’s recommendations. This bill is about ensuring that the momentum continues. 
The proposed changes represent a major drive for better value for money in our public health sector. They will enable greater national and regional cooperation in the sector and reduce duplication and bureaucracy. These changes will enable us to improve efficiency and move more resources to the front line. I commend this bill to the House. 
Bill read a first time.  
Bill referred to the Health Committee. 
Carter Observatory Act Repeal Bill 
Second Reading 
Hon Dr WAYNE MAPP (Minister of Research Science and Technology) 
: 
 I move  
That the Carter Observatory Act Repeal Bill be now read a second time 
. This bill was referred to the Education and Science Committee for consideration on 22 October and it has been reported back quite early. Of course one of the reasons the committee was able to report back so early is indicated in its own report which notes that the committee had to go out to seek submissions. Indeed committee members noted: “We support the provisions in this bill and do not recommend any amendments to the House.” The reason I mentioned those specific issues which I know that members on the committee will cover briefly is that this bill was voted for without dissent on its first reading and I am looking forward to that same practice for this second reading as well as for the Committee stage and the third reading. I am hopeful perhaps that when we get to the Committee stage we will be able to move immediately to the third reading on the same day as well—by agreement of the House of course as Mr Speaker would appreciate. I do not intend to spend a great deal of time on this debate because I know that the aspiration of the Wellington City Council is to take full legal ownership of the observatory as soon as possible. 
I had the great pleasure of attending as I know some other members in the House did as well the observatory for what was effectively the practical transfer—I suppose in legal terms it is the informal transfer—of the observatory to the Wellington City Council. The council has done a fantastic job of refurbishing the facility. It is a great community asset a great educational asset and a great tourism asset. The council has restored the observatory from a historical perspective. The key instruments date back to the 19th century but in fact they are in use today for tour groups and so forth. Indeed some useful scientific work is undertaken at the observatory. But it has moved fundamentally from being a scientific facility as such to more of an educational facility and one that boosts the overall profile of Wellington. 
In conclusion one of the interesting things I find as a non-resident of Wellington—as someone who visits admittedly on a weekly basis but nevertheless it is not my home—is that of cities of 400000 or so people Wellington must be one of the finest in the world. It has an extraordinary range of cultural and artistic facilities and an amazing physical location. The Carter Observatory complements the cultural aspects of Wellington and is a further reason why Wellington can project itself in a positive way as it does as a place of real intellectual firmament. 
The previous Government initiated this process of course but shifting the observatory from essentially Government ownership through to Wellington City Council ownership which is far more appropriate in the circumstances has been a very good move. I think I should allow other members of the House to also acknowledge the role of the observatory in the cultural and intellectual life of Wellington. I look forward to being able to move this bill through its progressive stages so that we can create a legal form of what has happened already as a practical reality. 
DAVID SHEARER (Labour—Mt Albert) 
: 
 I would like to absolutely and positively endorse the comments of the Minister of Research Science and Technology about the Carter Observatory and Wellington in general. 
The Carter Observatory Act Repeal Bill progressed through the Education and Science Committee in a spirit of real bipartisanship. As the Minister said the select committee did not receive any submissions but felt that it was better to go out and seek some submissions in order to inform the committee make the legislative process more rigorous and ensure that we were heading down the right track. The three submissions that came back endorsed that view absolutely. 
There was a very good spirit in the select committee which was led very ably by Allan Peachey. As the Minister just said the bill should progress quickly through the parliamentary process. At times like these we realise how long it takes for a bill to progress through Parliament. This bill was talked about in 2006 and here we are in 2010 still talking about it. I have watched every day with eager anticipation the Carter Observatory Act Repeal Bill climb up the Order Paper only to see it every now and again fall to the bottom. That has disappointed the many hundreds of people who have sent me submissions and emails supporting the bill and asking what has happened to it. I am not mocking the people who got behind the observatory; I am just reflecting on the length of time it takes to move forward something that has complete support within the House. As the Minister has just said the bill rubber-stamps what is already happening on the ground. 
The repeal bill decision was based on the 2008 report by Mike Bessell and the Ministry of Research Science and Technology as was noted during its first reading. Bessell made a number of recommendations about the bill and set out what he thought some key roles of a national observatory should be. Members will remember that the Carter Observatory was in fact the national observatory of New Zealand. He felt that the Carter Observatory was not really meeting the functions of a national observatory. It was fulfilling an educational and perhaps a tourism role rather than a real science role and as a result he felt that it was better suited to being administered by the Wellington City Council rather than being run as a national observatory. 
It is important to say as the Minister intimated that there is still real interest in astronomy in our communities. This bill will and does enhance our understanding of science in a real and positive way—particularly among our young people but also obviously among others as well. The feeling was that much of the scientific work was best posited with the University of Canterbury at the Mount John Observatory. It was perceived that that observatory was the major player on the national and international scene in terms of its scientific role. Canterbury University has always welcomed experts from other universities to share that observatory—from Victoria University Otago University and Auckland University. So in a sense we are not losing anything here but are regrouping our resources in a much more sensible and efficient way. If my memory serves me correctly the previous Labour Government put about $2 million into the Carter observatory— 
Kelvin Davis 
: 2.2. 
DAVID SHEARER 
: —$2.2 million—and Minister Nathan Guy submitted some lottery money to supplement the upkeep and refurbishment of the observatory as well. 
It is I guess something of an anticlimax in many ways that this bill is moving forward. It is an anticlimax in much the same way that the Government’s science Budget announcement on Tuesday was an anticlimax. The third-largest new appropriation in the coming Budget is so important that the Prime Minister announced early that piece of positive and new news. 
There is a feeling amongst the science community and certainly to some degree within this House that science should be treated as a bipartisan issue but I do not think that an Opposition can sit by and just look at the miserable amount of money that the Government is putting up in its Budget—a miserable amount of money. I will tell members why I say it is miserable. It is miserable compared with what was taken away 18 months earlier. The research and development tax credits would have delivered at least double what this Government announced just last week. The tax credits would have doubled our research and development spend in the business community. That has gone. What do we have now? We have a system of vouchers and grants where companies come on their knees to a Government bureaucrat. 
Debate interrupted. 
The House adjourned at 10 p.m.