Webb DuncanDr DUNCAN WEBB (Labour—Christchurch Central): Tēnā koe e te Mana Whakawā. It's a pleasure to stand on this third reading of this bill on the overseas investment regime. It's good to see that we've got pretty much consensus around the House on what is an important piece of legislation seeking to protect New Zealand's interests. The position of the National Party in respect of the forests is noted and it was raised at committee—I want to absolutely recognise that. But I want to step back a moment if I may and just look at the underlying philosophy of this and I think when we do that we'll see why the suggestions of the National Party weren't adopted because I think this is not about creating some kind of fortress New Zealand—quite the opposite in fact. This bill in particular is looking at fine tuning. You know we're on the third Act and there's reasons why we've got three of them but fine tuning our overseas investment regime to make good investment easier and to make it harder—to make the system more sensitive to pick up important situations which require far more scrutiny around what is sensitive and what is strategic.If we look—as Mr Bayly rightly notes I don't know the numbers he perhaps does but large amounts of our forests are owned cutting rights and the like are owned by overseas investors. And that seems to be working. This isn't a situation where we see some skewing of the market or the loss of a critical strategic asset of New Zealand rather—whilst I do absolutely recognise recent supply chain issues with timber and the like by and large our timber and forestry industry appears to be working well and foreign investment in it does not seem to be problematic in any way. Having said that—and we heard Mr Parker I think it was only yesterday say that keeping this area of the law in shape is important—it's not out of the question that at some future date that may be revisited.But the real point here is that this is a piece of legislation which says we want to attract high quality investment and not just the capital because capital is only one part of the picture but investors who bring particular expertise. We heard about the benefit to New Zealand test and essentially the abandonment of the counterfactual test because the counterfactual—and it pops up in various areas of the law including competition law but it's always a bit fraught because it's a What might happen if we allow it and what might happen if we don't." And so your counterfactual is by definition hypothetical. So it is a bit of crystal ball gazing whereas you've got a much more concrete test now—the before and after test—which asks the question "What is the status quo?" and then asks the next question "How will the status quo be improved if we allow this overseas investment?" You have to show ultimately a benefit to New Zealand to do that.I guess the real point here is that when we're doing that when we're asking what the triggers are for this we want to have a proportionate approach. One of the big complaints to date and I want to say it's a legitimate one is that people who are looking to invest in New Zealand had a regulatory burden that was too high. So while we're not burning the regulations we're absolutely seeking to make them a lot more workable in terms of having things like standing consents. We want a proportionate framework. So in this before and after test which is much more workable as part of it and also a framework where you won't have to every time go through the entire process of ascertaining the credentials of the investor and the nature of the investment and so on and so forth. So we see that as a really important part of it. The before and after test will now simply ask the question "What is it now? How will it be improved later?"I do want to touch on the other aspect of the benefit to New Zealand test which was very much robustly discussed in committee—and I want to recognise the Greens for raising this—the question of whether you simply ask what's the benefit what are the pluses that we can see and what are the direct economic costs or whether you have a much more open enquiry and ask what are the wider detractors for New Zealand. As you'd expect from the Greens quite rightly they identified the bringing into account of environmental issues. Now I guess the point to be made here is that whenever we're looking at any activity within New Zealand any for example use of land any activity on conservation land any of those kinds of things: there is a thoroughgoing regime. And any person who is making an application—whether it be to run a tour through Milford Sound or mine in Waihī they have to go through a rigorous and robust process. That's a process which occurs after approval has been given. So there's two quite separate questions. One is "Is there a benefit to New Zealand?"; the second inquiry—still an important inquiry absolutely but it's not one you should have to do twice you should only have to do it once—do the benefit to New Zealand enquiry for overseas investment first do the environmental enquiry or whatever other enquiry is important do that one next. They're still there and it's not appropriate to conflate those and essentially have a resource management hearing in an overseas investment context. So that was really important. I guess the other thing that cropped up in there was relatively straightforward but the idea that investments go up and down. There are some situations where that's not problematic and we know that by dint of company law there are some thresholds that are important. The 25 percent threshold is important the 50 percent threshold—where effective control exists the 75 percent threshold and of course total control at the other end. Within those boundaries creeping or shifting creeping sounds nefarious it's not nefarious but shifting shareholdings or ownership interests on something like—we mentioned the Fletcher group of companies which is an overseas company although has strong New Zealand roots it's not invidious at all. So we don't need—simply if there's an additional 5 percent being purchased for example it doesn't cross a threshold. We don't need a special Overseas Investment Act inquiry into that. So I thought that was sensible and a good tidy up. And of course around farmland—I think the tightening up around farmland was really good. Minister Parker just identified the bizarre situation where you could enter into a contract for the sale of farmland and then advertise later. Now that is truly strange. I think the point there being farmland is important to New Zealanders both economically and culturally. And if farmland is there on the market it should absolutely and genuinely be put on the New Zealand market so that a New Zealand person can buy that. So that's a really good idea. Of course along with that things like leases for less than 10 years the committee had a really good discussion around that and you know to be fair we had people coming in arguing that it should be 35 years—which is the extent of the longest consent you'll get under the Resource Management Act—and various other articulations depending on the particular interest held. But at the end of the day I think 10 years is a pretty long period of time. You can get a good economic return on your land in 10 years but it doesn't kind of creep to that point where it approaches a much more significant holding almost approaching a freehold ownership.Look we did some other tidy ups and one that I thought was important was fees and levies. There are fees and levies charged as you would expect. There was a change so that the levies could look backwards and forwards up to four years and I was concerned that that looked kind of like revenue gathering. It was a really good inquiry around the framework and whether it was appropriate to kind of have overs and unders over a long period of time—for fees and levies. Sounds technical but nevertheless important. I was assured and I take that assurance from officials that this was really only a cost recovery framework but smoothing out some of the longer-term projects that they have. So look I guess on closing that shows that it was a technical bill but a really important one. I'm very happy to commend this bill to the House."