Lees-Galloway Iain: Dairy Industry Restructuring Amendment Bill (No 2) — First ReadingText is incorporated into the Bound VolumeLees-Galloway Iain: Dairy Industry Restructuring Amendment Bill (No 2) — First Reading[Sitting date: 15 May 2013. Volume:690;Page:9998. Text is incorporated into the Bound Volume.]IAIN LEES-GALLOWAY (Labour—Palmerston North): I am slightly surprised to be taking a call at this stage but I am very happy to take a call now and support my colleague from West Coast - Tasman the Hon Damien O’Connor with his Dairy Industry Restructuring Amendment Bill (No 2).This is a re-imagining of a Supplementary Order Paper that Mr O’Connor put through when the changes that established the Trading Among Farmers system were passed through Parliament. I think what Damien O’Connor is doing here because he is a decent bloke from the West Coast is giving the Government another chance to get it right. It got it wrong the first time around and you know fair is fair. He has been lucky enough to have his bill drawn from the ballot and he is giving the Government another opportunity to get this right. Sadly it does not seem to have learnt from its errors and it is still refusing to support what is a perfectly sensible and logical piece of legislation that actually in fact reinforces in law as Shane Ardern outlined the position that the Fonterra shareholders—the farmers—actually support.They have voted internally to keep a cap on the foreign shareholding or the non-farmer shareholding of Fonterra. Ought we not just reinforce that and give them some security by enshrining that in the law? Over the years what we have seen—and various members have discussed this—is that the dairy industry in New Zealand has required a hands-on Government. It has not been left to the market. Governments over the years over the decades have had to step in and create the structures that have supported the New Zealand dairy industry.What this is in fact is a step back from the cooperative model from the hands-on supported model that Governments have pursued over the decades towards more of a market model. That just simply has not worked for our dairy industry. What we see here is of course a classic New Zealand story where there is no point competing amongst ourselves within our tiny market. We have to cooperate in New Zealand to compete on a global scale. Really what Damien O’Connor is doing is continuing that tradition of Parliament Government and the dairy sector working together to get the structure right so that Fonterra the dairy industry and New Zealand can effectively compete on a global scale.I think there is another really important point here and that is that Fonterra is essentially a single purchaser of raw dairy products in New Zealand. Single purchaser model—it can work very well. It really can.Hon Ruth Dyson: Can it? Tell us about that.IAIN LEES-GALLOWAY: Well you could apply it to a range of industries. You could apply it to keeping the cost of medicines down for instance with Pharmac or indeed to getting the price of electricity right as the Labour Party has suggested and of which the National Party is so dismissive of course.What is really important is that if you have got a single purchaser that has a lot of market power it has got to know who it is working for—it has got to know who it is working for. Pharmac knows that it is working for the people of New Zealand. It is owned by the people of New Zealand and it is working for the people of New Zealand.NZ Power likewise would be owned by the people of New Zealand and it would be working for the people of New Zealand. Fonterra is owned by the farmers and it is there to work for the farmers. But as we dilute that and as we make it so that it is perhaps not owned by the Australians but the dividends from Fonterra start to go to them—those Trading Among Farmers shares have mainly gone to the Australians not to domestic shareholders—then Fonterra has to start working for somebody else. It is a bit like this Government actually. It is not working for New Zealanders; it is working for somebody else. It is working for Skycity and Warner Bros and what have you.Fonterra has to start working for somebody else not the farmers. But it has a lot of power—it has a lot of power—and it has been using that power to share the dividends of its success with farmers. We have to make sure that something like the single purchasing agency that Fonterra is is absolutely certain about who it is working for—absolutely certain about who it is working for. That is why we in the Labour Party who know whom we are working for—we are working for New Zealanders we are working for New Zealand farmers—support the excellent member from West Coast - Tasman Damien O’Connor with this superb bill.