Volume 637 Week 37 - Tuesday 27 February 2007 
Text is incorporated into the Bound Volume 
Volume 637 Week 37 - Tuesday 27 February 2007 
[Sitting date: 27 February 2007. Volume:637;Page:7657. Text is incorporated into the Bound Volume.] 
Tuesday 27 February 2007 
Madam Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Questions to Ministers 
Fiscal Management—Appropriate Settings 
1. SHANE JONES (Labour) 
 to the  
Minister of Finance 
: What reports if any has he received on the appropriate settings for good fiscal management? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 [ 
Interruption 
] I am so pleased to see the National Party applauding Labour Party questions. I have received numerous such reports. Standard and Poor’s Asia-Pacific Sovereign Report Card highlights the Government’s solid fiscal profile. It follows on from Standard and Poor’s report last year that concluded the Government’s programme of debt reduction provision for future superannuation costs has made us one of the best placed nations in the world to cope with the costs of an ageing population. The report also noted that large-scale tax cuts would be “very short-sighted” and questioned whether they would be sustainable. 
Shane Jones 
: What reports has he seen on alternative approaches to fiscal management? 
Hon Dr MICHAEL CULLEN 
: I have seen reports suggesting the Government runs far too tight a fiscal position reflected in excessively large Budget surpluses and it should be significantly loosened up to $11 billion a year. I have also seen reports suggesting that the current fiscal position is far too loose and should be tightened meaning we should be aiming for much larger surpluses. The first of those reports is from John Key and the second is from his co-leader Bill English. 
Hon Bill English 
: Does the Minister agree with the assessment of the Governor of the Reserve Bank that his current fiscal policy is and I quote from the Reserve Bank’s statement “quite expansionary” and can he confirm to the House that this means his big spending plans in the run-up to the next election are one of the things that will cause interest rates to rise for householders? 
Hon Dr MICHAEL CULLEN 
: I note first of all that the member has already called in a statement only last week for the Governor of the Reserve Bank to increase interest rates further. I note further that the member has promised a $200 million a year reduction in spending on tertiary education without saying where it will come from and I note that it is completely at odds with his leader who not only promised large tax cuts but today promised another $60 million to $90 million a year. 
Gordon Copeland 
: What reports has the Minister seen on new developments in fiscal policy? 
Hon Dr MICHAEL CULLEN 
: Just today I have seen reports suggesting that a major new policy on welfare would be released. I was somewhat surprised when I read the actual reports of this major new policy which is simply the National Party’s submission on the tax and charities discussion document released by my colleague the Hon Peter Dunne earlier this month. It is of course Mr Dunne who has been leading the charge in terms of changes to the charities taxation regime. 
Foreign Affairs Minister—Confidence 
2.  
Hon BILL ENGLISH (Deputy Leader—National) 
 to the  
Prime Minister 
: Does she have confidence in her Minister of Foreign Affairs; if so why? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Yes because he is a hard-working and conscientious Minister. 
Hon Bill English 
: Was Mr Peters the Minister of Foreign Affairs speaking for the New Zealand Government when he stated: “There would be no advantage to an immediate withdrawal of US troops from Iraq.” and “… circumstances would slide into total chaos if that was to happen.”; if he was not speaking for the New Zealand Government what is the position of the New Zealand Government? 
Rt Hon HELEN CLARK 
: Mr Peters stated: “I will give you my opinion.” 
Keith Locke 
: Is it not peculiar that our Minister of Foreign Affairs is speaking out in favour of more young Americans being sent to be killed or to kill in Iraq when our Government has quite rightly— 
Rt Hon Winston Peters 
: I raise a point of order Madam Speaker. It is one thing to tolerate mischievous journalists seeking to misrepresent what I said; it is quite something else within this House to have a member say what he just said—which is totally not true. 
Madam SPEAKER 
: I ask the member to rephrase his question please. 
Keith Locke 
: Oh I thought it was—what was not true? [ 
Interruption 
] I will rephrase it. 
Madam SPEAKER 
: The member raised a point of order. I have ruled on the point of order. The member said that was not what he said in the statement. 
Keith Locke 
: Yes I will put it in a different way that might satisfy the member more. 
Madam SPEAKER 
: Thank you. 
Keith Locke 
: Is it not peculiar that our Minister of Foreign Affairs is speaking out for a continuation of the Iraq war which will result in more young Americans killing and being killed in Iraq when our Government—quite rightly—has kept well clear of the Iraq war? 
Rt Hon HELEN CLARK 
: I drew no such inference from what the Minister said. 
Rt Hon Winston Peters 
: Has the Prime Minister seen any reports about the primary questioner’s credentials regarding the question of troop withdrawals or of his views regarding National’s spokesperson on foreign affairs and of the National leader’s foreign affairs crisis which has seen him—despite having several so-called foreign policy experts within his caucus—take the extraordinary step of setting up an independent thinktank including Jim Bolger— 
Gerry Brownlee 
: You don’t deal with this. 
Rt Hon Winston Peters 
: When I am talking you keep quiet—OK? 
Gerry Brownlee 
: You don’t deal with that. 
Rt Hon Winston Peters 
: No no. When I am talking the member keeps quiet. Point of order— 
Madam SPEAKER 
: No—please be seated. If the member engages with chit-chat then there will be disorder in the House. Would the member please just ask his question. The ruling is that reasonable interjections are permitted. 
Rt Hon Winston Peters 
: Has the Prime Minister seen any reports about the primary questioner’s credentials regarding the question of troop withdrawals or of his views regarding National’s spokesperson on foreign affairs and of the National leader’s foreign affairs crisis which has seen him—despite having several so-called foreign policy experts within his caucus— 
Gerry Brownlee 
: She’s only responsible for you. 
Rt Hon Winston Peters 
: —well no one is responsible for you— 
Gerry Brownlee 
: That’s right. I’m responsible for myself. 
Rt Hon Winston Peters 
: I mean no one is responsible for that member. In fact after the last leadership crisis he got demoted. In fact he jumped before he got pushed and made it seem like some magnanimous act. But to carry on—[ 
Interruption 
] Look this is not a woodwork lesson; this is about foreign policy—the National leader took the extraordinary step of setting up an independent thinktank including Jim Bolger Jenny Shipley and other doubtful dubious foreign affairs luminaries. 
Rt Hon HELEN CLARK 
: My understanding of Mr English’s credentials was that he supported the war—he got up in this House on 18 March and stated that New Zealand should be supporting the coalition of the willing. As to where the National Party gets its foreign policy advice from I can only agree with Mr English who stated in writing to Dr Brash: “You need to know now that the experienced people you have will not work in a Government run by Mr McCully.”—who is of course the foreign affairs spokesperson. 
Madam SPEAKER 
: It is impossible for the member to be able to be heard when he puts his question. 
Hon Bill English 
: Can she tell the House whether the New Zealand Government agrees or disagrees with the position advocated by the Minister of Foreign Affairs that “… circumstances would slide into total chaos” if US forces withdrew from Iraq? 
Rt Hon HELEN CLARK 
: The New Zealand Government and most parties represented in this House did not support the war in Iraq. It does not have troops there and it is not getting involved in a debate about what other nations should do with their troops. 
Madam SPEAKER 
: I asked for quiet so that the Hon Bill English could put his question. I ask for quiet from the Opposition while the Hon Phil Goff puts his question. 
Hon Phil Goff 
: Has she seen the comment that New Zealand was too far away from Iraq to judge the best course of action; who made that comment and is it consistent with what his co-leader and other members of his party have said before and since? 
Rt Hon HELEN CLARK 
: I understand it is Mr Key’s position that Iraq is simply too far away. That did not stop Mr English committing his party to supporting the war. 
Hon Bill English 
: Can the House take it from the answer the Prime Minister gave to my previous question that she does not know whether the New Zealand Government agrees with the statements made by the Minister of Foreign Affairs and what confidence can New Zealand or any foreign Government have in that Minister if she cannot back statements publicly that he made publicly about New Zealand’s position? 
Rt Hon HELEN CLARK 
: In a Government I lead a Minister from another party is entitled to express an opinion. That may be novel to the member. 
Hon Bill English 
: So how are foreign Governments and New Zealand voters to know whether the Minister of Foreign Affairs is expressing a personal opinion when he made these statements in an official press conference after an official meeting in his official capacity as Minister of Foreign Affairs with the Minister for Foreign Affairs of Australia; and in what circumstances can we ever expect Winston Peters to actually articulate Government policy? 
Rt Hon HELEN CLARK 
: The short answer is: a lot more easily than one would find out what the current position of the National Party is on Iraq. 
Hon Phil Goff 
: Can the Prime Minister confirm that the positions on this side of the House on non-involvement in Iraq have in fact been consistent whereas the positions taken on the same question by the National Party have been multiple and contradictory? 
Rt Hon HELEN CLARK 
: I can certainly confirm that. Indeed I see some people taking a range of positions from supporting our sending troops in 2003 to claiming in December last year that they never supported our sending troops. Both positions were taken by John Key—and no doubt by the party’s co-leader Bill English. 
Madam SPEAKER 
: Point of order the Rt Hon Winston Peters. [ 
Interruption 
]  
Rt Hon Winston Peters 
: I tell the member to keep quiet—that is the last time I tell him that. Madam Speaker this is a question. 
Madam SPEAKER 
: Is this a point of order or a supplementary question? 
Rt Hon Winston Peters 
: It is now a point of order. I was going to ask a question but it is now a point of order. Madam Speaker although you have appeared to allow some intervention by way of statements from members of parties when someone is putting a question surely that is not allowed. And if I had been about to make a point of order the member should never have opened his mouth in the first place. That is all I am saying. I rose to ask a question and I would have liked to be able to actually put the thing before Mr Smith—who always has these psychological problems anyway— 
Madam SPEAKER 
: That is an entirely inappropriate comment about another member as the member knows. What the member has asked for is that members show a little bit of restraint and courtesy so that we can all hear what the question is. The noise was such that I thought the member was originally asking for a point of order. Would the member please ask his question succinctly. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. I think that if you consider the comment just made by Mr Peters you will find it appropriate for him to withdraw and apologise for that remark. Given that you are asking everybody to draw a bit of breath and give people a fair go that remark is hardly in line with what he has just offered to the House. 
Madam SPEAKER 
: Did the member take offence at the comment? The member does take offence. Is the member asking for the other member to withdraw? 
Hon Dr Nick Smith 
: I ask the member to withdraw and apologise. It is totally untrue and unfair. 
Rt Hon Winston Peters 
: I apologise for saying that the member had psychological problems. 
Madam SPEAKER 
: The member knows that that is out of order. [ 
Interruption 
] The member will sit down or he will be out of this Chamber. The member knows well enough that in these circumstances a member merely withdraws and apologises—he or she does not repeat the allegation. If there is any more of that the member will be out of the Chamber. Would he please just ask his supplementary question. 
Rt Hon Winston Peters 
: Thank you Madam Speaker. [ 
Interruption 
] 
Madam SPEAKER 
: Sorry the member must withdraw and apologise. That is it. 
Rt Hon Winston Peters 
: I withdraw and apologise. It is done. Can the Prime Minister contrast the situation now of someone in the Government who as a Minister can give an honest opinion on a tragic humanitarian problem whether it be in Afghanistan or Sudan and that of someone who rose in a National caucus meeting asked a simple question like: “What has the leader been doing?” and got sacked out of caucus? [ 
Interruption 
] That is the contrast. 
Madam SPEAKER 
: I am trying to see where the ministerial responsibility is. [ 
Interruption 
] I am sorry I have ruled on that matter. If the member wishes to ask another supplementary question he may do so after the Hon Bill English whom I call for this supplementary question. 
Rt Hon Winston Peters 
: I raise a point of order Madam Speaker. If you are to allow the primary question and all others to be based on the precept of one’s opinion then surely I am allowed to ask a similar question based on opinion as well. 
Madam SPEAKER 
: No what the member was asking for as I heard it was a comparison. There is no ministerial responsibility in those circumstances. The member may wish to reflect on how he can ask a question that is within the bounds of the Standing Orders. 
Hon Bill English 
: Does the Prime Minister recall an assurance given by the Hon Phil Goff to the Australian Foreign Minister that “policy from Winston will not be policy spun off the top of anybody’s head” but will be the policy of the Labour-led Government; and given that that assurance appears to have been breached has she or her officials been in contact with the Australian Government to explain to it that when Mr Peters speaks at official press conferences after official meetings he is probably not expressing the views of the New Zealand Labour - led Government? 
Rt Hon HELEN CLARK 
: As I said in response to an earlier answer Mr Peters made it very clear that it was his opinion. I state further that it was an honest opinion about a tragic situation. We are not used to hearing honest opinions from some others in this House. 
Rt Hon Winston Peters 
: Has the Prime Minister received any reports as to the wisdom of decision making when members of Parliament give an opinion that might affect the governance of the day—such as for example a case when a Minister gave his honest opinion on a very tragic circumstance and how the world might help its improvement—or by way of similar contrast someone asking what the leader is doing then being fired straight out of the National caucus? 
Rt Hon HELEN CLARK 
: I repeat that I believe the Minister gave an honest opinion about a tragic situation. Apparently honest opinions about the leader of the National Party lead to one’s expulsion from the caucus. 
Madam SPEAKER 
: It is difficult when members of the Hon Bill English’s party interject to the extent that it is difficult to hear him. 
Hon Bill English 
: If as the Prime Minister states the Minister of Foreign Affairs simply espoused an honest opinion about a tragic situation then why did she not say that yesterday instead of denying that it was anything to do with the Government; and if it was an honest opinion about a tragic situation can she now take this chance to tell the House her honest opinion about this tragic situation? 
Rt Hon HELEN CLARK 
: I repeat that New Zealand has no troops there and the New Zealand Government is not telling other nations how to run their policies there. 
Hon Bill English 
: If the New Zealand Government will not tell other nations what they should be doing with their troops in Iraq has she now instructed the Minister of Foreign Affairs to stop giving the impression that he is speaking on behalf of the New Zealand Government in telling other nations what to do with their troops or is he to be allowed to continue giving his personal opinion wherever he goes anywhere in the world? 
Rt Hon HELEN CLARK 
: What a terrible thing it is for someone to state: “It is my opinion.” and then to be damned by the National Opposition which expels people from its caucus for stating an honest opinion about a hopeless Leader of the Opposition. We have just heard from the former hopeless Leader of the Opposition. The other one has deigned not to be here to speak on this. 
Rt Hon Winston Peters 
: I ask the Prime Minister in the interests of exactitude whether it is a fact that the New Zealand Minister of Foreign Affairs gave no opinion or view whatsoever on an exit strategy or a withdrawal of troops from Iraq short term or long term but was speaking about something else entirely. 
Rt Hon HELEN CLARK 
: That would be my interpretation. The Minister spoke about February 2007 and the situation as he saw it. 
Keith Locke 
: I seek leave to table a survey by World Public Opinion of Iraqi public opinion which shows that 78 percent of Iraqis think that the US military presence is provoking more conflict than it is preventing. 
Document by leave laid on the Table of the House. 
Housing—Land Supply 
3.  
GORDON COPELAND (United Future) 
 to the  
Minister of Housing 
: Does he agree that there is a mismatch between the supply of and demand for land for new housing in New Zealand? 
Hon CHRIS CARTER (Minister of Housing) 
: 
 In some cases land supply may not have kept up with demand but the evidence is mixed. It would be foolhardy to suggest that simply freeing up more land will solve our housing affordability problems. Freeing land for speculators and large expensive housing developments will not solve the affordability question. 
Gordon Copeland 
: Can the Minister understand the despair felt by many of today’s young families about ever owning their own home when they hear stories from their parents of how during the 1960s 1970s and 1980s young families while still in their 20s were able to buy a new home because entire areas such as Wainuiomata and Newlands in Wellington and entire suburbs such as Hillsborough in Auckland were subdivided and a section could be purchased for little more than 1 year’s salary; and was not the original intention of the Resource Management Act to make the process of subdivision easier not harder? 
Hon CHRIS CARTER 
: I can understand those concerns by people wishing to purchase their first home. I could also of course remind the member that a lot of vacant land was within the metropolitan urban limit at that time. Our city of Auckland of 1.4 million people sprawls over one of the largest metropolitan areas in the world with one of the lowest densities. To consider opening up more land compounds the question of infrastructure roads sewerage transport etc. 
Lynne Pillay 
: What is the Government doing to increase the supply of land for housing? 
Hon CHRIS CARTER 
: We are doing lots. We have funded research into local housing markets to reveal all the factors in play. We have developed new mixed housing estates which offer both affordable and social housing—for example at Weymouth Papakura and Hobsonville. We are working with local government to assist it to encourage the development of affordable housing such as the proposal that the Queenstown Lakes District Council is currently consulting on. 
Phil Heatley 
: Does he stand by his statement that “housing affordability is an issue preoccupying hundreds of thousands of young households around the country.”; if so is he really going to build hundreds of thousands of houses for them at Hobsonville or elsewhere run equity schemes for hundreds of thousands of lucky families or provide hundreds of thousands of State houses for every last one of them as his solution and is it welfare that these young families are really looking for? 
Hon CHRIS CARTER 
: Housing affordability is certainly something that is exercising a lot of people much of it concern for children and grandchildren. Many of those children and grandchildren through employment and saving will of course meet their own housing needs. Some people particularly in high-value markets such as Auckland will face challenges and that is why the Government has brought in things such as the Welcome Home Loan scheme and next year of course we will be developing a pilot in shared equity. 
Gordon Copeland 
: Bearing in mind the Prime Minister’s statement last night about housing supply will the Government be involving Treasury in a comprehensive economic evaluation of the relationship between planning and other restraints on the subdivision of land for new housing and the cost of land with the clear goal of ensuring that the dream of homeownership can once again become the norm for today’s young families? 
Hon CHRIS CARTER 
: We already have officials working on a variety of streams of work—for example the shared equity programme and the Hobsonville development—where we are addressing these questions. I remind the House again that this is a complex issue; every Western country is facing it particularly in major metropolitan areas. 
Gordon Copeland 
: I raise a point of order Madam Speaker. I specifically asked whether the Government would involve Treasury and that was not in any way referred to in the response. I doubt whether the answer really addressed the question. 
Madam SPEAKER 
: Does the Minister wish to add anything? 
Hon CHRIS CARTER 
: The member may not be aware but every paper that goes to Cabinet is given a close scrutiny by Treasury. 
Phil Heatley 
: I seek leave to table a document that states that the Minister of Housing acknowledges that hundreds of thousands of young households are struggling with affordability and he is going to build houses for them all. 
Madam SPEAKER 
: Leave is sought. Is there any objection? 
Hon CHRIS CARTER 
: I seek leave to submit a document from a speech to the Property Institute by the former leader of the National Party Dr Brash that states that National will renew its 1990s programme of selling off State houses. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Would members please be quiet when the question is being put otherwise members will be leaving the Chamber. There is objection. 
Auckland District Health Boards—Productivity 
4.  
Hon TONY RYALL (National—Bay of Plenty) 
 to the  
Minister of Health 
: Has he received the series of reports on the three Auckland district health boards confirming hospital productivity has been declining despite huge funding increases and what action is being taken as a result of these reports? 
Hon PETE HODGSON (Minister of Health) 
: 
 Yes. Although they certainly do not prove the conclusions that the member asserts they are a valuable resource for learning how to further improve value for money. 
Hon Tony Ryall 
: If these reports do not support the conclusion of falling service for increased funding does the Minister agree with the Labour Party appointee and deputy chairman of all three Auckland district health boards Ross Keenan who said: “The reality is yes we accept decline in productivity is a huge concern given the huge increases in resources this Government has thrown at health.”—how does the Minister explain that one? 
Hon PETE HODGSON 
: The reason the deputy chair of the three district health boards expressed his concern is that the district health boards are keen—and in fact are required—to pay attention to value for money. An example of this is the $15 million per annum laboratory contract that the three district health boards have undertaken—a saving of $15 million per annum prospectively—opposed almost unbelievably by the National Party. 
Ann Hartley 
: What recent reports has the Minister received from the Auckland district health boards? 
Hon PETE HODGSON 
: I have received a number of reports recently. The first is that since 1 July the Auckland District Health Board has improved its forecast financial position by $45 million per year. Secondly so far this year Waitemata District Health Board has achieved a 4 percent growth in volume of work with a 2 percent increase in staffing. Thirdly in Counties Manukau District Health Board acute hospitalisation rates for children have declined by 5 percent over the past 2 years. Mortality rates have decreased for both children and adults. What better sign of improved value for money can there be than that I ask. Finally in the first 6 months of this calendar year over 1000 additional elective operations will be completed between Waitemata District Health Board and Counties Manukau District Health Board with a further announcement for further increased surgery from Auckland District Health Board still pending. 
Barbara Stewart 
: Would he concede that the boards’ productivity is likely to be further reduced by their mismanagement of negotiations relating to the laboratory services contract which has so far cost them $1 million in legal fees; if not why not? 
Hon PETE HODGSON 
: I just make two points. First of all this matter is before the court and commenting on the court case is unwise. Secondly the court case was not taken by the Auckland district health boards; they spent money responding. 
Heather Roy 
: As the Minister of Health did not answer the question from the Hon Tony Ryall I ask again whether he agrees with the deputy chairman of Auckland’s three boards when he said: “The reality is yes we accept decline in productivity is a huge concern given the huge increases in resources this Government has thrown at health.”; and how many more secret reports need to be written questions asked and denials issued before Labour comes up with a prescription for health care that is more than just dumping sick Kiwis off waiting lists? 
Hon PETE HODGSON 
: You see the primary question could have been asked: “… confirming hospital productivity has been declining because of huge funding increases.” It was not so long ago that New Zealanders were concerned that doctors were treating and diagnosing patients when really their first and foremost need at that moment was to get some more sleep. Productivity can be improved by having nurses and doctors run more quickly down corridors but it is not a sustainable way to go. 
Hon Tony Ryall 
: There is a problem. 
Hon PETE HODGSON 
: We are pleased that there has been an increase in doctors—in fact I will tell the member what the increase is. On page 6 of the third report on productivity from the Auckland district health boards it is stated that there has been a 19 percent increase in doctors and a 14 percent increase in nurses. One would think that therefore the increase in the bureaucracy from the stuff that you hear from the National Party would be the sum of those two figures. But let us have a look at the administration and management personnel increase—oh it is 6.4 percent! So another prejudice has been disturbed. The member needs to invent new prejudices. 
Rodney Hide 
: I raise a point of order Madam Speaker. I ask you to reflect most carefully on what we have just seen here in Parliament which is that a basic question was actually asked twice. We saw the Minister of Health stand up and give quite a long speech that might go down all right at a Labour Party conference where the people attending are rather uncritical. But the Minister stood up framed the question himself then answered it. Well actually what we have in this House is a question time where other parties ask the questions of the Minister. That does not give a licence for the Minister to get up say what the question should be put the question and then answer it. 
Madam SPEAKER 
: I thank the member. I understand his point of order. As the member knows Ministers do not have to give yes or no answers. The Minister did respond by giving his view of the matter and as such complied with the Standing Orders by addressing the question. 
Hon Tony Ryall 
: Does the Minister recall last week dismissing Treasury’s warning on declining productivity because out-patients were not counted and now that these Auckland district health board reports do include both in-patient and out-patient discharges and still show the number of doctors and nurses increasing but the number of patients being treated falling what excuse will he use now? 
Hon PETE HODGSON 
: The member forgets—even though it is only a few days ago—that the primary finding of that Treasury report is that productivity is hard to measure. These benchmarks are an attempt to improve the measurement. Actually we are going to do some benchmarking in some more district health boards too because if we get better at it we will be able to identify how productivity can improve. One really interesting thing is that one cannot have good benchmarking across district health boards unless one has a cooperative framework in which to operate. This is a recent phenomenon. During the 1990s there was no cooperative framework. [ 
Interruption 
] Crown health enterprises competed against one another; they competed against one another for doctors services and everything else. You see that is why there was a 42 percent increase in health expenditure in the term of the National Party and 89000 New Zealanders on the waiting list when it was thrown out of office. 
Rt Hon Winston Peters 
: I raise a point of order Madam Speaker. Could you please tell me what is so special about Tony Ryall that he can sit through an answer like that having his mouth constantly open interjecting the whole time the answer was given and never being stopped. Frankly there are members in this part of the House who remain reasonably quiet during question time and hear the questions and answers. But I do not see why certain members who are far more junior than others in this House and who have been here only 5 minutes can get away with that sort of behaviour. That was a very good example. It was not just Tony Ryall by himself; seven other people over there were shouting out as well. 
Madam SPEAKER 
: I thank the member. As the member knows interjections are permitted. However persistent interjections can in themselves be disruptive. In that particular instance the Minister’s answer was considerably lengthened by his responses to the interjections. That is what happens if we get this chit-chat. 
Rt Hon Winston Peters 
: I raise a point of order Madam Speaker. You do not get my point. I am asking what is so special—[ 
Interruption 
] There it goes again. It is a point of order. You have five people shouting out there. All should be exited from the House because of that. That is what the Standing Orders state. That is what Speakers’ rulings state. But again we have a certain group getting away with something in this House that the rest of us are not allowed to indulge in on any occasion. The constant shouting out and interjecting is going on as I speak now. I want to know what is so special about them. It is not because the answer was long that he was entitled to interject from the start to the finish. At the start he could not have known that the answer was going to be long. We at this end of the House want to know why they are getting away with what looks to be—I am not accusing you of this is an adverse way—like special treatment for the National Party. 
Madam SPEAKER 
: I have ruled on the matter. But the member does raise a good point that persistent interjections in themselves can be considered disorderly. So I just remind members of that particularly when there is a running commentary and Ministers are trying to respond to the question that is asked by the member who has asked it. 
Hon Dr Michael Cullen 
: Is it correct that two of the factors that can be cited here are improved working conditions and increased pay; if so has the Minister received any reports of any occasion on which any National Party spokesperson has opposed any claim for increased pay or increased working conditions as opposed to going out on the steps of Parliament House to greet every group that has ever arrived asking for more spending for health and promising to give it? 
Hon PETE HODGSON 
: No I cannot. On the contrary I find that the National Party is usually very very keen for the Government to get out its second cheque book and write a cheque in order to get this that or the other strike settled. 
Hon Tony Ryall 
: Does the Minister recall telling the House last week that productivity reports could not be relied on because the bulk of hospital work is in medical discharges and how can he say that more is being done in Auckland when these district health board reports show the number of doctors and medical services has grown by 20 percent but the amount of care provided has fallen by 6 percent? 
Hon PETE HODGSON 
: There are several ways to answer that question. The first is to repeat that it is not a bad idea for doctors to get some sleep. The second is to point out to the member that in the life of this Government we have built a new hospital at Waitakere. There has been a new hospital opened in Auckland. A super-clinic has been expanded in South Auckland. Green Lane Hospital has entirely shifted from one site to another. All of these things happen whilst the hospital must continue operating; and of course during those periods there can be a different productivity. Interestingly Waitemata District Health Board in the first 6 months of this calendar year has got an increase in volume of 4 percent and an increase of staff of 2 percent. 
Hon Tony Ryall 
: If Treasury says district health board productivity is falling the Minister of Health says district health board productivity is falling the Minister of Finance says district health board productivity is concerning and Labour appointee Ross Keenan on behalf of the district health boards in Auckland says productivity is falling does the Minister think district health board productivity is falling and what makes him so prescient? 
Hon PETE HODGSON 
: I think productivity should be sought throughout the health system or better value for money should be sought— 
Madam SPEAKER 
: I must say Mr Ryall I find it very distracting that once you have asked a supplementary question you then keep on asking questions when the answer is being given. I thought I had given a warning before so I am doing it quite explicitly now. You have the misfortune I know of sitting close and having a loud voice but interjections of themselves can in fact be disorderly. Thank you. 
Hon PETE HODGSON 
: This Government will always seek better value for money. One of the things we need to do is to benchmark district health boards—only possible in a cooperative model. To the extent that we are able to measure productivity we can learn lessons from it. But the member does need to reflect on the fact that this particular benchmarking involved a little over 10 percent of the entire activity of the district health boards in question. 
Ron Mark 
: I raise a point of order Madam Speaker. I do not wish to labour the point but my leader the Rt Hon Winston Peters has raised the issue with you. You have watched and adjudged and given Mr Ryall a warning yet as you looked to your right whilst that answer was being given he continued to constantly interject and heckle. How much more defiance of your rulings are you going to allow this House to witness? 
Madam SPEAKER 
: I thank the member. He is labouring the point. 
Dr Jonathan Coleman 
: Does the Minister agree with Dr Cullen when he wrote to the Minister of Health that the Treasury report— 
Ron Mark 
: I raise a point of order Madam Speaker. Your role is to protect all members of this House equally. As Speaker it is assumed you will ensure that all members of this House are treated equally. Your attempt to belittle and demean my very valid point of order and your reluctance to deal with Mr Ryall demonstrate unfortunately that you are not prepared to do that. 
Hon Dr Michael Cullen 
: The member is further back in the House; I am much closer to Mr Ryall and I think perhaps he was not aware that while Mr Ryall’s mouth kept moving and flapping no sound was actually coming out. I took it as some form of adoration of the Minister actually rather than anything else. 
Madam SPEAKER 
: I thank the member. Mr Ryall’s interjections were certainly not heard by me and that is my objection to it because it creates disorder. If he wants to mumble that is fine as long as it does not create disorder. But the member had my ruling and if he makes one more implication like that on my rulings he will find himself not in this Chamber. 
Dr Jonathan Coleman 
: Does the Minister agree with Dr Cullen when he wrote to the Minister of Health that the Treasury report  
Value for money in health—the DHB sector 
 “does raise concerns about declining productivity in DHB hospitals.” and that “Improving hospital productivity is an important way of freeing up money for services outside hospital and for other priorities.”; and does the Minister realise that the $35 million currently being wasted across the Auckland district health boards would more than pay the Herceptin bill for all New Zealand women? 
Hon PETE HODGSON 
: Yes I do agree with Dr Cullen. The member does not seem to have seized the point that that Treasury finding 2 years ago is where this benchmarking activity and a whole lot more activity in the health system came from. We are not short of our intention to get better value for money on our health system. We are very pleased with our health system—very proud of it—but we can always do better. 
Working for Families Programme—Household Impact 
5.  
RUSSELL FAIRBROTHER (Labour) 
 to the  
Minister for Social Development and Employment 
: What has been the impact on households of Working for Families tax credits? 
Hon DAVID BENSON-POPE (Minister for Social Development and Employment) 
: 
 The impact has been very considerable indeed. From 1 April 2007 an estimated three out of every four New Zealand families with dependent children will be entitled to further tax credits through Working for Families. Also from 1 April Working for Families tax credits will increase by a further $10 per child per week which depending on family circumstances is an increase of between 12 and 21 percent. That also means that from 1 April a family with two children on the average family income will be in total $136 per week better off than previously. Under National’s proposed tax cuts for the wealthy the same single-income family would be in comparison $91 per week worse off from 1 April onwards. 
Russell Fairbrother 
: What is the total increase to Working for Families tax credits as at 1 April this year? 
Hon DAVID BENSON-POPE 
: I can advise the House that the 1 April increases to the Working for Families tax credits will distribute a further $366 million to Kiwi families with children. I note that National’s policy announced today is a proposal to divert between $60 million and $90 million from tax revenue as a tax break for donations. That idea seems to be based on taking money from lower-income families and giving it to wealthy families so they can donate it to lower-income families. 
Russell Fairbrother 
: What further reports has the Minister received on the effects of the Working for Families package? 
Hon DAVID BENSON-POPE 
: I am pleased to read an excerpt from a letter to the  
Dominion Post  
from Judith Baxter of Khandallah which reads in part: “The scheme”—Working for Families—“recognises and encourages women in their mothering role and by offering financial support gives women more choice when deciding how many hours of paid work they need to supplement the family income or to advance a career. The power to choose takes the pressure off mums who have felt they must work reduces the need for expensive childcare and can only benefit the family as it is intended to do.” I seek leave to table a number of letters to the editor around the success of the Working for Families package. 
Madam SPEAKER 
: Leave is sought to table those documents. Is there any objection? There is objection. 
Early Childhood Education—Free Hours Policy 
6.  
KATHERINE RICH (National) 
 to the  
Minister of Education 
: Will the payment the Government offers to early childhood providers as part of the 20 free hours policy cover all operating costs for centres? 
Hon RUTH DYSON (Minister of Labour) 
 on behalf of the 
 Minister of Education 
: Yes. The funding rates are designed to cover all the operating costs of providing early childhood education to the regulated quality standards. The rates are based on information provided by centres to the Ministry of Education in the 2006 operating cost survey. 
Katherine Rich 
: Whom should New Zealand parents believe: the Minister who said that the rates would cover “all operating costs” or the Barnardos chief executive who said: “We are concerned that the rates set by Government do not cover the full cost of providing quality early childhood education to children and families.”? 
Hon RUTH DYSON 
: In my view the public should believe both because they are both telling the truth. The funds that are available have been provided to meet the operating costs to the regulated standards. That is not what the chief executive of Barnardos was referring to. The member should try to be a little more rigorous and accurate in her questions. 
Hon Marian Hobbs 
: Has the Minister received any reports about alternative payments offered to early childhood providers to cover operating costs for 20 hours a week? 
Hon RUTH DYSON 
: As a matter of fact I have. I have seen proposals to scrap 20 free hours of early childhood education. That policy would mean that all parents would have to continue to pay fees to meet the costs of early childhood education for those 20 hours. That is the National Party policy. Labour’s policy will substantially reduce costs for parents. That is why the early childhood education sector is very supportive of this initiative. It will increase participation and does support families. I cannot imagine why that member is so opposed to it. 
Katherine Rich 
: Why does she not admit that the Government will not be covering all operating costs and that it works out its figures based on average operating costs and does she agree with the Ministry of Education’s handbook on 20 free hours of early childhood education which states that providers can enforce the payment of optional charges by withdrawing or withholding children’s enrolment; if so why does she continually say that providers will not be able to charge for 20 free hours when the rules clearly state that they will—will those charges be optional or not? 
Hon RUTH DYSON 
: To repeat the answers to the same questions by the same member last week I say the free early childhood education rates cover all operating costs as determined by information provided by the centres in the Ministry of Education’s 2006 survey. The costs include teachers’ salaries administration costs professional services utilities capital and property costs such as rent and mortgage repayments and the replacement of assets. 
Katherine Rich 
: How can extra fees on top of the 20 free hours of early childhood education be “voluntary” when ministry guidelines for centres state: “The service may enforce the payment as they would a fee.”; how can something be voluntary if it can be enforced in a compulsory way—will parents be referred to Baycorp if it is not paid? 
Hon RUTH DYSON 
: To repeat the same information given to the same member in reply to the same question last week I say the key rule is that parents cannot be charged for 20 free hours of early childhood education. That is really what the word “free” means. Parents may be asked for and may choose to pay a donation for services—[ 
Interruption 
] It is the same information as that given last week. It is for services in addition such as— 
Madam SPEAKER 
: It is impossible to hear the Minister’s response. Would the Minister please continue. 
Hon RUTH DYSON 
: For example if the centre provides sunscreen lotion parents may be asked to pay for it. They may be asked to provide for clothing or for any additional items and may choose to pay for that. The 20 free hours of early childhood education is just as it is stated: 20 free hours. 
Katherine Rich 
: Does she think parents are idiots when she says they may be asked to pay money and they may choose to pay that money when in fact if they do not pay their child will be asked to leave the centre or will not get into the centre in the first place; how can a voluntary payment be voluntary if it is enforceable by centres as per the ministry’s own guidelines—or does the Labour Government have its own special definition of the word “voluntary”? 
Hon RUTH DYSON 
: In general my answer would have been: “No I do not consider that New Zealand parents are idiots.” but having listened to the member repeat the same question time after time I may now reconsider that. 
Hon Dr Michael Cullen 
: Madam Speaker—[ 
Interruption 
] 
Madam SPEAKER 
: The question will be asked in silence. Anyone who interrupts will leave the Chamber. It is becoming too disruptive. 
Hon Dr Michael Cullen 
: Will the Minister accept Katherine Rich’s implied suggestion that the Government should pay for whatever an early childhood centre chooses to provide or whatever parents demand should be provided; if so how would she reconcile that with Bill English’s call for cuts in Government spending? 
Hon RUTH DYSON 
: Yes I certainly would infer that from the member’s continued questions. But although that is inconsistent with co-leader Bill English’s stated position it is consistent with that of the spokesperson on health: one of accepting every demand in the health system and demanding that every health provider gets more funding. 
Electricity—Renewable Generation 
7.  
STEVE CHADWICK (Labour—Rotorua) 
 to the  
Minister of Energy 
: What reports if any has he received on plans to build renewable electricity generation in New Zealand? 
Hon DAVID PARKER (Minister of Energy) 
: 
 Contact Energy has announced plans to invest $2 billion in renewable geothermal and wind energy in preference to using Otahuhu C. I am also advised that Contact Energy’s share price rose upon the announcement showing that renewables make both environmental and economic sense. The Government’s climate change policies are clearly working. 
Steve Chadwick 
: How will Contact Energy’s extra renewable generation help New Zealand towards carbon neutrality? 
Hon DAVID PARKER 
: By decreasing the proportion of electricity that comes from emission-producing thermal electricity we take another step towards carbon neutrality. As John Ashton the UK’s most senior climate change diplomat said today carbon neutrality is an achievable goal over time. Yesterday Meridian Energy attained carbon neutrality. Despite the National Party’s wish to the contrary carbon neutrality is breaking out all over the place. 
Gerry Brownlee 
: Why does the Minister keep repeating the Prime Minister’s carbon neutrality mantra when in 2006 electricity generated from renewable sources was the lowest on record a 210 megawatt wind farm was delayed by over 15 months because of Resource Management Act difficulties the second-biggest thermal plant in New Zealand’s history is about to be commissioned and Contact Energy has put the strong proviso that it will go ahead only if the Resource Management Act does not get in its road; what is the Minister doing about that? 
Hon DAVID PARKER 
: It appears that the National Party is sad that the Government is successful in actually bringing forward renewables. Indeed I quote from Mr Baldwin the chief executive of Contact Energy who said that “with Government support for the consenting of geothermal and wind development he believed the Government’s goal of meeting New Zealand’s energy growth from renewable forms of energy could be realised.” 
Gerry Brownlee 
: I seek leave to table documents showing that New Zealand’s carbon emissions have risen astronomically in the last 7 years and the trend shows no sign of turning around at all. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? Yes there is objection. 
Hon Phil Goff 
: In the Minister’s promotion of renewable energy to reduce global warming what support has he received from the National Party given the statement made in this House not so long ago by its co-leader John Key that “… even if one believes in global warming”— 
Gerry Brownlee 
: I raise a point of order Madam Speaker. We have a leader; his name is John Key. We are sick to death of Labour members’ smart alec behaviour in their reference to a co-leader and we want it to stop. [ 
Interruption 
] Much as the House was refused the right to refer to “Helengrad” and the “Republic of the Labour Party” so too this will stop. 
Madam SPEAKER 
: Please be seated. I ask members to refer to other members by their correct names and titles. Would the member please start again. 
Hon Phil Goff 
: In his promotion of renewable energy to reduce global warming what support has he received from the National Party given the statement made in this House not very long ago by Mr John Key that “… even if one believes in global warming—and I am somewhat suspicious of it— … we will see billions and billions of dollars poured into fixing something that we are not even sure is a problem.”? 
Hon DAVID PARKER 
: Indeed that quote does illustrate the difficulty we have in garnering support from National members for sensible policy in this area. It is plain that they remain unconvinced as to whether climate change is real as evidenced by that quote. Dr Smith last week said the Hon Phil Goff was misquoting when—as Mr Goff just repeated then—he was absolutely accurately quoting and those comments are irreconcilable with later comments from Mr Key saying he believed in climate change and always has. 
Gerry Brownlee 
: I seek leave to table the National Party document on the environment released last October which now appears to be the source document for David Parker’s climate change policy. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Hon Phil Goff 
: I seek leave to table in the House Mr Key’s comment quoted in  
Hansard 
 that he is suspicious of global warming and that he is not even sure it is a problem. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Peter Brown 
: I raise a point of order Madam Speaker. Through you might I respectfully remind the House that it has become the convention that members raise and table documents at the end of supplementary questions unless there is a particularly good reason for doing otherwise. 
Madam SPEAKER 
: I thank the member for reminding members of that point. 
Peter Brown 
: Noting all this debate on renewables will the Minister clarify the position on what will happen if Huntly coal-fired power station is shut down—as is being advocated by Greenpeace; would New Zealand’s electricity supply suffer and what effect would such a closure have on climate change? 
Hon DAVID PARKER 
: If a price on emissions is introduced into the economy the cost on per unit of electricity output will be most expensive for the coal-fired Huntly power station and it is likely to change the relative despatch order of different generation sources so we may see Huntly being despatched less often as a consequence. Nonetheless we will be reliant for some years to come on electricity produced by Huntly. 
I seek leave to table two documents. The first is Contact Energy’s announcement of $2 billion in renewables where it says that the Government’s vision of achieving growth in electricity from renewables can be met. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Hon DAVID PARKER 
: The second document I would like to table is Meridian Energy’s announcement in respect of having achieved certified carbon neutrality. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Hon Dr Nick Smith 
: I seek leave to table the Ministry of Agriculture and Forestry’s latest deforestation figures released today that show that last year we lost more trees than in any year of history since 1946. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Ingram Report—Status of Report 
8.  
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
 to the  
Minister of Immigration 
: Does he still rely on the Ingram report because it is an authoritative comprehensive report written by a Queen’s Counsel as he confirmed to the House on Wednesday 30 August 2006? 
Hon DAVID CUNLIFFE (Minister of Immigration) 
: 
 Yes and I note that the member has produced no evidence to the contrary. 
Dr the Hon Lockwood Smith 
: Why did the Minister tell Parliament in answer to a question last Thursday that it was not correct that when Mrs Field presented Taito Phillip Field’s 18 May letter detailing the Associate Minister’s alleged decisions to the Apia branch of the New Zealand Immigration Service the branch manager in Apia faxed the group manager of service international in Wellington the same day asking “whether our Assoc Minister was aware of the information we have received … regarding these Thai nationals when he apparently made these decisions following discussions with the Hon Taito Philip [sic] Field” when paragraph 136 of the Ingram report records those very words and paragraph 137 notes that the branch manager in Apia did fax that query to the group manager of service international the same day on 9 June 2005? 
Taito Phillip Field 
: I raise a point of order Madam Speaker. It is an understanding in this House that members should avoid bringing the names of wives spouses and family on to the floor of this House. That is my objection to the question. 
Madam SPEAKER 
: My ruling is that if there is a legitimate reason for doing so in the context of the documentation then that is permitted. 
Hon DAVID CUNLIFFE 
: Quite simply because I am advised that on a local time basis the letter was presented in Apia on 8 June and transmitted through to the department’s managers in New Zealand on 9 June. 
Dr the Hon Lockwood Smith 
: Why did he tell Parliament in response to a question last Thursday that it was not correct that after receiving the fax from the Apia branch manager of the New Zealand Immigration Service the group manager for service international phoned the then Associate Minister’s office the same day to warn him and spoke to the Associate Minister’s private secretary when paragraph 137 of the Ingram report clearly states that the group manager received the fax from the Apia branch manger on 9 June and paragraph 138 not only discusses the group manager phoning the Associate Minister’s private secretary but also details the telephone records of a 5-minute conversation between the group manager and the private secretary at 2.41 p.m. on the same day 9 June 2005? 
Hon DAVID CUNLIFFE 
: I said so for the same reason I gave in my previous answer. It has been long established in this House and in the Ingram inquiry report that the key fact was that the attempt to transmit that information to the Minister did not succeed before the Minister had to make his decision. Consequently Mr Siriwan remains outside New Zealand and the Minister remains beyond reproach for his approach to that issue. 
Dr the Hon Lockwood Smith 
: Is it correct that after an email was sent from one of Taito Phillip Field’s ministerial staff to the New Zealand Immigration Service on 25 May 2005 asking about Mr Siriwan’s partner’s removal costs compliance officer Murray Gardiner emailed the Associate Minister’s private secretary Nicola Scotland prior to the Associate Minister making his decision and told her about Sunan Siriwan being in Samoa and the query from Mr Field’s ministerial office? 
Hon DAVID CUNLIFFE 
: According to the information I have before me some emails were sent at that time. As to the exact content of that information I am not quite sure at this point. 
Dr the Hon Lockwood Smith 
: Why did the Minister tell Parliament in response to a question last Thursday that crucial to Dr Ingram’s judgment about whether the Hon Damien O’Connor’s private secretary would have passed on the information she received from the head of service international on 9 June were the facts that “the meeting with Taito Phillip Field in question happened on 17 May and that the first alleged passage of specific information about Sunan Siriwan to the private secretary did not occur until some 3 weeks later on 9 June.” when the Ingram report states specifically at paragraph 133 that on 27 May 2005 compliance officer Murray Gardiner emailed Damien O’Connor’s private secretary Ms Nicola Scotland with specific information about Sunan Siriwan and his partner Ms Phanngarm in Samoa? 
Hon DAVID CUNLIFFE 
: In the first place it is because the Ingram inquiry report conclusively concludes that the Minister in question did not receive the information before he made the decision. That judgment is backed up in the financial review report of the Department of Labour published yesterday which records that member’s party—no doubt led by that member—as saying that the Associate Minister’s briefing paper did not contain that information and that that represented either a lapse of judgment or a failure of processes on the part of the department not the Minister. That is what the chief executive of the department has agreed with since April last year and I suggest that that member is continuing to waste the time of this House by going over the same old ground when there is nothing new to say. 
Dr the Hon Lockwood Smith 
: If as the Minister claimed in his answer to Parliament last Thursday the 3-week gap from the date of the meeting between Taito Phillip Field Damien O’Connor and Mr O’Connor’s private secretary was crucial to the issue of whether the private secretary Nicola Scotland would have passed on the information she received from the head of service international on 9 June how does the Minister explain Ms Scotland’s claimed failure to pass on the information from compliance officer Murray Gardiner received on 27 May only 10 days after that crucial meeting on 17 May 2005? 
Hon DAVID CUNLIFFE 
: What has been clear all along is that private secretaries receive a great deal of information from a great deal of sources not all of which is corroborated or reliable. It is a matter of a private secretary using judgment in deciding what information to pass on to his or her Minister. The chief executive of the department has already stated that on this occasion the department should have had more robust processes to ensure that the Minister was informed in writing. He was not and the member has drawn attention to that fact in the financial review of his department that was published yesterday. 
Office of Treaty Settlements—Landcorp Properties 
9.  
TE URUROA FLAVELL (Maori Party—Waiariki) 
 to the  
Minister in charge of Treaty of Waitangi Negotiations 
: He aha te hatepe whiriwhiringa kua whakatakotoria e Te Tari Whakatau Take e pa ana ki te Tiriti o Waitangi ki te panui atu ki te iwi i te hiahia o Landcorp ki te hoko i nga whenua kei te tautohea e nga whakataunga i raro i te Tiriti o Waitangi? 
Hon MARK BURTON (Minister in charge of Treaty of Waitangi Negotiations) 
: 
 If the Office of Treaty Settlements is in negotiations with a group the office discusses the proposed sale with the mandated representatives. 
Te Ururoa Flavell 
: What is the Minister’s response to the comments made by Jim Sutton former Labour Cabinet Minister and Landcorp chairperson who told  
Waatea News 
 on Friday 23 February that the Office of Treaty Settlements may have made a mistake of judgment; and would he not agree that the fact that Hauraki Maori Trust Board chairperson Toko Renata and senior tribal kaumatua have occupied Whenuakite Station in a bid to stop the sale of the land is indeed a very serious response to this mistake of judgment? 
Hon MARK BURTON 
: It is obviously Mr Sutton’s prerogative to offer an opinion and I have no particular view on his opinion. Certainly I take all negotiations seriously but as the member knows in the case of the latter there is no mandated negotiation in progress. None the less these cases provide a complex set of circumstances and under the circumstances I am taking the opportunity to look at the detail of them. 
Hone Harawira 
: Kia ora Madam Speaker kia ora tatou. How does the Minister reconcile the difference between his response to my questions in the House last Wednesday when he suggested that Landcorp property was generally not available for use in settlements with this comment made by Mr Sutton on Friday: “I’m working on the basis the State-owned farming company’s land is available for Treaty settlements.”? 
Hon MARK BURTON 
: There is no inconsistency but perhaps I should explain. I think what Mr Sutton is referring to is that in all circumstances when surplus land is available it is offered back to the Office of Treaty Settlements. My response indicated that it is not generally the case that that offer is taken up because of the section 27B memorial coverage that the land already enjoys. 
Pita Paraone 
: Tena koe Madam Speaker. For what reasons did the Office of Treaty Settlements refuse to purchase land offered by Landcorp for use in Treaty settlements and who will be held accountable for any extra cost incurred if the land has to be bought back by the Crown from a private buyer for the purpose of a land settlement? 
Hon MARK BURTON 
: It is fair to say that the process that has been followed consistently since the early 1990s has been followed in this case. I think the decision was taken primarily on the— 
Shane Ardern 
: It was just faster in the 1990s that’s all mate. 
Hon MARK BURTON 
: No it was not faster in the 1990s. Actually it was slower. But let me say that the decision was taken primarily on the same grounds that have been applied since the early 1990s—that is sufficient land was judged to be held available. Secondly I can say to the member that should such land be acquired for the purpose of a settlement whether by direct purchase by the Crown before the fact or through a section 27B resumption in effect fair market price would be the prevailing sum required. So there is actually no material difference in terms of cost to the Crown. 
Nandor Tanczos 
: Could the Minister explain in what way the Government’s position differs in principle in relation to Landcorp land from that of a thief who on being asked to return a stolen BMW car says: “Oh no I put it on TradeMe it’s up for sale. I’ll give you my Lada instead.”? 
Hon MARK BURTON 
: The return of land or not is part of a process in each case with a mandated negotiating team from the iwi in question. That is the process used in each case. Certainly in the case of one of the areas currently being referred to there is not yet a mandated team. 
Te Ururoa Flavell 
: How does the Government propose to allay the concerns of the respective iwi who have repossessed Landcorp’s Rangiputa Station on the Karikari Peninsula and Whenuakite Station in Hauraki; and is it not sensible that in light of iwi concerns the fact that the Prime Minister herself confirmed that she was unaware of this dispute and the fact that Landcorp chairman Jim Sutton has admitted Landcorp was unaware that there was a claim on this land all of these are an indication there is something seriously wrong with the process of land properties to be offered back under the Treaty settlements process? 
Hon MARK BURTON 
: As I indicated in an earlier answer—the member may have missed it what with some of the noise from members opposite—I am looking at the circumstances around both of these settlements directly. Further I have indicated that the process that has applied since the early 1990s perhaps needs to be reviewed. In future I will have all such offer-backs referred directly to me as Minister which will mean a direct ministerial involvement in those future processes. Thirdly I understand that in terms of Hauraki Landcorp has given an undertaking that it will not take any further action on the disposal until it has had discussions with the Minister for State Owned Enterprises. 
Te Ururoa Flavell 
: I seek leave to table a transcript from  
Waatea News  
on Friday 23 February in which Mr Sutton states that the Office of Treaty Settlements may have made a mistake of judgment. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. It is a document that the Minister in charge would not mind seeing. If the member could supply it I would be quite keen. 
Madam SPEAKER 
: I shall put the leave again. Would members please be quiet when I put the question. 
Document by leave laid on the Table of the House. 
Parole—Police Powers to Recall 
10.  
SIMON POWER (National—Rangitikei) 
 to the  
Minister of Justice 
: What advice if any did he give to the Prime Minister prior to her proposal to “give serious consideration” to allowing police to make a recall application for prison parolees who pose an undue risk to community safety as outlined in her Prime Minister’s statement to Parliament on 13 February 2007? 
Hon MARK BURTON (Minister of Justice) 
: 
 That I agreed that serious consideration should be given to the proposal. 
Simon Power 
: Did he advise the Prime Minister that section 73 of the Parole Act already allows any member of the police to arrest without a warrant any offenders he or she has reasonable grounds to believe either to be unlawfully at large or to have breached their parole conditions; if so is not her announcement at the start of this year just a bit of a sham to make it look like the Government is doing something after the Graeme Burton tragedy? 
Hon MARK BURTON 
: I can assure the member that the Prime Minister is well aware of current provisions. The Prime Minister was indicating clearly a need to look at a wider potential provision. Further I say to the member that I will enjoy his support and that of his party for the extensive further provisions in the extension of parole coverage and parole service that this Government has before the House in legislation at this time. 
Simon Power 
: Does the Minister stand by the Prime Minister’s statement that the police are best placed to know whether an offender poses an undue risk to the safety of the public; if so can he explain to the House and the public of New Zealand why section 73 of the Parole Act was not invoked at the time that police told the probation service that Graeme Burton was not living where he was supposed to be that he had amassed a cache of weapons and that “if Burton’s parole wasn’t revoked and he remained in the community that he would kill someone”? 
Hon MARK BURTON 
: The member knows that it would be irresponsible of me to comment on any specific case particularly when it is under current investigation. 
Simon Power 
: Has he seen the recent claim by the Chief Executive of the Department of Corrections Barry Matthews that he was not aware of any proposals to change the Parole Act and why did he not consult with the department which not only administers the probation service but also provides the funding for the administrative support to the Parole Board or has he like the rest of us simply lost confidence in the department? 
Hon MARK BURTON 
: I have had considerable discussion with my parliamentary colleague the Minister of Corrections. 
Simon Power 
: When the Prime Minister prefaced her statements to fix the Parole Act with phrases such as “give serious consideration to allowing the police to make a recall application” and “it can be argued that the police should have the power to make an application for recall” does that mean the Government will actually change the Parole Act or will she continue to use woolly language to make it look as though the Government is going to do something when the provisions in the Parole Act make it clear it could have done something? 
Hon MARK BURTON 
: The Prime Minister was clearly indicating this Government’s willingness as proven by numerous actions already to further strengthen the provisions of the Parole Act. Further the Government has before the House the Criminal Justice Reform Bill which will further strengthen parole provisions. I look forward to that member’s party’s vote following his rhetoric. 
Internet—Gambling Site RaceO 
11.  
SUE BRADFORD (Green) 
 to the  
Minister of Internal Affairs 
: What actions if any is the Government taking to close down RaceO the Internet gambling site that went live on Saturday? 
Hon RICK BARKER (Minister of Internal Affairs) 
: 
 I am advised that officials of the Department of Internal Affairs are actively investigating the website in question. I expect to be advised of the result of those investigations within about 4 weeks. 
Sue Bradford 
: Why was the Government not ready to deal with this website immediately given that as long ago as 1999 the briefing to the incoming Minister for Racing at that time advised way back then that a RaceO Internet site was proposed and was not permitted in terms of the law; as this advice has been available since then and the 2003 Gambling Act confirmed the law in that area why has it taken until now to investigate how to stop it? 
Hon RICK BARKER 
: It is very hard to investigate intentions. The department had to wait until the website was an actual reality and investigate that. 
Sue Bradford 
: Does he believe that the Government has the power to shut down RaceO or are we witnessing the first of many Internet gaming sites with all the associated damage to problem gamblers and to the New Zealand racing industry that will come from them? 
Hon RICK BARKER 
: The answer to that question will be known at the end of the department’s investigation. 
Walking Access Consultation Panel—Report 
12.  
Hon DAVID CARTER (National) 
 to the  
Minister for Rural Affairs 
: Has the Walking Access Consultation Panel report been discussed at Cabinet and when will the report be released to the public? 
Hon DAMIEN O'CONNOR (Minister for Rural Affairs) 
: 
 Yes and in due course. 
Hon David Carter 
: For how long has the Minister sat on this report and why will he not release it immediately to the public of New Zealand and put our farming community at ease? 
Hon DAMIEN O'CONNOR 
: The chairman of the panel presented the report to me just over a week ago. The farming community can rest assured that this report I am sure will be welcomed. It will also be welcomed by the recreational sector as well. It is a very sensible proposition. 
Gordon Copeland 
: Does the Minister acknowledge that this Government has a responsibility to uphold its 1999 election manifesto pledge to complete the Queen’s Chain by securing access to the 30 percent of waterways and coast where the Queen’s Chain either does not exist or is misaligned; if so is he concerned about rumours that the Walking Access Consultation Panel has backed down from making such a recommendation in the wake of pressure from a minority of farming interests? 
Hon DAMIEN O'CONNOR 
: I am not concerned about any rumours at all. The Queen’s Chain is something that New Zealanders have expected and upheld through the years. However on close analysis as that member should be very aware one finds that the legal imposition of the Queen’s Chain is not as easy as one would think. The panel has after extensive consultation and research come up with some very wise recommendations on how to move forward. 
Hon David Carter 
: So are the media reports correct that the report is a massive back-down for the Prime Minister on her original promise to ensure public access to our lakes rivers and coastline by forcing access over private land? 
Hon DAMIEN O'CONNOR 
: No. 
Hon David Carter 
: Does the report represent the unanimous view of all eight panel members; if not who holds a dissenting view? 
Hon DAMIEN O'CONNOR 
: I would encourage that member to hold his breath until the report is released. 
Nathan Guy 
: Will local government be expected to negotiate with landowners over messy paper road deals; will it be like so many other bits of legislation passed by the Labour Government where the ratepayer will bear the cost? 
Hon DAMIEN O'CONNOR 
: No. The issue of paper roads or unformed legal roads as is their proper title is one that has been raised and thoroughly canvassed by the panel. There are some recommendations again to make some sensible progress on that difficult issue. 
Nathan Guy 
: I seek leave to table Landcorp Farming Ltd’s statement of corporate intent for 2007 2008 and 2009 and in particular its land management philosophies. 
Madam SPEAKER 
: Leave is sought to table that document. Is there any objection? There is objection. 
Third Readings 
Hon RICK BARKER (Minister for Courts) 
: 
 I move  
That the District Courts Amendment Bill (No 3) the Employment Relations Amendment Bill (No 2) the Judicature Amendment Bill (No 2) Te Ture Whenua Maori Amendment Bill (No 2) / Maori Land Amendment Bill (No 2) the Coroners Act 1988 Amendment Bill and the Coroners Act 2006 Amendment Bill be now read a third time 
. This legislation raises the retirement age for all judges of all courts and for associate judges of the High Court coroners and community magistrates from 68 to 70 years. 
As mentioned in my previous speeches a compulsory retirement age for the judiciary is desirable for two main reasons. The first is judicial independence. The independence of the judiciary is a fundamental concept underlying New Zealand’s democratic system. A compulsory retirement age is key to protecting that independence. The second reason is that a compulsory retirement age means that monitoring of individual judges to guard against issues of incapacity is not required. Raising the retirement age of the judiciary to 70 years brings New Zealand into line with comparative overseas jurisdictions in particular the United Kingdom Australia and Ireland. 
The Justice and Electoral Committee were comfortable with the changes in the legislation. These changes are also supported by the judiciary itself. For these reasons I commend the bills to the House. 
CHRISTOPHER FINLAYSON (National) 
: 
 I wish to address the House only briefly on this matter in the third readings of these bills because I think that most of the arguments were adequately raised in the second reading and during the Committee of the whole House. As I explained the original age for retirement of judges certainly in the High Court was 72. It was then reduced to 68 after the report of the Royal Commission on the Courts chaired by the late Sir David Beattie in the late 1970s. So that I could say something new in the third readings a few days ago I looked up that report of the royal commission. Paragraph 685 talked about the statutory requirement age of 72 for judges being out of line with the generally accepted retirement age for most public offices the civil service and the business community. Indeed at that time magistrates—as they then were—had to retire at age 68 although there was provision for them to be removed from office in certain circumstances before that age. 
Sir David referred to the report of the Magistrates’ Executive which told the royal commission about the general pace and pressure of work in the Magistrate’s Court having increased substantially in recent years and that it was essential that a magistrate be able to give “of his best every hour of his judicial career. Concentration and standards cannot be relaxed at any time and further that the maintenance of a high standard of judicial determination until age 68 may in some cases become difficult.” So in fact the royal commission then was recommending that the normal retiring age for judges of the High Court and District Court should be reduced to 65. As it turned out the age was reduced to 68. As I said in both the second reading and Committee debates there is simply no justification for such a low retirement age now for reasons that have already been advanced. 
So National supports the third readings of these bills says that the legislation is timely and notes what the Law Society said which was that the age for retirement could really be 72. It may well come to that. It may even be higher in years to come. But 70 is an appropriate age at this time and that is why the National Party supports the third readings of these bills. 
LYNNE PILLAY (Labour—Waitakere) 
: 
 I would like to take a brief call on this legislation. It is common-sense legislation and I thank the Justice and Electoral Committee for its sensible approach of referring the matter back to the House. The legislation has been very uncontroversial. All the comments we received were in favour of it and it brings us into line with other jurisdictions. It means we can use the very good skills that we have in our judiciary for longer. I think that changing the age of retirement from 68 years to 70 years is a move in the right direction and that it will enhance the service provided by our judiciary. For that reason I commend the bills to the House. 
Dr RICHARD WORTH (National) 
: 
 I join my colleague Chris Finlayson in indicating that National supports this legislation. The original bill the Judicial Retirement Age Bill has been divided into six bills. The reason is that separate changes are being made to separate statutes. 
It is very unusual to have a retiring age in the context of modern society. The reality is that Prime Ministers can serve for as long as their luck lasts and that is so in the case of many public officials. But here we see that it is appropriate to set a specific retiring age in the context of protecting and enhancing judicial tenure. There is no magic in age 70 being selected as the age for retirement. The age might as previous speakers have said have been set higher and for one part of our judiciary it was set at 72 for a period of time. 
I simply note in my concluding comments on this legislation—the next stage of course being the Royal assent—that we do have an ability for acting judges of the Supreme Court to serve until the age of 75. I repeat the hope I have expressed that this change to the legislation will not prompt part-time judges to have a place in our system for judging is very much a full-time business. 
KATE WILKINSON (National) 
: 
 In speaking in support of the third readings of these bills which increase the retirement age from 60 to 70 years of age for judges I have often been asked throughout the passage of the legislation why we need a retirement age for judges at all. Why should there should be a mandatory retirement age and why should judges not just retire when they feel like it when they no longer feel able to do the job properly or indeed when they no longer want to do the job? A mandatory retirement age for judges is not peculiar to the New Zealand jurisdiction. It has been noted that this legislation brings the age of their retirement into line with other jurisdictions such as the United Kingdom Australia and Ireland. Canada is a bit more generous in allowing its judges to retire at 75 years of age; certainly there is no magic in 70 years of age as opposed to 75 years of age. 
A mandatory retirement age is essential for a number of reasons. These have been canvassed before but they are worth repeating. One is the vital principle of judicial independence. There must be a separation of powers between the judiciary and the legislators. That is how our democracy works and it is an important foil against any semblance of corruption. Politicians should not and must not be in a position to fire judges. Judges must be able to act independently. If they cannot act independently or are not seen to act independently then any confidence in our judicial system will be seriously eroded. 
Judges must be able to deal with the merits of any case without having to worry about whether they still have a job because they interpreted the law—which we made—contrary to how we intended it to be interpreted. That is why it is so important that we do get the law right and that we do not blame the judges for their decisions. They apply the law that we make. If the decision is not what Parliament intended then it is up to us to put it right and to make sure that the law we make is understandable or more to the point that it is not able to be misunderstood. Judges must have independence and we must conscientiously protect and maintain the separation of powers principle. 
This is straightforward and non-controversial legislation. It merely increases the retirement age of the judges in the District Court the High Court the Employment Court the Maori Land Court and the coroners’ court. It is consistent with other jurisdictions. National supports this legislation. 
RON MARK (NZ First) 
: 
 I rise to put on the record that New Zealand First will continue to support the passage of these six bills that have been separated out from the Judicial Retirement Age Bill. Right from the outset New Zealand First believed that it was sensible to raise the retiring ages for judges. I think it would be fair and appropriate to put on the record our support of the question asked by the member who just resumed her seat Kate Wilkinson from Waimakariri. We should possibly be asking that next question of why there should be a mandatory age for retirement at all.  
On reflecting on the member’s question I think there are many of us in this House who can name people who at the grand old age of 85 still have absolute and complete control of all their faculties who are able to reason articulate views analyse and read and who still have an immense knowledge of the area of professionalism they have worked in—some for 50 or 60-odd years. We in New Zealand First have long thought that and I guess we have been criticised for our support for the elderly community of New Zealand. We have often been criticised by members both in National and in Labour for our unswerving support for the elderly because we—unlike those parties—do believe that elderly people still have a major role to play in society.  
The amount of experience and knowledge that people have accrued over 50 years may not be expressed as vocally or as loudly as some of the more junior younger professional people in the field may want to express their opinions but often the contributions of older people contain a great deal more wisdom. There is far more value in the counsel that those older people in the profession have to offer. So it is timely as we pass this legislation through its third reading to not sit and smugly pat ourselves on the back and say we have done good—because we have at this point—but I think it would be right for New Zealand First to express to the House the need for us to ponder the subject a little more deeply.  
I can tell members that on my holidays over Christmas when I went up to Whangaroa—prior to my partner and I going up and spending some time at the Hon Dover Samuels’ place at Matauri Bay—I had occasion to stay at the home of Robyn and Doug Gow and I had the fortune of meeting Robyn’s mum. Let me tell members she is one totally independent lady. She is in her 80s she lives alone and she is able to sit and engage and discuss with me everything that is happening politically. She is extremely well read and well informed. I would suggest that she has a far greater knowledge of political events than many members and she is able to articulate a depth of understanding to a degree that far surpasses that of a large number of honourable members in this House.  
To suggest that a person is no longer capable of expressing a view—or indeed to suggest that a judge who has given long loyal and competent service to this nation is no longer capable of doing that—because he or she is 71 is a nonsense. People should be judged on their merits. It is interesting that when we in this House are out there on the political hustings seeking support from the public for our political parties we often express views that suggest people should be judged as to their merits. People should not be treated simply discarded or ignored simply because they have attained a certain age—or have not attained a certain age. On occasion we seem very long in the rhetoric as to what we believe and very short in the doing.  
I suggest that this is good legislation. It is a step in the right direction. New Zealand First supports it wholeheartedly but we would suggest that possibly it is time to start thinking a little more widely and to start asking questions about how retirement should be determined for the judiciary. Should it be a question of age or should it be a question of capability? I think I already know the answer to that question by looking around the House and seeing the faces of other members right now. We in New Zealand First might suggest that it should be a question of capability as opposed to a question of age. 
NANDOR TANCZOS (Green) 
: 
 Like other members before me I rise to give a fairly brief contribution to this debate because so much has already been said on it. The Judicial Retirement Age Bill was a fairly small bill and the bills into which it has been split are fairly straightforward in what they do. We have had some very good contributions through the first reading select committee second reading and Committee of the whole House stages. All of the arguments have been well canvassed. I would particularly like to acknowledge the contribution of Chris Finlayson who I think has added some quite deep historical information and perspective to the debates. I just want to acknowledge and thank him for that. 
The only thing I would add is that I was reflecting on the debate during the passage of the Supreme Court Act. One of the arguments that was put forward was about the small legal pool we have in this country and some people seemed to be of the view that our judiciary was just not up to the job. There is certainly no doubt in my mind that there is no basis in that claim. I think New Zealand has produced some exceptional jurists in our time. That is quite evident. I would also say that if one looks at the Supreme Court that we have today one can see there are a number of excellent jurists to be found there as well. But raising the retirement age a smidgen as we are doing in this bill perhaps helps to even further demolish that argument because it actually allows us to retain the services of our exceptional jurists for that bit longer. 
That was all I really wanted to cover today except just finally to reply to the point that has been made around whether we should have a retirement age at all. The only comment I would make is that although I think the idea is an interesting one it creates an enormous practical difficulty. If there is no retirement age on what basis do we then retire our judges? It becomes a case-by-case decision. Who is going to make it? And given the enormous sensitivity—and rightly so—around issues of judicial independence and the potential for interference with judges it becomes a very difficult thing if we do not have a standard condition that applies in terms of who gets retired when. I think the sensitivities around it are just too difficult for us to look at going down that way. That would be my reply to that argument. But apart from that I think the House seems to be in absolute agreement on this legislation and I look forward to its passage. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora tatou te Whare. Over the weekend I and a couple of my mokopuna had the privilege of attending Te Matatini National Kapa Haka Festival 2007 in Palmerston North along with Pita Paraone and a number of other members of this House. In one word it was awesome. It was an excellent venue and it had beautiful weather friendly crowds heaps of stalls plenty of kai and the best kapahaka in the country. There was a memorable performance from the world’s most powerful distinguished long-serving competent and complete exponent of kapahaka the dangerous Dr Pita Sharples who is the nation’s sexiest politician and co-leader of the nation’s sexiest political party. 
Whangara Mai Tawhiti took out top honours in the crash-bang display of raw power on the main stage but it was Taikura that stole the hearts of the crowd. More than 300 kaumatua and kuia from different parts of the country took to the stage with their renditions of classic and treasured compositions to the delight of the thousands who saw them perform. Taikura was magic. 
It has an age limit. Performers have to be 55 to get in but many of them are actually in their 70s and 80s. A lot of them had not performed for more than 40 years and were challenged to clear the cobwebs and oil up the joints again for another stint on the world stage. They were hugely impressive—a reminder of a different time and a different style of sweet sound and gentle rhythm of dignity and grace and of long-lost musical giants like Ngoi Pewhairangi Canon Wi Huata and Sir Kingi Ihaka. 
Taikura embodies one of the messages I want to bring to this debate today which is that we limit our own potential as a society when we seek to limit the contribution of our elders. We hinder our own development when we reject the values of the past and we show immaturity by denying the experience of the mature. Taikura in fact highlights the futility of imposing arbitrary age-limits in fields where intellectual experience and firepower can never be replaced. 
The Maori Party has spoken of its support for lifting the retirement age for District Court judges Employment Court judges High Court judges Supreme Court judges Maori Land Court judges and even coroners but it seems that we may have all forgotten about the judges who live and work in our very own communities—our justices of the peace; our JPs. Apparently they are appointed by the Governor-General for life so most of them are already over 60 but the Act states they are no longer “fit and proper” for appointment after they turn 72. I raise this issue to highlight the inconsistency between the 70-year age-limit for judges and the 72-year age-limit for JPs and again to question the rationale behind the arbitrary age cut-off for roles that are actually enhanced by experience. Indeed even the Law Society suggests that the judicial retirement age should be raised from 70 to 72. 
The House knows well the Maori Party’s very strong views about the value of kaumatua and kuia—the insights vision experience and wisdom they give us as a sound foundation for our future. So when I checked the statistics I was pleasantly surprised to see that there were more than 600 kaumatua and kuia over 75 years of age in Tai Tokerau although undoubtedly not many as old as the father of our own member Mr Pita Paraone. I am sad of course that there are not a lot more but I am happy to know that we have as many as that and furthermore I would suggest that with the value we know older people can provide our society this data gives us 600 great reasons to support the lifting of the retirement age for judges. 
But it is that tinge of sadness that I need also to bring to the attention of the House because I know that increasing the retirement age for judges and coroners will not mean a hell of a lot of Maori as the statistics also tell us that Maori simply do not make old age in the same numbers per head of population as Pakeha. A history of poor health poor diet poor housing poor education and poor employment opportunities—and poor Governments as well—work against Maori reaching old age. The combination of those factors means frailty is also a major consideration. Older people are at risk of falls admission into rest homes and disability in key activities of daily life. And we know from the  
Social Policy Journal of New Zealand  
that many Maori who get into their 60s 70s and 80s have a number of problems to do with issues of frailty. Indeed the journal notes that frailty among 65 to 70-year-old Maori is the same as that for non-Maori in the 81 to 84-year-old age group—a difference of a full 10 to 15 years greater even than the 8-year difference in life expectancy between Maori and non-Maori. 
In supporting this bill the Maori Party highlights the value of our older citizens through the particular personage of a person of high calibre—in this case Judge Eddie Durie. But we also highlight the failure of policy dealing with the gaps in life expectancy quality of life and frailty because those gaps and those disparities—indeed those disadvantages—reduce the ability of Maori to be able to fully participate in society and we know from the  
Social Policy Journal 
 research that those disadvantages can be easily addressed through intelligent and innovative social policy change. 
So I close in acknowledging again the very real value we gain from our kaumatua and kuia in laying a foundation for our future. In an age where sustainability is the buzzword I think often of the inspiration and guidance that sustains me from one of my own kuia from Ngati Kuri my Auntie Saana Murray—who of course is one of the claimants in the Wai 262 claim to indigenous flora and fauna and cultural and intellectual heritage rights and obligations. Auntie Saana is an icon of the north; a woman who fought long and hard to block the mining of the silica sands in her precious Parengarenga Harbour because of the importance of the sand dunes to the surrounding ecosystem and the impact that the sea was having on Te Hapua as more and more of the sandspit was being lost to sand mining. Indeed I can even remember her giving me a thwack around the ears for not doing enough to stop the mining when I was working for Te Aupouri Maori Trust Board. Auntie Saana has been a fighter for our plants and our lands our kaimoana our harbours our beaches and our seas since way back before it was fashionable. Her commitment to that work and the knowledge that she has gained over her 80 years make her one of my most treasured mentors in all of Muriwhenua. 
When I think of Auntie Saana Judge Durie and all those kaumatua and kuia who would make spectacularly good judges through their simple but deep knowledge of life I have no problem in saying that the Maori Party supports this proposal to increase the judicial retirement age to 70. Kia ora. 
CHARLES CHAUVEL (Labour) 
: 
 It is a pleasure to follow the previous speaker in commenting briefly and taking a call on the third readings of the legislation deriving from the Judicial Age Retirement Bill. Mr Harawira referred to one Maori judge in particular—the recently retired Justice Eddie Durie—and I join in his tribute in respect of His Honour Justice Durie. His Honour performed fine service on the bench and it is a good thing to have the opportunity to reflect on that service and to reflect that under this legislation had we passed it in time we would have been able to have 2 more years’ service from that judge. I think that demonstrates in a very tangible way what good legislation this is and it is pleasing to see that it has multiparty support from the House. 
Of course we should not single out one Maori judge when we think of the service that has been rendered to the judiciary from Maori judges. In recent years there have been many more judges of Maori ancestry appointed to many different judicial positions at all levels of the judicial system and they are providing sterling service on the bench. One might also note that there have been recent appointments to quasi-judicial positions such as that of Justice Goddard to the Police Complaints Authority. Justice Goddard is from Ngati Kahungunu. It is a matter of great pride that Judge Ida Malosi and Judge Semi Epati from the Pacific communities have been appointed to the bench in recent years. Under this legislation they will have the opportunity to serve a further 2 years of their term on the bench. 
Previous speakers have raised a number of interesting questions including the issue of why we have a retirement age at all for the judiciary and with respect to them that is a good question. It is one that ought to be considered further by Parliament. As Mr Tanczos said the reason why it is a different matter to consider retirement ages on a compulsory basis for the judiciary on one hand and all other employees on the other is that judges are independent. If we do not have a fixed retirement age for the judiciary what do we do when there is genuine incapacity on the part of a judicial officer and that judicial officer does not realise that he or she is in a state of incapacity? We would have the only constitutional option left which is a humiliating address to the Governor-General from this House. 
That is no way to end what would no doubt have been a sterling judicial career simply because incapacity has been reached and the judge has not realised that that is the case. That is a very sad way to end a career. We would not want to see that become a feature of New Zealand constitutional debate I would think. So for my part although in general I do not support the idea of retirement ages in employment I do see that constitutionally there is a case for retaining a fixed retirement age in judicial service where there is constitutional independence and where a head of bench cannot simply require a judge to retire so that we do avoid that unsightly and unseemly spectacle. 
I will comment on a point that was raised by an earlier speaker Dr Worth. He expressed the hope that this legislation by extending the service of judges by 2 years would not lead to the appointment of part-time judges because he said that would be a very bad thing as judging is a full-time occupation. Well I beg to differ with the member. One of the things that I am particularly proud about in terms of recent judicial appointments is that the quality of the bench has been preserved. Anyone who attended the swearing in on Friday of Justice Bill Wilson to the Court of Appeal—as I did as the Attorney-General’s representative—would be able to attest to just how fine the serving judiciary in New Zealand is as previous speakers have mentioned. That quality has been preserved. 
Another good thing that has happened as well in recent years is we have managed to achieve some diversity in appointments to the bench. As I said earlier there are more Maori judges more Pacific judges and more women judges. It is a good thing if on the one hand the bench can retain its expertise and on the other hand it can also look like the rest of the community so that when members of the community appear in court they can have confidence that they are being judged by their peers and not simply by a group of people drawn from a profession that reflects only one demographic in society. If it is the case that moving to some form of part-time judiciary can enhance the diversity of the bench while not diluting the quality of judicial appointment then I would be very supportive of that sort of move. I think it is a shame that the member sought to rule out or condemn that possibility in his remarks to the House. 
As previous speakers have mentioned it was the case in previous years—until 1980 when the Judicature Amendment Act was passed following Sir David Beattie’s landmark report—that some judicial retirement ages for the superior courts were set at 72. The age then went back to 68. We are proposing in this legislation to put the retirement age back to 70. For my part I would be hopeful that this is just a step on the journey. If putting the age back up to 70 works well and I am sure it will—as the rest of the House also seems sure—then we should keep the matter under review. We should look at further advances to the judicial retirement age in future as and when that seems appropriate. 
Bills read a third time. 
Injury Prevention Rehabilitation and Compensation Amendment Bill 
In Committee 
Part 1 Amendments to principal Act 
PANSY WONG (National) 
: 
 Kia ora Mr Chairperson. New section 169 to be inserted in the Injury Prevention Rehabilitation and Compensation Act by Part 1 of this Injury Prevention Rehabilitation and Compensation Amendment Bill talks about the level of levies. The levies for both the existing employers’ levy account and the self-employed levy account come from three sources as is correctly stated in the bill. First of all new section 169(1) provides that the levy is paid by an employer to the employer’s employee for that period or is collected from private domestic workers etc. and then it depends on the level of earnings deemed by regulation to be derived by a self-employed person. But new section 169(2) of the bill makes it very clear that the extent of the funds to be collected from the levies should be calculated “so that the cost of all claims under the Work Account is fully funded.” That account would be a merger between the employer levy and the self-employed levy. 
But a strange situation is happening here. Members will remember that the legislation states that all these levies should be calculated so that the cost of all claims under the combined work account would be fully funded. But right now before the merger the employers’ account is showing a surplus of $688 million which means that the liability is more than covered by the existing levy account. In the self-employed work account there is a $60 million surplus. So the question I would ask the Minister in the chair Ruth Dyson is that if both of those accounts have a surplus over those estimated liabilities why should the Accident Compensation Corporation (ACC) continue to hold on to these surpluses? The estimated liabilities are already fully funded in both of those accounts. 
It gets even more ridiculous. I will use the specific example from the Meat Industry Association. I would like the other parties—including New Zealand First and the Greens—to listen to this carefully because I know that they are trying to look after the self-employed and those parties will have a problem with that. By passing this legislation they will punish those self-employed people. Let me demonstrate why. The Meat Industry Association has listed the following figures for its members. At the moment the ACC levy rate for 2006-07 is $8.30. If there is no merger of those accounts next year the levy will be $6.57 per $100 but if the merger goes ahead those members will pay $8.83. It simply does not make sense to punish the self-employed by making them pay more under the merger situation. I would like the Minister to take a call on that issue and tell the Committee why that should happen. 
The reason is that the ACC looks at the surplus situation in the employers’ levy account and sees that there is a margin of 63 percent and it looks at the self-employed account and sees that there is a margin of 20 percent. The corporation adds the two together and arrives at a margin of 53 percent. So in the process it says it will rebate $100 million because bringing the employers’ account down from a 63 percent margin to a 53 percent margin will mean the employers are entitled to a rebate of $100 million. The problem is that we are being told that the self-employed account which sits on a 20 percent margin has to go up to 53 percent. This means that the self-employed will have to come up with $100 million extra for the next 2 years. 
It does not make sense because the ACC states that it needs to work with a surplus of only 11 percent just in case the liability exceeds the funds but it does not need to work with a margin of 53 percent. So the ACC has a policy of reducing those margins to 11 percent by 2010 but in the meantime for the next 2 years it wants the self-employed to pay $100 million extra. 
So I would like the Minister in the chair to take a call on that issue. She needs to answer this question. She cannot say that she has not been asked about it because the Meat Industry Association has written to her and asked her to please explain why she would want the self-employed members of the Meat Industry Association to pay $360000 collectively to cover a claim cost of around $25000. 
 This is all to do with the ACC being very conservative. It is concerned that it might get the calculation wrong. So even though the corporation thought it needed to work with a margin of 53 percent I would say that no private enterprise nobody who runs a business can have the luxury of saying: “Well I really want to cover my bases. A 10 percent profit is not enough. I want 53 percent.” Private industry does not have those luxuries. But the ACC today through Parliament is seeking political parties’ support to increase a margin that it thinks is sufficient at 11 percent to 53 percent. 
I challenge parties like New Zealand First and the Greens to rethink their position of punishing the self-employed. I can assure them that for the next 2 years their offices will be flooded with letters of complaint from the self-employed as soon as those notices hit the letterboxes. But I think for a start that if the Minister is so confident about this bill then she should take a call to explain to the public why the ACC should want a margin of 53 percent when its stated official policy is 11 percent. Why should the Minister not agree to be fair to the employers and rebate them and also to not punish the self-employed? The ACC should work within the existing margin of the self-employed work account which is 20 percent. Therefore the self-employed would not have to face a hefty bill up to the tune of $100 million for the next 2 years. It might mean that in 3 years’ time down the line they would get a rebate. 
Nobody has the luxury of asking people to pay money in advance and not even pay interest on it. If people have overpaid their tax to the Inland Revenue Department even the department would give them some interest because it has had the use of their money. I would say that the ACC is a monopoly organisation and it is an outrage that it will charge the self-employed $100 million extra for the next 2 years. Members should think about it. How can we expect the self-employed to accept a position whereby they would have been levied at $6.57 per $100 if the merger did not go ahead otherwise they will have to pay $8.83? I think that New Zealand First and the Greens will have to look at their position because for the next 2 years they will have a lot of explaining to do if they do not support my amendment which will come under Part 2 “Transitional provisions”. 
But in Part 1 there is an issue of principle outlined whereby the legislation shows that liabilities should be fully funded—but we want answers as to why a 53 percent margin over the fully funded position is supported in this Parliament by the Greens and by New Zealand First. I think that those parties have a lot of answering to do. For a start the Minister might be able to help out those members if she would just take a call and explain why the ACC is demanding a 53 percent margin on the merged work account. 
Hon RUTH DYSON (Minister for ACC) 
: 
 The purpose of the Injury Prevention Rehabilitation and Compensation Amendment Bill was not obvious from the contribution of the member who spoke previously so I would like to outline it. 
The bill aims to do two things. The first is to amalgamate the two accounts that cover injuries incurred during a person’s work—the current self-employed work account and the employers’ account—and to rename the combined account the work account. It covers all injuries that occur at work. It may sound quite obvious that we have one account to cover all injuries that occur at work and certainly some people have asked me over the last few months why we have two separate accounts. The reason is very clear and it should be obvious to members who were in the House in the 1990s. That excludes the members who are currently interjecting; they may not know. In 1998 when the then National-led Government privatised accident compensation its funding mates the insurance industry of New Zealand did not want to take on liability and responsibility for the self-employed because there were too many of them to deal with in one go. So in order to have a compulsory privatisation of the employers’ account National had to separate the self-employed work account and the employers’ account. That is why they were separated. It was for no principled reason but solely for the purpose of privatisation. The insurance industry did not want to cover the self-employed because there are so many of them and it involves a lot of administration. 
But would a self-employed plumber who is doing his or her job every day on looking down the road and seeing a person who is employed as a plumber reflect to himself or herself that the two people may be paying the same levies because they are exposed to the same risk? In fact they may be doing literally the same job on the same site but have a different business structure. The answer is overwhelmingly yes. This is a very basic issue of fairness. If two people are doing exactly the same job and are exposed to exactly the same amount of risk why would they be insurance risked on the basis of their business structure rather than their literal exposure to risk? The answer is that they should not be and this bill fixes that. We are calling it a work account because that is what it is. It would be very cumbersome to call it the employers’ and the self-employed work injury account so we are calling it the work account. That is the first thing that this bill does. 
The second thing is that the bill replaces the old term “medical misadventure” with “treatment injury”. I want to acknowledge the concerns raised by New Zealand First during the consideration of this bill. We have moved away from a system that in the past under previous accident compensation legislation required people who were injured at the hands of a health provider—at the doctor’s at the chiropractor’s at the physiotherapist’s or in the surgery—either to show fault from the health provider or to demonstrate that their injury was both rare and severe. We changed that in the last amendment bill but we did not change the name of the account. The name of the account which is still the medical misadventure account does not reflect the actual practice which is to treat all injuries regardless of where they occur as injuries and to investigate their circumstances separately. 
The concerns that New Zealand First raised through Peter Brown were that we must not through this change of name in this amendment bill lose the focus of the quality assurance contribution to the health system that the old medical misadventure system provided and that the new treatment injury system is designed to ensure as well. So I give the whole Committee but particularly New Zealand First my commitment that the change in clause 12 will not in any way undermine the quality assurance contribution that we need to make through being able to investigate the causes of injury at the hands of a health provider. 
There are two amendments in the name of Dr Paul Hutchison to this part and I would like to make a brief contribution in reference to them. Dr Hutchison is a very considerate and considering member despite the fact that he represents the National Party. I have given what I consider to be serious consideration to his amendments. I regret to advise upfront that although I will not be recommending support of them I do believe in the principle in them—he will persist in using the word “premiums” when the word is “levies”—and I have taken them very seriously. 
Dr Hutchison’s first amendment proposes to insert in clause 11 a new section 175A “Independent auditing of proposed premiums”. Independent auditing already occurs; it is available under the Official Information Act. It is my view that people should not have to go through that process and that to have the very information the member is seeking made public would be a very valuable contribution. But I am not convinced because the member did not discuss it with me—and that would have been a good and thoughtful move—that that needs to be provided for by an amendment to the legislation. A handwritten amendment with no consideration has still had good consideration from me. I give the member a commitment that that information will be available on the Accident Compensation Corporation website and that he will not require his legislative change in order for that to be done. It is a thoughtful contribution and I think it will help businesses—both the self-employed and people in different business structures—to assess how their levies were determined and to look at their business planning. I am very keen on that. 
In the same way in relation to the member’s other recommended amendment to clause 11 to insert new section 175B “Provision of forecast statement of financial performance” I say that that information is currently provided to me and I would like to consider some way in which we can better have a quality debate in the public arena so that people do understand the basis on which their levies have been set. They might not wake up in the morning and say: “Yippee! I am very pleased that I have to pay this contribution for potential injuries.” But they will have a very in-depth understanding of the analysis that has gone on behind the setting of their levy and hopefully an understanding also of the main driver of this legislation which is to lower their levies by lowering their injury rates. If they better understand the link between the injuries that are incurred and costs then perhaps we will have a little more commitment to injury prevention. 
On that basis I regret that I will be recommending to my colleagues that Dr Hutcheson’s amendments are not supported. But he can take credit for the consideration behind them and be assured that their intention will be implemented. 
David Bennett 
: Hollow words. 
Hon RUTH DYSON 
: I raise a point of order Madam Chairperson. I deeply resent the implication in David Bennett’s interjection. I take offence at it and I ask that you ask him to withdraw and apologise. 
The CHAIRPERSON (Ann Hartley) 
: The Minister has taken offence at the member’s words. I ask the member to withdraw them. 
David Bennett 
: I withdraw and apologise. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 I am pleased to have the opportunity to speak on this very unfortunate Injury Prevention Rehabilitation and Compensation Amendment Bill—unfortunate because it is a blatant robbery of funds that employers have in good faith paid since 1999 to fully fund their account. It is a blatant grab by the Labour Government which is purely ramming through the ideology it has in terms of so-called social insurance and is disobeying the basic principles of insurance whereby those who are at higher risks should indeed have higher premiums. Merging the accounts undoubtedly acts in a directly opposite way to basic insurance principles and it is very regrettable that the Labour Government has just failed to see that unless we apply basic insurance principles to accident compensation it will never ever be efficient. That is of great worry. 
Here we have two accounts. The first is the employers’ account into which employers since 1999 have in good faith paid their premiums and accrued a substantial surplus yet the Labour Government has said that it wants that money to go to a merged account that will cross-subsidise the self-employed who unfortunately have higher risks and higher injury rates. It is sending exactly the wrong message from that which it should be sending. 
One of the things I am very concerned about is that in New Zealand we have had an increase in the incidence of moderate and severe accidents. Despite 6 years of this Labour Government— 
Darren Hughes 
: Seven. 
Dr PAUL HUTCHISON 
: Seven? Sadly 7 but it will not be much longer. Despite 7 long years of this Labour Government the incidence of moderate and serious accidents has gone up. But in this legislation the Government is trying to put in provisions that will give exactly the opposite message to the community out there in terms of accident prevention and of inputting safety measures within their organisations. 
The facts are that injury rates are lower on average in the employers’ account and that is by virtue of the fact that employers are better organised have better infrastructure in place and have worked very hard since National so appropriately privatised the account back in 1998. We saw a decrease in accidents a dramatic increase in safety procedures in the workplace and decreased premiums. That is the fact of what matters but in this bill we are seeing a blatant manipulation of the levies by the Labour Government. That has been brought about by the fact that substantial money is being transferred from the employers’ account to the residual account and the Labour Government is artificially putting down the levies. 
It thinks it can fool the public by this mechanism. But we should know that if a car driver out there has many accidents and they are his own fault he should pay a higher premium. That is a simple rule of basic insurance philosophy. Yet this Labour Government wants to go in a totally opposite way to that. It says that it wants to reward those in the self-employed group who have higher injury rates and higher risks. The Government is going to bring down their levies and give them some money to boot. That is the total lack of logic of this Labour Government. 
I do take seriously the fact that the Minister has said that she would support—only in principle—the two amendments I have brought in. I am deeply saddened she will not support them and I hope that the rest of the Committee will look at those amendments. They are thoughtful as the Minister said and I think they will contribute to the transparency we really need in this accident compensation debate. 
Firstly in relation to Part 1 clause 11 I propose that the following section section 175A is substituted: “Independent auditing of proposed premiums”. One of the major problems we have in this country is that the general public does not understand the levy setting in this country and in this amendment is a mechanism whereby “proposed premiums and the rationale for such premiums must be audited by independent third party actuaries yearly”. The Minister says that that happens but the difficulty is that we cannot get to them because of the Official Information Act. [ 
Interruption 
] Well that is what the Minister told us just a few minutes ago. 
Hon Ruth Dyson 
: I said that you can get to them because of the Official Information Act. 
Dr PAUL HUTCHISON 
: We can get to them but they are not open to the public. The Minister is saying that in good faith she will ensure that they are available to the public. If the Minister thinks that is a good idea why does she not support the amendment? I call on the Greens the Maori Party New Zealand First United Future and all the other parties in Parliament to support an amendment that the Minister herself has said is a highly sensible and thoughtful amendment. The same goes for— 
Darren Hughes 
: Huh! 
Dr PAUL HUTCHISON 
: Now we hear “Huh!” from Darren Hughes the member by a very very thin margin for Otaki. He should be adding a sensible contribution to this debate not by saying “Huh!” but by persuading his Minister that this is a very sensible amendment. 
Let us go on to clause 11 where I propose that a new section 175B is also substituted: “Provision of forecast statement of financial performance—ACC must provide yearly a forecast statement of financial performance for the next five years to allow levy funders to analyse current premium setting performance against projected outcomes.” Again the purpose of this amendment is to make the levy setting mechanisms as transparent as possible and hopefully as understandable as possible to all those who are involved. I am delighted to see that the Minister is nodding her head and I would appeal to her not only to say that she supports this idea without supporting the amendment but to formally support the amendment because I do believe that it is a serious contribution to this debate. We can see the National Government-in-waiting is ready to do all sorts of useful things to accident compensation and I am glad that the Minister is recognising them. 
 Finally I want to speak on the amendment put up by my colleague Pansy Wong. That is in the next part but let me foreshadow it. Again it is another very sensible amendment and it comes to the nub of the philosophy behind this unfortunate Labour Government bill. One would hope that in accident compensation and accident prevention good faith is demonstrated by whoever the Government is. The Government certainly in good faith required collection of levies from the employers and they have done that for the last 5 years. The employers in good faith have paid expecting that fund to be fully funded. Here clearly a surplus has accrued and sadly the Labour Government wants to grab it. This absolutely defies the principles of good faith as does its insistence against the idea of rating which it is so determined to object to. 
I think we will find in this debate that the Labour Government is in denial about the idea of relative risk rating. It will cite some very obscure literature from Europe and maybe North America that is irrelevant to the fact that people out there actually respond to financial signals. I agree that robust safety management practices have to be put in place within all businesses whether they are large or small—I absolutely agree with that. But clear financial incentives also should be in place and one of the major problems that this bill encompasses is that of merging the two accounts. It is directly opposite to all the basic principles. The Labour Government is saying it wants to reward those who take risks and who are not helping the New Zealand safety record. That is wrong. 
SUE MORONEY (Labour) 
: 
 It is my pleasure to speak to the Committee stage of the Injury Prevention Rehabilitation and Compensation Amendment Bill—a very sensible bill that has come before this House. The last speaker Dr Paul Hutchison took some time to rewrite history and I want to make some comments on how we have come to consider this bill here today. The only thing that was increased by the National Government when it was in power and privatised the accident compensation system was donations to the National Party. That was the only thing National was able to increase by its privatisation agenda. Donations to the National Party did not do anyone who actually had an injury that needed treatment in this country any good but those donations were all that it was able to increase. So I want to set the record right on that to start off with. 
It is time the member who just finished speaking and his party caught up with the rest of the world in applauding the accident compensation system we have. The no-fault system and the levy system we have in place are the envy of other countries. That is because Governments like the Labour one have stood up and said we are going to have a no-fault system we are going to stick with a system that is fair and a system that is simple and we are not going to sell out our policies to the highest bidder. 
This bill sets right an artificial barrier that was brought in by the last National Government. It is some time ago since we had a National Government and it is now time we put this artificial barrier right. In fact these accounts were not separated to start off with but during the 1990s they were separated for the purposes of privatisation by the National Government. It is quite an artificial barrier: the self-employed working in exactly the same industry and doing the same occupations have ended up in a separate account from the employed. 
It was very well demonstrated when members of the Seafood Industry Council came before the Transport and Industrial Relations Committee that I sit on as a member. They made a very thoughtful submission and put the matter very clearly. They talked about coming forward with a submission where they could not necessarily support or oppose the bill in its entirety because the members of their council fell into both of those groups. They worked in exactly the same industry did exactly the same work faced exactly the same risks but ended up paying quite different levies and paid into different accounts and they could not see the logic of that. 
They brought forward to us the very practical scenario of two people working on the back of a fishing boat one being self-employed and contracting his or her services to the fishing company and the other working directly for that fishing company. As they were hauling the nets in those people faced exactly the same risks but they were on a completely different payment regime. The only reason for that was an artificial barrier based on the business structure that they were involved in. The reason behind that of course as I have already outlined was an artificial barrier put in place by the last National Government to ensure that the insurance industry could pluck off the profitable bits of the Accident Compensation Corporation and leave the rest of it behind. 
In my previous role before I came to Parliament I was actively involved in the issue of health and safety—training health and safety representatives in the workplace. Certainly my knowledge of working with people in the workplace doing the work and looking after workers’ interests in health and safety is that they clearly understand that the risks faced by working people in the workplace are the same whether they are self-employed or directly employed by the company. People who are heavily involved in this work in the real world—in the workplace—understand the good sense of this bill that is before the House at the moment. 
I want to take the opportunity to make a comment about probably the most worrying submission that came before the select committee when we were considering this bill. 
Darren Hughes 
: Who was that from? 
SUE MORONEY 
: The submissions I am concerned about came from those representing employers. They talked about the fact that the levies under this new regime would come down to such a low level that it would not be desirable for employers to go into the scheme set up by this Government. The new regime with lower levies actually gives employers an incentive to have certain health and safety systems in place. I felt that that was a very strange position to come from those purporting to represent employers. They were essentially telling us that even though they knew those very good programmes brought down the injury rate in their workplaces and improved morale and attendance and productivity in their workplaces because this bill brought in great stability and lower levels of levies they might choose to go off those programmes even though they knew those programmes had a very positive spin-off for their workers and their workplace. 
I think it is important we keep an accident compensation scheme in place. It is a fair scheme it is a simple scheme and it ensures that there is a clear link between injury prevention and the levies that are paid. This bill ensures that it makes a lot more sense. Irrespective of whether people are self-employed or employed by others the risks they face—because of the industry they are associated with—will be reflected in their levies. 
The last thing I want to say in speaking in the Committee stage on this bill is this. In the select committee we got a lot of information from the officials on exactly how the legislation would work—there were pages and pages and pages. It was very interesting to note. What we got before us was exactly what industry would end up on what levy and how long it would take for the transition to go through. I was interested that all that the National Party members particularly the one opposite who is interjecting a lot at the moment—David Bennett—really wanted to do was to go straight to the page that indicated the businesses they personally owned and to have a look at what the levies were for their personal businesses. They asked questions of the officials based on the industry that they owned businesses in. They very quickly went fairly quiet because they realised that this is good for them and that their own businesses will benefit from the reduction in levies that will happen under this bill. I finish on the note that the Labour members certainly took into account the effect this bill will have on all New Zealand workplaces all employers and all self-employed people. I commend this bill. 
DAVID BENNETT (National—Hamilton East) 
: 
 I say in relation to the speech from that last member whose implications were most dishonest and untrue that this legislation is a scam for New Zealand business a scam for employers and a scam for the self-employed. Let us look at the average rates. The average rate for employers is about 86c; the average rate for self-employed people is $2.03. Those are the average rates. There is a difference between the rates for employers and the self-employed. There is a big difference; it a real difference. 
The Government has put this bill together for one reason: so that it can hoodwink employers during the next election campaign. It is using this bill as a bribe so that it can go into the next campaign saying that it has reduced Accident Compensation Corporation (ACC) levy payments for employers and in some cases for the self-employed as well. That is all the Government is up to. This bill has nothing to do with being good for business and it is not about reforming the ACC; it is here so that the Government can go into the election saying that it has done this for business and for self-employed people. Should we expect that from this Government? Yes. It has stolen from us once in order to win an election; it will steal from the levy reserves of employers and the self-employed in order to try to win another. But it will not work this time. Labour can steal but it will not win the election. 
This is another such case and the Minister for ACC Ruth Dyson has admitted to that in relation to the reserves. The Minister said in the second reading debate that if as some had requested all the excess reserves in the employers’ account were refunded to levy payers in 1 year then employers would experience significant increases in levy rates in years to come which would defeat the object of levy stability. The objective of levy stability is to get this Government through these 2 years—through another election campaign. Then it will rack up those rates. That is what the Minister was saying. She admitted that is what the Government intends to do. If people do not agree that is the case they should look at the numbers. 
Let us look at the numbers that have been presented. For example the levy in relation to shearing will go from $3.79 before the merger to $4.18 after the merger has gone through and all the rebates have been given out. That means that in 2 years’ time once all the rebates have been given out shearing employers will have to pay $4.18 when they pay $3.79 now. That is an increase. Let us look at the rate for ocean and coastal fishing which will go from $2.43 to $4.31. It will increase under this Government in 2 years’ time. After the election employers will have to pay the real rate that this Government wants them to pay. Here is another one: the rate in relation to timber dressing and wholesaling will increase from $1.13 to $2.74. That is a huge increase—more than double in 2 years—just so this Government can win an election. Let us keep going. Here is another one: the rate in relation to non-metallic minerals will rise from $1.58 to $1.74. Those increases in cost will all occur under this legislation. 
There is a provision in the legislation that states that levies cannot increase by more than 25 percent for a business in 1 year. Well that sounds all right but what kind of business would want to experience a 25 percent increase anyway year on year? None. The Government says that 8 percent of employers will have a levy increase of between 5 and 45 percent. A levy increase of 45 percent is huge and it is not being done in the best interests of New Zealand business. All of this is so that Labour can go into an election campaign saying that it has kept the levies down for employers—and then a year later it will whack them up again. At that point the reserves will be exhausted and employers will have to face the huge levy increases that this Government proposes. It is not only employers but some self-employed people as well who will have big levy increases with 17 to 20 percent increases in some cases. This is unfair legislation. It will increase the employer rates and the self-employed rates in some cases. For example the sports levy will increase by 17 percent the equestrian rate will go from $4.83 to $5.65 and the rugby league rate will go from 75c to $1.01. 
What then can we do about this legislation? New Zealand First correctly stated that after privatisation there was a 6-month trial period for the new legislation that National tried. New Zealand First said that legislation had worked better than anyone had expected and it did not want to change it. It wanted that trial to continue. Rodney Hide said that this Government has failed because it has stayed with its ideological position. It has not actually looked at what is good for the ACC or for employers or the self-employed. It has looked just at establishing what is a State-run monopoly for Labour and its supporters the unions. That is all this legislation is. It is a payback for the unions and it is another bribe going into an election year from this Government. 
This legislation was put through in an unusually short period of time. The reason is that when Labour goes into the next election campaign this legislation will be all up and running. The timing has nothing to do with consultation. This legislation is being passed so that next year Labour will go into the election campaign saying that it has reduced levies. This cynical Government is trying to use people’s own money for its own purposes; it has been proven to do that. It is a Government that once again is proving what it wants to use the ACC levy for. The ACC is just another cash cow for this Government to use to try to win an election. Shame on this Government! 
DARIEN FENTON (Labour) 
: 
 It is a great pleasure to rise in the Committee stage of the Injury Prevention Rehabilitation and Compensation Amendment Bill. The part we are discussing Part 1 is the core of the bill really. It is all about making Accident Compensation Corporation (ACC) levy rates fairer for the self-employed and the employed. I did notice in the last member’s speech that there was no mention of the people who actually do the work. He did talk an awful lot about employers and business but there was no mention of the workers. 
I think it is very interesting actually because I noticed in one of the many hysterical press releases put out by Paul Hutchison the former National Party spokesperson on ACC one particular quote that David Bennett has just repeated: “It is unfortunate that under Labour people in New Zealand do not have a choice of insurer when it comes to cover for personal injury. Instead the Labour Government and their union mates heavily influence a monopoly model that attempts to socialise insurance rather than apply basic principles.” Do members know what is interesting? The National leader John Key is meeting with the Council of Trade Unions next week. What will he be saying? He is seeking to be mates with the unions as well! I think that is just hilarious. Will he own up to them that the plan of the National Party is to re-privatise accident compensation? 
Getting back to the bill we see that it enables the merger of the ACC’s self-employed work account and its employers’ account which makes practical sense and creates a fair and sustainable accident compensation scheme that emphasises injury prevention while at the same time minimises the social and personal impact of injuries. As others have said the only reason the accounts were separated originally was privatisation. The self-employed work account was established to support the creation of the private insurance market for employer and self-employed workplace injury cover in 1999. 
I saw firsthand that failed experiment. As everybody knows I was a workers’ representative and I am very proud of that. There is nothing about the work I have done and the path I have chosen in the past that I am not proud of. I saw firsthand the impact on workers of that failed experiment. That is why it concerns me that the Opposition never ever talks about the workers in this situation. The National Government created a shambles and it created a situation whereby the only driver of the insurance scheme was profit for the private sector. It is no wonder really. Of course when Labour came into power it had to pick up the pieces. This Government has ensured that privatisation is not on the agenda any more and I thank this House for it. 
The privatisation of accident compensation did not work. It did not mean a better service. It did not work for workers and it did not work for employers. This bill builds on the changes the Government has made since it was elected in 1999. We have returned accident compensation to a full social insurance scheme—and we are proud to say those words “social insurance scheme”. [ 
Interruption 
] David Bennett should learn to spell them. We are rejecting the costly private insurance model introduced by National. 
 We have kept ACC levies down built a robust financial scheme and reintroduced lump-sum payments for permanent impairment. This Government has improved rehabilitation and launched partnership programmes with approved employers. It has rewarded employers with levy discounts for good injury-prevention practices and improved access to compensation for seasonal and casual workers and for people on paid parental leave. 
It is fascinating to me that in this debate the National members are showing so much concern for workplace injuries. When they had a chance to do something about workplace injuries they abolished workplace health and safety representatives and they changed the whole health and safety system so that the number of injuries went through the roof. Yes they are concerned today but what would they do? Everybody knows that if National ever got the chance it would privatise accident compensation throw health and safety to the market and throw workers to the wolves. 
Evidence now shows—and it is the reason for this bill—that self-employment as a business structure in and of itself does not have a significant bearing on risk when one compares like with like for example self-employed farmers with employee farmers. However I must say that I have never ever heard of a self-employed All Black or rugby player as a member referred to formerly. Self-employed injury claims tend to be similar to that of small and medium-sized enterprises. Under the current system levy payers are allocated to the work accounts on the basis of business structure which may result in differing levy rates for businesses carrying out similar activities that entail similar risks. 
Small businesses have often cited levy instability as creating problems in their business cost planning. The Labour-led Government has acknowledged this unfairness and the bill removes this inequity. Merging the accounts will ensure that ACC levies paid by businesses are fairer as they are based on injury risk associated with the activity undertaken rather than the business structure. It will remove the arbitrary distinction and corresponding levy differentials between self-employed people and employees in the levy risk group level. Merger will also allow greater focus on reducing the risk of injury based on industry and occupational type rather than on the business structure. It will provide a much clearer focus across industries and enterprises for injury prevention and health protection. 
This bill is consistent with the principles of fairness. It provides a more equitable system and a better focus on injury minimisation. Merging the accounts will also improve levy stability particularly for self-employed people as the cost of injuries will be spread over a larger and more stable earnings pool. This is a good bill and as a member of the Transport and Industrial Relations Committee I am proud it has come back to the House. 
Dr JONATHAN COLEMAN (National—Northcote) 
: 
 We have heard the Labour members talk a lot about fairness today and in that spirit I know they would like to acknowledge the landmark historic policy announced by John Key today whereby the 5 percent cap on charitable donations by private businesses is going to be lifted enabling companies to get in and do something about the underclass in this country. The Minister in the chair the Hon Ruth Dyson is a fair Minister and I know that she would want to acknowledge that. I would say that the Labour members opposite are probably a little bit disappointed that this policy has not been put forward by their somewhat tired Government. It is ironic that on the same day as this policy is announced the Government is trying to force through a bill that will punish the very businesses that employ people who under this policy will be in a position to give a higher level of donation to the charitable sector. That is the irony of what is happening here today. 
The irony too is that we have heard four or so speakers from the Labour side of the Chamber who have been very concerned about the rights of self-employed people but not one of those members has ever been self-employed. 
Darien Fenton 
: That’s not true. 
Dr JONATHAN COLEMAN 
: I am sorry Darien has been. We have a couple of freelance unionists on the other side! Getting back to the issue of fairness I point out that fundamentally this bill will punish employers. Employers will have the risk premium amounts they have paid in over the years cross-subsidising the pool of self-employed people. The Minister spoke about fairness. How can we say that is a fair situation? It flies in the face of actuarial common sense because actuarial sense tells us that insurance premiums are directly related to risk—the higher the risk the higher the premium. The Labour Government is telling us that self-employed people carry a higher risk than the employed as they tend to cluster in high-risk occupations. Frankly that shows just how out of touch the Labour Government is with the reality of self-employment in New Zealand today. The self-employed workforce is in the main made up of white-collar professionals—people in areas like information technology people who are behind desks people in the service industry— 
Hon Harry Duynhoven 
: General practitioners! 
Dr JONATHAN COLEMAN 
: General practitioners—not people who are in high-risk professions. This is antiquated out-of-touch thinking. 
At the core of the Labour Government’s pushing of this bill is that it wants to super-reinforce the Accident Compensation Corporation against any threat of competition in the future. I ask Government members what is so wrong about competition in accident compensation. Despite what Darien Fenton the list member and unionist said when National was in Government and accident compensation was privatised accident rates went down and premiums were lower. Competition was good for business; competition was good for everybody. 
Under this bill as David Bennett said we are in effect seeing an election bribe. One has only to look through the table to see that premiums will be kept down for about 18 months to 2 years—just until about the time of the next election—then they will soar up again. So the Government is trying to politically neutralise this as an issue. 
As Paul Hutchison said earlier the legislation provides for a blatant grab from the employers’ account. The Government should be paying back that $500 million to the employers. The employers are the people who are helping the workers; they are providing jobs and keeping the economy going. Why would we want to constantly punish employers through philosophy and the practical implications of policies such as this? 
The other thing this bill will do is make the Accredited Employers Programme extremely unattractive. We know there is a philosophical motive for that. We know that the Government knows—and it is what it wants to happen—that employers will opt out of the Accredited Employers Programme which will add more cost to the new merged accounts and even greater cost and liability to the residual account. 
So there we have it. In the interests of fairness the Minister did say that she was very impressed with Dr Hutchison’s amendments. Basically what is wrong with an amendment that asks for greater transparency in the audit programme? How could one possibly object to that? Employers and the self-employed have a right to know how their levies are set. We oppose this bill. It is bad and unfair legislation. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 Thank you Mr Chairperson for the opportunity to speak again on this very unfortunate Injury Prevention Rehabilitation and Compensation Amendment Bill brought up by the Labour Government. 
I want to point out a few things I was concerned about when I heard the list member Sue Moroney trying to put the record straight. Unfortunately she distorted the record. After all the situation is that in 1998 the employer and self-employed accounts were separated and the separate accounts came into being. What happened at that time was that injury rates went down. Workplace safety management increased dramatically early rehabilitation was cemented in as an absolutely vital part of the accident prevention system in New Zealand and premiums went down. 
I see the Minister in the chair the Hon Ruth Dyson is looking quite astounded. She should take note because these changes were the catalyst to make accident compensation much more efficient and it has worked. It has worked only because of the experience of 1998. It is now starting to deteriorate as under the Labour Government the Accident Compensation Corporation (ACC) monopoly gets fatter and lazier as one would utterly predict. It is very very important that Sue Moroney’s somewhat distorted history is exposed. It was the changes in 1998 that reversed some of the problems under the Accident Compensation Corporation into a virtuous cycle of change that has improved accident compensation over the last 5 to 6 years. 
It is now indeed time to resist a bill such as this. My colleague Dr Jonathan Coleman was absolutely correct in pointing out the dangers of the erosion to the affiliated providers or partnership programme. This is one of the most successful aspects of the accident compensation scheme in New Zealand and it is one aspect that does not happen to be about the monopoly. In this partnership programme businesses manage themselves and as I say it has been highly successful. 
However a deplorable aspect of this bill is that it manipulates the account so that the attractiveness of the partnership programme has been diluted. Substantial funds are being transferred across and the residual levies will go up punishing and penalising those who have gone into the most efficient aspect of accident compensation in New Zealand as we know it today. 
As well as that the Government has decided to increase the stop-loss margins from about 150 percent to 200 and 300 percent—another reason why the partnership programme is being eroded. Why is it being eroded? I believe it is because the Minister does not like the concept that individual businesses can manage their accidents better than the ACC monopoly. 
I would like the Minister to get up and explain to me why it is that third party administrators tell us that they are able to achieve much greater efficiencies than ACC. For instance one of them said it managed 1350 entitlement claims for a range of accredited employers with an average life cost of $5200. This compares with ACC’s average cost of $13700. Under this third party administrator the average time off work is about 4 to 5 days; under ACC the average time off work is over 30 days. 
Another third party administrator claims an even better record than that in the order of about $3500 compared with $30000 for the corporation and similarly much much less time off work than under the current ACC regime. 
It is regrettable that under this merger legislation the partnership programme is being eroded. This is happening because the Labour Government cannot bear the success of the private sector. 
Hon MARK GOSCHE (Labour—Maungakiekie) 
: 
 After listening to that speech it is no wonder that the insurance industry fought so hard to get a new spokesperson for accident compensation. After all the money it paid and after writing National’s policy that is what the industry got—Dr Paul Hutchison. Now the industry will be thinking twice about that move and having said: “Oh he’s so hopeless that we have to get a new one.” because it now has Pansy Wong. 
The poor old insurance industry wrote all the National Party’s policy and it is a pretty simple policy—“Just privatise the lot give us all the cream and you keep the rubbish.” Anything that costs a lot of money the industry wants the State to look after and anything it can make a big profit out of it will have. One would have thought that Dr Paul Hutchison would at least be able to get up and espouse that sort of policy on behalf of the industry and do it with some sort of panache but no even the industry could see that it had an idiot on its hands. So the industry said: “Please” to whoever the leadership of the National Party was that day “give us another one.” And look what it got—it got Pansy Wong! 
So the poor old private insurance industry listening to this debate must be in despair at the quality of that sort of performance from the other side. Those members do not bother to read even the bill let alone any explanatory notes that are given to them. They do not bother to try to understand that it was their woeful attempts to privatise that set this account up in the first place. 
Dr Paul Hutchison has yet to explain why that professional rugby league player he was talking about in his speech should get a different premium when he runs on to the field dependent on whether he happens to be self-employed or a business person who set himself up as a company—an individual. Players are not tackled any less hard because they wear a jersey that reads: “I’m self-employed; please don’t tackle me hard.” They do not go on to the field with any less risk. Dr Paul Hutchison thinks that that is OK for those players on that field or in the case of people on the back of a fishing boat or a plumber or any other people—just because they happen to have a different business structure. Just because they decide to do it this way rather than the other the National Party says: “We don’t care about you you’re self-employed you pay more than people who’ve gone to the trouble of setting themselves up as a company.” 
Where is the logic in that? No wonder the private insurance industry is in despair! Those members cannot get through their thick heads that the risk is exactly the same for that rugby league player running out for the Warriors. It does not matter whether he is self-employed or a company in terms of the way in which he structures his affairs; he will still be tackled as hard and he is still going to get a broken leg if he happens to be tackled in the wrong way. So I ask Dr Hutchison who went to university for many years and obviously was an educated man once why that self-employed rugby league player should pay a higher premium than his mate playing next to him who passed him the ball if he happens to have set himself up with a company structure. 
Where is the logic in that? Where is the logic in that for the National Party? It is just plain ideological nonsense. It is just plain ideological nonsense that saw National privatise accident compensation in the first place. It said to the private insurance companies that were paying them to do this: “Oh OK that’s too much risk for you guys. We’ll take it off your hands and we’ll insure it for you as the State.” That is the truth of why this was set up. The National Party members can sit there and make all the silly speeches they like but they do not like to be reminded of their past and what they would do again in the future if they were ever let loose again on this side of the Chamber as a Government. 
They would do it again because they are saying so over and over again. They can come down and make speeches about having charity—I am not sure what 5 percent charity has got to do with accident compensation; maybe they are going to make all those self-employed people a charity as well as they did last time when they said to the insurance industry: “Take the profitable end of the business and we’ll look after this.” 
If those members had read the explanatory note before going to the select committee and coming to this Chamber they would see that the reason for the high injury rates was the jobs that people were doing—jobs such as forestry fisheries and farming—not because of the nature of the way in which they set themselves up as a private person on a self-employed basis rather than as a company. It was the job that one was doing. It was the risks people were confronting in those jobs. So poor old Dr Hutchison who was sacked from his job—and no wonder—has not figured that out yet. And there have been many many spokesperson’s roles along the way. 
PANSY WONG (National) 
: 
 The only reason I am taking this call is to raise some alarm about the chairperson of the Transport and Industrial Relations Committee who chaired the passage of this bill through that committee. It is no wonder that every other party apart from National has been hoodwinked by that person. Firstly he is lazy. Every time he stood up we got the same speech apart from the names. That is laziness. Secondly I want that member—the chairperson of the select committee—to take another call to explain whether he cares about the self-employed. How is he going to explain to the self-employed members of the Meat Industry Association that if the merger does not go ahead next year they will pay $6.50 to $7 per $100 but that if it does go ahead they will pay $8.83? But the situation gets even better. When the merger of the two accounts goes ahead—and we should remember this—the self-employed are to pay $8.83 but I ask members to guess how much the employer will pay. [ 
Interruption 
] I thought the member had read all the papers. The employer will pay $4.69. So the self-employed will pay almost double the amount that employers will pay. 
The lazy chairman of the select committee is trying to tell us that we did not study the papers. We studied the papers from top to bottom. It is no wonder that he and the Minister hoodwinked the whole Labour caucus; its members are so lazy that they never read a word of the papers. I would like that member to explain to the poor self-employed people why after the merger they will pay $130 million extra in total. If the merger goes ahead without a rebate employers will pay only $80 million. So for the next 2 years the poor self-employed people have to pay an extra $100 million. 
The National Party under the leadership of John Key is charitable. We need only to look at what our leader announced today about lifting the cap on donations. We are going to encourage people who are charitable. We will support them—unlike the Labour members on the other side of the Chamber. They will punish the hard-working self-employed people who in the next 2 years will pay $100 million extra in their levies—and the chairperson of the select committee got up and said that Labour looks after hard-working self-employed people! I would hate to think what would happen if it stopped looking after them; it would probably charge them an additional $500 million. 
So the challenge in terms of Part 1 is for New Zealand First and the Green Party to explain to their supporters why they should support the Labour Government’s move to impose a surcharge of $100 million on the self-employed for the next 2 years so that they can pay higher levies when compared with employers. I think it will be extremely interesting to see what this socialist Government will actually do to those vulnerable self-employed people for the next 2 years—$100 million. I think Labour members had better be prepared to front up and be answerable to all those irate self-employed people if this bill goes through. National will make sure for the next 2 years that they know who has punished them for being hard-working self-employed businesses. 
DARREN HUGHES (Junior Whip—Labour) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Motion agreed to. 
The question was put that the following amendment in the name of Dr Paul Hutchison to clause 11 be agreed to: 
to insert after section 175 in clause 11 the following new section: 
175AIndependent auditing of proposed premiums 
ACC proposed premiums and the rationale for such premiums must be audited by independent third party actuaries yearly (and the result made public) to ensure transparency in the premium-setting process. 
A party vote  was called for on the question  
That the amendment be agreed to. 
Ayes 48 
New Zealand National 48. 
Noes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the following amendment in the name of Dr Paul Hutchison to clause 11 be agreed to: 
to insert after section 175 in clause 11 the following new section: 
175BProvision of forecast statement of financial performance 
ACC must provide yearly a forecast statement of financial performance for the next 5 years to allow levy funders to analyse current premium-setting performance against projected outcomes. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 48 
New Zealand National 48. 
Noes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Amendment not agreed to. 
A party vote was called for on the question  
That Part 1 be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Part 1 agreed to. 
Part 2 Transitional provisions 
PANSY WONG (National) 
: 
 In Part 1 we established that the law sets out very clearly that the Accident Compensation Corporation (ACC) would impose a levy to make sure that the employers’ account and the self-employed work account are fully funded. But the history of the employers’ levy account is that ever since 2003 the surplus in that account which started with $108 million increased. In 2004 it was $300 million in 2005 it went up to $500 million and in 2006 it was $757 million. I think that is a clear demonstration that the ACC has always played a conservative role in terms of the rate at which the levy was set at a point just in case it made a mistake in setting it. That was why my good hard-working intelligent colleague Dr Paul Hutchison asked for transparency and openness by getting an independent person to look at how the ACC set those levies. 
This part Part 2 is about the merging of the two accounts and combining the surpluses—estimated to be about $600 million in the employers’ account and about $60 million in the self-employed work account. Any person who thinks logically about ACC policy would eventually say that ACC will be quite comfortable to have a surplus margin of about 11 percent. But with the merging of these two accounts—one of which carries 63 percent surplus and the other 20 percent surplus—it says it would quite like a combined margin of 53 percent. 
The problem of simply adding those two together and arriving at this average would mean that for the next 2 years those who are self-employed will be penalised. They will have to come up with $100 million extra to bring the 20 percent margin up to 53 percent. Then the employers will also be penalised because they have a margin of 63 percent and the ACC refuses to bring it down to 11 percent. But the irony is stated in the official paper. By the year 2010 it would like to bring down the surplus to 11 percent. It would quite like the surplus sitting at a high amount just in case something happens in between and they might call on this high surplus. 
Firstly I encourage ACC management and officials to be confident of their ability. They have shown in the past 4 years that the surplus amount has kept growing. They should stop holding on to other people’s money and compounding the problem with a surcharge of $100 million for the self-employed for the next 2 years. Self-employed people—for example people in the meat industry—are saying that they will suddenly face a hefty bill in the next 2 years. As a small pool of people they have to front up with an extra $100 million while the ACC has every intention of reducing that surplus margin in about 4 years’ time. 
This legalised stealing simply does not make any sense. That is the practice I describe—legalised stealing of money that was paid in by the employer on behalf of their workers’ earnings or by the self-employed. So I have moved a very simple amendment that states that before the merger the surplus margin of the employer’s account should be adjusted down to 20 percent. The impact of this amendment would be that the self-employed would not be penalised by having to pay a surcharge of $100 million. Then—rightly so—the employers who have contributed on behalf of their workers’ earnings in the past— 
Hon RUTH DYSON (Minister for ACC) 
: 
 I speak to Part 2—as I believe we are required to Mr Chairperson by your instruction to the Committee of the whole House—unlike the member who just resumed her seat Pansy Wong. She might have been talking about something entirely different. 
Part 2 has just three clauses which cover the transitional provisions. There are two amendments to clauses 14 and 15 proposed by the current Opposition spokesperson on ACC Pansy Wong on her Supplementary Order Paper. If one were to go back to the primary purpose of the Injury Prevention Rehabilitation and Compensation Amendment Bill one would understand the transitional provisions. The purpose of this bill is to ensure that people in the paid workforce have their risk assessment based on their exposure to risk rather than on the company structure or business arrangements they happen to be set into. To ensure that the merger of the accounts that is required to achieve that fairness—so that two people doing exactly the same job have their levy assessed on the basis of their exposure to risk rather than on their company structure—is a smooth amalgamation we have the transition periods outlined in clauses 14 15 and 16. So unless one believes that people should be assessed for risk on the basis of their company structure—which is what I presume Pansy Wong might be trying to say although it was not really clear—then I think people should support these three clauses unamended. 
I just want to refer briefly to the comment that Pansy Wong made in her final contribution in her last speech which was in reference to Paul Hutchison’s amendments. Frankly if information is available under the Official Information Act then I would recommend to the current and former—recently dumped—Opposition spokespersons on ACC that they should use its provisions. When I held that spokesmanship in Opposition I used Official Information Act provisions a lot and they were very worthwhile. I do not think I will give them as much pleasure as Murray McCully gave me but I would recommend they use the provisions of the Official Information Act. That information is available. 
My final point is in response to Pansy Wong’s Supplementary Order Paper containing the two proposed amendments to these clauses. Firstly she should recognise that the volatility of levies is something the entire House should be anxious about. Business people—whatever their company structure—like to have some certainty. That is why I think the information about the levy setting is important and it was a valuable contribution to the debate. But if we have no smoothing policy at all then we will get back to the good old bad days when people had no idea from one year to another what their levy was likely to be. That is a totally unsatisfactory situation. 
Mention has been made of the Accredited Employers Programme. I challenge the National Party to front up before the end of this debate in the Committee stage to what its actual policy is on the Accredited Employers Programme. In my view it is a good programme. We put it into the 2000 legislation because we believed it was a good programme. It gives opportunities for employers and unions to work together in genuine partnership as outlined in the legislation to reduce injury incidents within the workplace and to work together to improve safety in the workplace. Paul Hutchison said it was the best thing since sliced bread. I do not think it is as good as that actually but I think it is very good despite the concerns I have. 
David Bennett—I think he is a list member from the Waikato—said the Accredited Employers Programme was a sham. That is an outrage. If accredited employers do not know that that was what he said—although it is on the record now that David Bennett from Waikato said the Accredited Employers Programme was a sham—then I will make sure they understand that that is his view. 
David Bennett 
: I raise a point of order Mr Chairperson. The member is misrepresenting what I said. 
The CHAIRPERSON (H V Ross Robertson) 
: I would like the member to have a look at Speakers’ ruling 36/5. When it comes to misrepresentation you do not raise points of order now. You raise them at the end of the speech. 
Hon RUTH DYSON 
: So with those concluding comments I thank the members for their contribution over the next little while on these three single clauses. I urge members to vote against Pansy Wong’s Supplementary Order Paper. 
PANSY WONG (National) 
: 
 That is a real concern is it not? I gave the Minister plenty of notice when we were debating Part 1 of my specific concern about the reserve margin and of an amendment to adjust it. I will give her the benefit of the doubt and assume that she actually understands what the issue is all about but refuses to debate it. It would be worse if she was hoodwinked by the officials and did not even attempt to address it. The Minister had no answer and then resorted to personal attacks on my hard-working colleague from Hamilton—the hard-working diligent David Bennett—who won the seat and is absolutely loved by the people of Hamilton. Good on him! We are very proud of him. 
The Minister resorted to personal attacks but that will not deter me from asking her to look at her own official’s paper which stated categorically that the 150 percent margin of the work account as at 1 April 2007 would be progressively reduced in 2008 2009 and 2010 towards the target of 111 percent. That is the stated position of her officials. Yet at the same time the Minister is asking all the other parties to support her in imposing a surcharge on self-employed people that will increase their margin from 20 percent to 53 percent. It simply does not make sense for the Government to impose a surcharge of an additional $100 million and then in a few years’ time to bring the rate down again. That defies logic. 
First of all let me acknowledge United Future’s support for my amendment. It is a sensible party that can exercise its own independent thoughts and it is on the side of the self-employed. I will make sure the self-employed are aware of United Future’s support for the amendment. New Zealand First and the Green Party will just have to face up to self-employed people who will be irate when they receive their bills in the next 2 years. 
Second I propose the amendment because we feel outrage particularly at this point about the legislation the Government wants to pass to do away with consultation. Actually that is telling. The Minister says that if anybody wants information he or she can make a request under the Official Information Act. But why should anybody have to make a request under the Act? Why can the Minister not simply make the information available as public information? I thought the Labour Party believed in open government and consultation. What is happening is that the Government is legislating to do away with consultation. It does not want to hear from self-employed people because it knows what would happen. Labour members know that those people will be outraged when they are asked to pay a surcharge of an additional $100 million. Labour members do not seem to understand that hard work produces the incomes of those people. They think nothing about penalising people to pay that money to a monopoly organisation “just in case something happens”. We have bad news for the Labour Government: self-employed people understand what the Government is trying to do to them. They know it will penalise them in the next 2 years for $100 million without consultation. That will add insult to injury. 
Once again I acknowledge that United Future is the only party so far that has indicated it will exercise its own independent thinking and support my amendments. It believes it is a party that stands up for the self-employed and it does not think the Government should penalise those people with a surcharge amounting to $100 million for the next 2 years just so that a monopoly organisation can feel good. We want the self-employed hard workers and employers to feel good about themselves not a monopoly organisation. 
GORDON COPELAND (United Future) 
: 
 I rise to take a call on the amendment in the name of Pansy Wong to clause 14. I do so with some experience of risk management ratios from my business background. The facts of this matter are fairly straightforward. The Accident Compensation Corporation (ACC) has set itself a risk management ratio of 111 percent. In other words its assets at any given point in time will exceed its liabilities by 111 percent. However the present situation according to figures supplied by ACC is that the employers’ account presently has a cover of 163 percent. In doing the sums quickly in our mind we find that this is 52 percent higher than the risk ratio established by the corporation. Pansy Wong’s amendment very reasonably suggests that 163 percent ratio figure could be reduced by way of a refund to a ratio of 120 percent which is still 9 percent higher than the self-imposed risk ratio that the board of ACC itself adopted. 
When this matter was brought to my attention by the member Pansy Wong I was quite staggered. I have done the sums. The reduction that Pansy Wong is seeking amounts to $468 million. The plain fact is that employers have been already overcharged that amount and more. I find that absolutely outrageous. The employers of this country have been overcharged levies by an amount way over $500 million. That money should never have been collected in the first place because the risk management ratio was already satisfied and this figure is well in excess. Therefore the only just thing to do in those circumstances is to give the money back. The money does not belong to the ACC; it belongs to the ACC only if it comes within the corporation’s own defined policy of risk management. 
I heard briefly the statement made by the Minister in the chair Ruth Dyson about ebbs and flows and I can understand that. But I say to the Minister that it is more than an ebb and flow when the ratio goes from 111 percent to 163 percent and when the corporation is collecting more than $500 million extra. That is not an ebb and flow. That in my opinion amounts to a deliberate concerted campaign of overcharging employers over an extended period of time. It is wrong. It should stop. The money should be given back. It does not morally belong to the Government in the first place. It belongs back in the pockets of those employers. 
Therefore as a caucus we had little hesitation in agreeing to support Pansy Wong’s amendment because it is the right thing to do. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 It is indeed salutary to hear Gordon Copeland from a party that supplies confidence to the Government point out that the Government should give this substantial amount of money back based on principle. He points out that the Accident Compensation Corporation (ACC) has recommended a risk margin of 111 percent and that at present it is 163 percent. My colleague Pansy Wong has an eminently sensible amendment in that she suggests a risk margin of 120 percent which is above that recommended by ACC. Gordon Copeland quite rightly suggests that the Labour Government should give this money back to the employers. The employers have paid it in good faith. They have paid it thinking that the employers’ account would be fully funded but it has gone well over that level. 
It is unfortunate that this particular phrase “give the money back” has such a familiar ring when it is applied to the Labour Government. I will not go back to the credit card again but let us just say for the record here again we have this mischievous Labour Government taking money from employers in the private sector and using it for the Government’s own purposes and for its own ideology. 
It is absolutely appropriate that we speak about the principles of this particular issue. We heard the Hon Mark Gosche talking about a rugby team and how one person should not have a premium different from another person’s. I absolutely agree with that. Premiums should be risk rated individually. This Government wants to pool the lot of them defying basic principles of insurance. It is unfortunate we cannot get it into the thick skulls of this Labour Government including the chairman of the select committee. This is the chairman who insisted that submissions to the select committee close after 2 weeks. He is the man who might talk about democracy but no he wanted to rush the submissions through quickly. In fact the time for submissions might have been even less than 2 weeks. There is absolutely no question that a lot of employers out there very much wanted to submit on this bill but Mark Gosche the chairman of the Transport and Industrial Relations Committee prevented them from doing so by instructing that submissions would close so fast. 
One other principle is extremely worrying about this bill and that is the transitional provisions. They are ominous and unprecedented. In the Labour Government’s hurry to get this legislation through the levy consultations for 2007 and 2008 will be bypassed. The Labour Government says: “To hell with the levy consultations! Forget about democracy and forget about listening to the employers and the self-employed. We will just bypass the levy consultation process for the convenience of merging these two accounts.” Talk about principles! 
I say to the Hon Mark Gosche the chairman of the Transport and Industrial Relations Committee that he has certainly not displayed principles in terms of allowing time for submissions to be heard in a democratic way through this process. Certainly when we come to the levy consultation process we see that he has bypassed normal precedent. 
Hon RUTH DYSON (Minister for ACC) 
: 
 I will take just a brief call in response to some of the comments made by Gordon Copeland who without exception makes well-considered contributions to debates. In my view he has omitted quite a major consideration in his deliberation of and support for Pansy Wong’s Supplementary Order Paper 91. In any one of the accounts there will be a considerable investment opportunity because the amount of money that is required to be collected in levies each year is not just to cover the cost of a claim for that year; it is to cover the cost of a claim for the life of the claim. We know that with some serious injuries tragically the life of that claim could be 30 or 40 years. So more money is collected in levies in the accounts in any 1 year than is required to fund the cost of the injuries in that year and that money is invested. 
So what should the money that has been acquired from sensible—or indeed wise—investment be used for? Should that money go back to the levy payers in that account? Or would it be better used for future investment in order to reduce the overall levy in that account because of the return from the investment? Or indeed should it be used for increased investment generally so as to give advantages to the scheme in areas such as injury prevention? 
Although the member’s comments were cute and might be quite good in a debate about a number of other areas that we have debated in this Chamber I believe that the member is doing the debate his party and this Committee a disservice by saying that it is an outrage that the employers’ account should not have that money paid back without his giving in the debate any consideration of or recognition to the amount that has been accrued to that account and all the other accounts from wise investment. In my view first of all to take away a large percentage of that money from employers’ liability now for the possible increased cost of claims that have already been incurred by the scheme and secondly to reduce the investment opportunity would be to do the entire scheme a disservice. 
The other implication of the amendment from Pansy Wong’s Supplementary Order Paper would be the lack of parity between the Accredited Employers Programme and the employers’ account and that should be a major concern to every member in the Chamber. If the levies for employers were artificially dropped because of a combination of overfunding from the amount that has been accrued and the returns from investment and the employers’ account became very attractive to accredited employers because there was no disadvantage financially to them they could join the employers’ scheme which would mean we had an increased number of employees being covered by the employers’ account without any contribution being made by accredited employers to that account at all. So not only are the potential advantages to the scheme of the investment money that would accrue from that amount being left in being ignored but an opportunity is also being provided for the current accredited employers who have made no contribution to the employers’ account to benefit from a one-off windfall. In my view that is not a fully considered position and I say that with the greatest of respect to the member whom I believe has given Pansy Wong’s Supplementary Order Paper some consideration—but in my view not full consideration. It would do a disservice to the overall levy stability it would do a disservice to future employers and employees because of the lack of opportunity for investment returns and it would give a windfall opportunity to accredited employers who frankly on this occasion do not deserve it. 
The question was put that the amendment set out on Supplementary Order Paper 91 in the name of Pansy Wong to clause 14 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 51 
New Zealand National 48; United Future 3. 
Noes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; Progressive 1; Independent: Field. 
Amendment not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 91 in the name of Pansy Wong to clause 15 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 48 
New Zealand National 48. 
Noes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Amendment not agreed to. 
A party vote was called for on the question  
That Part 2 be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Part 2 agreed to. 
Schedule 
The question was put that the amendments set out on Supplementary Order Paper 89 in the name of the Hon Ruth Dyson to the schedule be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Amendments agreed to. 
A party vote was called for on the question  
That the schedule as amended be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Schedule as amended agreed to. 
Clauses 1 to 3 
DAVID BENNETT (National—Hamilton East) 
: 
 Today we have heard a series of statements made by the Minister in the chair the Hon Ruth Dyson in which she indicated a complete faith in the comments made by individuals—Paul Hutchison and Gordon Copeland—and in which at the same time she rejected their concerns. That has also been the situation with the legislation we are debating today. The Government has gone about saying how this is good for New Zealand how it is about equality and treating employed and self-employed people together and how employers have nothing to fear from this legislation. But the reality is that this legislation will have a dramatic effect on many employers and some self-employed people. It will increase many of their costs of doing business through the increase in the levy amounts. It is part of a plan that this Government has had all the way of treating everything as being equal. It thinks that there is no difference between business entities—there is no difference in the reasons why people go into self-employment or into employment relationships. We are seeing that through other parts of the employment law legislation as well with the intention to treat contractors the same as employees. 
That is all part of the mentality of this Government. It talks of removing the employers’ account and the self-employed work account and inserting a definition of a work account by omitting all references to the employers’ account and the self-employed work account and replacing them with references to a work account. We see that all through Part 2 “Transitional provisions”. That shows an intention by this Government to try to make everything the same—its kind of level playing field. The Government believes that everything is the same in this world. The reality is that it is not all the same. There are different business interests and there are different ways of structuring one’s business because people take different actions and have different responsibilities. 
Some of the implications of what the Government is doing in this grand vision of equality will have a major effect on many businesses. Businesses have paid a large sum of money into these accounts over a number of years. The employers’ account has reserves of over $500 million and in the self-employed work account there are reserves of over $115 million. These people have paid money into these accounts under the genuine understanding that this money would be used for the purposes for which they paid it. Employers did not pay that $500 million on the basis that it would be put together at some place and point in time as part of some grand plan for equality thought up by a Government that believes it knows best. Employers paid that money in over time because they were doing what they thought was the right thing under their legislative requirements. They expect that a Government would also repay that money if over time it was needed. This Government has not shown the good faith that the employers have shown. Instead it has used that money for its own ulterior motives. It has taken away the element of good faith that is essential for business to grow and prosper. 
This Government has no intention of looking after the self-employed or the employed. When the business community whether self-employed or employed has made submissions to this Government they have been pretty well ignored and dressed up. The Government has said: “Oh we’ll look at them as part of some review at some point in the future.” This is one of those kinds of reviews and it has been shoved under the radar in a very short period of time. The Government has not given people the time to adjust to make submissions and to see what the Government is doing in this case. All it is doing is pushing this through in a very short period of time with the intention of taking away the hard-earned money that employers have put into that account over a number of years. 
That will hurt employers. It will also hurt the self-employed. Some large self-employed revenue rate increases that we have seen in the documents provided to the select committee include increases for the police. If their 2006-07 rate of $1.03 were separate it would be 73c for 2007-08 but under the merged ratio they are paying $1.08 in 2007-08. That is a percentage change of 48 percent from having a separate account to having a merged account. The police are going through a pretty tough time at the moment with this Government which will not resource them. It is a Government that will not stand by the police in time of need and a Government that blames them for any driving infractions that may happen if travelling from Timaru to a game of rugby in Christchurch. But at the same time the Government is willing to shaft the police by putting up their levies. 
PANSY WONG (National) 
: 
 I am proposing a very sensible amendment to this part of the debate. It is to defer the implementation of this bill until 1 April 2009. It is the only sensible thing to do. Judging from what some of the political parties sitting in this House—the Greens the Maori Party and New Zealand First—have said I do not think they have had an opportunity to understand the implications of the passage of this bill on the supporters whom they claim to represent the self-employed. I want to look after these party political colleagues. I do not want them or their electorate offices to be facing outraged self-employed people in the next 2 years. So I am seeking their support to make sure that this bill is deferred for 2 years so they can have time to think about the implications. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
PANSY WONG 
: I am seeking for the sensible parties in this Parliament to support a very sensible amendment—to delay the commencement of this bill to 1 April 2009 for a very good reason. National will then be in Government and when I become the Minister for ACC I will not be an apologist for the Accident Compensation Corporation (ACC). I will not put myself up there and tell the self-employed that they have to front up with $100 million extra. I will not confiscate the $500 million in the employers’ account so that ACC can feel good smooth the levy and not forego the opportunity to invest. According to the Minister in the chair the Hon Ruth Dyson she is the apologist for ACC. 
It is typical of a Labour Government that it will not trust the self-employed to invest their own money. It will not trust employers and workers to know how better to spend their own money. But the contempt of this Minister towards employers was evident when she said that the employers did not deserve their rebate. She blatantly said that they did not deserve it; I am not too sure what they have done to upset the Minister. We will be very clear when we become the Government that ACC will serve the people it is set up for. ACC will not turn around and use its monopolistic position to basically tax people keep the surplus of $600 million just so that it can feel secure if it makes any calculation of premiums incorrectly. When we think of it we remember that last week in the House we were told by the Minister that that monopoly agency ACC was spending $5.1 million just to market itself in a branding exercise. Yet it is a monopolistic agency; people have no choice of going somewhere else or through various sources to pay their premiums. 
So I am seeking the support of the other parties in Parliament because after the previous debate—or lack of debate—it seems they might not be clear that the passage of this bill will actually impose $100 million worth of surcharge in the next 2 years for self-employed people. So when all those self-employed people come knocking on the doors of New Zealand First the Green Party and the Maori Party I hope those parties will be able to tell them some good reasons why they supported a bill that has imposed $100 million extra on those self-employed in order to bring the surplus on the reserve to a margin of 53 percent although ACC has indicated all the time that an 11 percent margin would have been sufficient. The law stated very clearly that all the account had to achieve was to be self-funding. At the moment the reserve accounts are showing surpluses of 20 percent and 63 percent yet this Labour Government is trying to push through a bill without consultation to impose $100 million extra on self-employed people. Members should try to explain to some of the people in the meat industry why they should pay for that. 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 I am pleased to have the opportunity to speak on the “Title” “Commencement” and “Principal Act amended” clauses of this Injury Prevention Rehabilitation and Compensation Amendment Bill. 
R Doug Woolerton 
: This man should be the Opposition spokesperson on health—wonderful man. 
Dr PAUL HUTCHISON 
: Despite the excellent remark from my colleague over there from Hamilton I believe that the title of the bill is clearly quite inept. I have a few suggested alternative titles that would be appropriate—for instance “The Labour Government Defies Common Sense by Rewarding Those at High Risk and Penalising Those at Low Risk Bill”. Then we might go to the Minister herself for “The Hon Ruth Dyson and”—we will add in—“the Hon Mark Gosche Denial of Basic Insurance Principles Bill”. We have heard those members tonight absolutely denying the concept of risk rating. But they love the idea of merging things and pooling them together of socialising and of taking all the common-sense incentives—the time-honoured principles—that belong to insurance away from that industry. Or perhaps we could call this bill “The Labour Government’s Let’s Break Faith with Employers and Take a Few Hundred Million Dollars for Redistribution Bill” because that is exactly what the Government has done. 
I think it was very salutary to hear Gordon Copeland from United Future the party that is partly responsible for keeping this Government in power say that what the Government was doing was daft and to hear the Minister first praise Gordon Copeland for his insight and intelligence but then say she was not going to follow his common sense. Mr Copeland said that the risk margin at present is 163 percent but that the Accident Compensation Corporation (ACC) itself suggested a risk margin of only 111 percent. Even if that margin were increased to 120 percent as Gordon Copeland suggested $468 million would still be stolen from employers—$468 million that should be given back. 
What else could the title most aptly be? Well let us call the bill “The Hon Ruth Dyson Let’s Erode the Accredited Employers’ Scheme Because it is Working Too Well Bill” because that is the fact of the matter. I outlined earlier in the debate just how well the partnership programme is working—how there is a situation whereby 25 percent of employers are not under direct control of the Government monopoly and how they do very well. In fact they do so well that their costs are about one-third of those of the ACC and on average they get employees back to work in about one-quarter of the time taken by the ACC. I believe that it is because of that that the Government is systematically trying to erode the programme by changing money over to the residual account so that the levies of that account will go up. It is manipulating the employers’ and self-employed workers’ levies and is artificially keeping them down so that most people out there—who do not really understand this—will think: “Aha! They have kept them down.” But the Government is only fooling itself; it will be found out sooner or later. 
Perhaps the other suggestion for this title could be “The Labour Government’s Let Fiddle the Levies Bill” because indeed that is what the Government is doing. It is a great shame that the Minister was firstly prepared to say that the amendments I suggested to clause 11 were useful and it was helpful to have transparency but then said—having gone through all the amendments I wanted to make to Part 1 and suggested that it would be helpful for people to understand how the levy process worked and to make it transparent—she was sorry but she was not prepared to vote for it. She did however say she was prepared to ensure that this information would be available—and I very much hope she does keep to her word in that respect. I was delighted that she did see some intelligence and insightfulness in the speaker’s amendment and I too recognise her for her insightfulness in that respect. 
I guess that the other title for this bill could be “The Labour Government’s Let’s Fiddle the Residual Account Bill”. I just want to finish off the six alternative titles that would aptly replace the title we have now. Indeed the title “The Labour Government’s Let’s Fiddle The Residual Account Bill” is quite appropriate. We know that by legislation the ACC should be fully funded by I think 2014 yet under this Labour Government there has been no improvement in the position over the last 4 to 5 years. That is hugely hugely concerning. 
Finally I reiterate my colleague Pansy Wong’s plea that it would be very helpful if her amendment to delete the commencement date of 1 April 2007 and replace it with 1 April 2009 was supported. By that time there will be a National Government in place and we will bring sense to New Zealand’s accident compensation scheme. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Clause 1 agreed to. 
The question was put that the following amendment in the name of Pansy Wong to clause 2 be agreed to: 
to omit “1 April 2007” and substitute “1 April 2009”. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 48 
New Zealand National 48. 
Noes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Amendment not agreed to. 
A party vote was called for on the question  
That clause 2 be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Clause 2 agreed to. 
A party vote was called for on the question  
That clause 3 be agreed to. 
Ayes 71 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 4; United Future 3; Progressive 1; Independent: Field. 
Noes 48 
New Zealand National 48. 
Clause 3 agreed to. 
Bill to be reported with amendment presently. 
Customs and Excise Amendment Bill (No 2) 
In Committee 
Part 1 Main amendments to principal Act 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 I rise on behalf of the National Party to support the Customs and Excise Amendment Bill (No 2) in the Committee stage. Basically the National Party is in full agreement with the proposal put forward in this legislation. The purpose of the bill is to strengthen New Zealand’s border security by clarifying the Customs Service border-management role and improving its ability to work cooperatively with other agencies at our border. The bill amends the Customs and Excise Act 1996 to ensure that individuals and items arriving in or departing from New Zealand are unable to slip through border processes without proper scrutiny. 
I do so with some reservations. The reservations are in the area of whether this Government—a Labour Government that is I have to say typical of most socialist Governments around the world—has missed an opportunity. 
Tonight in the Committee stage I particularly want to highlight new section 175C “Seizure and detention of goods suspected to be certain risk goods or evidence of commission of certain offences” inserted by clause 15. It states: “(1) A Customs officer may seize and detain goods or documents that are presented or located in the course of exercising any power of inspection search or examination under this Act if he or she has cause to suspect on reasonable grounds that the goods—(a) are risk goods (within the meaning of the Biosecurity Act 1993) for which no biosecurity clearance has been given under that Act;”. It is that point that I think this Government could have taken full advantage of but once again it has failed to do so. 
There is a lot of anecdotal evidence. People regularly come to me as an Opposition spokesman from within these organisations and state that there is a massive advance in technology around the world particularly—but not just—in the US as a result of attempts to not only stop drug trafficking but also eliminate terrorist acts. The opportunity provided by that technology is being missed. There are pieces of equipment that have the ability to detect biomass down to the size of a matchstick. The reason why New Zealand does not have that is not because of cost and not because the equipment is expensive but because we do not have the personnel to then inspect that biomass once it has been detected. Given that we have had 229 new biosecurity incursions in the last 5 years clearly there is an opportunity here for more synergy between the Customs Service and Biosecurity New Zealand in that regard. 
In the second reading of this bill the very honourable member Dianne Yates—who is sitting in the House tonight and I welcome her back here—said that there were no extra taxes in this bill and that I should read it. Well when I made the comments that triggered her response I had. If the member believes that that is the case I suspect that she has not seen in the index of rates and excise duty on alcohol and tobacco the ability now to inflation-proof that tax based on the consumer price index adjustment every year and that she has not seen the provision which I think was very good work on the part of the Foreign Affairs Defence and Trade Committee where the increase in taxation has been harmonised with the excise duty. 
I say to the member that she should go back to some of her constituents—good Labour-voting people who enjoy having the odd tipple or the odd dram here and there or the odd wee drink—and ask them whether they think that is fair. I bet they do not know that tonight we are passing legislation without any reference back to Parliament that will automatically increase the tax on the little bit of enjoyment left in their lives. So I ask her to look at that. 
I also bring to the Committee’s attention the ability under this legislation to increase surveillance in the area of importation of drugs or of the components that make up methamphetamine and other such P drugs which have become almost an epidemic in this country. The increase in that area has been my notes tell me sixteenfold in recent times and that is an indictment also on this Government. 
KEITH LOCKE (Green) 
: 
 On behalf of the Green Party I will deal with a different provision in the bill. It is to do with the export of strategic goods—goods that could be used for a military purpose. It is good that the bill elaborates further on these exports compared with the previous legislation because we do not want to be in the business of exporting components of nuclear weapons biological or chemical weapons or weaponry that may be used by people who in terms of the Ministry of Foreign Affairs and Trade’s criteria are in violation of international humanitarian law or who may use the arms to contribute to regional conflict. That is another aspect of the regulations that are separate from this bill. 
This bill lays down a set of criteria that exporters have to go through. There are huge volumes on bits and pieces of equipment that one is not allowed to export. As I indicated one has to take into account the country that something is going to as well as the nature of the export. There has been quite a debate over the export by Rakon of oscillators that could be nuclear-hardened or shock-hardened specifically for military purposes. That activity was funded by Rockwell Collins which is a military corporation. 
That debate took place about a year ago but even before that there was another good illustration. Oscmar International based in Auckland was producing a particular harness called the Manworn Laser Detection Harness. The firm was exporting that around the world. One of its contracts was with the Israeli Defence Force. In answer to a written question from myself to the then Minister of Foreign Affairs and Trade it was admitted that the ministry turned down the export licence for Oscmar International to export the harness to Israel. It was turned down in March 2004 and the declining of the application was confirmed in June 2004. 
Where this bill is a bit relevant to that is that it appears from reports that once the application was turned down and the company could not export the laser harness itself it then through computer technology emails and putting things on disks and whatnot transferred that technology to San Diego and Mexico where other affiliates of the company existed. I presume that the harness was then done up and exported from there to Israel because as everyone knows America is the main supplier of military weaponry to Israel. This bill refers a lot to electronic goods as well so under this bill it would be an offence for Oscmar to do that. So the bill is helping in that respect. 
There is another problem in this export area. It has come up also in the discussions the Green Party has had led by our co-leader Russel Norman on whether the Superannuation Fund should be put into firms that produce cluster bombs or bits of nuclear weapons. One reply when we brought that up was that big companies like Boeing produce all types of equipment some for civilian purposes some for military purposes and that we should not knock them for doing the military stuff. 
I think that that was part of the debate over Rakon too. Rakon was saying that it was producing oscillators for civilian purposes as well but the counter-argument which I think would be covered by this bill was that the oscillators were being specifically produced to military specifications—and Rakon was producing equipment to military specifications and being funded in the tens of thousands of dollars to do so by Rockwell Collins. Hopefully the bill covers that situation and the export would be prevented. 
There is also another question that is always very debatable when we talk about the destination of equipment and that is whether the country concerned is violating international humanitarian law in terms of what the Government calls the criteria for assessment of export applications. I would say—and it relates to the debate we have been having over the last day in Parliament—that the United States is violating international humanitarian law and that we should be very cautious about what military equipment we export to it. 
TIM GROSER (National) 
: 
 I will take a brief call on Part 1 and essentially address the same issue that Mr Locke has just addressed. It is a fairly technical point of course but it relates to an issue of great concern on the part of all political parties I am sure in this Parliament and in most countries in the world. That is the issue of the misuse of dual-use technology for weapons of mass destruction or for military purposes that probably no New Zealander would want to see associated with us. We have had prohibited export regimes for a number of years and I think the Foreign Affairs Defence and Trade Committee in looking at this bill was trying just to fine-tune that regime in line with modern realities. 
Various international agreements are in place: the Wassenaar arrangement covers conventional arms and duel-use technology there are the Nuclear Suppliers Group and the Missile Technology Control Regime and no doubt there are several others that I cannot think of off the top of my head at this point. So there is a fairly elaborated international regime. The fact that we are very small I do not think obviates the need for New Zealand to play its part in that because quite assuredly although probably no companies in this country are capable of producing the finished article there are certainly companies in our country that whether or not they intend it produce the componentry of commodities used in the production of these devices. 
We have had as the centrepiece of this for a number of years the Strategic Goods List. We have had procedures that have worked tolerably well I suppose up until now but that obviously need to be updated in the light of current requirements. The standard procedure if I understand it correctly is that these goods are prohibited unless otherwise permitted. So it is a “prohibition with exceptions” approach to ensure that people with legitimate trading interests as often will be the case with dual-use technology exports are not prevented from building up their own export industries and providing jobs and employment for New Zealanders. 
The general feeling in the select committee hearings was that the procedures lacked a certain flexibility. The select committee looked at the proposals and came to a consensus I think that made some sense for us. Obviously this is a shifting target. What is deemed to be an undesirable good today can change very rapidly tomorrow. To bring it down to the retail level for example we have seen that in respect of the types of devices that people can bring on to aircraft. So this has to be a procedure that is flexible that takes account of modern intelligence and that can respond very quickly to a change in international circumstances. As a previous speaker pointed out the criteria are generally the end use the destination and the taking into account of all these factors rather than technical characteristics of the good per se. Obviously a certain subjective element must inevitably come into this but I think the legislation before the Committee is a reasonable compromise in trying to balance the needs of legitimate exporters with the very important broader political and strategic objectives for which this legislation is designed. 
Some of the submitters were concerned quite reasonably about the transparency of the rules and about ensuring that exporters of dual-use technology were not caught out. What we have here in terms of an Order in Council gives the authorities—in this case it will be exercised formally by the Governor-General acting on the recommendation of the Secretary of Foreign Affairs and Trade—a sensible and efficient way through this. The prohibition will of course come into effect when the determination is made by the authorities but we have concentrated on some improved notification procedures to ensure that legitimate exporters are aware of the arrangements and that their interests can be accommodated. 
To sum up I have focused on one aspect of Part 1. It is a very technical point but it has become of increasing concern to the international community in which we try to play our part. I think we have arrived at a fair and balanced solution. 
JOHN HAYES (National—Wairarapa) 
: 
 I rise to support this bill because it will provide more effective and integrated border management for our country. In rising I commend the head of the Customs Service Martyn Dunne for his leadership in this exercise and generally for the outstanding results he delivers from his department. It is a particularly important department and it has direct relevance to the people in my electorate in the Wairarapa. 
The work of the department impacts on trade flows and the movement of people. Having been associated with issues around the illegal movement of people I would just like to comment on a couple of elements of the bill. One of the changes introduced through the bill will require that people arriving in or departing from New Zealand are not allowed to use any sort of electronic communication equipment in a customs area. That means that people will not be able to get on the phone or use computers BlackBerries or other things to coordinate excuses for activities that customs people might want to ask about. 
The other issue is that under this bill people will now be able to be detained by customs officers for up to 4 hours when either departing from or arriving in New Zealand. That is particularly important. People may come in and the person at the border may say: “I think you have got an infectious disease.” and that provision gives time for a doctor to be brought in to check people out. It also gives the border control people an opportunity to check police records to determine whether warrants are out on a person who is at the border. It also enables checks to be made on whether people have been endangering or threatening to endanger the life health or safety of a person or group of persons. We can think about the relevance of this when we think of some French travellers who may have been detained for rather longer at our border in relation to the  
Rainbow Warrior 
 affair. Giving this extra power to customs officers is I think a very good lesson that has come from that process. 
Just to comment quickly on other elements of this new bill I think it is really important that we have clarified the opportunity for the Customs Service to interdict vessels that are between 12 and 24 miles offshore. At the moment the law is unclear. I think it is particularly important that we do clarify that. If a boatload of illegal immigrants is coming into this country the further from our border we can deal with them the better. I wholly support that provision being included under section 32C inserted by clause 6. 
Search warrants may now be exercised by a customs officer to immediately detain and search a person for dangerous items. That is particularly important in cases where people have things hidden from view. I also think it is important too for the Customs Service to be able to retain or seize unlawful travel documents and goods. People test our borders every day and it is in the interests of the whole community that we keep people under decent control and at a distance—so that in the case of some people we can recover documents that may have been flushed down toilets on aeroplanes when people arrive at our border and demand to be treated as refugees. 
I come back to another issue. The department is engaged in the collection of a tax which is a quite normal thing on the part of a Labour Government. In this case it is an excise tax. Although I personally would like us to be rid of this arrangement which handicaps people like winegrowers in my electorate it is inevitable that we at least have to do the best we can by the department. From the point of view of this bill we are now going to shift the collection date from March to July. That means the Customs Service has a bit more time to get its paperwork in place. When this tax is levied on hard-working people in this country it is levied automatically on the basis of inflation-rate adjustments so we are giving the department more time to process cost of living orders and exchange rates in relation to the excise tax that is collected upfront from our winegrowers. I think that is a useful development even if we are unable to get rid of the tax completely. 
I now come back to the issue of export regulations which my colleague Mr Locke has raised this evening. A balance has to be drawn. Mr Locke’s comments take me back to a period when I recall having to write to one Maire Leadbetter on behalf of our Ministers. She assailed the Government and wound up its process over many years trying to prohibit the export of a New Zealand - made product called the Mere Mortar Calculator. This was an entire exercise in trying to be obstructive from the point of view of a company earning foreign exchange. More important the calculator enabled one to lob a mortar shell far more precisely than by any other mechanism. If one was trying to protect human life in a difficult situation one could use the Mere Mortar Calculator to target buildings or other pieces of capital infrastructure and avoid hitting populations indiscriminately. I personally felt that this was a very good product that needed to be protected and I can assure Mr Locke that the product was marketed and that New Zealand earned foreign exchange as a result of it. 
Finally I confirm that National fully supports this bill. I think that the Customs Service amongst most of those agencies that report to the Foreign Affairs Defence and Trade Committee gives better value per dollar of taxpayer money spent than any of the other agencies with which we engage. It is a $100 million department; it sticks within its budget; it does not ask for outrageous increases; and it is constantly innovative. It works very closely with the World Customs Organization which has 169 or 170 members. The department is really well led good legislation is promoted and it is a pleasure to deal with. I reiterate our support on that basis. 
The question was put that the amendments set out on Supplementary Order Paper 90 in the name of the Hon Nanaia Mahuta to Part 1 be agreed to. 
Amendments agreed to. 
Part 1 as amended agreed to. 
Part 2 agreed to.  
Clause 1 agreed to.  
Clause 2 agreed to.  
Clause 3 agreed to.  
Bill to be reported with amendment presently. 
House resumed. 
The Chairperson reported the Injury Prevention Rehabilitation and Compensation Amendment Bill with amendment and the Customs and Excise Amendment Bill (No 2) with amendment. 
Report adopted. 
Unsolicited Electronic Messages Bill 
Third Reading 
Hon DAVID CUNLIFFE (Minister of Communications) 
: 
 I move  
That the Unsolicited Electronic Messages Bill be now read a third time 
. This bill is an important part of the Government’s Digital Strategy. The aim of the Digital Strategy is to ensure that New Zealand is a world leader in using information and technology to realise our economic environmental social and cultural goals. Ensuring that users have trust and confidence in the use of these technologies is central to achieving this goal. Unsolicited electronic messages more commonly known as spam now comprise about 80 percent of all email traffic worldwide. Spam clogs up networks reduces productivity and is often used for scams and malicious cyber-attacks. Always spam is a nuisance. Sometimes it can be critical both for systems and personal security. 
Spam continues to grow in volume worldwide and is often a channel for viruses scams and attacks on computer networks and systems. It has been estimated to reduce the productivity of office employees by several percent and to provide a drain on productivity that this country can ill afford. It runs the risk further if unchecked in New Zealand of giving us the reputation of being soft on cyber-crime—a reputation we would wish to avoid. 
Accordingly this bill aims to prevent New Zealand becoming a haven for spammers to promote good e-marketing practice and to provide a basis for further international cooperation on combating spam. With this legislation New Zealand now joins many other countries that have also enacted anti-spam legislation. The legislation enables us to join the global fight against spam. International cooperation to identify shut down or block the sources of spam is an important part of New Zealand’s anti-spam strategy. It also complements a number of other initiatives being undertaken by other agencies to improve Internet security and safety working in partnership with the community sector. Here in particular I recognise the work of the Internet Safety Group. 
The key requirements of the bill are that persons must not send unsolicited commercial electronic messages that have a New Zealand link and that commercial electronic messages must have accurate sender information and contain a functional unsubscribe facility. Persons must not use address-harvesting software or a harvested address list in connection with the sending of unsolicited commercial electronic messages. The legislation applies to all emails text and instant messages that market or promote goods services or schemes of a commercial nature. A sender must have the prior consent of the recipient. This consent can be expressed inferred or deemed but this is clearly an opt-in approach consistent with good e-marketing practice as recommended by the New Zealand Marketing Association and an opt-in scheme as adopted by many partner Governments including the European Union Governments and the Government of Australia. 
Electronic communication offers many benefits and the bill seeks to support its use for legitimate marketing purposes where the interests of the recipient are duly respected. There is a 6-month transition period before the bill comes into effect. This gives organisations a reasonable period of time within which to ensure that their e-mail practices and databases are in compliance with the Act. It is important to underscore that this bill alone will not solve New Zealand’s spam problem which is growing rapidly. Rather it sits with improved technical interdiction measures the primary locus of which will continue to be within Internet service providers themselves and major commercial networks and with enhanced user education so that all New Zealanders understand how to protect themselves from cyber-attack and the nuisance of spam. This bill will play an important part in providing that third leg of the Internet security treble—a sufficient and appropriate legal sanction against spammers with a New Zealand link. The New Zealand link modelled on the Australian legislation includes not only people within our territorial boundaries but people who attack New Zealanders and who are from countries whose Governments we are able to negotiate enforcement agreements with. The ability for us to negotiate such agreements will be an important part of implementing this agreement on a bilateral and I hope also multilateral basis in years to come. 
In conclusion the Unsolicited Electronic Messages Bill is important legislation that reflects the significant role that information and communications technologies play in our lives now and will play in the future. The bill has received widespread support within the House the business and information and communications technology sectors and the general community. Every person who uses a computer connected to the Internet can relate to the nuisance of receiving spam. The bill promotes good e-marketing practice and provides a basis for international cooperation to combat spam. We know that it will not in and of itself stop spam. However it will send a clear message to would-be spammers that New Zealand is no longer a haven for spamming and it will be an important building block in the broader effort to combat this phenomenon. As such I commend the bill to the House. 
CHRIS AUCHINVOLE (National) 
: 
 An aspirational bill is how I would describe the Unsolicited Electronic Messages Bill—it is an aspirational bill. This is very much in keeping with the present Government’s approach towards all legislation at the moment; it is aspirational. What one wonders is the effect of an aspirational bill? Well it works something like this. There are three main points. There is public concern over an issue and a mounting public demand for action on the part of the Government. Legislation is introduced that has appropriate titles and ambitious objectives and that is presented in a way that will give the impression of having a serious intention to deal with the issue placate the public clamour for action and even enthuse people towards participating in it. The third step is when the policy or the bill is carefully examined and it is found it will not actually work in the way the public thought it would. Then it is termed “aspirational”. 
We have endured an amount of things being classed as aspirational in recent months. From memory we had aspirational ideas over the waterfront and other stadia. We have aspirational policies for climate change and so it goes on. I guess the recent proposal to alter probation controls will be termed aspirational when they do not come into fruition. The access to farms policy will now be aspirational given that it has changed completely from what was promised initially. 
In this Government bill which was subtitled the “anti-spam legislation” the clear thrust was to reduce the amount of spam received—at least that was the perception amongst many of the people who are aware of the legislation.. But no it actually cannot do that. The reason is that most if not all of the spam received in New Zealand is generated overseas and in spite of the current discussion over how we conduct foreign affairs be it through government or personal opinion our legislation is unlikely to affect spam producers in Eastern Europe. So the legislation will not stop spam from coming into New Zealand from overseas. Will it prevent people from sending it within New Zealand? It will certainly apply penalties for doing so but at present that is not happening to any extent. And so again we are at the aspirational stage—if anybody were to send or transmit spam within New Zealand we would get them. 
This therefore is not just an aspirational bill; it is a virtual bill. It is more virtual than real. In reality it does virtually nothing as the Minister knows. It is legislation imported from the USA via Australia and it has been reasonably shaped in the Commerce Committee to suit New Zealand commercial circumstances. As part of an international system of safeguards National is prepared to support the bill as an integral part of an international strategy to reduce geographic locations that spammers might operate from but National will not pretend that it will reduce the amount of spam received in the short medium or even long term on computer screens in New Zealand. 
The bill though did raise some interesting debate. It was a good debate to have in the select committee and I trust Mr Assistant Speaker you will permit me to provide a few illustrations that emerged in terms of defining and describing unsolicited information. First of all is it unsolicited or simply unwanted? That was quite a good question to discuss. I am put in mind of question time during which the Minister who has just spoken seems to view any questions about the matter of Taito Phillip Field as unsolicited unwarranted and unwanted. 
In the second reading of this bill I remember the Hon Paul Swain speaking at length about electronic mail and the subsequent release of information that was otherwise regarded as private. From my memory of that Mr Swain seemed to support the release of private information. If only Mr Swain would be forthcoming over his activities in Samoa when he was over there enjoying the considerable and extensive hospitality provided for him and the honourable Mr Goff! Having visited Samoa frequently over a period of a decade I can vouch for the quality of that hospitality. Previously— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
CHRIS AUCHINVOLE 
: Thank you Mr Assistant Speaker. However I come back to unsolicited information. My conclusion is that this is a virtual bill from a Government increasingly perceived as being a virtual Government. The New Zealand electorate requires more reality in its legislation. 
MARYAN STREET (Labour) 
: 
 It is my pleasure to rise and speak to the Unsolicited Electronic Messages Bill. The member who has just resumed his seat used the word “aspirational” and seemed to imply by the way he used it that there was something somehow wrong with that. One could wish for a little more aspiration to be evident in the policies speeches and contributions to this House from the Opposition but we will have to continue to wait for something of that order. 
This bill is an important start. As the Minister the Hon David Cunliffe said in his speech introducing the third reading it is not the last word on getting rid of spam entirely but it is a start. I make reference in particular to his comment about looking to enhance or provoke or produce international agreements. In the event that we cannot legislate outside of our own jurisdiction we can at the very least make sure that New Zealand is not a spam haven. 
I enjoyed working on this bill in the Commerce Committee and I thought that the member who resumed his seat quite enjoyed working on it as well although the support evident in the select committee was not evident in his speech just now. However I will proceed. 
There are a couple of points I would like to make about this bill. One of the things that struck me as most interesting when this bill was before the select committee was a submission we received from the Direct Marketing Association—that is the representative group of commercial retail outlets that direct-market to people in their homes. One could characterise the people in this association as being the producers of the junk mail that comes through our letterboxes. The association did a survey of its own. My entire expectation when I went to read its submission was that it would oppose the bill and that of course direct-marketing through personal computers into people’s homes had to be an even more efficient way of marketing than junk mail in letterboxes. 
So I expected the association to be vociferous in its opposition to this bill but in fact the opposite was true. Even those that by any normal expectation one would imagine opposing this bill were very much in favour of it. It was because the association had done its own research. Much as people hate getting junk mail in their letterboxes they hate getting commercial spam even more. So the association from its own research determined that it was completely counter-productive on its part to insist that commercial spam be regulated on an opt-out rather than an opt-in basis. I was most interested in the fact that that association thought it would be completely self-defeating and counter-productive to allow retailers to send commercial spam out across the countryside on the basis of any list they were able to harvest from anywhere. 
This bill does exactly what most people want which is to put in place an opt-in regime not an opt-out regime. In other words under this law people cannot receive even one commercial email seeking their custom. They cannot receive even one. If people want to receive commercial-marketing emails on their personal computers they have to tell retailers that they wish to be on their emailing list. So people cannot get one and then unsubscribe; they have to actively opt-in to receive those emails. That was an excellent protection and gets rid of a lot of the unsolicited electronic messages that have been besieging people’s PCs up and down the country. 
 So having dealt with the commercial aspects of unsolicited electronic messages the committee then went on to consider further how this regime would be policed and enforced. Members will see there is a provision in the legislation for an enforcement department to be set up within the Ministry of Economic Development that would keep an eye on this. It will be a place that is not a complaints desk. It will not be a fix-it agency but it will be a monitoring agency that will allow through its monitoring this legislation to be enforced. 
There are a number of constructive and creative aspects to the bill. There are also some slight amendments to it that the select committee chose to make and that from my recollection were agreed to by the select committee unanimously contrary to what might have been inferred from the previous speaker’s contribution to the debate. 
The other thing the select committee went on to do was to look at messages that could be considered offensive. They were not commercial in nature but could be used for sexual exploitation purposes and for what is commonly called grooming purposes. Grooming is to be particularly noted as a practice that is used to inveigle young people into Internet and email conversations that are undesirable and that if the young people understood their full import would certainly be unsolicited. So it has begun to move down that path as well in order to regulate this whole electronic environment. 
Of course it is notoriously difficult environment to regulate but this bill is a very practical and good way of doing it. It has the support of Internet providers up and down the country. They themselves are not responsible for the things their clients do although they do extract required behaviours in return for providing Internet services to customers. They can enforce those contracts and withdraw their services. The bill does regulate the provision and circulation in the first instance of commercial spam. But it goes beyond that as well. It is constructive excellent legislation that will help the efficiency of our economy and will aid in the protection of people from unsolicited electronic messages. Thank you Mr Speaker. 
BARBARA STEWART (NZ First) 
: 
 On behalf of New Zealand First I rise to support the third reading of the Unsolicited Electronic Messages Bill. We do support this bill. We believe we need to see some action on spam as it is an increasing problem on our computers. [ 
Interruption 
] I think everybody in this House—even Sandra Goudie—would agree here. The spammers need to be stopped. Even here in Parliament it is a huge problem and I would have thought that if these messages could have been stopped the parliamentary information technology team would have stopped them. However the spammers can now bypass any filter and the junk emails block up our whole email system. 
This bill takes an opt-in approach which I hope the Internet service providers can use when they take some action. When I looked at the most recent figures I saw that in June 2006 worldwide 55 billion spam emails were generated on a daily basis which is a huge amount. Of course 80 to 90 percent of the email traffic is spam. The bottom line is we are very tired of all the articles and deals for products we read about on our emails. Very few people would even bother to buy them off the Net. The same messages seem to come from heaps of different sources. They are totally unsolicited and unwanted and they block up all the genuine mail that is sent to everybody. They are totally impossible to block from our computers. Even if one uses the unsubscribe option it does not seem to even vaguely work which is a real problem. 
We believe that here in New Zealand we are absolutely drowning in spam and that it is becoming a totally impossible thing to try to manage. The problem does need a worldwide strategy and worldwide action because it is a challenge right throughout the world. By itself New Zealand can do absolutely nothing. It is very unfortunate that this legislation can apply only to messages generated within New Zealand. We know it cannot apply to all emails sent to a New Zealand email address from an overseas location which obviously we cannot control. 
Sandra Goudie 
: Invest in Nigeria. 
BARBARA STEWART 
: As it stands smart operators can easily migrate to Nigeria as the member said to arrange for their messages to be sent from an overseas address and be totally above this law we are passing here today. However the legislation does make it very plain that New Zealand is not a safe haven for spammers while at the same time it also provides a basis for international cooperation on combating spam. We need to do that. This is an important bill and one that New Zealand First wants to see have its provisions implemented as far as it is possible to do so. We definitely support this bill. 
Dr PITA SHARPLES (Co-Leader—Maori Party) 
: 
 Last Thursday the House witnessed a most unprecedented event. Two bills were each rushed through a stage in unseemly haste with absolutely no debate whatsoever on their contents. The first was the Unsolicited Electronic Messages Bill; the other was the second reading on the Disabled Persons Employment Promotion (Repeal and Related Matters) Bill. Neither of those bills is what one would call straightforward yet the speed at which the business of the House was conducted saw the House rising at 5.02 p.m. 
In reviewing the  
Hansard  
we see that apart from the Minister of Customs speaking to her bill and a mere four sentences from the Minister for Courts about the Judicial Retirement Age Bill the Government was curiously silent about the matters of State before the House. One has to wonder what the state of affairs is if in only the second week of business for this parliamentary sitting programme the Government is unable to speak to the policy programme it is promoting. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member needs to address the bill. 
Dr PITA SHARPLES 
: When we look at the  
Hansard 
 record of the Unsolicited Electronic Messages Bill we see that the Committee-stage proceedings record only that Parts 1 2 3 and 4 were agreed to the schedule was agreed to clauses 1 and 2 were agreed to and the bill was reported without amendment. 
I am not someone who knows a lot about distribution lists or a great deal about the workings of Internet service providers. In that light and with the recommendations from the Commerce Committee I am relieved to support measures to do away with the dual regime distinguishing between promotional and commercial messages and to instead refer to electronic messages per se. Anything that can reduce confusion and avoid uncertainty has to be good. 
But even a novice like me in the use of information and communications technology cannot help but notice the unwanted invasion of junk mail offering stock-price tips cheap loans healthcare miracle diets hair restorers etc. According to a BBC report spam now accounts for almost 70 percent of emails worldwide. That figure is expected to reach 80 percent by the middle of the year. 
The Maori Party is therefore happy to support a bill that takes as its primary purpose the intention to protect New Zealanders who are accessing the Internet from any untrustworthy and unsolicited messages. We support the intention of the bill to require all commercial and promotional spam to include accurate identification and contact details of the sender; to include a functional unsubscribe facility; and to ensure that the prior consent and proof of identification are taken into account in preventing vexatious messages being sent and clogging up the system. 
However although there is no doubt we urgently need anti-spam legislation the downside for smaller businesses may be uncertainty and higher marketing costs. In thinking about this issue we inevitably think about the 8397 people of Maori descent who described themselves in the 2001 census as “employers” and the 15975 people of Maori descent who are “self-employed with or without employees”. We think also about the employment-related compliance costs the Occupational Safety and Health Service paperwork and the inordinate amount of administration that business is already taxed with. We wonder what sort of impact the recommendations of the Commerce Committee will have in the context of compliance-cost priorities particularly for small business activity. 
The latest annual survey of business compliance costs conducted in 2006 by Business New Zealand—KPMG surveyed some 1400 businesses and concluded that compliance problems and costs were still disproportionately high. The survey confirmed the trend of the last three surveys—that compliance costs fall more heavily on small businesses than on large businesses. It was reported that small businesses with fewer than 10 employees face compliance costs averaging around $3000 per employee whereas larger companies with over 50 employees have compliance costs of less than $1000 per employee. 
The Government has acknowledged that businesses most likely to be caught by this legislation before the House today are small and medium enterprises. Larger businesses tend to follow e-marketing best practice and as such it is likely they will suffer little impact to their regulatory routine. But for small businesses—which after all constitute the vast majority of New Zealand businesses—the regulatory impact will be far more severe. The Government estimates the cost of compliance for small and medium enterprises could constitute at least an extra $1000 to $2000 including changing address lists to develop an opt-in system ensuring all marketing and promotional messages contain correct sender information and how to unsubscribe setting up systems to update electronic addresses held for marketing purposes and separating commercial and promotional materials. 
The Maori Party recognises the enormous impact that such changes can have on business productivity and acknowledges also that many businesses may not have sufficient lead time to comply. We also acknowledge that the bill will place unfair costs on Internet service providers because even though they usually cannot do anything specific about spam they will still have to pay for the complaints process. 
I have some knowledge of the commitment and effort put forward by the Maori Internet Society Te Whanau Ipurangi which promotes a strong Maori presence on the Internet and registers domain names such as “maori.nz”. I acknowledge for the record the initiative of Ross Himona and Kamera Raharaha who have led the way in establishing an authentic Maori presence on the Internet since 1997. 
But in a frantic cyber-world the hassle involved in constructing a process to deal with complaints about spam is simply not feasible. As a result the recommendation from the Commerce Committee that further work be undertaken by the industry to combat spam as part of a multi-pronged approach is to be endorsed. Based on current estimates if users are being confronted by some 350 million messages per month then solutions must be considered on many different levels. The report of the committee referred to the current work being undertaken on developing an anti-spam code of practice for email services. The Maori Party supports such an approach as well as the associated procedures for dealing with complaints and constructing appropriate software programmes and technical remedies to filter spam. 
Finally I refer to the advice of the Ngati Porou and Te Aitanga-a-Mahaki writer Sally Pewhairangi in her work  
Internet Safety and Maori 
 in which she said: “The internet has a lot to offer Maori but there are concerns of intellectual and cultural property rights control language accuracy and authority and access.” We must now add to that list the need to abide by compliance requirements to prevent the use of unsolicited electronic messages. 
The Maori Party supports the moves to create a safe and secure information highway within Aotearoa and we will vote accordingly. But we simply remind the House again that yet another compliance cost is being placed on New Zealanders that an administrative burden is being sanctioned by this legislation and as such we have a concern that the financial burden in our view will fall heavily on those least able to afford it—the little people the small-business enterprises. 
NANDOR TANCZOS (Green) 
: 
 One really has to wonder why spammers do it and what they are up to. I look at the stuff coming through my desktop computer and I have to ask myself whether these people really think that I am going to see a title with an inflated promise and actually open that and buy something. It is highly unlikely. Of course we now have spam filters so every day I have to go through this big pile of things that have been filtered out by my spam filter to make sure that something I really need has not been filtered out. Now spammers have invented ways of circumventing spam filters by giving spam new subject names like “Within my wrath of thee” or “Mark 27/2 Bryan Adams”—that is a really enticing title! That is going to get me interested. There is stuff in Cyrillic lettering. Do spammers really think that people will respond to this stuff? Clearly they do. We need legislation like this because people do respond. People actually open this stuff and buy items or send money. 
If we think of the Nigerian scams we wonder who on earth would believe an email from someone in Nigeria claiming to be the great-nephew of some hideous tyrant who looted his or her country of $30 billion worth of emeralds and who has just selected the recipient at random and wants to put $10 million in the recipient’s bank account to help launder it. Well I would not! It seems extraordinary that anyone falls for that stuff but people do. We read in the newspapers that apparently intelligent people think they are going to make money by giving their bank account details to some strangers in Africa who claim to have looted their country. People do that stuff and it means that this House cannot legislate to stop stupidity. We have spam because the economics of it is that only one pick-up in say 100000 is needed for it to be worth carrying on. It just annoys the hell out of the rest of us decreases productivity and uses up huge amounts of resources. I think the Minister said that 80 percent of Internet traffic is spam. That is the economics of the situation I guess. 
So we come to this bill which certainly will not solve the problem on its own. Our ability to solve the spam problem in this Chamber is pretty limited. Nevertheless it is important that we pass this legislation. Three things about it make it worthwhile. The first is simply a point of principle: international solidarity. In order to address spam given the international nature of Internet traffic an international regime that all countries will stand with has to be developed. This bill is our attempt to be part of that. That is important because it is difficult for us to put pressure on other countries to clamp down on that kind of traffic if we are not doing something at home. The other side of that of course is that the bill pre-empts a move by spammers to relocate to this country as other nations start to tidy up if such a thing should ever happen. So the bill is important in that international dimension. 
Secondly there is a small amount of New Zealand - derived spam. The fact that transitional provisions are in the bill indicates that that must be the case so the bill is useful in that regard. 
The third thing that is useful is some of the stuff in clause 25 where there is some useful monitoring and information-gathering functions so that we can start to understand better what is going on. If we are going to come up with the kinds of technical solutions that Mr Sharples and the Minister have endorsed then we have to understand better what is coming through. 
I am not sure that I agree with Dr Sharples’ comments about compliance costs in relation to Internet service providers. Internet service providers will acquire those costs in any case because it just has to be part of their business practice to deal with spam and complaints about spam. I am not sure that the bill will inflate those costs. The other side of that is the cost to us all that comes from non-compliance. So I am not sure about how strong those arguments are. 
The other thing I make reference to is Barbara Stewart’s points about the unsubscribe functions in the bill. One of the difficulties with spam is that we are always told not to hit the “unsubscribe” button because we just encourage spammers by letting them know that someone is on the other end of the email address. It is a kind of weird contradictory thing. But again there has to be some kind of provision. To find a viable alternative is beyond us at this time so that is the way we will have to go. 
All in all the bill is saying that we have to do something about spam. I offer my congratulations to David Cunliffe who has been an energetic Minister in the information technology portfolio with movements around unbundling the local loop the operational separation of Telecom and those kinds of things. This is just one other example of useful movements in the information technology portfolio. 
I will end on what I think is probably the single biggest disadvantage of this bill as it goes through its third reading. It specifically excludes dealing with voice traffic including—it quite specifically says—voice traffic over Internet protocols including Skype and all those kinds of technologies. I have mentioned it before but with the voice spam that was pumped out of the ACT party campaign offices during the last election I say that Parliament may well live to regret that omission. 
RODNEY HIDE (Leader—ACT) 
: 
 It is very good to follow my colleagues Pita Sharples and Nandor Tanczos. I am interested in Mr Tanczos’ comment that we cannot legislate against stupidity. That is certainly true. But our job is to not legislate stupidly and I am afraid having heard the speeches that in respect of the Unsolicited Electronic Messages Bill we are in danger of legislating stupidly. That is why the ACT party will be voting against it. 
I pick up on Dr Sharples’ speech. Dr Sharples in speaking in support of the bill spoke all the way through about its intentions. Its intention is to stop spam and he said that is a good thing. Of course it is a good thing but just legislating intentions does not actually produce a result. We can legislate all the good intentions that we like. We can have policies filled with good intentions but that does not mean those good intentions will be fulfilled. Then when Dr Pita Sharples talked about the practicalities of the bill he was not talking about it in the sense of how it would stop spam; he said we had to be a bit careful because it would have costs. Of course this bill will have costs. Dr Sharples said the official advice was that the cost was something like on average $1000 or so for a small business. 
So we have to say to ourselves that this is interesting: here we are in Parliament passing legislation that intends well but has a cost of maybe $1000 per small business which is no mean amount. Dr Pita Sharples in particular drew attention to Maori small businesses and so he should but there are other small businesses. Let us take the example of a small Maori business that is struggling away and suddenly has to come up with $1000 to cover the costs of our Parliament’s intention to stop spam. I am sure we all feel good standing up in this Parliament saying we are against spam. Well the cost does not fall on us; the cost of it falls on the very small businesses that Dr Sharples represents here in this House. 
Then we have to ask ourselves whether the cost we are imposing is worth the candle. I see nothing in this bill to justify that cost other than politicians in this Parliament and this Government standing up and saying that they care about spam. 
Maryan Street 
: Then read some of the submissions. 
RODNEY HIDE 
: I love Maryan Street. Here is Labour. I know that half of its members would not turn on their computers. The thing I like about Mr Tanczos is that he knows how to turn a computer on. He uses it and indeed he is like me in that he prefers to use Linux and open-source software rather than propriety software. I can tell members that I prefer to do so too. Particularly after updating to Windows Vista Linux is a good option. 
I know that Mr Tanczos knows that this bill will not actually change spam at all. It will be passed into law. I know that Maryan Street might have a great intention that legislation will somehow change people’s behaviour but this bill will do nothing to change people’s behaviour. 
Maryan Street 
: Grow up Mr Hide! 
RODNEY HIDE 
: I love Labour’s response for me to grow up. I quite like being young. I would hate to be old and miserable like members of the Labour Party are so I am quite happy to be the Peter Pan in this Parliament. So I as the Peter Pan of this Parliament will tell members the problem with the legislation. How on earth does passing this bill change what a Nigerian spammer will do tomorrow? I have to say that Nigerian spammers are not sitting there with their crystal sets listening to Maryan Street telling Rodney Hide to grow up and saying that they had better not send any more spam to Maryan Street of the Labour Government because it passed a law against spam. No siree! Spam from Nigeria China and indeed from the United States of America will continue. Let me say that the United States of America passed exactly this legislation. [ 
Interruption 
] I ask David Cunliffe who shakes his head and says it was slightly different whether the legislation stopped spam in the US. No it did not. 
The bill refers to people who are—I love this bit; it shows legislation in this Parliament coming up against cyberspace—physically present in New Zealand. That is interesting is it not? How does one upon receiving spam work out where on earth the person sending it is physically present? It is not easy because the spammers live in cyberspace and the same idea of—[ 
Interruption 
] David Cunliffe knows so much. His answer to every problem is more legislation and how about we pinch property rights and impose more costs on small business? To hang about the result! I am interested in what it is costing New Zealanders and whether it will achieve the required result. I have to say that Mr Cunliffe has been an abysmal failure in achieving results in the cyber-world of New Zealand. 
The best argument we have come up with for this bill is that we will—I love this bit—“send a signal”. Mr Tanczos is quite right: spammers send out millions and millions of pieces of spam. I tell members that I do not get spam; the only place I get it is on my parliamentary server. I have a home email that is far more public than my parliamentary email and on my home email I do not get spam. Why? It is because I take precautions to eliminate it. I get more spam on my parliamentary server than anywhere. I say to Nandor that we know how to stop spam do we not? Sure some spam gets through but that is two-fifths of next to nothing. 
 So we are passing this law to send a signal. I can imagine that the spammers in Nigeria China and the US—and indeed wherever because we do not know where they might be—are all shaking in their boots because a signal has been sent. The signal was received that Maryan Street and Labour—and indeed 119 MPs in this House—voted to intend to stop spam and say it was banned. It will not make one bit of difference. In fact all around the world they say that what we will have is a multilevel approach to dealing with spam—sort of like a UN in cyberspace. As more and more countries pass more and more anti-spam legislation has anyone noticed what is happening with spam? It is going up. So the legislation ain’t working. The answer is not more knee-jerk legislation. The answer is to follow the ACT party get oneself up to speed or employ someone who is up to speed and engage in some anti-spam software which in my experience certainly works in New Zealand. That works far better to send a signal than any legislation that this Parliament can pass. This legislation will just mean more red tape for business Internet service providers and people in New Zealand. 
In a way it demonstrates why we need a regulatory responsibility bill. What we need in this process is some openness some transparency and some accountability for the laws that we are passing. Quite frankly I am shocked that in this day and age this Parliament is standing up and passing legislation simply because of good intentions. I know that the National Party can see through that. I look forward to those members joining the ACT party and voting down this bill. Thank you very much Mr Speaker for your time. 
Hon DAVID CUNLIFFE (Minister for Information Technology) 
: 
 I raise a point of order Mr Speaker. I seek clarification of a potential point of misrepresentation in the member’s speech. He may wish to clarify it. My sense is that he was opposing the “anti-scam bill” not the “anti-spam bill”. Would the member be able to clarify that? 
Mr DEPUTY SPEAKER 
: That should not have been raised by the Minister. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. [ 
Interruption 
] Chris Carter can interrupt all he likes. 
Mr DEPUTY SPEAKER 
: This is a point of order only. There will be no chit-chat. 
RODNEY HIDE 
: I just want to respond to David Cunliffe’s vicious attack in his point of order and to ask whether we could have 5 minutes silence while I recover. 
Mr DEPUTY SPEAKER 
: That is tit for tat. 
RUSSELL FAIRBROTHER (Labour) 
: 
 I always thought that members had to stand while they were giving their speeches. I was looking as hard as I could at the previous speaker Rodney Hide but I did not see him standing once. However maybe he will grow into the role. My attention was particularly drawn by his comment about the Minister David Cunliffe whom he had just praised as being an abysmal failure. When a leader of a party takes six members of Parliament into an election and comes out with two one has to wonder what definition of success that might be. Then when those two— 
Rodney Hide 
: I raise a point of order Mr Speaker. If we look through all the Speakers’ rulings and the Standing Orders there surely has to be something there about a member who won his seat being lectured about failure by a member who lost his seat. 
RUSSELL FAIRBROTHER 
: But it is worse than that—[ 
Interruption 
] 
Mr DEPUTY SPEAKER 
: When the member raises a point of order he will please wait for the Speaker to acknowledge him before going into it. And it was not a point of order. 
RUSSELL FAIRBROTHER 
: The member was in fact standing so perhaps that should have been acknowledged a bit earlier. It is sometime difficult to see with that speaker. 
This spam bill as the member mentions would keep the activities of electronic messages relevant in this country—unlike that speaker who returned to this Parliament with two MPs. Those MPs spent most of last year either learning to dance or training to be soldiers. Of course I guess those are some of the great tragedies of the ACT party. 
But I want to speak on the third reading of the Unsolicited Electronic Messages Bill. [ 
Interruption 
] Go on. Keep them coming. The member is not prepared to speak on the bill. Why is that? It is because the enforcement procedures in this bill are designed for the member’s party. This bill could have been written after the drafter read a book that was published before the last election a book that harks back to T S Eliot and a book that everyone in this Parliament read with some eagerness: a book called  
The Hollow Men 
. The point about that book is that it would have been described as a civil event as described in the enforcement provisions of the bill. 
Let us see what a civil event is as found in clause 11. This clause would apply entirely to the emails from an exclusive religious sect that offered the National Party $1 million to help it win the last election. Despite the gift of $1 million the National Party just could not manage it—even with that $1 million bonus. This bill would have helped John Key to recognise spam email about which he said: “I might have opened it but I didn’t smoke it.” Of course an email offering John Key $1 million would be chicken feed. He would not be bothered by such a small amount as $1 million. But if he had bothered to read the email from a sect that does not vote with its offer to win National an election with $1 million and to get the troops out in the electorates—[ 
Interruption 
] I tell Mr Finlayson to raise his point of order at the end of the matter. He should read the Standing Orders. 
Christopher Finlayson 
: I raise a point of order Mr Speaker. Speaker’s ruling 112/8 states: “Members must confine themselves to the main purposes and contents of the bill; they must not deal at length with matters not provided for in the bill.” The drivel the member is speaking clearly does not come within third reading parameters. 
Rodney Hide 
: I raise a point of order Mr Speaker. 
Mr DEPUTY SPEAKER 
: No I do not need any assistance thank you Mr Hide. [ 
Interruption 
] No I am not. The key to the matter is probably the phrase “at length” and that is a judgment I would make. The member is using references by way of example but always referring to the bill. 
Rodney Hide 
: I raise a point of order Mr Speaker. 
Mr DEPUTY SPEAKER 
: Is this a new point of order Rodney Hide? 
Rodney Hide 
: Indeed it is. I think the point to be made here is that we should allow Mr Fairbrother to continue his speech without interruption—that is why I was wanting to get in on the point—because it is a really great exposition as to why one should not have a drink over dinner. 
Mr DEPUTY SPEAKER 
: That is a reflection that should not be made but then again nor should Mr Fairbrother have reflected on Mr Hide’s height. 
RUSSELL FAIRBROTHER 
: He is a man of considerable stature from some angles. But if Mr Hide is worried because he had a drink over dinner and cannot make sense of this speech that is his problem. 
Under clause 11 a recipient of an email offering $1 million on a promise to win an election would understand immediately who had sent the email. There are four prerequisites. First of all the message must clearly and accurately identify the person who authorised the sending of the message. Well who in this country would offer $1 million over and above election spending to help to win an election if he or she were not readily identifiable? Of course when that email says “We are working with you to win the campaign.” then clearly the provision of clause 11(a) is satisfied: “the message clearly and accurately identifies the person who authorised the sending of the message;”. So National members would welcome this bill because it would help them to identify unsolicited electronic messages. But clause 11(b) does more than that; it states that the message must include “accurate information about how the recipient can readily contact that person;”. 
Let us look at those emails in  
The Hollow Men 
 and at the information that was included therein. First of all they included the names of certain individuals. That fact would help to identify them. Secondly one email said that the Exclusive Brethren wanted to overthrow the Labour Government and National was the only option it had in order to do so—pathetic though it was. It would do that in working with National by advancing the party or by giving it $1 million over and above its election spending cap. So it was quite clear that the message accurately identified how the recipient could contact that person. Though we may read an email or open it but claim not to have read it we would know if we had read it how to contact that person. So clause 11 would have helped the National Party to identify the spam emails it received before the last election which are a subject of that book  
The Hollow Men. 
The third provision in clause 11 at paragraph (c) states: “the information referred to … complies with any conditions specified in the regulations;”. Well there we have a bit of bother because we do not quite know what that is the regulations not yet having been passed. But paragraph (d) states that “the information referred to … is reasonably likely to be valid for at least 30 days after the message is sent.” We can just take ourselves back to page 83 or thereabouts of  
The Hollow  
Men. The particular email that referred to $1 million for the next election was sent as I recall it within the 30-day period. 
So we have a bill now that the National Party has been mute upon during the third reading. National members have been mute because they know that this bill is being passed to handle their unread correspondence by email. We also know that they could then send off somebody to a District Court to get a search warrant. In relation to a search warrant clause 48(1) states: “An enforcement officer may apply for a search warrant to search a place or thing.” The enforcement officer must have made reasonable inquiries. We all know from the common law that that officer under clause 48(1A) does not personally have to make reasonable inquiries; it is sufficient for another colleague or for someone whom he or she has sufficient reason to trust to have made those reasonable inquiries. So the body set up to enforce the provisions which were so scoffed at by Mr Hide gets real teeth under clause 48 because its personnel working collectively can make those reasonable inquiries described in clause 48(1A). 
Once the application is made the District Court has the discretion to issue a search warrant if there is reasonable grounds for it to believe that a civil liability event has been or is being committed. Of course that takes us back entirely to the book  
The Hollow Men  
and to clause 11 because we know that the people in the National Party who claim to have opened the email but not read it would take some protection in saying they did not know who it came from. That is despite the fact that the sender was offering them $1 million within about 30 days in order to try to buy an election. 
This bill is very very important because it sets a benchmark for proper behaviour on the Internet and with electronic messages—emails. No longer will members of the party opposite be able to stand in this House or appear in the press and say they did not know where something came from. If they were to say that then they would be duty-bound to lay a complaint and to have the matter followed through. Did they want to lay the complaint? Did they want the matter to be followed through? Did they want to reveal that they knew all the time who had sent the email offering $1 million? Did they want to know who the campaign manager in Napier was dealing with in the Exclusive Brethren to get the troops out in order to grab votes that would not have been there for the National Party otherwise? Did they want to know who was organising the telephone banks and who was ringing up and passing off messages of unreliability? A “brother” of unsolicited electronic messages is a telephone call from the telephone banks of those people who claim to be Christians but who hide behind anonymity and the emails that this bill is designed to put an end to. 
This is a very important piece of legislation. It will put an end to such rubbish as bedevilled the last election. And the election in 2008 will see Labour returned with a victory because the emperor on the other side will be found to have no clothes. 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. Through you Mr Deputy Speaker—and I am sure I have the support of the House—may I invite Mr Russell Fairbrother if he is up to it to seek leave to speak for a further 5 minutes? We heard from him in relation to the ACT party that I had learnt to dance and Heather Roy had learnt to be a soldier and defend the country. What we did not hear was what he had achieved— 
Mr DEPUTY SPEAKER 
: Mr Hide— 
RODNEY HIDE 
:—other than to lose his safe Labour seat— 
Mr DEPUTY SPEAKER 
: Order ! 
RODNEY HIDE 
: I think he should stand up in the House and say what he has been doing for 2 years. [ 
Interruption 
] Oh he does not want to. He has got nothing to say. 
Mr DEPUTY SPEAKER 
: That was not a point of order and by following what you were saying you were actually interjecting on your own point of order. But I will not do anything about it. 
Rodney Hide 
: That’s why we love you. 
Mr DEPUTY SPEAKER 
: Thank you. 
A party vote was called for on the question  
That the Unsolicited Electronic Messages Bill be now read a third time. 
Ayes 118 
New Zealand Labour 49; New Zealand National 48; New Zealand First 7; Green Party 6; Maori Party 3; United Future 3; Progressive 1 Independent: Field. 
Noes 2 
ACT New Zealand 2. 
Bill read a third time. 
Disabled Persons Employment Promotion (Repeal and Related Matters) Bill 
In Committee 
Part 1 Preliminary provisions 
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 Thank you for the opportunity to speak on this very important Disabled Persons Employment Promotion (Repeal and Related Matters) Bill. There is no doubt that this is a very important bill to the disabled community and also to Ruth Dyson personally. I acknowledge that both the Disabled Persons Assembly and the disabled community have put considerable thought and effort into the bill—as for that matter has the Minister herself. 
This bill is important not only to the disabled community but to their relatives to their friends and of course to the wider community. It is based on the philosophies behind the New Zealand Disability Strategy and  
Pathways to Inclusion 
 and National supports those philosophies. Where we are concerned is that this bill is being pushed through when inadequate preparation has been made for its practical application. That is of great great concern. 
The Workforce Auckland submission to the Social Services Committee stated: “Workforce Auckland has consistently supported the repeal of the DPEP Act to the extent that some opponents of the repeal have accused us of trying to rush through the repeal.” It went on to state what is absolutely important about this bill which is the reason why National is opposing it at this stage: “We are concerned about the failure to work through the practical arrangements to replace the DPEP Act and the lack of consultation.” I understand there has been some considerable consultation since but there certainly have not been adequate practical arrangements to ensure the smooth transition of this bill. 
In fact I had a call from the chief executive officer of Workforce Auckland Joy Ottaway only tonight. She said the Department of Labour came on site yesterday and said there was a change in the policy guidelines coming up but it did not know when the change was coming up. Clearly that is of huge concern for New Zealand’s largest sheltered workshop where 170 disabled people are very gainfully employed. In fact I might say that having visited Workforce Auckland one can be nothing but inspired by the tremendous activity that goes on there and by the satisfaction the disabled people get through having the choice of being employed there. 
Workforce Auckland also asked whether it would get any extra support to see in the practical application of this bill. Apparently the ministry said Gordon Pryde had asked Mrs Dyson for more money but that it would not hear about it until April. How can a large organisation like Workforce Auckland which has 170 disabled people working there plan ahead when it does not know about the policy guidelines just a few months before the bill is due to be enacted let alone whether it will be adequately compensated? Apparently someone asked about the single core benefit that has been promised for the last few years by this Labour Government. The ministry did not know about that. That is yet another reason a practical reason why it will be so difficult to implement the transition clauses to this bill. 
Apparently someone else asked the ministry whether it could guarantee that disabled people would be no worse off and the ministry said it could not guarantee that. That is of great concern. It is for that reason that I have put in a Supplementary Order Paper. The very sincere amendment will ensure that there will be a much smoother transition when the time is right. Basically this amendment requires the enactment of the bill to be extended from 30 June 2007 until 2009. But it gives the Government a chance. It states: “… 30 June 2009 or the time by which the Government has defined the taxation/benefit arrangements so that no disabled workers are adversely affected fiscally from their current status nor are employers fiscally disadvantaged whichever is the sooner.” I put it to members that only yesterday we had first-hand information from the largest sheltered workshop that clearly the ministry has not put in place a practical transition for this bill. That is why this amendment is so important. 
I had very much hoped that the Maori Party and United Future would support this amendment. I understand that New Zealand First is supporting it and I am delighted that it is. It was New Zealand First United Future and ACT members who expressed reservations around compliance costs and the practical implementation of this bill. Hopefully we will get from the Minister in the chair Ruth Dyson some explanation as to why the ministry and the Minister are so inadequately prepared. The Government has not sorted out or defined the taxation and benefit arrangements or employer support measures; it just has not done that at this stage. 
As I say the implications for disabled people are extremely serious. Many of the sheltered workshops are saying that their viability will be seriously threatened once the exemption from minimum wages is removed. Some disabled employees may lose their jobs and some may be worse off due to the attrition of their benefits through high effective marginal tax rates. In my view it is negligent that the Labour Government and the Minister have not sorted this out. National remains opposed to this bill in its present form and regards the amendment that I have put out as essential to the interests of both disabled people and employers. Obviously it would be ideal for all people with disabilities to be able to gain work in open employment where practical but sheltered workshops provide an atmosphere that many people with disabilities and their families value enormously. That choice is very very important and it is very very important that when this bill is eventually implemented there is a smooth transition that does not adversely affect disabled employees who so much enjoy their jobs. 
There is no doubt that the choice available to disabled people through sheltered workshops is one of huge import. As Peter Fraher from the Abilities Group on the North Shore said disabled people go there by choice. They go early for work. They often stay late for work. Some of them even go in the weekends. After the holiday period some were actually lining up very early in the morning because they were so looking forward to going back. This Government is prematurely making it extremely difficult for workshops such as Abilities Group on the North Shore to be able to operate. In fact the workshop is saying it may have to close unless sensible practical provisions are made by this Labour Government. 
So I ask the Minister to take a call and hopefully detail some of the things she is putting in place. I understand that $4 million was allotted in 2002 to help the transition but that almost entirely went on the community participation scheme. One of the disabled people from the North Shore said about the community participation scheme replacing work: “It’s a waste of money.” I would not agree with that entirely because it has been a mixed experience. 
Hon RUTH DYSON (Minister for Disability Issues) 
: 
 I thank the member who has just resumed his seat Dr Paul Hutchison for his contribution. It has been an interesting debate over the last 5½ years. I am very interested to address first of all the member’s Supplementary Order Paper. He is requesting that members support a move to delay the implementation of the repeal of the Disabled Persons Employment Promotion Act. 
I want to contrast him with his “cheer man”—that is what he has been doing this evening—Simon Power. He spoke in this very same debate on 26 May 2004; we could hardly be accused of ramming this legislation through without adequate consideration. Simon Power said on 26 May 2004: “It lacks conviction because … [it has] a long-drawn-out period before coming into full force so indeed does this bill create a transition period until 2007.” The member went on to accuse me of lacking conviction in implementing a move towards an inclusive society despite his supporting the Disabled Persons Employment Promotion (Repeal and Related Matters) Bill. He said: “she should crack on and get this legislation with a commencement date that reflects the courage of that conviction.” Well good on Simon Power. That was a very commendable speech and it is a shame that Dr Hutchison did not read his colleague’s comments before he moved his Supplementary Order Paper. 
I do not think that any legislation before this Committee for which I have been responsible as Minister has been subject to more misinformation and scaremongering. I exclude the member who has just resumed his seat from that because I do not believe he has been part of it in the main but some of his colleagues and members who fortunately have left Parliament since then were. Some of the scaremongering has been genuine and political—an attempt at point-scoring at the expense of people who I consider worthy of better treatment—and some of it has been based on a lack of information. I hope that through the Committee stage we can place some of those facts on the record and give the reassurance that people in sheltered workshops their families and providers are seeking. 
First I will talk about the number of people who are currently in sheltered workshops and the current legislative regime under which the workshops operate. About 3000 people are currently in the many many sheltered workshops around our country. About two-thirds of those people will not be affected by this legislation because they are not classified as being in work—they are not working in any sense of employment or in an employment relationship. They are doing either what is now called as the member who resumed his seat referred to community participation—what we used to call day activities—or some sort of training. So about 1000 people are categorised as being in what we would call employment. Currently those 1000 people because they are in a sheltered workshop have no right to any minimum wage sick leave holiday pay or basic employment rights at all regardless of the quality and quantity of work they do. That is—and no other word is appropriate—wrong. 
It is just wrong to have a blanket exemption without any regard for the work a person does. It is not acceptable. It was not acceptable in 2001 when I announced this policy—on the day the World Trade Center in New York was hit —it was not appropriate in 2004 and it is no more appropriate now. Instead of saying that therefore the blanket exemption would be removed entirely and that we hoped the market would just work it out I said that that was not an appropriate response to what was clearly a changing labour market and to what was for many people who have been in sheltered workshops for a long time a significant change. I said we would not remove the blanket exemption and have no exemptions although that has been actively proposed by many including some in this Chamber. I said that people would now have an individual assessment of their capacity to work and that on that basis they would be entitled to apply for an exemption to the minimum wage. In my view that is a fair and pragmatic way of moving the sector forward—and it certainly has moved forward. 
Ten years ago when I started working with the vocational services sector on this policy the sector was frankly very fragile. It was very poorly funded quite poorly managed and in many instances quite poorly governed. People worked in substandard environments and there were no resources for training or for advancing their capability. We have put very good money into the sector and we can see the results. We can see the results of support for infrastructure. Some workshops are in new buildings some have had their buildings altered to make them more appropriate and some have moved into new facilities. I have been recently to two workshops in Canterbury that have moved premises and they are now very impressive. Nearly all workshops have had staff training including management training and a large number have had governance support and assistance. 
So ensuring that the sector itself is robust and strong has been an important part of this. The sector has received additional funding for its direct contracts and for its workshops as well. Many have seen the face of the future looked at the aspirations and ambitions of their clients and said that they need to change not just to take account of the changing aspirations but to take account of the changing labour market. Many people have moved from what were quite repetitious not very stimulating day activities into either community participation or supported employment. We now have three times the number of disabled people in supported employment than we had 5 years ago and that is a very significant move forward. 
So in my view this is not just a fair approach but a pragmatic one to dealing with the changing aspirations and therefore with the changing responsibility of central government to support disabled people in our workplace. If people are doing a job the very minimum this Parliament should offer them is minimum wages and conditions protections. We have taken the pragmatic approach to individual exemptions in this case and many people will still be entitled to continue. 
The final point I make in this part of the debate is to correct the factual inaccuracies that I am sure were unintentionally demonstrated by Dr Hutchison in his contribution. He said that people in sheltered workshops who received minimum wages would be worse off financially than they would have been. That is not correct. At the conclusion of the debate on this part I will seek leave to table a graph that shows hours of work rate of pay net wage net benefit and the comparable income for people earning wages. People would be better off financially under any regime than they currently are by being on a benefit. Thank you Mr Chairman. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I really think that the Disabled Persons Employment Promotion (Repeal and Related Matters) Bill could probably at this stage be called the “Disabled Persons Unemployment Promotion (Repeal and Related Matters) Bill”. I say that because that is likely to be one of the outcomes when this bill is passed. The Minister Ruth Dyson constantly refuses to recognise that there was no adequate consultation over this bill and that nothing was done to really ascertain how this bill will affect the people it applies to and to protect them so that they have a job to go to. 
 A number of work providers have said quite clearly that they will not be able to employ all of the people they are currently looking after within their working environments. Those working environments are not just businesses—they are much much more than that. They care for those people. They help them with their budgets with their medications and with anything they need in terms of their health personal care accommodation and contact with family and friends. They provide a friendly caring environment. They provide social interaction with people and provide social activities as well. Some of those people will be denied that because those work providers will not be able to afford to employ them. So this will be the “Disabled Persons (Unemployment Promotion) Bill”. Let us make no mistake about it; that will happen. 
The reason the Green Party supports this bill is that it believes that people with disabilities should have the same employment and work conditions as other employees. The problem is that those people have to have a job in the first place. Right now they are on a benefit yes but that benefit is supplemented because they go to a work environment where they feel valued. They feel that they are working and contributing. Now there is every likelihood that a number of those people will have that opportunity taken away from them. All of the other services which are not paid for by this Government—the services that people in our voluntary sector and in the workplaces that assist people with disabilities provided free of charge—are provided because the work providers care about those people and they want to do that. 
What will happen? “Stan the man” will go along to somewhere like Workforce Industries or the Abilities Group in Auckland and he will be told the organisation is sorry but the bill has gone through so it has to pay all of the people minimum wages but it cannot afford to do that. So those providers will have to say to people like Stan: “I am sorry Stan you can’t come on Monday. Sorry mate.” They will have difficulty even explaining that to him. He will ask: “Why can’t I come on Monday? What is it that’s stopping me coming on Monday?” and the provider will have to say: “Well I’m sorry but we just can’t afford to pay the minimum wage.” He will say: “But why can’t you? I’ve been coming all these years; why can’t I keep coming?”. How will people like Stan understand what this is all about? Where will they get the care they have been experiencing? What about the relationships they have built up and the support they have been getting with their budgets with their health and with everything else—even personal care? Those providers will not be able to afford to provide those extra services along with trying to maintain a business while having to pay the minimum wage to employees in their workforce. 
That issue is at the heart of our opposition to this bill. If we thought that everybody would be looked after and would continue to have a quality of life and feel valued then that would be fine. But that will not happen because the consultation has not been undertaken that should have been. Workforce Industries supports the repeal of the legislation. It is a great employer as my most excellent colleague Dr Paul Hutchison said. It looks after 170 people in its workforce environment. It supports this bill but it has also clearly said that the issues have not been worked through and the people and their families who will be directly affected have not been adequately consulted. They have not been given the assurances or the outcomes they have sought from the Minister in the chair the Hon Ruth Dyson. The Minister has failed to provide those assurances to a huge number of the 3000 people who she purports to be in this sector. 
STEVE CHADWICK (Labour—Rotorua) 
: 
 What a strange perspective we have heard from the Opposition. I believe that we are both coming to this bill trying to make things better for people with a disability but I suppose Labour’s policy was worked up during the 1990s when we saw such an oppressive and paternalistic approach to people with a disability. We went out with a document called  
Pathways to Inclusion 
 in which people with a disability themselves stated they wanted services that helped them to get into real work. That is why we are proudly in this Chamber with a Minister for Disability Issues presenting this bill in the Committee stage today. It has hardly been rushed through; it has hardly been imposed on the sector as the member opposite said. 
One has to wonder at the Supplementary Order Paper from Dr Hutchison. He does have a genuine heart in relation to this sector but his Supplementary Order Paper is patronising. National members say that they do not want any people with a disability to be adversely affected fiscally from their current status. But I believe that National members are really concerned about employers being fiscally disadvantaged by having to comply with the minimum wage and annual leave requirements and all the other requirements and protections that the Employment Relations Act will give these people too. These people are not helpless and unable to see and have a heart and a hope for their own future. They spoke up loudly in  
Pathways to Inclusion 
 which was about consultation and they said: “We have the right to”— 
Sandra Goudie 
: That’s up there. Get down here. Get real! 
STEVE CHADWICK 
: No they have the right to a decent wage to a minimum wage and I am pleased that this bill repeals the provisions they work under in the sheltered workshop environment. Those are the old ages. I am never going to criticise those fantastic providers. There are 45 providers and 4060 people will be affected by this bill. I think the member Sandra Goudie is slightly muddled because she is actually talking about the people the Minister has already said will not be affected by this bill because they are involved in community activities. They are the 1000 people who do need some help but do not do a real job. 
 I think it is really sad to see someone who I respect Dr Paul Hutchison saying that we should put this bill out to June 2009 after the 2008 election which could make one feel slightly cynical. The days of paternalism to this sector are over. The Disabled Persons Assembly and the IHC are putting out their press release tonight saying that they hope the bill proceeds through the Committee and the third reading stage so people with intellectual disabilities soon have equal rights in the work places. So that is great. The society says that the provisions under the current Act are discriminatory and contravene New Zealand human rights and international rules and conventions. For goodness sake! It is time to bring this sector up into the 20th century and not treat it like another underclass which is the paternalistic and patronising attitude of the Opposition. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 Let me make it quite clear from the onset that when this bill had it first reading in May 2004 New Zealand First supported it to select committee. I have here the actual  
Hansard 
 of that debate and I represented New Zealand First at that time. Let me read a little bit of it because I want to explain our position as fully as I may. “Let me say from the onset that New Zealand First will be supporting this bill. I like the way the Hon Ruth Dyson outlined it: we believe that it is better to pay people according to the work they do rather than their place of employment.”—I think those members over there are in agreement with that thus far from listening to them.—“I like that phrase and I thought it summarised the situation exceedingly well.” 
Now we are debating Part 1 of this bill and let me just remind the Committee and anyone who might be listening tonight about the purpose clause which states: “The purpose of this Act is to—(a) repeal the Disabled Persons Employment Promotion Act 1960; and (b) provide for matters arising from the repeal of the Act until the expiry of the transitional period on 30 June 2007; and (c) make related amendments to the Minimum Wage Act 1983.” We had a member on the Social Services Committee last term who is no longer a member of Parliament. Unfortunately we cannot get hold of him to get some clarification but we notice from the select committee report back the following: “Concerns were raised that the financial implications of the repeal of the Disabled Persons Employment Promotion Act will force sheltered workshops to close or move to providing other vocational services.” 
All the correspondence we had—certainly all I had—on this bill told New Zealand First not to support it. However we have a conscience and we are trying our best to work through this as honestly as we can. We read in the explanatory note of the bill the following: “Most people in sheltered workshops receive an average of $17 pay per week.” That is not good enough by anybody’s standard. The question we are asking ourselves in New Zealand First— 
Sandra Goudie 
: They are on benefits. 
PETER BROWN 
: I understand that but that is what they are being paid. The question we are asking ourselves is: can we improve the lot for those people and keep the workshops open and give them a more satisfying life? Right now I have to say that I do not think this bill does it. But having said that I can tell members that we had a mini-caucus tonight to discuss this because a lot of things have come up. We are going to vote against this bill at this point of time see what comes out of this Committee stage and we reserve the right to support the bill if we like the framework afterwards. 
Sandra Goudie 
: Ha ha! 
PETER BROWN 
: We are entitled to do this. We have a heavy heart here. We are not prepared to knock these people for six it is just against our beliefs but at the same time we are not convinced at this point in time that this bill will do it. So tonight we are going to vote against it because that was our instincts as we came into this Chamber tonight. But I know that something has pricked at least my conscience and that of my colleagues here. I will be consulting with my caucus and we will be asking the Minister for further information. Whether we stick to that position is yet to be clarified. 
 I have to say that we do not think the bill as it is written and as it has come back from the Social Services Committee is doing the job. However we are determined to address this issue positively for the people it affects. A few moments ago we listened with a lot of interest to the Minister and to Steve Chadwick. We also listened to the National Party. I know that Dr Paul Hutchison is very sincere in his beliefs on the way to address this issue. Indeed Supplementary Order Paper 71 in his name sits comfortably with us at this point in time. 
R Doug Woolerton 
: He should be the Minister of Health. 
PETER BROWN 
: Well he knows a little bit about it we have to agree on that. 
R Doug Woolerton 
: The spokesperson. 
PETER BROWN 
: Yes he should be the spokesperson on health; he is not quite on this side of the Chamber yet I remind my colleague. This might sound as though New Zealand First is in a state of flux. In all truth we probably are and we will address that issue as best we can. Thank you. 
CHESTER BORROWS (National—Whanganui) 
: 
 I rise to speak against the Disabled Persons Employment Promotion (Repeal and Related Matters) Bill as it is at the moment. It is no surprise to me to find that this bill is promoted by the Labour Party. Labour members pat everyone on the head and they tell us that we are the patronising ones—the paternalistic ones. Yet they are the ones who are deciding what is best for people who are currently working within the sheltered workshops system. They will decide what is best for us and they will make that decision no matter what we say. They will not bother consulting with anybody. They will not bother talking to parents or to the people who are involved in working away day to day with their loved ones their children who attend these workshops. They will not bother to listen even to them but they will make a decision in any event. 
The people who administer the schemes are worried sick about how this legislation will affect them. One of the things they have to do is to assess what part of a full unit the particular person they are assessing is from a productivity point of view. For instance if a person is assessed as being one-tenth of a full unit then he or she will get one-tenth of the minimum wage. Some of these people will get somewhere between $1.25 and $2.50 an hour. 
It is interesting to read an extract from the  
New Zealand Herald  
on 10 February where Mr Jones the Chief Executive Officer of IHC New Zealand as I understand it obviously believes he is selling his soul on this one. When he was held to account by a Mrs Armstrong from Nelson who was worried about the situation in respect of her family his response was: “Has the IHC become too PC in some areas? Yes by being a service provider we have bought into the government expectation standards and policies. The $140 million”—those are the 2005 figures that the Government was funding to IHC—“comes with a cost.” And the cost is that one has to swallow a rat. 
Well the people around this place have been swallowing a few rats lately and will continue to do so especially as we look forward to the consideration of the anti-smacking bill. But they have looked for some sort of help from the Minister as to how things would go—some sort of assurance that things were going to go really well. The Minister is quoted as saying: “If I wanted the sheltered workshops closed I would’ve closed them. But I don’t. We’ve put substantially more money into them.” That is what she is saying but let us see the proof of it. 
She goes on to say that workshops must absorb the cost of at least the first round of payments and that the workshops cannot be funded for salary increases. And then she is quoted as saying: “I can see their problem … But I don’t think it is going to be a problem. I can offer no more assurance than that.” Well whoop-de-doo! The people working in the sector are saying: “You’re not here day by day.” 
Chris Auchinvole 
: “We know how you feel!” 
CHESTER BORROWS 
: “Yeah we empathise with you greatly.” Whoopie! Ironically while the workshops will be paying significantly more most workers will be marginally better off at best and the paper shifting involved could quadruple. A Mr Freyer who is working in one of these enterprise workshops has found that the Department of Labour inspector who was going to come along do all the assessments and work out just how much of a full labour unit these people were going to be worth in the eyes of the Labour Government has managed to do six assessments. He has to do them with a representative of the family there and with someone else to audit. It has to be done over time and then it has to be signed off. 
Progress reported. 
Report adopted. 
The House adjourned at 9.56 p.m.