Clark David: International Finance Agreements Amendment Bill — In Committee 
Text is incorporated into the Bound Volume 
Clark David: International Finance Agreements Amendment Bill — In Committee 
[Sitting date: 19 February 2013. Volume:687;Page:7954. Text is incorporated into the Bound Volume.] 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 Thank you for the opportunity to speak to this bill and to speak about the international nature of the International Finance Agreements Amendment Bill in particular which is where I want to put my attention. Indeed in the earlier stages of this bill I raised the issue of international reputation and the way in which Maui’s dolphins were not being protected by New Zealand. This Government was the only one in the world that did not propose greater protections for the Maui’s dolphin. 
It is difficult to discuss this widely here obviously Mr Chair—and I do not intend to because that would be far too wide ranging and you would draw me back into the substance of the bill—but suffice it to say that international reputation matters and that is one of the reasons why this legislation is very important. 
This legislation was debated earlier by Mr Goldsmith who confessed to being a little confused. His contribution attempted to debate some of the Labour positions on monetary policy and I am happy to set the record straight but perhaps a little further into my speech because to start with I actually want to outline some of the important things that Labour supports in this bill. 
Economic stability is really the aim of the IMF. It is an important organisation and it is important that New Zealand contributes to that aim for the good of the whole world for the good of world trade and for the betterment of all of the citizens of the world. If Parliament did nothing or if it disagreed with the proposed changes to the articles the changes would nevertheless come into force for New Zealand with effect from the date that they entered into force for all IMF members. The result would be a confusing gap essentially between New Zealand legislation and our Treaty obligations. 
We want to line up here deliberately in order to say that we support this legislation. Labour is a responsible internationalist party that believes we should honour the international obligations and agreements that we have entered into. What we do oppose though are the changes that allow future updates to the articles to be made by regulation. We think that subverting the normal parliamentary process is a tragedy. We think that this is the kind of thing that ought to come before this Parliament so that we can debate the merits of changing articles like this in the future. We should not delegate this down to Orders in Council. 
Andrew Little 
: We have to maintain scrutiny. 
Dr DAVID CLARK 
: We need proper scrutiny as my colleague Andrew Little says from behind and he is right. Mr Andrew Little is right—absolutely right. We need proper parliamentary scrutiny on these important measures. So although we have no difficulty with the actual substance of this particular change we do feel uncomfortable with the change to process that allows that regulation-making power essentially to go into the hands of the executive in a power grab that bypasses the sovereignty of this Parliament and hides things in the background. 
Hon David Parker 
: Unlike this process. 
Dr DAVID CLARK 
: This process that we are going through now is a transparent process. We are all debating it. We are debating the merits and that is precisely what we lose when we do away with this process. 
I guess the Government is embarrassed when it hears scrutiny being poured over many things and I could go into Skycity deals which are talked of today and the report that has come out that suggests that indeed there was a lack of transparency and some unusual process. But we will hear more of that I am sure in the media. Or I could go into the way in which the Government opposed asset sale changes in select committee—the way in which it tried to shut down debate because the scrutiny was uncomfortable. 
But parliamentary scrutiny is very very important. It is a basic part of our job here as members of Parliament to make sure that laws are made well and are debated properly and are made with full information. How can anyone I ask oppose that? Why is the Government opposing this scrutiny in future? It does not feel right to me. 
I want to ask also why this bill has taken so long to appear in Parliament. Australia passed equivalent legislation in September 2009 and November 2010. This is another example of a Government incapable of managing the parliamentary agenda and perhaps— 
Hon Trevor Mallard 
: Incapable. 
Dr DAVID CLARK 
: Incapable—incapable Mr Mallard corrects me. And perhaps this is why we see the Government wishing to push this away from Parliament in future so it has less to manage. I do not think that is a legitimate reason for pushing this out of scrutiny out of the eyes of the scrutiny of this Parliament. 
One begins to wonder whether this is important to the Government because it is concerned that we may need IMF intervention here. Look when we see the books we do not think seriously that this is the case but you do start to wonder—you might not wonder Mr Chair but I certainly do—as to whether things are worse behind the scenes than we are really seeing. 
What we see clearly though is that under the last Labour Government we had 25 percent growth in real GDP. That was a great performance. Under this Government real wages have dropped and that is concerning. So what is going on when the IMF is projecting for New Zealand the worst current account deficit in the developed world this year? What is going on there with New Zealand? I have a real concern that this Government behind the scenes is saying that we need to line up and we need to tick all the boxes with the IMF because one day soon we might need them. 
If what we saw from Mr Goldsmith—the confusion around economic policy—is anything to go by that need might come sooner rather than later since he is understood to be one of the promising economic minds. He said in his contribution that he did not understand the need for macro-prudential powers to be given to the Reserve Bank so that it might look at issues other than simply inflation when it goes about its business. 
To that I could add a range of other things that could be done were the Government a little more focused on the economy. You know we need pro-growth tax reform we need a capital gains tax to neutralise the investment signal we need research and development tax credits we need greater KiwiSaver universal KiwiSaver so that we have actually got savings to invest in business and we need procurement policies that are pro - New Zealand rather than in favour of multinationals that are avoiding tax in New Zealand. 
We know that the purposes of the IMF in supplying its loans are to help member countries tackle balance of payments problems. Well we wonder. If that is its first objective maybe that is why the Government is cosying up to it. New Zealand certainly has a balance of payments problem that this Government has not even started to address. The IMF loans are meant to help member countries stabilise their economies. Well we have seen an economy that is not performing here in New Zealand; in fact this Government has the worst economic record of any Government in New Zealand in the last 50 years. That is amazing. It is not good; it is outrageous. So stabilising economies is something the IMF does. The IMF loans are also meant to help restore sustainable economic growth. 
All of these things are things that this Government is failing on so perhaps the real reason that this Government is cosying up to the IMF—that is agreeing to pass things outside the normal parliamentary process for future changes—is that it is wanting to get cosy with the IMF in case one day Paul Goldsmith becomes the finance Minister. 
Andrew Little 
: Oh it’ll never happen. 
Dr DAVID CLARK 
: Members behind me say it will never happen. We thought this Government promised a brighter future and we have seen 17000 jobs go last year in the manufacturing sector. So we are seeing promises on the one hand and on the other a Government that is failing to address the balance of payments problems failing to stabilise the economy and failing to restore sustainable economic growth—those very objectives that the IMF loans are meant to help member countries tackle. 
Brendan Horan 
: Mr Speaker—