Volume 707 Week 24 - Tuesday 11 August 2015Text is incorporated into the Bound VolumeVolume 707 Week 24 - Tuesday 11 August 2015[Sitting date: 11 August 2015. Volume:707;Page:5557. Text is incorporated into the Bound Volume.]Tuesday 11 August 2015Mr Speaker took the Chair at 2 p.m.Prayers.Business of the HouseHon GERRY BROWNLEE (Leader of the House): Pursuant to Standing Order 56(1)(a) I move That the business for the extended sitting of the House to be held from 9 a.m. on Wednesday 12 August 2015 as agreed by the Business Committee also include the Committee stage and third reading of the Hawke’s Bay Regional Planning Committee Bill.Motion agreed to.Points of OrderLeave for Introduction and First Reading—Sale and Supply of Alcohol (Extended licensing hours during Rugby World Cup) BillDAVID SEYMOUR (Leader—ACT): I raise a point of order Mr Speaker. I seek leave to introduce a member’s bill in my name on extending the licensing hours for the sale and supply of alcohol for the duration of Rugby World Cup 2015 to be set down for first reading tomorrow as members’ order of the day No. 1. To allow the legislation to commence prior to the start of the Rugby World Cup I also seek leave for the bill following its first reading to be referred to the Justice and Electoral Committee for 2 weeks and for the bill once it is reported back to be given its second and third readings forthwith on the following members’ day 26 August 2015.Ron Mark: Point of order—Mr SPEAKER: Is it to do with this?Ron Mark: Yes.Mr SPEAKER: Then I will hear the point of order from Ron Mark.RON MARK (Deputy Leader—NZ First):I raise a point of order Mr Speaker. Could we ask that the member consider putting this proposal forward tomorrow?Mr SPEAKER: No the member is seeking leave. The member Ron Mark knows what to do. Leave is sought for that purpose. Is there any objection? There is. [Interruption] Order! There is objection.Questions to MinistersTrade Agreements—Saudi Agri-hub1.RON MARK (Deputy Leader—NZ First) to the Minister for Primary Industries: Does he stand by all his statements?Hon NATHAN GUY (Minister for Primary Industries): Yes. In particular I stand by my statement that although dairy prices are experiencing some short-term volatility the medium to long term outlook for the sector is still very positive indeed.Ron Mark: In respect of his statements around the Saudi farm issue can he explain why his predecessor and the then Minister for Primary Industries the Rt Hon David Carter met with Mr George Assaf of Awassi New Zealand Ltd on 21 January 2009?Hon NATHAN GUY: I am unfamiliar with what details and discussions were had between those various parties at that time.Ron Mark: So is the Minister telling the House that he has no idea whatsoever as to what was so important that Minister Carter had to meet with Mr George Assaf during the parliamentary adjournment just following the formation of Mr Key’s Government; if not why not?Hon NATHAN GUY: The member should realise that Ministers meet a variety of people and they discuss things that are appropriate in their different ministries and portfolios.Ron Mark: Why have the venue duration and substance of this meeting not previously been disclosed?Hon Gerry Brownlee: I raise a point of order Mr Speaker.Mr SPEAKER: Point of order the Hon Gerry Brownlee. [Interruption] Order! [Interruption] No I have not called the member yet. I just want silence for this point of order.Hon Gerry Brownlee: The primary question is: “Does he stand by all his statements?”. We are now getting into some sort of forensic consideration of a meeting that took place during the long 7-week parliamentary adjournment. There is nothing unusual in that.Mr SPEAKER: And it will be for the Minister in answering the question to decide how he answers it. [Interruption]Hon NATHAN GUY: Can I hear that again?Mr SPEAKER: I am going to ask that the question be heard again.Ron Mark: Why have the venue duration and substance of this meeting not been disclosed?Hon NATHAN GUY: This is a ridiculous question. I cannot believe that this member is even asserting that. As I mentioned in the answer that I just gave previously Ministers meet a variety of people. When something is appropriate in their own portfolio they should indeed meet. I do not have the specifics of what went on at that meeting with a former Minister and neither should I carry that around. If the member wants to put a detailed question on the sheet then I am happy to answer it.Ron Mark: Is not the real reason taxpayers’ money is being wasted on the so-called Saudi agri-hub which he has been supporting that this Government is being blackmailed over what David Carter and the National Party and Michelle Boag promised in Opposition?Hon NATHAN GUY: No. That is a pathetic question and I refute that question.Economy—Reports2.TIM MACINDOE (National—Hamilton West) to the Minister of Finance: What reports has he received on the outlook for the New Zealand economy?Hon Member: Ha!Hon BILL ENGLISH (Minister of Finance): A rather more thorough report than that. I have seen reports where Fonterra has revised down its forecast payout from $5.25 to $3.85 per kilo of milk solids. This reduction will clearly have a significant impact on the dairy industry and dairy-intensive parts of the economy but it is not a particularly surprising downgrade as it reflects the ongoing reduction in the international dairy price. Fonterra has at the same time announced higher earnings per share of 40c to 50c and an optional interest-free support payment of 50c per kilo of milk solids. It is clear that for dairy farmers times are turning out tougher for longer than forecasters previously expected but the additional measures announced by Fonterra on Friday will offset that to a certain extent.Tim Macindoe: What effect will the fall in milk prices have on the wider economy?Hon BILL ENGLISH: It will certainly have a big effect on the dairy-intensive parts of the economy. A drop in revenue of this magnitude in the dairy sector will have flow-on effects to the wider economy because the dairy sector makes up about 20 percent of New Zealand’s exports and around 5 to 6 percent of the total economy. The automatic stabilisers though are providing support to the dairy industry and to the benefit of other industries. For instance the New Zealand dollar is down 25c against the US dollar for the last 12 months and this underpins the returns of all exporters not just those dealing with low prices. The Reserve Bank has cut interest rates the overnight cash rate to 3 percent and indicated this may fall further. The Reserve Bank’s most recent forecasts of the economy show that the economy is growing around 2.5 percent a year which is solid sustainable growth.Tim Macindoe: What other reports has the Minister seen on the economy?Hon BILL ENGLISH: In its Monthly Economic Indicators released last week Treasury said that most indicators remain around their long-run averages with the exception of dairy prices and they are consistent with an economy growing around its trend rate of 2 to 2.5 percent. Statistics New Zealand also released the latest employment figures last week. Unemployment increased from 5.8 percent to 5.9 percent. At the same time the average wage increased by 3.2 percent in the last year to over $57000 considerably faster than inflation of 0.3 percent. Of course there are a number of risks to the economy—well-known risks such as the uncertainty around Greece and some uncertainty about China’s growth prospects. So there is some chance that we could move away slightly from the 2 to 2.5 percent growth rate that we are seeing now.James Shaw: Has the Minister of Finance received any reports that show that the New Zealand economy will face a $7 billion hole as a result of low dairy prices and what specific measures is he putting in place to ensure that distressed dairy farmers are supported through this commodity price crash?Hon BILL ENGLISH: Yes I have seen those reports and I am pleased the member asked about them. In order to understand the context of this that $7 billion reduction is a reduction on nominal GDP of over $220 billion. When you look at it that way you can see that it is going to have a negative effect on the economy but a containable effect and we can continue to grow at moderate rates. In respect of dairy farmers in distress Governments have had in place for some time measures for those families that are in severe financial distress but generally the Government would not be looking to financially support dairy farmers because of low prices.James Shaw: Does he regret telling Radio New Zealand in March that the concentration of capital in dairying was “not a bad thing” and how will he now ensure that this over-allocation of resources into one sector does not now put out of work thousands of farm labourers retailers contractors and suppliers who all rely on dairy farms?Hon BILL ENGLISH: The flow of capital into the dairy industry has been based on a longer-term confidence that across the Asia-Pacific region the fast-growing class of middle-income consumers will show more demand for dairy and other protein products. That is a view of the world that is not really disputed by anyone in particular. In the short term however the reduction in income will of course have an impact on employment directly on dairy farms but also in the supporting towns and services. The measures announced by Fonterra last week and the positive indications from the banks that they will finance cash flow for dairy farmers over the next 12 months mean that it will not be as bad as the straight drop in income indicates because dairy farmers have to spend $4.50 a kilo just to get the milk on the truck.Tim Macindoe: What implications do recent developments in the international economy have for New Zealand’s economy?Hon BILL ENGLISH: Although there are risks in the global economy it is evident that growth in our trading partners is holding up reasonably well—in the range of 3 percent to 4 percent. When we look back through the history of New Zealand’s growth patterns it is reasonably clear that when our trading partners are growing at that kind of rate—3 to 4 percent—that is a positive indicator for sustainable moderate growth in New Zealand of around 2 percent to 2.5 percent which is our long-term trend growth rate.James Shaw: Given his previous answer that investment in dairying was based on a long-range view of the sector what work has he done to understand whether the dairy price collapse is actually a structural long-term change in the market rather than a cyclical short-term change?Hon BILL ENGLISH: We try to make an assessment about that the same as everyone else. It is pretty evident though that no one is quite sure. It is likely that dairy prices will not go back to $8 a kilo. In fact it may well be not a bad thing because what is evident is that the price going that high has stimulated not just positive supply but probably excess supply. No one quite knows the answer to that question but talking to the people whose capital investment is at stake and whose livelihoods are at stake they maintain confidence that prices will rise from where they are—in fact they have to because they are below the cost of production—and they maintain a positive view about where they put their investment.Grant Robertson: Has the Minister of Finance seen this report about the economy under his watch which features a boat that has run aground?Hon BILL ENGLISH: Yes I have and I thought how similar it is to the fate of the Labour Party. [Interruption]Mr SPEAKER: Order! Just complete the answer.Hon BILL ENGLISH: In the interest of assisting the vice-great helmsman as I understand it that is the Westpac Economic Overview and I note that its forecasts are for between 2 percent and 2.5 percent growth over the next 3 years despite the fact that it says there is going to be a recession.James Shaw: Will he stop subsidising the expansion of high input - cost dairying by spending $160 million on irrigation when that money would be much better invested in capturing more of the dairy value chain to escape the boom and bust of commodity price cycles?Hon BILL ENGLISH: I could not verify that number. What I can tell the member is that the irrigation investment fund has actually paid out around $8 million or $9 million much as some people would wish it is $160 million—Hon Nathan Guy: $6.5 million.Hon BILL ENGLISH: —$6.5 million sorry. So look the Government spreads its support for infrastructure around the country whether it is roads or public transport and in the case of irrigation schemes dealing with some of the short-term demand issues that enable those schemes to get up and running and we do not have any plan to change that. I do expect though that the low dairy prices mean that there will be less willingness among farmers to finance the overwhelming share of the development that they pay for.James Shaw: Is he aware that organic milk powder commands up to six times the price premium of conventional milk powder on international markets and will he turn this crisis into an opportunity by helping move more dairy farmers into organic milk production?Hon BILL ENGLISH: If the member is correct that farmers can earn six times as much by selling their milk as they earn from organic milk then I am quite sure they will.James Shaw: When he says that this is not a crisis and that dairy is just 5 percent of the economy is he saying that when the All Blacks lose it just does not matter because they are one of thousands of sports teams playing over the weekend many of which are winning?Mr SPEAKER: In so far as there is ministerial responsibility the Hon Bill English.Hon BILL ENGLISH: Clearly the Greens like New Zealanders being able to watch the All Blacks lose but they do not want them to be able to watch them win in the Rugby World Cup. I mean when people use the word “crisis” well the Opposition should explain what that means. If those members think it means that dairy farmers are sitting around with their heads in their hands paralysed by low prices then they are wrong. Actually they are getting up every morning going out into the cold wet weather doing the calving milking the cows and spending the money they need to get their production moving and get their product to world markets. Calling it a crisis seems to me to be particularly useless. In fact it downgrades the resilience and the responsiveness of not just the dairy sector but households right across New Zealand to a bit of economic pressure which they can handle.Prime Minister—Unemployment and Dairy Industry3.ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that New Zealand is on the “cusp of something special”; if so was that “something special” rising unemployment along with plummeting dairy prices?Rt Hon JOHN KEY (Prime Minister): Yes I stand by that statement for two reasons. The first is that I am positive and aspirational for New Zealand—Hon Members: Ha ha!Rt Hon JOHN KEY: —unlike some people who are always talking the country down. But actually the second reason I stand by that statement is that I made that statement on a couple of occasions during debates in the 2014 general election and we were on the cusp of something special: the worst pounding the Labour Party had ever had—Mr SPEAKER: Order!Andrew Little: Given that the number of people who are unemployed has risen by 13000 and that unemployment in Taranaki alone is now at 7 percent and there are hundreds set to join them due to major job cuts announced recently is it not the truth of it that he is sending more and more families to the cusp of poverty?Rt Hon JOHN KEY: Firstly the Government has created—along with the people of New Zealand of course—148000 jobs over the last 2 years. But I note that the Labour Party has an interest all of a sudden apparently in farming. So when prices go up it is nothing to do with the Government; when prices go down it is everything to do with the Government! Those members are not asking: “Why are beef prices high? Is that the responsibility of the Government?”. But I make this simple point: the Labour Party wanted to put a huge number of costs on farmers. That was its policy during the election.Andrew Little: Given that Westpac says that there will be no more job growth this year and the economy has grown at just a quarter of the expected rate has he not driven the economy to the cusp of a recession?Rt Hon JOHN KEY: If the member goes and reads the Westpac report the glimpse that I had a look through it showed that growth will be between 2 percent and 2.5 percent over the next 3 years.Andrew Little: Why has he failed to invest in diversifying the economy neglected regional infrastructure and turned a blind eye to the 35000 jobs lost in manufacturing since 2008?Rt Hon JOHN KEY: The member needs to get out a bit more—it is as simple as that. If you go around New Zealand and have a look at what is happening around New Zealand you will see just how diversified the economy is. Tourism spending alone is up over 20 percent from last year at over $8 billion. The information and communications technology sector is doing well. Kiwifruit growing is back from the lows of Psa. Beef farming is doing extremely well. Horticulture is doing well around New Zealand. Manufacturing—for 33 months in a row the performance of manufacturing index has been expanding. The services sector export education—the only people who think the economy is solely dairy are in the Labour Party and it wanted to tax those people—Mr SPEAKER: Order!Andrew Little: Did he receive any official advice to back up his claim that a new flag would add billions to the economy or was he making it up just like usual?Rt Hon JOHN KEY: I do think that changing the flag has over time very significant economic benefits for New Zealand. The reason for that is that if you go and have a look on the New Zealand Herald website today you will see New Zealanders voting and I notice Mike Hosking’s column today actually talking about genuine debate about the flag—[Interruption] Oh that is right. Just remind me: it is Labour Party policy to change the flag but it does not want it. Oh and Andrew Little was on his live chat 10 months ago supporting change but today he does not want to do it. When we have a flag that is of the ilk that we see today actually it will be on our goods that are sent around the world and that will have huge economic benefit. But the bottom line is this: if the Labour Party is telling New Zealanders it simply misleads them with its policies—Mr SPEAKER: Order! The answer is long enough.Ron Mark: To the Prime Minister in terms of helping the economy—Mr SPEAKER: Order! Just ask the supplementary question.Ron Mark: Thank you Mr Speaker. Given that the Prime Minister knows about trading halts why does he not agree with the Rt Hon Winston Peters and Federated Farmers Waikato’s Chris Lewis that Fonterra should temporarily suspend participation on global dairy trade?Rt Hon JOHN KEY: Firstly that is a matter for Fonterra. It is a private organisation and it makes up its own mind. But that is akin to saying: “When things are going well we’ll have a global dairy auction. When they’re going badly in the world market we won’t.” In other words when the poll results are high we will listen to them and when the poll results for New Zealand First are bad we will turn our eyes away. It is a ridiculous way to operate.Ron Mark: When dairy stock and land values fall in line with the falling commodity price and pay-out as they always do and dairy farming couples are forced into negative equity and the foreign banks move in to foreclose—Mr SPEAKER: Order! Can I have the question please.Ron Mark: —what will he do?Rt Hon JOHN KEY: Well I will just pick one basic point and that is that there is no great evidence actually that when pay-outs go down as they have you will see a massive amount of foreign investment in dairy farms. They are far more likely actually to come in when they can make an economic return. At the current returns as the member will know most dairy farmers are either breaking even or not making money and on that basis it is very unlikely that foreign investors are going to come in and buy those farms.Ron Mark: I raise a point of order Mr Speaker. Could I ask through you Mr Speaker whether the Prime Minister can comment on the particular part of my question that says—Mr SPEAKER: Order! No. [Interruption] No. Order! The member will resume his seat. If he can make his questions concise and to the point then I can help him but when it is a question as long as that one—to the extent that I have got to intervene to ask for the question—then in my mind the Prime Minister addressed it.Economy—Diversification4.ANDREW BAYLY (National—Hunua) to the Minister for Economic Development: What progress is the Government making in diversifying the New Zealand economy?Hon STEVEN JOYCE (Minister for Economic Development): Very good progress. There has been very significant diversification in the economy since 2008 and many sectors of the economy are growing significantly in proportion. In fact there are 199000 more people employed now than there were 4½ years ago with 24500 more employed in manufacturing in the past year alone. Sectors as diverse as the information and communications technology sector which has grown at a rate of 9 percent per annum since 2008 now contribute 1.7 percent of GDP. International education is now worth nearly $2.85 billion and supports more than 30000 Kiwi jobs. The wine industry’s exports were $1.37 billion last year up 8.2 percent in 1 year. High-tech manufacturing has grown from a $139 million industry a few years ago to a $1.4 billion one now. The tourism industryis of course worth 7 percent of GDPnow. Although the dairy industry is struggling at the moment—and that will certainly have an impact on the New Zealand economy—other parts of the economy are growing strongly and are helping to counteract that.Andrew Bayly: What is the Government doing to further diversify the New Zealand economy?Hon STEVEN JOYCE: Encouraging the economy to diversify and grow in different sectors is a very important part of the Government’s comprehensive Business Growth Agenda. Initiatives contained in the Business Growth Agenda include Callaghan Innovation and we are investing more and more in research and development for New Zealand’s high-tech companies in order to develop new products and services. As part of Budget 2015 we invested an additional $80 million bringing our total contribution to science and innovation to around $1.5 billion a year—70 percent more than 8 years ago. We are establishing information and communications technology grad schools to train more young people for this industry. We are lifting greatly the number of people in engineering disciplines; we are investing more in critical infrastructure like the roads of national significance and ultra-fast broadband; and through New Zealand Trade and Enterprise we are encouraging more New Zealand companies to grow offshore.Andrew Bayly: How is the Government encouraging New Zealand companies to grow their offshore businesses and to expand into new and developing markets?Hon STEVEN JOYCE: That is a very important part of the task and that is why we have increased the number of companies that New Zealand Trade and Enterprise works closely with by an additional 200 companies to 700 helping more companies to boost their global reach and to open doors in new markets. We have added new New Zealand Trade and Enterprise positions in countries as diverse as Columbia Saudi Arabia Papua New Guinea and Abu Dhabi; we have increased our presence in the Philippines Indonesia Australia the UK Germany the US Spain Chile and China; and we are further growing our international footprint. New Zealand Trade and Enterprise is working with more New Zealand companies up and down New Zealand in order to make the most of the free-trade agreements with Korea and also the new World Trade Organization government procurement agreement.Dr David Clark: Why is export growth going backwards?Hon STEVEN JOYCE: I appreciate that the Opposition members do not like it because it does not fit with their lines but their lines are rubbish.Dairy Industry—Milk Price Forecast and Sale of Land to Overseas Investors5.ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that dairy prices are likely to be low for “a little bit longer” given the latest auction was a record low?Rt Hon JOHN KEY (Prime Minister): Yes.Andrew Little: Given that dairy farm prices have already fallen by 18 percent since peaking last October what preparations has his Government undertaken for dealing with increased sell-offs by insolvent farmers who cannot make ends meet with dairy prices so low?Rt Hon JOHN KEY: What we have done over the course of the last 7 years after straightening out the mess we inherited from Labour and with our very strong economic management is to make the economy more efficient and more productive. Here is a bunch of things that we have not done: we have not brought the emissions trading scheme in straight away we have not put a large tax on water irrigation we have not put a capital gains tax on every farm we have not increased the minimum wage to two-thirds of the average wage and we have not taken money out of the Primary Growth Partnership. We are in favour of the Trans-Pacific Partnership. The Labour Party—Mr SPEAKER: Order!Rt Hon JOHN KEY: —is claiming it is the farmers’ friend. They were the policies it took to the election.Andrew Little: What is the Government’s response to the reports that contrary to Bill English’s claims the banks are already forcing mortgagee sales on indebted farmers and what is to stop more of these farms being bought by overseas investors?Rt Hon JOHN KEY: Firstly I am sure that the banks will work closely with farmers as they typically do because there is approximately $35 billion worth of debt I think sitting on dairy farms. One of the things the bankers will be sitting there and looking at is they will be looking at the policies of the National-led Government which has supported the farmers; they will be looking at the proposed policies of Labour which is anti-farmers; and they will be saying “Thank goodness National is in Government.”Andrew Little: Given his Government has rubber-stamped 296 sales of sensitive land to foreign buyers since the start of 2012 how much more land is he prepared to sell overseas?Rt Hon JOHN KEY: I think it is important to note that the Government for the most part does not actually sell land; land goes through the Overseas Investment Act and the Overseas Investment Office. As we know the percentage of sales overseas is relatively small and actually New Zealand is not seen as necessarily the easiest place to buy land. If you look around the OECD we have as many restrictions as most other countries; in some cases more.Andrew Little: As a lot of his Government voted down a Labour bill that would have protected farms against being bought up by foreign investors what steps is he prepared to take to ensure farms that are sold during this downturn will not end up in offshore ownership?Rt Hon JOHN KEY: This is what would have driven farmers off the land: going into an emissions trading scheme straight away whacking a massive new tax on irrigation putting a capital gains tax on every farm increasing the costs of wages on every farm having less money in science and innovation and being opposed to trade. It is pretty simple. Farmers in the dairy sector are subject to an international commodity price which is clearly on a bit of a downturn at the moment. Last year it was in quite a big upswing. In fact if you look between 2002 and 2006 the on-farm forecast was about the same as what it currently is today. It is not new. Apparently in all those years when Labour was in office it was fine.Mr SPEAKER: Order!Rt Hon JOHN KEY: Today it is not.Andrew Little: Can he confirm that there is a late entry in the flag referendum: a map of New Zealand with a “For Sale” sign over it?Rt Hon JOHN KEY: The member really needs to sort his game out because either he wants to go on to his website and change his policy which is to change the flag with a referendum or he should realise that he is playing stupid politics with something that could actually seriously benefit New Zealand. That is why Labour continues to poll very poorly because in the end it is just opposed to everything that the Government is in favour of not because it is a good idea or a bad idea. Otherwise Labour members must be misleading New Zealanders because this is their policy. And when you were on your little chatroom a wee while ago you were telling people you were in favour of it. Were you misleading them deliberately? I do not think so.Primary Sector—Export Forecasts6.IAN McKELVIE (National—Rangitīkei) to the Minister for Primary Industries: What reports has he received on the outlook for primary sector exports?Hon NATHAN GUY (Minister for Primary Industries): The Situation and Outlook for Primary Industries for 2015 highlights that the medium to long term outlook for our primary sectors is indeed positive. Although the outlook forecasts that some sectors like dairying will experience short-term volatility overall primary sector exports should increase by 17 percent to $41 billion by 2019. Importantly the outlook highlights the long-term trend of global income and population growth particularly on our Asian doorstep. This will provide an opportunity for New Zealand to continue growing its customer base with sustainable economic growth—indeed boosting the regions.Ian McKelvie: What does the Situation and Outlook for Primary Industries2015 highlight about the short-term volatility in the dairy sector?Hon NATHAN GUY: The outlook highlights that large price peaks are often followed by price falls and then recoveries. At the moment the world is pretty much awash with milk. China has taken longer than expected to come back into the market. The removal of the European milk quotas is expected to increase the world supply of milk. The Russian sanctions are also having an impact on some of our traditional markets. However as this report highlights the medium to long term outlook for the dairy sector is very positive. Just one example: a 1 percent increase in income is estimated to increase the demand for dairy products by 0.8 percent. As the incomes of developing countries increase so will the demand for New Zealand dairy products.Ian McKelvie: What is the outlook for our other primary sectors?Hon NATHAN GUY: That is a very good question. Strong growth in the meat horticulture and seafood sectors has helped to partially offset any decrease in the dairy sector and these sectors have very strong outlooks. In the meat sector beef export revenue is up by 30 percent and we are likely to fill our US quota for the first time ever. Total meat and wool exports are expected to increase by almost 11 percent to $9 billion by 2019. Strong growth in kiwifruit and wine exports is driving horticulture export revenue past $4 billion and it is forecast to reach $4.6 billion by 2019. Seafood export earnings are forecast to reach $1.8 billion by 2019 driven primarily by aquaculture planned expansion growth.Economic Outlook—Milk Price Forecast and Employment7.GRANT ROBERTSON (Labour—Wellington Central) to the Minister of FinanceDoes he agree with the Prime Minister that “Dairy is 5% of our economy. So yes dairy prices are down and it’s tough on those dairy farmers who are resilient people but 95% of our economy is not involved in that”?Hon BILL ENGLISH (Minister of Finance): Yes.Grant Robertson: In light of that answer if 95 percent of people are not affected how does he explain retailers in Taranaki who say that the downturn in the dairy market is seeing sales decline between 10 and 20 percent including one retailer who said that the situation was as bad as it was at the height of the global financial crisis?Hon BILL ENGLISH: Because that seems to be a natural consequence of the fact that dairy farmers in Taranaki are earning less so they are spending less.Grant Robertson: What explanation does he have for the following reports on economic confidence: the July Colmar Brunton survey that shows economic pessimism outweighing optimism for the first time in 6 years the Reid Research Services poll that says that 64 percent of people think we are heading for a downturn the ANZ business confidence survey that reports a 6-year low in business confidence or today’s Westpac quarterly economic survey which features a boat that has run aground—symbolising his management of the economy?Hon BILL ENGLISH: I think the reason for that is pretty obvious. People have been adjusting to a stream of what they regard as pretty negative news: first about Greece then about China then more recently about a steadily dropping dairy price and a few other indications that the economy which was growing at 3 to 3.5 percent looks like it is growing at 2 to 2.5 percent. So given how high the levels of confidence were it is not surprising that they dropped somewhat.Grant Robertson: Does he expect to meet forecasts in his Budget for reducing unemployment to below 5 percent or after three quarters of increasing unemployment is he prepared to admit that Westpac is right and unemployment is heading back to over 6 percent?Hon BILL ENGLISH: There will always be differences between forecasts. What has been positive about the labour market has been the continued growth in new jobs and the continuation of a record high participation rate—that is a bigger proportion of the working-age population available for work than has ever been the case. So in light of those positive trends it is still possible that unemployment could rise. We have yet to see. What we do know is that we have an economy that is producing a lot of new jobs and has slightly more New Zealanders showing up for them than there is growth in jobs.Grant Robertson: Why was he so keen to take credit for the state of the economy when it was going well but at the first sign of a downturn it is everyone else’s fault?Hon BILL ENGLISH: The member should go back and have a look because actually this Government has always given credit for the stronger economy to New Zealand households and businesses which in the face of a recession and an earthquake rearranged the way they operated became more efficient and leaner and got themselves through a very difficult period. We have always attributed the strength of the economy to the people who are the economy.Waste Management—Plastic Bags8.DENISE ROCHE (Green) to the Minister for the Environment: Why has he announced a plastics recycling initiative rather than a levy when recycling will only maintain the volume of plastic in the waste stream whereas a levy will reduce the number of plastic bags in circulation?Hon Dr NICK SMITH (Minister for the Environment): Plastic shopping bags actually make up only about 2 percent of plastic waste. Focusing only on these ignores the large volume of waste from plastic bread bags plastic frozen food bags plastic vegetable and fruit bags and actually dozens of other types of plastic packaging. The strength of the Government’s approach is that it enables recycling of all soft plastic packaging. The Government has introduced a levy on waste going to landfill.Denise Roche: Given that there are less harmful alternatives for the 1.6 billion plastic bags used in New Zealand every year why will he not introduce a levy to reduce their use?Hon Dr NICK SMITH: Plastic shopping bags make up only 0.2 percent of waste that goes to landfill. I would also point out that in the scientific surveys of amounts of litter these plastic bags are actually only about 1 percent of New Zealand’s litter problem. So they are such a small proportion that it seems somewhat unusual to target all our waste efforts on this single product. I note that some supermarkets are tempted to introduce a levy. It was not at all popular with consumers.Denise Roche: Why then is he spending $1.2 million from the Waste Minimisation Fund on a scheme that does not actually minimise waste?Hon Dr NICK SMITH: I am somewhat surprised to see the Greens criticising recycling. What the Government is doing is saying that by recycling those plastics whether they are plastic shopping bags or frozen food bags—all those soft plastics that are often collected by New Zealanders and currently end up just going to landfill—as in Australia if we can recycle them this enables us to reduce the amount of petrochemicals that we are importing from overseas to make new plastic bags.Denise Roche: Will the Minister listen to the 89 percent of Local Government New Zealand delegates who are calling for a levy on plastic bags because a levy would lead to fewer plastic bags being used and ending up in the environment?Hon Dr NICK SMITH: I noticed that in 2009 a number of supermarkets took the Green Party’s advice and did introduce a levy on shopping bags. It went down very badly with consumers and actually this Government is more focused on the general public than we are on what general councils or others want to think people want to do. There are also large numbers of perfectly responsible New Zealanders who use those plastic shopping bags to dispose responsibly of their other wastes. My advice is that that poses little harm to the environment.Denise Roche: I raise a point of order Mr Speaker. My question was specifically—Mr SPEAKER: Order! No your question has been addressed by the Minister.Health Services—Elective Surgery9.BARBARA KURIGER (National—Taranaki - King Country) to the Minister of Health: Can he confirm that the number of patients benefiting from elective surgery has increased by 5030 in the last financial year and that 49234 more patients are having surgery now compared to 2007/2008?Hon Dr JONATHAN COLEMAN (Minister of Health): Yes I can. When National was elected in 2008 increasing the number of elective surgeries every year was a top Government priority. These new figures show that a record 167188 New Zealanders received elective surgery in 2014-15 a remarkable increase of 42 percent on 2007-08.Barbara Kuriger: What is the spread of these increased numbers across the types of elective surgery and what is his expectation for the future?Hon Dr JONATHAN COLEMAN: This continued growth in elective surgeries—over 5000 in the last year—has been spread across the specialities. It includes more than 690 orthopaedic operations 1300 general surgeries and 150 more cardiothoracic surgeries. It is my expectation that the district health boards will continue to deliver increases averaging 4000 more surgeries a year over the next 3 years which is why the Government invested an extra $92 million into elective surgery in the last Budget. This Government is committed to protecting and growing public health services and the extra 50000 surgeries over the last 7 years is evidence of that commitment.Hon Annette King: What impact will the prediction of deficits by 11 of the 20 district health boards have on their ability to provide services in a timely manner?Hon Dr JONATHAN COLEMAN: The member does not need to worry about that because we have reduced those deficits from $150 million under the last Government to around $50 million and dropping over the longer term under this Government. In actual fact there is nothing to worry about. It will not be like when Mrs King was Minister and the budget doubled but there were 2000—Mr SPEAKER: Order!Hon Annette King: I raise a point of order Mr Speaker. My question was a straight question. It had no political inference in it. I asked what the impact of deficits was—Mr SPEAKER: Order! And the Minister was—[Interruption] Order! The question was answered in order. It was describing what impacts—which in the Minister’s mind were relatively minimal.Trade Agreements—Saudi Agri-hub10.Hon DAVID PARKER (Labour) to the Prime Minister: Did he chair the Cabinet on 18 February 2013 when Cabinet noted the initial $4m payment to a “Saudi investor” and did he ask why Cabinet approval was not being sought?Rt Hon JOHN KEY (Prime Minister): Yes I did chair Cabinet. In answer to the second part of the question no. Cabinet was asked to note the payment. It was within the Ministry of Foreign Affairs and Trade’s appropriation and did not require Cabinet approval.Hon David Parker: When he was chairing that Cabinet meeting was he aware that Minister McCully had told the Saudi investor and Ministry of Foreign Affairs and Trade officials that he would “not want any financial contributions to be treated as compensation as this would involve a plethora of lawyers and bureaucrats.”?Rt Hon JOHN KEY: I have been aware the whole way through that Mr McCully has never viewed this as compensation because it is not.Hon David Parker: I raise a point of order Mr Speaker. That was not my question.Mr SPEAKER: Yes it was your question and it has been answered.Hon David Parker: No—Mr SPEAKER: Order! Does the member have a further supplementary question?Hon David Parker: Why did the contract for the $4 million payment make no reference to the settlement of the long-running dispute when Cabinet noted this as part of the payment’s purpose?Rt Hon JOHN KEY: You really have to refer that to the Minister of Foreign Affairs because the Ministry of Foreign Affairs and Trade put the contract together. But everyone is aware in reading the papers just where the responsibility started. It was with the Labour Government and yes National cleaned it up.Hon David Parker: Did Minister McCully tell him and his Cabinet that the Auditor-General had made a written complaint to the Ministry of Foreign Affairs and Trade about the ministry misrepresenting its advice about the Saudi sheep deal?Rt Hon JOHN KEY: I cannot recall discussions about the Auditor-General but I think it has been quite clear that there was some early dialogue. Ultimately actually the officials are very happy with the way the process went.Hon David Parker: What can his Government show for this dodgy deal other than a sullied international reputation; a failed farm in the desert where the lambs died in a sandstorm according to his own Minister; and the waste of over 11 million of taxpayers’ hard-earned dollars—and still no free-trade agreement?Rt Hon JOHN KEY: I know that the truth is inconvenient but it is worth actually having a look at the papers because it was Labour that imposed the ban. It was the Labour Government that said it would reverse the ban and it was Labour that dispatched the Minister of Foreign Affairs and Trade at the time Phil Goff who told the Saudi Minister that they would restart and it was the Labour Government that actually did not tell the Saudis until it had publicly made the decision. It is very inconvenient but this all started with Labour. That is what I call dodgy dealings—it is the Labour Party’s actions.Andrew Little: In light of the dump of 900 pages of documents last week that failed to prove a single word of the claims made by the Prime Minister about the Labour Government and the fact that it is the National Government that twice continued the ban on live sheep exports is it not time that he finally cut through all that crap and was straight with New Zealand? What is the real reason he paid off Al-Khalaf?Rt Hon JOHN KEY: Being “Angry Andrew” worked the first time he was in Parliament. Now it just looks like bad language and the inability to actually front up and be honest. Phil Goff went to Saudi Arabia and misled them. The rest is history.Education—Asian Language Learning in Schools Fund11.MELISSA LEE (National) to the Minister of Education: What recent announcement has she made that supports the learning of Asian languages in schools?Hon HEKIA PARATA (Minister of Education): I am delighted to announce that 22 programmes involving 129 schools will receive a total of $3.3 million over the next 3 years in order to establish new Mandarin Japanese or Korean language programmes and to expand existing ones. This signals the first phase of the Government’s commitment to spending a total of $10 million over 5 years to increase the provision of Asian languages in schools. The first round generated such enthusiasm for Asian languages in classrooms that for the second round we are extending funding eligibility to include all Asian languages. Applications for that round open today and schools have until 25September to register their interest.Tracey Martin: Does the Minister believe that New Zealand students learning an Asian language is more useful or has more value than New Zealand students learning Te Reo Māori?Hon HEKIA PARATA: The decision as to which languages a school wishes to provide to its students is a discussion between that school and its board of trustees. What this Government does is fund and support the availability of Te Reo Māori English and sign language and in addition this wonderful announcement that I am making todayabout Asian languages.Melissa Lee: What benefit will the Asian Language Learning in Schools (ALLiS) fund bring to New Zealand children?Hon HEKIA PARATA: International evidence shows that learning a second language can also contribute to the development of a student’s literacy skills in their first language. Also in addition to supporting our official languages—English Te Reo Māori and sign language—and Pasifika languages we need to provide young New Zealanders with opportunities to learn the languages of countries that we have strong cultural economic and trade relationships with. As our international and trading links grow particularly with Asian countries future generations of kids will need to be able to work in different cultural environments and to communicate in different languages. Easy access to learning an Asian language is a real benefit to the young people of New Zealand.Tracey Martin: Will the Minister be making a similar announcement that her Government will also provide the additional funding required in order to increase the number of resource teachers of Māori thereby supporting the delivery of Te Reo Māori in both English and Māori-medium schools; if not why not?Hon HEKIA PARATA: I can refer that member to successive Budgets within which we have made those commitments already. There are scholarships available for kaiako—that was announced in Budget 2013.Tracey Martin: I raise a point of order Mr Speaker. My question was specifically about an increase in the number of resource teachers of Māori.Mr SPEAKER: Order! No no—the question started with “Will the Minister be making similar announcements”. The Minister was talking about previous announcements that she has made. Does the Minister wish to complete the answer? Then the question has been answered.Point of Order—Leave to Ask QuestionCHRIS HIPKINS (Senior Whip—Labour): I raise a point of order Mr Speaker. The Standing Orders allow for 12 oral questions each day. I understand that the Māori Party was unable to lodge a question by the deadline this morning. I therefore seek leave for it to be able to ask its oral question—Mr SPEAKER: Order! You cannot. The member knows the rules of this House very well. He cannot seek leave on behalf of another member.CHRIS HIPKINS: In that case I seek leave to ask a question myself seeing as there is not an additional question—Mr SPEAKER: Order! [Interruption] No I just need to deal with this first. That is certainly within the Standing Orders. Leave is sought by Chris Hipkins to ask one additional question. Is there any objection? There is.MARAMA FOX (Co-Leader—Māori Party): Kia ora Mr Speaker. I seek leave to ask a question on behalf of the Māori Party.Mr SPEAKER: Leave is sought for that particular course of action. Is there any objection? There is none. It is very unusual. I need to know—I think you also need to describe whom you are asking the question to.MARAMA FOX: I would like to ask the question to the Minister for Social Development. [Interruption]Mr SPEAKER: Order! [Interruption] Order! I am going to allow the member to put the leave in view of the fact that we have done it before. If the House decides it is in order so be it. If the House—[Interruption] Order! The leave was put without us knowing where the question was going. I am going to put the leave again. It will then be over to the House to decide. Leave is sought by Marama Fox to ask a question of the Minister for Social Development. Is there any objection? There is none.Marama Fox: Thank you Mr Speaker and apologies to the House for the administrative error.Mr SPEAKER: Order! Just ask the question.Child Youth and Family—Review12.MARAMA FOX (Co-Leader—Māori Party) to the Minister for Social Development: Has the Minister provided through the Child Youth and Family review opportunity to ensure that children are not being alienated from their whānau throughout the process of the modernisation in the review?Hon ANNE TOLLEY (Minister for Social Development): The Child Youth and Family review of course is still ongoing and I have only just received the first report from the panel. But we have throughout the review to date taken great lengths to ensure that the voices of children are heard and I have set up an advisory committee consisting of eight young people who have experienced care under the current Child Youth and Family system. I have also made two appointments to the review panel who have extensive experience in Māori as Māori make up more than 50 percent of the numbers of children in care.Urgent Debates DeclinedTrade Agreements—Saudi Agri-huband Release of InformationMr SPEAKER: I have received a letter from the Hon David Parker seeking to debate under Standing Order 389 the release of documents pertaining to the Government’s dealings with a Saudi businessman. This is a particular case of recent occurrence involving ministerial responsibility. There must be an element of urgency for a matter to take precedence over other business. The proper use of taxpayer funds is an important issue. The question is whether the release of documents is an issue so urgent that the ordinary business of the House should be set aside to address it. I am not persuaded that the business of the House should be set aside today. However I note that the Auditor-General has been asked to investigate the matter. Should she do so then the findings of that investigation may warrant a debate in the House at that time. The application is therefore declined.New Zealand Flag Referendums BillIn CommitteeDebate resumed from 29 July.Part 3 Miscellaneous provisions (continued)The CHAIRPERSON (Hon Chester Borrows): When we were last debating this bill the Committee was debating Part 3 and Stuart Nash had the call. He has 20 seconds remaining.Hon Member: Make it good.STUART NASH (Labour—Napier): I will make it good because this bill is a very very poor bill. We know this. It has been reiterated. In fact the vast majority of New Zealanders know this. When I speak to New Zealanders in my electorate they say to me: “What about employment? What about job opportunities? What about economic development?”. They ask the question: why is the Government wasting money on a flag referendum when there are—CHRIS HIPKINS (Labour—Rimutaka): I am very happy to take my call on this particular bill. I am just turning to Part 3 the part that we are debating. Of course the major issue that the people in my electorate want to know about is why on earth the Government is spending so much money on this referendum at this given time. They simply cannot understand it when there is no appetite for change. Why has the Government not made the decision to firstly test the will of the public towards the need for a change or the desire for a change before it then goes and has another expensive referendum asking people to choose the option they wish to have? The issue here is why we would have a run-off competition to choose the preferred design if it is ultimately going to be voted down in the end anyway. Why bother going through that particular part of the process if it is going to be voted down anyway? That is the question that everybody has been raising with me and I think it is a very legitimate one.I have yet to hear anyone from the Government—anyone from the Government—provide a comprehensive answer.Chris Bishop: Wasn’t it in my speech?CHRIS HIPKINS: No not at all—not at all. We have not had an answer as to why not ask yes or no before asking people which option they would prefer if the answer was yes. There has not been a good answer from the Government on that. It is trying to do everything it possibly can to generate as much interest in the referendum but what is interesting is that the more interest the Government generates in it the more opposed people are becoming to the idea of changing the flag.I think that says everything about where the current Government’s priorities are. It is more interested in talking about the flag than many of the very important issues that face New Zealand at the moment and I think—Tim Macindoe: I raise a point of order Mr Chairperson. We are currently in debate on Part 3 which is a very narrow part of this bill—essentially dealing with regulations and validation of irregularities. The member has had nothing to say yet on either on those topics and I would invite him to either speak to Part 3 or cease his call.The CHAIRPERSON (Hon Chester Borrows): The point of order is well made. I am listening closely.CHRIS HIPKINS: While we are on Part 3 if we turn to the highlighted section 5 as inserted by clause 69 which describes the New Zealand flag I think that this might be a good place for me to address some of the comments that I have been raising. The New Zealand flag is described as “the national flag of New Zealand for general use on land within New Zealand and where appropriate for international purposes overseas; and … is the proper national colours to be worn by all New Zealand Government ships and by such other New Zealand ships as may for the time being be authorised to wear the New Zealand Flag by or under the Ship Registration Act 1992.”One of the reasons that I am interested in that is I made the suggestion at the beginning that if New Zealand were to adopt a new flag why would it not do something similar to what was done with the national anthem and actually have for a period of time two New Zealand flags so that those who wished to continue to fly the existing flag could do so? That is the arrangement that we have in place for the national anthem. We actually have two national anthems in New Zealand. “God Save the Queen” is still ournational anthem. It is very very seldom used in New Zealand but those who wish to use it can still do so. The definitions of the New Zealand flag in this bill make provision for there being only a single flag.I thank my colleague Tim Macindoe for providing me with the opportunity to read that particular section while he raised his point of order because the issue here is why the Government did not allow for the possibility that in fact although there may be some desire on the part of some New Zealanders to have a change of flag the vast bulk of people would prefer to stick with the existingflag. Why did the Government not make provision for that within the legislation? It would actually have been perfectly possible for the Government to make provision for there to be twoflags just as we have two national anthems so that those who are for whatever reason very attached to the currentflag—and I have to say that I am not one of them but I note that the vast bulk of my constituents are. So I ask why the Government would not make provision for people to continue to use thatflag.It may be that there are some occasions when the use of the current flag would be more appropriate than the use of a new flag. I note for example that much of the feedback in this debate is about why we are doing this when we are commemorating the First World War and that in fact people would rather have the existingflag—the flagthat New Zealand soldiers fought under in the First World War—on display at those events. That would be a legitimate reason why potentially we might have a definition that allowed there to be more than one official flag of New Zealand. At those events where it is more appropriate and that are of a commemorative nature it may be more appropriate to have a definition in the bill that allows there to be another official flag which is the existing flageven if New Zealanders voted to change.Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman): It is a pleasure to speak on what is I guess an important issue but not an important piece of legislation. If that sounds somewhat contradictory I think the fact is that we are putting the cart before the horse here in my view.In speaking on Part 3 “Miscellaneous provisions” including validation of irregularities I will refer to clause 69 which inserts new section 5. It is about the New Zealand flag. The reality here is that we have not yet decided what the flag should be so I am putting before the Committee one of the options that was certainly brought to my attention. If the New Zealand flag is as described here in new section 5—“… the national flag of New Zealand for general use on land …”—then I guess the inclusion of a sea mammal is probably outside it. Although that might seem a little too cute the reality is that the interpretation of this piece of legislation and of this part is really important. It must reflect the objectives I guess of New Zealand having aflag. What it says in paragraph (b) of new section 5(3) is that the New Zealand flag “is the proper national colours to be worn by all New Zealand Government ships and by such other New Zealand ships …”. The point is that the colours that will be chosen for theflagwill end up being the colours that each and every New Zealander should identify with. I am not sure what they should be.I think black is a good start. I will put before you again this quite innovative flag design here. I do not think it is one of the 40 being put up—I have not to be fair gone through and had a detailed look at all 40—but it does cover a few things. For the current National Government I would suggest it is a perfect representation of what is about to happen because we have the whale above the water with the kiwi and the lamb on it about to do a big dive—about to do a big dive—as is this economy taking with it the sheep and the kiwi. It is a perfect representation of the National Government in power because the National Government is taking this economy into a deep deep dive. It is ignoring all the warning signals showing that we are facing recession particularly in dairy for some time and probably longer than even the whale can hold its breath.I will come back to Part 3 here. It is important that there is widespread support for this legislation and all the details included in this bill. I do not think that is the case. I think that what the Government is trying to do here is pass a piece of legislation that does not have the full support of Kiwis and that does not have the support of New Zealanders who are looking forward and who are asking the questions about the colours that should represent us and the flagdesign that should represent us. Indeed if the Government is so determined to go ahead then put up the flag and then come to us with the legislation that may allow us to utilise the flagin the way that should be intended to ensure that if we insist that the national colours as is stated here in Part 3—“proper national colours to be worn by all New Zealand Government ships”. If theflagdesign is not the right one and the Government as it has done in most areas just bulldozes through with that intention we are all lumbered with it as is the navy as are New Zealand ships and as is every part of our economy.This is not a good piece of legislation and Labour is raising concerns that I hope Minister Bill English will get up and answer. I hope he will get up and explain himself as to why the National Government is determined to push ahead with this waste of money come up with a design and a new focus that the vast majority of New Zealanders see as unnecessary and certainly as untimely. We have bigger issues that the Government and this House should be focusing on not just a flag design. Perhaps the Minister can explain to me why we should not put this design up as a design given that it is such a great representation of the National Government as it is at the moment: taking this economy into a deep deep dive that is going to leave a lot of Kiwis drowning—and indeed a lot ofsheep—because they do not have the proper support.IAIN LEES-GALLOWAY (Labour—Palmerston North): I would like to look at clause 68 “Validation of irregularities”. Clause 68(1) says: “In the circumstances described in subsection (2) the Governor-General may by Order in Council do any of the things described in subsection (3).” That sounds to me like the Governor-General has quite broad scope actually to act and to do a variety of things: to extend the time lines that are included in the legislation and to validate any things that have or have not been done. Basically my reading of this—and again I was not on the Justice and Electoral Committee so if members who were on the select committee could give us a little bit more information about this that would be helpful—is that the Governor-General has quite a lot of scope to be able to do things by Order in Council.I wonder whether one of the circumstances in clause 68(2)(b)—“if anything cannot be done at the time required by or under this Act;”—is if one of the things that cannot be done is for the Government to run a surplus or maybe to get the country’s debt below $101 billion which might actually be a step in the right direction towards being the time when you would spend $26 million on a flag referendum. If that were not to happen I wonder whether the Governor-Generalmight be able by Order in Council to do one of the things under clause 68(3)—that is subclause (3)(a): “at any time before or after the time within which the thing is required to be done to extend that time;”. So in other words what I am getting at is if the Government cannot get us back to surplus or at least get the debt below $100 billion and actually get us a step towards the point where you would spend $26 million on a vanity project for the Prime Minister maybe the Governor-General might be able to say: “You know what? Let’s extend the time before we have the first referendum and let’s just wait until a time that is a little bit more appropriate for this referendum to occur.”I think what we have heard loudly from the public—whether you are for or against the idea of changing the flag—is that people have made it quite clear that now is not the time and one of the reasons that they are quite clear that now is not the time is the fact that we are not in surplus and we are at such a deep level of debt. OK fine pass the legislation now if we must but set this up as a process that will occur a bit further down the track. I think that here in clause 68 in Part 3 we may actually have the mechanism for that to happen. Cabinet could decide to listen to the people of New Zealand—that would be a first. It could decide to do that and it could instruct the Governor-General by Order in Council to extend the time before which the referendum actually occurs.Tim Macindoe: I raise a point of order Mr Chairperson. Again I draw your attention to the question of relevance. There is nothing in clause 68(2) that is remotely relevant to the comments that this member is making. He is attempting to bring in ludicrous matters that are totally extraneous to a very very tight and technical provision.Chris Hipkins: The point that I would make to you is that the Speakers’ rulings are very clear that the question of relevance is a matter for only the Chair and that it is in fact disorderly for anyone other than the Chair to interrupt a member’s speech to question them on relevance. The senior Government whip has done that twice now when in fact the only person who has the prerogative to do that is you as the Chair.The CHAIRPERSON (Hon Chester Borrows): I invite the member Iain Lees-Galloway to continue with his speech. We will all be listening closely to what he has to say relevant to the particular clause.Hon Bill English: Except me—I’m not listening.IAIN LEES-GALLOWAY: I could tell that you were listening Mr Chair. It is a shame that the Minister in the chair has just admitted that he is not listening. He may as well just go out there and say that to the public of New Zealand: “I’m not listening.” The Deputy Prime Minister the Minister of Finance has just admitted that he is not listening. He is not listening to this debate and that is exactly what the Government is doing. It is not listening to the people of New Zealand who have overwhelmingly said: “This is not the time for this debate. This is not the time to—The CHAIRPERSON (Hon Chester Borrows): Well exploited but get back to the clause.IAIN LEES-GALLOWAY: Well I was very happy talking about the clause before I was interrupted by the senior Government whip and before the Deputy Prime Minister interjected that he was not listening and I was quite happy to respond to the interjection from the Deputy Prime Minister that he was not listening. But honestly I know that the senior Government whip is very keen to shut this debate down but those were serious questions. I was not on the select committee. I am reading this clause—I am doing a close reading of this clause—and I want to know either from the Minister who is not listening or maybe from one of the members opposite who was on the select committee whether that is possible. Is that possible under clause 68? Could Cabinet through the Governor-General by Order in Council extend the date or perhaps delay the date for the referendum to a point in time that might be more acceptable to the public of New Zealand? That is my reading of clause 68 and I would be very happy to have that clarified either by the Minister or by any member opposite.I would like to touch on clause 69 “Amendments to Flags Emblems and Names Protection Act 1981” which replaces section 5 regarding the New Zealand flag. This is an interesting thing that is going on with the current flag—which is called the 1902 flag—which would be “recognised as a flag of historical significance to the Realm”. I find new section 5A(2) really really strange. New section 5A(2) allows people in the event that the flag changes—Hon PHIL GOFF (Labour—Mt Roskill): I want to speak to clause 69(4) in Part 3 and in particular its reference to section 5 because this in many senses is the most important part of the bill. It is the part of the bill that actually describes what our national flag does. What it says in section 5(2) is: “The New Zealand Flag is the symbol of the Realm Government and people of New Zealand.”I do not think there is anybody in this debate who does not think that the flag is an important symbol of our country. I know that for my father’s generation it was the flag that they fought under and that their mates died under. For many contemporary New Zealanders it is the flag that is flown—I saw it fly sadly on Saturday night at the Bledisloe Cup and much more happily in terms of the Silver Ferns—and it is a symbol of a country that people are really proud of.If it is the symbol of the people of the nation it makes sense that the people of the nation should have the power to change the flag and not 121 elected representatives. So in one sense I support the process that not Parliament but the people make the decision but there are things in the way that this is being done that have undermined the consensus that is necessary in order to maintain a flag that is widely agreed to by the people of this country as representing their independence their sovereignty and their pride in the nation.I think that what the purpose of the flag is as set out in section 5(2) is undermined by the process that we have actually taken. The first thing that any Government that was contemplating changing the flag should have done was try to work across parties so there was a consensus around the process by all the parties in this country and clearly that has not happened. That has undermined the credibility of what we are trying to do in the Committee today. It is the Government’s failure in that regard that disappoints many of us who would contemplate a change in our flag. I do not think I have any more right than any other New Zealander to determine what the symbol of our people should be but I personally would like to see a change in the flag. But what the Government has done has undermined the consensus by which an appropriate way of changing the flag might have been adopted.You see by holding two referenda that are outside an election you are likely on best estimates to get maybe a 30 or 40 percent turnout. You cannot change the symbol of the realm and the symbol of the people on a turnout in a postal referendum that maybe only a third of the people will vote in. So my question to the Minister is: why not hold this referendum at the time of a general election when you will get an 80 percent turnout and then the result will have some credibility about what New Zealanders want as the symbol of the realm and a symbol of us as New Zealanders? That is the way that this process should have been followed.The other thing when you are talking about the symbol of the realm—and the bill goes on to talk about the symbol of us overseas. The last thing surely that a Government wanting to follow proper process would do is introduce a bill to change the flag on the eve of the centenary of the start of World War I when so many of our surviving veterans not from the First World War but the second one are focused on the flag that they fought under. You would almost think that the Government has deliberately undermined its own intent of wanting a change of the flag and wanting New Zealanders as a whole to accept an alternative as the symbol of our country.So the timing was awful the process was appalling and the lack of bipartisanship or cross-party support has been appalling. One of the reasons for this I have got to say is that the Prime Minister has talked about this change not as a change by New Zealanders of their flag but as a matter of his pride and his project. During the question time we have just had he quoted Mike Hosking. He said—KRIS FAAFOI (Labour—Mana): It is a pleasure to speak to Part 3 of the New Zealand Flag Referendums Bill. I do think there is a strange irony or tension in I think it is the changes to section 5(2) and (3) in clause 69(4). I will read it out as my colleague Phil Goff did because I think section 5(2) and (3) really does talk about the significance of the flag to our nation. Section 5 says: “(2) The New Zealand flag is the symbol of the Realm Government and people of New Zealand. (3) The New Zealand flag—(a) is the national flag of New Zealand for general use on land within New Zealand and where appropriate for international purposes overseas; and (b) is the proper national colours to be worn by all New Zealand Government ships”. So that sets out just how significant the current flag and any possible new flag may be.But the select committee process that this bill went through treated the submitters as though they were insignificant. I believe that there were close to 750 submissions from people who did not get the chance to make a submission in person at all. Those who did submit got 5 minutes on an issue of such national significance. I believe the only organisation that did get more than 5 minutes was the Returned and Services’ Association and I think that is appropriate that it did get more but you would think it would have got more than 10 minutes for something that is of such huge significance to this nation.There is also something within this section that talks of the significance of the timing of this. We have just come back from a 1-week adjournment. I did not have anyone knocking down my electorate office door saying: “Kris can you please make sure that we change the flag.” I had a lot of people come to me to talk about domestic violence and I had a lot of people come to me to talk about housing and about making sure they have jobs but no one came and knocked down the door to ask us to change the flag. In fact the Government turned away as many people at the select committee process as the number of those who actually attended all the meetings right around the country to say: “This is a good idea.”This is a significant issue and I think that section 5 inserted in clause 69(4) does talk about the significance of what we are doing. But it is clear to see from the lack of uptake with the Government process with its engagement with meetings and that cost a hell of a lot of money—I think a lot of the feedback that the Government would have got at the select committee process that it turned away would have been negative about this change. The general feeling amongst the community—I think it was the New Zealand Herald that said that 70 percent of New Zealanders do not want this change and that this is the wrong thing to do right now.A lot has been made about the cost that is involved with this—$26 million is not chump change. There are plenty of other things that this Parliament could do with $26 million rather doing than something that New Zealanders do not want done right now. There may be a time and a place to change the flag but it is not right now. My personal feeling is that I do not want to change the flag. I have changed my mind on the flag. When I was young I said: “Yes let’s have a new flag.” In fact over time I have become much more aware—becoming a bit more mature and having travelled overseas—of the significance of the New Zealand flag.We can talk later when we come to schedules 1 2 and 3 about the process the Government is using to ask the questions of the public which is a bit skew-whiff about changing our flag because it has got that round the wrong way but right now New Zealanders do not want this. Section 5 which is inserted by clause 69(4)of this bill shows just how significant what we are doing is. It is not just a symbol that we throw away; it will go on the arms of people who will fight for this nation. So if we are going to do it let us do it because the people want it changed and they choose what they want to choose. And if they do not want to change the flag right now then let us not do it.But we are not even asking that question first. We are asking what you would like if the flag were to change. I do not think that any kind of sane person would use that process. Any person outside this Chamber would think that that is arse about face. We want to know first whether you want to change the flag not what do we want to change it to if we get the chance to change it.Tim Macindoe: I raise a point of order Mr Chairperson. Yet again we have a member straying far into a version of irrelevancy. I would point out that under Speakers’ ruling 86/1 there is no reason why I cannot draw that to your attention and I do so now.Carmel Sepuloni: This was raised by our senior whip earlier. It is not the role of the National Government senior whip to point out the relevance of our speeches and we trust Mr Chair that you will use your discretion and advise us if you think there are any problems with relevance.Tim Macindoe: Speaking further to the point of order—The CHAIRPERSON (Hon Chester Borrows): I do not need to continue taking points of order. If there was to be some spat over who can raise what when take it somewhere else. Do not soak up time in the Committee because it undermines the point of order that the member is making that the Committee should not muck around with this particular line of debate. The member has the floor and I invite him to continue.KRIS FAAFOI: Thank you very much Mr Chair. I go back for the benefit of the senior Government whip to clause 69(4) which is about the significance of the decision that we are putting in train. This is not something that we want to do just because the Government wants to do it. It is of significance. It is a symbol of this realm.JONO NAYLOR (National): I move That the question be now put.STUART NASH (Labour—Napier): I would like to talk about section 5A(1) in clause 69. What it actually says is that the “1902 Flag”—what they are calling the current New Zealand flag is the “1902 Flag”—“is recognised as a flag of historical significance to the Realm”. I do not know why the word “historical” is in there. It seems that by legislation we are already consigning the current flag to the past.Remove that word I would suggest because this flag is still of huge significance to a whole lot of New Zealanders and a whole lot of New Zealand groups. As has been mentioned those from the RSA in particular are affronted that this flag has already been consigned to historical significance. It is of huge current significance to the people of New Zealand. There is no doubt about that whatsoever. In fact I think that for the first time ever I disagree with Mr Goff on something. I actually like the current flag. I would like it to remain. But when Mr Goff talked about the fact that this was not put at a referendum in a general election—actually this was highlighted in the regulatory impact statement. The regulatory impact statement actually said that one of the main risks around this is that there will be disengagement. The way to really get engagement from Kiwis is to have this at a general election but we are not going to do that.The other point I would like to make is in respect of section 5A(2). It says: “Any person or body (other than a government department) may use the 1902 Flag except where required by law to use the New Zealand Flag or another specified flag for a particular purpose.” I would have thought that if the Prime Minister was spending so much political capital on this—and he is according to the polls because the vast majority of New Zealanders do think this is mistimed and is a huge waste of money considering all the issues we have got—then this legislation would actually be very very clear that the New Zealand flag must be flown at all times.Part of the reason we are told that we need a new flag is that there is confusion between the New Zealand flag and the Australian flag. Well what this legislation actually does is nothing to alleviate that confusion at all. In fact what it does do is it adds to the confusion because this legislation says that anyone apart from a Government department may fly the New Zealand flag. This gives them a legitimate right to fly the New Zealand flag at any time. It does say: “except where required by law to use the New Zealand Flag or another specified flag for a particular purpose.” I am not too sure what the definition of “a particular purpose.” is. I can make some assumptions but I have absolutely no idea what the definition of “a particular purpose.” is. So this just creates a whole other level of confusion.In section 5A(7)(d) it talks about “the days or occasions on which and the times during which the 1902 Flag or any other flag of historical or national significance may be flown:”. Again I have looked through the schedules and I could not find a list of days that this section relates to. I would love the Minister in the chair to stand up and just let us know. Is it all statutory holidays? Is it every Sunday? Is it only Anzac Day? Is it a day when people are allowed to wear their relatives’ or ancestors’ medals? I am not sure.The main aim of alleviating confusion about our national identity seems to have been taken away by this legislation because this legislation legitimises the right of every New Zealander to fly the 1902 flag. I think that what we will find probably as an element of protest is that there will be more New Zealand flags—i.e. the 1902 flag the current flag the one on my lapel—flown around this country than we have seen for a generation as people say: “I reject this whole process. I reject the fact that the Government is spending money at this point in time on a worthless cause when there are so many more important issues that we could be spending $25 million on. We will go out there and we’re going to fly that New Zealand flag.” In fact at my house in Napier I have a 100-year-old kauri flagpole and the flag that flies from that pole will be the 1902 flag. It is at the moment and it will be going forward. My house is not a Government department so according to this legislation I am allowed to fly that flag whenever I want to.But the other thing is that anyone can fly that flag—a Government department a Government ministry can. In fact the confusion that will be created by this is something that I think is a real anomaly in this legislation and I would have liked to see it disappear. I would have liked to see the Government have the courage of its convictions. If it is spending this amount of political capital then be clear. You fly the New Zealand flag or you do not. This bill says you can do whatever you want except on a couple of occasions and we have absolutely no idea of what they are.SCOTT SIMPSON (National—Coromandel): I move That the question be now put.DENIS O’ROURKE (NZ First): I wanted to ask the Minister in the chair the Hon Nick Smith about how he interprets parts of new section 5A in clause 69. When I read parts of that new section I get a little bit confused about what it is actually trying to achieve because we have in new section 5A(2): “Any person or body (other than a government department) may use the 1902 Flag except where required by law”—except where required by law—“to use the New Zealand Flag or another specified flag for a particular purpose.” Then I go down to subclause (8) which creates new sections 10(2) and (3) in the Act. It says: “The Minister may either in any notice issued under subsection (1) or otherwise set out for general information and guidance rules of conduct and the etiquette to be followed in the flying or other use of any of the following: (a) the New Zealand Flag: (b) the 1902 Flag:”. But then new section 10(3) says: “Any rules set out under subsection (2) do not have the force of law.”So we have in one provision reference to “except where required by law” and then further on we have a provision that empowers the Minister to set out rules of conduct and etiquette to be followed in regulations. However the rules do not have the force of law. So I am a little bit confused about how we interpret the words “except where required by law” in new section 5A(2) and the other provisions to which I have referred. I actually think that if anybody was to read this legislation they would not know whether or not really they were actually allowed to use the 1902 flag or not with or without regulations or whether or not they had the force of law for the purposes of new section 5A(2) or not.So I think there needs to be some answer given to how we should look at all of this and in particular think about people who would look at this legislation and say: “OK maybe we have a new flag. I hope there is not but maybe there is a new flag—one of those gormless symbols that we saw in a list the other day. Maybe there is one of those but am I still entitled to fly this current flag or not?” If you look at all of that legislation I think you would be pretty hard-pressed to know what position you were in with regard to that—I really do. I think that needs to be answered and the position clarified and if it cannot be clarified then the bill should not proceed because it is just not clear enough.MARK MITCHELL (National—Rodney): I move That the question be now put.A party vote was called for on the question That the question be now put.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Motion agreed to.A party vote was called for on the question That Part 3 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Part 3 agreed to.Schedule 1A party vote was called for on the question That schedule 1 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Schedule 1 agreed to.Schedule 2A party votewas called for on the question That schedule 2 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Schedule 2 agreed to.Schedule 3A party vote was called for on the question That schedule 3 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Schedule 3 agreed to.Schedule 4A party vote was called for on the question That schedule 4 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Schedule 4 agreed to.Schedule 5A party vote was called for on the question That schedule 5 be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Schedule 5 agreed to.Clause 1 TitleThe CHAIRPERSON (Hon Chester Borrows): Before I take a call I would just like to point out to members that those in the Chamber and those listening at home will no doubt be able to recite in this very wide-ranging debate around clauses 1 and 2 virtually every point that has been made so far in the course of the debate. It is also important to note that repetition is a trigger for the Chair to call the end of a person’s call. So I encourage people to be interesting and creative in their debates.DENIS O’ROURKE (NZ First): Clause 1 is indeed the clause I wish to speak about because this bill’s title clearly is not appropriate and this has not been referred to so far in the debate. It is not appropriate because it does not actually state what the bill is really about. It is not fundamentally about referendums—and that is what the title says. It is actually about replacing New Zealand’s historic and well-respected national flag. But the title does not refer to that at all. The current name reflects only the means which are the referendums and not the end which is the replacement or not of the current flag with an alternative. And it is about the legislation that puts that into effect because the most important part of the bill is the part that replaces the current flag with a new one should that be the result of the two referendums. This is not reflected at all in the name of the bill and so I am very disappointed in the name for that reason. It really should be changed.Some name such as for example “New Zealand Flag (Replacement With a Gormless Meaningless Modern Symbol) Bill” would be a lot more relevant to this particular legislation than the name that has been given for the reason that I gave. I have seen the long list of flags already published and I do not think that my term “gormless meaningless modern symbol” is entirely out of place when you look at those possible alternative flags. That name would be totally appropriate and much better than the name that this legislation has been given. That list is a patchwork of gaudy and ugly designs and that needs to be referred to and reflected in the name of this bill. None of them even slightly represents New Zealand’s heritage in any way like the current flag does. Another point—Tim Macindoe: How ridiculous.DENIS O’ROURKE: The member opposite says: “How ridiculous.” But it is absolutely true. The current flag this flag that I am holding actually does represent New Zealand’s heritage and none of the rubbish—absolute rubbish—that I saw in that gaudy list could possibly compare to it on those grounds.Furthermore the title is not truly representative of the actual referendum process. The name would be better as something like the “New Zealand Flag (Gerrymandered Back To Front) Referendum Bill” because that actually is what this bill is. It is not just the New Zealand flag referendum bill; it is a gerrymandered back to front referendum bill and therefore the name should say so. It is gerrymandered because of the fundamental flaw in the first referendum which is that people wanting none of the alternatives have no way to vote in the first referendum because the New Zealand flag is not there. So they can participate only by casting a vote with none of the options chosen—just leaving the voting paper blank and putting it back into the ballot box or perhaps writing across it: “I want the current New Zealand flag.” That would do it because they are now currently disenfranchised from participating in the first flag referendum.If those people want none of the alternatives how can they participate? They cannot. The only two ways that I know of that they could participate are by drawing a vote and then putting it back with nothing written on it or by writing: “I want the current New Zealand flag.” on it. There is no provision in the first referendum allowing them to express their feelings. That is wrong and that is why I say that it is gerrymandered and that that should be referred to and reflected in the title.New Zealand First does call on people to do one of those two things because they have been disenfranchised. New Zealand First says to those people who want the current flag: “Go along and vote but don’t choose any of the alternatives if you want the current flag or write across it ‘I want the current New Zealand flag.’ ” I think that is a perfectly valid thing for them to do and New Zealand First says that they should feel free to do so.Hon DAVID PARKER (Labour): Timing is everything and I suspect that if the Prime Minister had brought forward this idea at the start of his time as Prime Minister he might have carried the country with it. He could have used some of his popularity at the time to turn this into a positive experience and he could have used his influence to get the outcome that he wanted. But of course he was not willing to do that. He delayed 8 years and of course people see the somewhat cynical timing of the flag by then as being a flag of diversion—a flag of convenience to take the eye of the public off more serious issues. Of course that coincides with a downturn in the New Zealand economy and so perhaps people are more willing to think ill of this move to change the flag than they would have had the Prime Minister used his political skill to bring this forward at an earlier time.I want to say why I agree at one level with the last speaker Denis O’Rourke in terms of the name of this bill. It is called the New Zealand Flag Referendums Bill but in the first referendum there is nothing in it about the New Zealand flag. There is no option presented in the first referendum to answer the question as to whether you want the New Zealand flag to change or not and that has been one of the main complaints that has been made by Opposition parties. It is not too complex. Most people can get their head around whether they want a change to the flag or not and if that had been included in the first question then the second referendum would have been stayed. If the majority did say that they wanted a change to the flag you could proceed but if the majority said that they did not then you would not waste any more money on it.Tim Macindoe: Did this member support the policy he campaigned on last year?Hon DAVID PARKER: I did. I did but I also see this for what it is. It is something pulled out of the bottom drawer. You know Paula Bennett’s excuses or another bit of benefit-bashing or another attempt to blame criminals for every ill that we have in society—those sorts of excuses were running thin so the Government said: “Oh we’ve got to pull another one out of the bottom drawer. How about we resurrect this old flag idea and bring it in.”Of course circumstances change. You know Fonterra has responded to the circumstances changing in the dairy sector by making 500 people or so redundant and trying to cut its cloth. That is going to have flow-on effects for the Government’s books. It is now unlikely it is going to make surplus or its surplus will be smaller and it is time that the Government responded to the effect that that will have upon its books as well. So that is why responding to the interjection from the whip for the National Party I say that it is appropriate that you cut your cloth and when things are not going as well you should not waste $26 million on a process that obviously is unpopular now anyway and is not going to succeed. Secondly even if you are going to proceed you should do it in the most cost-effective method possible rather than have two referenda when one would have sufficed.The next point I would make is to ask why we are doing this through a special postal referendum. The cost of that will be higher than if it was just tacked on to another election. It does not seem to me to be an appropriate thing—to go the more costly route. As my colleague the Hon Phil Goff has already said because postal referenda have a lower turnout than a general election you do not get the same mandate if you like either for change or for retention of the status quo if that is the way people want to go.You have heard that the Government members at the Justice and Electoral Committee blocked an amendment proposed by the Hon Trevor Mallard to try to fix this problem with the referendum which has no question about the current flag in the first referendum. There is a rather barren question: if we were to change which of these flags would you like? It would have been very simple to make that better by including the option of retaining the flag in the first referendum. That is described in the minority view of the Labour Party in the select committee report which said that there is a balance to be struck in questioning—CARMEL SEPULONI (Labour—Kelston): I want to start with the title of the bill and then I will go through to the commencement clause. But firstly I want to make the point that this bill should be renamed the “Tricky New Zealand Flag Referendums Bill”. The reason I say that is—and much discussion has been had about this—that the order in which the questions have been asked in the two referendums is back to front. The first question that New Zealanders should have been asked is “Do you want to change the flag?” but instead the first referendum that is being done is presenting New Zealanders with a range of options when they have not even had the option to say whether or not they want to change the flag.This referendum is back to front and it is back to front because the Government has done that deliberately. It has its own agenda. It wants to change the flag. Government members do not really care whether New Zealanders want to change the flag; they want to change the flag. So to mitigate the chances of New Zealanders in the first referendum saying they do not want to change the flag—like 70 percent of them did during a New Zealand Herald poll—the Government twisted it round turned it upside down and provided only the option to choose between the current New Zealand flag and an alternative in the second referendum. It is back to front and it is tricky—tricky like the National Government.I also want to say that the other name this bill could have that would be appropriate is the “John Key’s Vanity Project Bill”. Let us be honest. This bill is not about New Zealand it is not about progress and it is not about being progressive. It is about John Key and the National Government wanting to have some sort of legacy when their term is over—and it will be over. And because those members have achieved nothing else for New Zealand—nothing else—they are clutching at straws and they are asking what they can do. All they can think of is forcing New Zealand to change the flag so that in 20 years’ time if they were in the position where it worked then they could say: “We were responsible for changing the flag. We were responsible for changing the flag.” So that is an alternative title—“John Key’s Vanity Project Bill”.I want to talk to the commencement side of this. What we have here in clause 2(3) is: “If in the second flag referendum the current New Zealand Flag gains a greater number of votes than the alternative flag design then sections 69 70 and 71 do not commence.” So those sections would not commence at all. What I want to point out is that because of the back to front way in which these referendums are being done we will have wasted millions of dollars in having public meetings that people did not turn up to and in collecting designs from people and putting them out there in the first referendum because of the fact that it says here: “If in the second flag referendum the current New Zealand Flag gains a greater number of votes than the alternative flag design then sections 69 70 and 71 do not commence.” How many millions of dollars will we have wasted at that point?I guarantee that there will be at least twice as many people participating in that second referendum as there will be in the first. There are so many New Zealanders out there who have already indicated not only that they do not necessarily want to change the flag but also some are saying that this is not the time to change the flag. Many are saying that given the pressures that this country is under under that National Government given the bad job that the National Government is doing and given the other priorities that we have as a country why would we waste $26 million on two referendums about a flag?Hon Nicky Wagner: Because we believe in democracy.CARMEL SEPULONI: Many New Zealanders are saying—it is about democracy Nicky Wagner said. She said that it is about democracy. If it was really about democracy then the Government would have got the referendum round the right way and first asked New Zealanders: “Do you want to change the flag?”. But Nicky Wagner knows as well as we know that this is not about democracy; this is about the National Government and John Key and their vanity project. Nicky Wagner knows that.Let us go back to alternative titles for the bill. Let us go back to alternative titles that really suit the mood of New Zealanders and the way they are feeling about this bill. We could call this the “Money That Could Be Better Spent Elsewhere Bill”. Actually where could we spend $26 million—some worthwhile places that $26 million could go to? Perhaps it could go to the child poverty issue that we are facing as a country which the Government has done nothing to address. Perhaps it could go to the housing crisis that the Government—Hon Dr NICK SMITH (Minister for the Environment):We are a Government that does what we say and what is more we actually do what we say. What is extraordinary in the contributions I have heard from Labour members is that—only 9 months ago they campaigned at the election saying they wanted to change the flag. They then come to this House less than 9 months later and I hear speeches from Stuart Nash saying that he loves the New Zealand flag and that we should never propose to change the New Zealand flag. There is a very simple message to New Zealand from this debate: you cannot trust a word that Labour says to you during the election. Its message is that whatever it says in the election it will regardless of principle change its position as it suits itself. It lacks integrity it is untrustworthy and it is duplicitous and that has been so heavily reinforced in this debate.There have been questions about the process by which the two referendums will determine New Zealand’s flag. It is interesting that I have gone back and checked the record and found that both the New Zealand First Party and the Labour Party absolutely supported the two-referendum process around the choice of MMP. At that time those parties said that it was the right process. They said that people cannot make a choice—and I quote Winston Peters who said: “People can’t make a choice about changing from first past the post unless they know the alternative.” My question to New Zealand First members is how can people make an intelligent choice about changing the flag without knowing the alternative?This bill appropriately named the New Zealand Flag Referendums Bill is about National doing what it said it would do unlike other parties which are all over the paddock and which are duplicitous and untrustworthy and that is why we should put this bill through this Committee stage.CLAYTON MITCHELL (NZ First): It is great to be in a very engaging debate this afternoon particularly with Mr Macindoe who reminds me of a pit bull chewing a wasp with his references to frustration. I look at his face and I understand the frustration that he feels because the people back home—the vast majority of New Zealanders—feel exactly the same way about the nonsense that is going on in relation to this flag referendum.I have a great name for the bill and it is better than everything I have heard so far. I think it is a name that should be seriously considered; in fact it may even be worth putting in a Supplementary Order Paper. It has got to be called the “Clayton’s Flag Referendum Bill” because this is the flag referendum you have got when you have not got a referendum. Let us be honest: the way we are doing this is absolutely back to front. This is about not asking the people of New Zealand: “First and foremost do you want a flag change—yes or no?”. The polls can do it. The newspapers can go out there and ask the question. We are largely hearing from the rank and file New Zealanders that they do not want this referendum.What we are also hearing is that it is an absolute waste of money. This bill may be better called the “Waste of Taxpayers’ Money Flag Referendums Bill” because that is exactly what it is. Putting $26 million into a flag referendum is an absolute waste of time dialogue and money because the vast majority of New Zealanders do not want it.Tim Macindoe: Two main parties promised it at the last election.CLAYTON MITCHELL: We have got New Zealanders out there with faces like twisted sandshoes in frustration with the Government because it will not stand up and listen to them Mr Macindoe—and you are one of those people not listening. Anyway he is giving a lot of this and not a lot of that.I have to say that the amount of money that $26 million takes up would be around about 10 percent towards a better ferry system for those commuters travelling from Wellington across to Picton. Ten percent—that is a hefty deposit for a new reliable interisland ferry transportation system for example. What $26 million would do is upgrade around about 900 houses in our underfunded social housing stock around the country and yet this Government says we cannot afford to do all of these things—we have got no money for it. Yet it can find $26 million pull it out of its pocket and throw it on the table. It is absolutely disgusting. It is a disgrace that we are allowing ourselves to get into this debate because we have got a legacy that this Government wants to leave behind particularly what John Key wants to say he delivered for this country. We are seeing a lot of depression and we are seeing a lot of frustration out there from people in small businesses and it is costing New Zealanders not only in their well-being and their mental state but in their pockets as well.This is nothing but a vanity fair. If this Government were serious about putting a referendum forward it would first and foremost ask the question: “Do you want it?”. If the answer was yes then we could go into the whole discussion about which one of these flags the public would like to see put forward. The flags that I have seen today and the comments that I am hearing on social media and seeing in the newspaper are a disgrace. It is a debacle. With an open mind I cannot see one of those flags jumping out and me saying: “Well being objective that might work.” They just do not work. I would like to go back to this one Gareth Morgan’s winning flag. That makes a little bit of sense. You have got Labour on the left National on the right and you have got New Zealand First in black and white coming up through the middle and separating them. That is exactly what is going to happen. The polls will show it. They are starting to tell it now. This Government is getting concerned about the movement.Mr Macindoe you were saying that New Zealand First has supported this in the past. We have not supported it. We have been dead against it. We have not been standing up there saying: “Let us have a referendum.” prior to now. We have been the only party standing fast on our position of leaving New Zealand’s flag as it is and not wasting taxpayers’ money. Thank you.IAIN LEES-GALLOWAY (Labour—Palmerston North): Before I address the matters to do with the title that I had already planned to address I would just like to respond to both the Minister in the chair and some of the irate and frustrated interjections from the senior Government whip. First about the matter of what exactly Labour’s policy on this is—the National Government is always quite obsessed with Labour’s policy. It never wants to talk about its own policy but it—Tim Macindoe: Because we read it and we thought you meant it. You can’t rewrite it. It’s there—it’s there.IAIN LEES-GALLOWAY: Calm down Tim. Tim chill out and I will tell you—just be cool. Certainly Labour’s policy at the election was to have a referendum on the flag but we did not say that we would do it when the country was $101 billion in debt. We did not say that we would prioritise it over trying to get the country back into surplus. So when New Zealanders spoke out loudly and said that this was an interesting debate but not a thing to blow $26 million on when we are deep in debt and we are not in surplus I tell you that we would have listened to that.Jono Naylor: Read us the first line of the policy.IAIN LEES-GALLOWAY: We would have listened Mr Naylor. Just calm down and listen to me. We would have listened to that and we would have introduced the referendum at a time that was appropriate. The other strange thing that Nick Smith the Minister in the chair did was he compared this process with the MMP referendum. That is actually quite a good comparison to make except that the Minister got it wrong when he made the comparison because the first question in the MMP referendum was: “Do you want to change the voting system?”. And we agree that that would be the way to go—question No. 1: “Do you want to change the flag?”. That was not the point that Nick Smith the Minister in the chair was trying to make but we actually agree. Yes use a process analogous to the two-referendum process that was used for the shift from first past the post to MMP. Question No. 1: “Do you want to change?”. That would be the place to start with the referendum.Just so that Tim Macindoe and co. can relax for a second I would like to talk about something that I hope is not too contentious. In the bill—the New Zealand Flag Referendums Bill—we have this interesting thing the word “referendums”. That word has caused a bit of consternation and quite a bit of confusion. In fact one of the members opposite who was on the Justice and Electoral Committee actually interjected on one of the members on this side saying that it was “referenda” not “referendums”. I was a little bit concerned about that because if a member was on the select committee—Tim Macindoe: The interjections say we believe that the time has come for a change and it is right for the issue to be put to the public. That’s your policy.IAIN LEES-GALLOWAY: Tim chill out. If a member on the select committee is scrutinising the bill closely then he should know what the title of the bill is. If he was listening to the submissions and was actually paying attention in the select committee hearings he should know what the title of the bill is and the title of the bill is the New Zealand Flag Referendums Bill. I must admit that when I first saw that I thought: “That doesn’t sound right to me. I would have thought it should be ‘referenda’.” So just like the member opposite I was a bit confused about that but I have looked it up and it turns out that actually there is a really legitimate reason why the title has the word “referendums” in it not the word “referenda”. It turns out that this is all a matter of going back to the origin of the word “referendum” which comes from Latin. My Latin pronunciation is a bit rusty but I think it is the verb “referre” meaning “to refer”.Scott Simpson: A good King’s education.IAIN LEES-GALLOWAY: Yes actually I did do Latin in the third form at King’s College but it was a long time ago and I cannot recall exactly how the pronunciation goes. Anyway the first problem is that this is a verb—this is a verb not a noun. So that is why. What has happened is that we have anglicised a Latin verb. The word “referendum” did not start to be used until relatively recently. In the old days the word was “plebiscite” which is also derived from Latin based on the word “plebiscita” which comes from the Roman-era word “plebeian” meaning “commoner”. In fact the Concilium Plebis—Hon Member: Is this really related?IAIN LEES-GALLOWAY: —was the Roman Parliament. It was the house of the common people. This is to do with the derivation of the word “referendums” which is a word that is in the title of the bill and we are debating the title of the bill. It was only in the mid-19th century that the word “referendum” which is a derivation of that Latin verb came to be used and it is because of the fact that it is a verb and not a noun—ADRIAN RURAWHE (Labour—Te Tai Hauāuru):Ā tēnā koe e te Heamana o te Komiti o te Whare nei tēnei te mihi atu.[So thank you Mr Chairperson of the Committee of the whole House I greet you.]I think the title of this bill ought to be the “Change the New Zealand Flag and Related Matters Bill” and I say that because there are many related matters within this bill that have not yet been spoken about. In particular I want to mihi out to all the millions of New Zealanders who actually carry a flag around with them every single day. I am one of them and I bet that there are many in this Chamber who are too. This is a New Zealand driver’s licence. It has the New Zealand flag on it.Within this bill in clause 70 the driver’s licence is one of the related matters and that is why I say that the title ought to represent what is actually in the bill. It is not just about referenda; it is also about related matters. One of those related matters of course is changing the legislation so that the flag that appears on your New Zealand driver’s licence can be changed. If the New Zealand public decides that we will change the flag then there will be a 6-month period when you can have one or the other. My point in speaking to the title is that it should accurately reflect what is in the bill and I do not think that the current title the New Zealand Flag Referendums Bill is sufficient to describe the totality of what is in this bill. The bill has many other things and that is why the “Change the New Zealand Flag and Related Matters Bill” ought to be its title.I think also that in respect of the commencement there have been many interesting points made. My point about the commencement is that we should make it at the next general election. That is because it will be more inclusive of the wider New Zealand public and I will tell you why. Only 65 percent of Māori in my electorate voted. That probably reflects a systemic problem within wider New Zealand. However it is important that everyone’s view is reflected within the first referendum regardless of all of its faults and they are many and they have been well canvassed in this debate. So I want to put my hand up to say that that is not good enough.I reflect on another point that was made in this debate and that is that if only 30 percent of people turn up for this vote then I think we could do some urgent legislation put it through the House and cancel the final vote—cancel it altogether. If there is such a low turnout—and I suspect there will be—and if it is less than 40 percent really—Tim Macindoe: I raise a point of order Mr Chairperson. This is the title and commencement debate and this member has not addressed either of those at any stage of his contribution.Carmel Sepuloni: Speaking to the point of order—The CHAIRPERSON (Hon Chester Borrows): I do not need any further instruction. Adrian Rurawhe.ADRIAN RURAWHE: Thank you Mr Chair. I think the point around the commencement is that it ought not to be as it is drafted in this bill. It ought to commence to coincide with the next general election. That would be a lot more democratic and if we are talking about democracy and what is right—and I have heard that word used in this Chamber in this debate by one of the members opposite. He is sitting there right now actually saying this is about democracy. Well if it is about democracy then make it available to all people at the next general election. An alternative is that maybe we could call it the “Tīnihia te Haki Bill” [“Change the Flag Bill”]. Two weeks ago we had Māori Language Week but I am going for a month. Kia ora.KRIS FAAFOI (Labour—Mana): It is a pleasure to talk on the title and commencement clauses of the New Zealand Flag Referendums Bill. I take great pride in being creative sometimes as you requested Mr Chair at the beginning of this debate on the name of this bill. This particular bill with the title of the New Zealand Flag Referendums Bill is one that I am not going to propose any amendment to because I believe it is appropriate. Having two referendums is the mechanism that this Government has chosen to start the process of changing the New Zealand flag. But I believe that the referendums and the way that they are being sequenced is symbolic of the way that the Government has got this whole process for the changing of our flag the timing of it and the cost of changing our flag absolutely and utterly wrong.I believe that the bill is aptly named but I do have an issue with the referendums themselves. The bill helpfully in schedule 1 points out the options or the questions that the New Zealand public will have. I am holding here from the bill itself a copy of roughly what New Zealanders will be asked. The first question is: “If”—if—“the New Zealand flag changes which flag would you prefer?”. New Zealanders are given four options on which they will put their preference. So the question is: “What would you prefer if”—if—“the flag is changed?”. That is the first question that New Zealanders will be asked: if it changes what would you prefer it to change to? Schedule 2 points to the question that we on this side of the House believe should beasked first and that is: “What is your choice for the New Zealand flag? Would you want it to stay the same or would you like to have something different which you have been asked for in the first referendum of the referendums that are being held here?”.There is a lot of heat in this debate or in these potential referendums because it is a flag. So let us take that out and just say that we are choosing a car. If you wanted a new car or if you were being asked whether you wanted a new car would you first ask the question “Which car would you want?” or would you ask “Do I need a new car?”. Any logical sane person out there would ask the first question “Do I need a new car?” before asking “Which car would I like?”. That is the simple stupidity of the sequence of these two referendums that are being proposed in this bill. The second question should be asked first—“Do I want a new car?”—and the first question should be asked second: “If I want a new car which car would I prefer?”. You should be asked whether you prefer the car that you have got now—the status quo—or whether you would prefer potentially four other new cars that are being offered up.In any other logical situation that is the way you would do it but not here in the New Zealand Flag Referendums Bill. I think that points out for everyone at home the simple yet elegant stupidity of this piece of legislation. Not only do people not want our flag to change right now—not right now—they do not want $26 million to be spent on this. This referendum is just plain-out stupid. It is asking the second question first and the first question second. That is why this piece of legislation should not pass. If the Government really wants to have a meaningful process around changing a flag of significance to every New Zealander let us get it right. Let us not have this mickey mouse process that people have not bought into. Only 700 people turned out to the flag referendum meetings right around the country. It has cost us millions of dollars already. The Government turned away from the select committee process over 700 people whom it blatantly obviously did not want to hear from because they would have said the same thing that we have said too which is we want to change the flag at some stage but not right now.The cost is wrong—$26 million. It is not what we need right now. The question is wrong. The timing is wrong. So if you are going to have referendums do not ask the second question first; ask the first question first. Ask whether you want to change the flag first and if the country says yes then we will buy that. But at the moment the country says no.LOUISA WALL (Labour—Manurewa): Kia ora Mr Chairperson. Thank you very much for the opportunity to contribute to the title and commencement debate for the New Zealand Flag Referendums Bill. I have been thinking quite seriously about what the title of this bill should be based on how this bill has appeared before us here in Parliament today. Actually I would like to quote from one of the designers a guy called Pax Zwanikken. He is a Kiwi who lives in Sydney. He contributed 25 designs and two of his designs actually got through. So he has been shortlisted in terms of the 40 flags that have been shortlisted. What he said which I find really interesting is that he does not hold much hope for the flag change being supported—it does not matter what kind of flag—because from his perspective this has not come out of a groundswell of public desire for a new flag. So from his perspective the title of the bill should be the “No Public Desire For a New Flag Bill”.The reason I want to highlight that point is that if you actually go back and look over time at the call for change and whether or not the New Zealand public has wanted change we can go back to 1973 when there was a poll. Of New Zealanders in 1973 75 percent of them said no they did not want to change the flag. So I acknowledge that this conversation has been around for a long time. Then again in 1984 86 percent of New Zealanders said no when they were asked whether they wanted to change the flag. In 1999 64 percent said no. In 2008 62 percent said no. In 2011 72 percent said no. Actually the latest poll shows that 70 percent of New Zealanders are saying no they do not want to change the flag. So that particular quote from Pax is actually incredibly relevant.I think the other title that this bill could have had was actually published on 30 January 2014. It was a heading by Isaac Davison actually. It could have been the “Keep It Or Flag It Bill”. That was his report after John Key actually announced this idea about changing New Zealand’s flag—he had this brainstorm: “Let’s change New Zealand’s flag.” So actually the title of this bill could be the “Keep It Or Flag It Bill” because of what the Prime Minister thought on 29 January 2014—“Let’s change the flag.” Actually we could look at the National Party website. We could call this bill the “PM John Key Believes It’s the Right Time to Change the Flag Bill” which is what the National Party promoted and has been promoting. This bill—let us get real—has come about because the Prime Minister had this brainstorm.But a title that I think is really interesting—and this was actually part of the open letter that the flag review panel put out itself—is the “Open Call No Criteria New Zealand Flag Bill”. What I find really interesting is that we got 10292 submissions—new designs where people decided that they would participate in this process some of them from overseas—but what we did not do actually was have a set of criteria for what the flag should represent. So we talk a lot—and this bill has talked a lot—about New Zealand’s identity but the reality is that that has not been part of the conversation at all. It was not in the criteria to make sure that our indigenous people were represented. There were no criteria to make sure that the Southern Cross was going to stay because for us that is part of our national anthem. There was not a call to make sure that the koru was in the flag. In fact there was not even a call to make sure that the silver fern was even though the Prime Minister said when he announced it on 29 January 2014 that we must ensure that the silver fern is in there.Now apparently this is all part of some tourism boost and some economic boost because we are going to be recognised globally as a country because we are going to have this amazing new flag that represents our identity. So I find it really interesting that actually we did not do that. The call went out far and wide and we did not care what people submitted we did not care who they were and we did not care about the context of their design. We just put out this open call. So that is why I think our title could be the “Open Call No Criteria New Zealand Flag Bill”. It now seems that those criteria are actually really important because we have picked flags that have got a koru we have picked flags that have got the Southern Cross and we have picked flags that actually represent New Zealand. So when you think about it—IAIN LEES-GALLOWAY (Labour—Palmerston North): We have had a bit of conversation about the title and my last contribution was on the title. I would like to move now to clause 2 the commencement. Actually the commencement of this bill when it becomes an Act is probably one of the areas of most contention. This is all to do with the timing of the referendums.My colleague the Hon Trevor Mallard has offered an amendment that would amend clause 2(1) so that it reads: “This Act (except sections 69 70 and 71) comes into force five years after the date on which it receives the Royal assent.” I guess 5 years is somewhat arbitrary because you cannot put things in a commencement clause like “when the Government can run a surplus” or “when we do not have $101 billion worth of debt” or “when we can get the cost of running these referendums down”. So I guess what Mr Mallard is attempting to do here is to project into the future and make a couple of assumptions. One and I think it is an important one is that we will have a Labour Government because that leads to the second one which is that we will actually have some decent economic management and we will have a fair chance of the Government heading back towards being in the black again and being in a position where people might see holding a referendum or two referendums on changing the flag as something that is more relevant and a more appropriate use of the money that is needed to run those referendums.These things do cost money. Democracy costs money. I appreciate that the Government has proposed a democratic approach to this. We have some questions over the order of the referendums but at least it is being done by referendum not by fiat and that costs money. But we really do question whether this Act should be commencing should be coming into force on the day after it receives the Royal assent which is what clause 2(1) provides for or whether it should be put off to a date in the future when the Government’s books might be in a better state and in a state where this could be more of a priority. This is what a lot of the opposition to the Government’s process comes down to: when exactly the legislation should come into force. I do not actually think most members of the public would be too concerned about the fact that we are debating this legislation now. They might have a view that there are other more pressing issues to be debating in public but the debate now is not as big a problem as holding the referendums this year and next year. So I support Trevor Mallard’s amendment to clause 2(1) because I think arbitrary as it is 5 years from now is probably a more appropriate point in time for us to have those referendums and the expenditure that comes with them.There are some other aspects to the commencement clause that are certainly appropriate for this legislation but they are somewhat unusual. There are various sections of the legislation that may or may not commence and of course this relates to what the result may be of the second referendum. Obviously the first referendum has no bearing on the commencement of any of the clauses in this legislation because whatever happens there will be two referendums with all the costs that come with that. But the second referendum does have a bearing on whether or not certain parts of this legislation do actually commence and those parts are clauses 69 70 and 71. Of course those clauses would not need to commence in the event that the public voted to retain the current flag. Another interesting matter with the commencement of clauses 69 70 and 71 is that there are two triggers for the commencement of those clauses which is a little bit unusual in legislation as well. The first trigger—JOANNE HAYES (Third Whip—National): I move That the question be now put.Hon CLAYTON COSGROVE (Labour): I have listened to a number of contributions in respect of clauses 1 and 2 the title and commencement clauses of this bill. I want to propose perhaps a different title that more aptly deals with the content and the fiscal issues associated with this bill. I think it is very apt to be called “The $26 Million Bill”. If you look at the document it has got a bit of weight to it. I am not sure how much paper is going for per pound or per kilogram in the international price but given the relevance of the figure $26 million which I will explain in a moment—I know other colleagues have—I think it may well be relevant as the bill is in the name of the Minister of Finance the Hon Bill English to call this bill “The $26 Million Flag Bill”.That is what it has cost the taxpayer budgeted to date—$26 million—to conduct this exercise which opinion poll after opinion poll suggests no one wants. It has not only been opinion poll after opinion poll but given that so very few people some 700 people turned out to the public meetings on the flag consideration project—these meetings cost $208500 for venues and a further $200000 for panel members and fees and whatnot. There must have been some very good scones and sausage rolls or whatever at these meetings. The average cost per person who turned up was $550 each or $2300 each once advertising is included. So in terms of the title this whole exercise is estimated to have cost $26 million. In respect of this it is very apt and the Government should be upfront and call it what it is. It is a $26 million waste of time.The New Zealand public have demonstrated through opinion polls and by their turnout—some 700-odd people—that they do not see this as a priority. I suspect there are people who have turned out to those meetings who may want to see a change. There are thousands of others who may want to see a change indeed but those people do not view this as a priority in their lives. They view health education their kids’ welfare and other things as a priority in their lives. I suspect speaking again to clause 1 the title that those people who did not show up to those meetings can probably think of 26 million reasons to go along with a $26 million budget for this thing as to how that money could be used in a better way. Or the title could perhaps be “The Prime Minister’s Legacy Project That Has Cost New Zealanders $26 Million”.I put this to the Government. If it were serious about changing our constitutional arrangements about some of the lofty things that the Prime Minister and others have said it may want to consider this. The Government has put the cart before the horse. Surely you would look at our true constitutional arrangements. Should we have a written constitution? Should there be a head of State who differs from the current one? Should that person be elected or appointed or whatever? You would deal with all those heavyweight constitutional arrangements and work that through the community and bring the communities with us. And then the last thing—with no disrespect to the flag but probably the smallest component of true constitutional reform is to change the flag which is one of the symbols of your country. People will be for and against that but I think that is the heavyweight process dealing with heavyweight issues that leads—if the Prime Minister were of a mind to look at that—to a heavyweight debate and possibly a heavyweight legacy.But to have a bill that changes the flag at a cost that is just incredible to most people—you know I have been to public meetings during election campaigns. Election campaigns generally are not that popular where you have had—and I am sure the Minister in the chair the Hon Peseta Sam Lotu-Iiga has had more people turn up to many of his meetings. In fact there may be more people in his prisons—and I suspect there are—than the 700 people who turned up to the flag meetings.In terms of the name it could be called “The Prime Minister’s $26 Million Legacy Project Bill”. It could be called “The $26 Million Flag Bill”. It could be called a number of things. But I think what is going to be sad in this because I suspect it will not get through—not the bill but the actual change because people are just not for it—is that lost in amongst all of this bunkum and the silly process and a process that is about the Government’s legacy or the Prime Minister’s legacy more than anything else we actually lose the grit and the substance of the issue which is a debate about our constitutional arrangements—JONO NAYLOR (National): I move that the motion the question be now put.The CHAIRPERSON (Lindsay Tisch): No you have got to get it right when you move closure motions. I will call Carmel Sepuloni in a moment. The member must go back to Standing Order 136 for the specific wording that you need to use—nothing else; just focus on that.CARMEL SEPULONI (Labour—Kelston): I think that we have had some great alternative options offered today for the title of this bill. I do have some other alternative options but I will discuss those later in my speech. I just want to talk about Part 3 of this bill in relation to the title and commencement clauses. I think that that is allowed at the Committee stage. In Part 3 what we have is two clauses that give quite wide powers to amend the process by Order in Council. These may be standard but they read as the Government being able to correct errors in the legislation without coming back to the House.So I want to talk about that part in relation to this because if the Government is going to have power because of Part 3 to correct errors in the legislation without having to come back to the House I want an answer from the Minister about what errors it is anticipating in this bill and about whether or not there are any anticipated problems or potential errors that may come out of the title or commencement provisions of the bill. In the commencement clause for example could there be an error in relation to say clause 2(2) which says: “If in the second flag referendum the alternative flag design gains a greater number of votes than the current New Zealand Flag then sections 69 70 and 71 commence on whichever of the following dates is earlier: (a) a date set by the Governor-General by Order in Council: (b) the day that is 6 months after the date on which the result of the second flag referendum is declared.”With that in mind—and we are talking about the date here and also we are looking at the amendment put up by my colleague Trevor Mallard who has asked to remove “on the day” and replace it with “5 years”—does that mean that the Government could actually decide that that is an error and change the time framewithout bringing the legislation back to the House? We are hoping actually that it will support the amendment in the Committee here today and that it will remove the wording “on the day” and replace it with the words “5 years”. That is the amendment put up by Trevor Mallard. Does that mean that if the Government does not support this amendment in the Committee it could still do so later on once it discovers the error of its ways and that it has in fact got it wrong in terms of the time frames that it has put around implementing this bill? If the Minister could respond to that it would be good.In terms of what it says in Part 3 about the Government being able to correct errors without bringing the legislation back to the House I wonder whether or not—when the Government members leave the Chamber and if this does manage to happen in terms of a change of flag and if we proceed with the resulting Act in terms of the rest of it—the Government could then change the actual title of the bill later on without bringing it back to the House. Is that what it means in terms of Part 3 and how it applies to the title and commencement clauses of this bill? I have those questions for the Minister and if he could respond it would be greatly appreciated.JONO NAYLOR (National): I move That the question be now put.A party vote was called for on the question That the question be now put.Ayes 62New Zealand National 59; Māori Party 2; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Motion agreed to.A party vote was called for on the question That clause 1 be agreed to.Ayes 62New Zealand National 59; Māori Party 2; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Clause 1 agreed to.The CHAIRPERSON (Lindsay Tisch): Can I just remind members that votes are taken in silence.The question was put that the following amendment in the name of the Hon Trevor Mallard to clause 2 be agreed to:in subclause (2) replace “on the day” with “5 years”.A party vote was called for on the question That the amendment be agreed to.Ayes 46New Zealand Labour 32; Green Party 14.Noes 74New Zealand National 59; New Zealand First 12; Māori Party 2; United Future 1.Amendment not agreed to.A party vote was called for on the question That clause 2 be agreed to.Ayes 62New Zealand National 59; Māori Party 2; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Clause 2 agreed to.Bill to be reported without amendment presently.Estimates DebateIn CommitteeDebate resumed from 30 July on the Appropriation (2015/16 Estimates) Bill.Justice Sector (continued)The CHAIRPERSON (Lindsay Tisch): Members we now turn to the Appropriation (2015/16 Estimates) Bill. When we were last progressing the estimates debate we were debating the votes in the justice sector—volume B.5 volume 7—Vote Attorney-General Vote Corrections Vote Courts Vote Justice Vote Parliamentary Counsel Vote Policeand Vote Serious Fraud. David Clendon had the call and he has 2 minutes and 5 seconds remaining should he wish.DAVID CLENDON (Green): The point that I was making at the earlier sitting was that it is not that we are spending too little on the suite of portfolios—across police corrections courts and so on—but that we do not spend the money wisely and that we need to reinvest in a different manner and spend money on solutions. In that sense I think the obvious gap in this year’s appropriations is around the police. The police budget has been flat for a number of years. In effect it has suffered a funding cut overa number of years.The police have found efficiencies in their operations and they are using technology well and wisely to the extent that they can. Nevertheless if they are to deliver on the Prevention First strategy for example they will require well-resourced officers of good morale to do that hard grinding work to prevent crime in the communities. We will not achieve that if we continue to underfund the police as we are undoubtedly doing this year in these appropriations. The solution is not to turn the police into a user-pays force which is the intent of a bill before this House—the Policing (Cost Recovery) Amendment Bill—that effectively would have police running around with an invoice book to charge people for vetting initially and later potentially for anything from search and rescue through to educating businesses on how to make their premises secure and to public education about crime prevention. That is an intolerable proposition and one that we should not entertain at any level. We need to fund the police force properly in order for it to do its job well and we know that it wants to do its job well. We should enable it to do that.In terms of corrections we know that privatisation is not the answer there. That might appeal initially as a cost-saving measure but over time as we have seen quite recently it is in fact a false economy and the public sector can provide corrections services. There is a moral imperative that only the State should manage the incarceration of people. There is also a major economic imperative. Thank you.JONO NAYLOR (National): It is a great pleasure to rise and talk on these issues in this debate because actually this is an area that as a Government we can be really proud of in terms of the progress that we are making. It is an area in our country that we can be really glad of—that our crime is at a 35-year low. I think as we look over the last 7 years there have been some things that we can be happy about in terms of the things that we are achieving.The Better Public Services target of crime being down by 20 percent by the year 2017 is on track. We have already had a 17 to 18 percent decrease over the time period that we were aiming for so we are absolutely on target to reach that. We have identified a number of ways that we can in fact make some improvements. There are some things that this Government has done over the last number of years that are helping us to make some of those impacts. We have been very much at the forefront of ensuring for example that we are putting victims first. For a long time in New Zealand our justice system was very focused on the criminals as to a certain degree it needs to be. We need to make sure that we are addressing criminal behaviour and the like but we have not always done the best that we can by victims so this Government has been absolutely committed to ensuring that we are mindful of the needs of victims.This is a Government that in the 7 years it has been in power has put through 94 pieces of legislation across the justice area. In particular I want to point out the work that has been done with the victims of crime reform legislation and also the Harmful Digital Communications Act which are as I said earlier very much focused on delivering for victims. But there have been a number of things introduced and I want to highlight those things as we look at this sector particularly when we look at the establishment of a Chief Victims Advisor to the Government. This is the first time this has been put in place. It was advertised last month and we are hoping to make an appointment by the end of this year. Again it is something that will ensure that we are going to have victims’ needs very much at the forefront of what we are doing across this sector.We are creating a National Home Safety Service which is aiming to assist up to 400 victims of family violence a year as well as up to 600 children. We are improving judges’ access to information to ensure that they are the best informed that they can possibly be. They will have more information about the history of the perpetrators of family violence and that kind of thing so that they can make better decisions to keep victims safer.We are speeding up court cases. We are getting things going through the court system in a timely way. Again we are not drawing that out because as we know victims have that time frame of the justice system and when the wheels of justice move slowly victims face the issue of perhaps being revictimised all over again and having to live with that and not being able to move on from the trauma that they have suffered. So speeding up that court process is another important aspect of what we are doing.There are a number of other things that have been introduced. If we look at the $50 offender levy which was scoffed at by a lot of people what we have actually seen is that this has generated more than $16 million since its introduction. That has gone towards funding at least 15 new grants and services to provide key victim support services that were not previously available. If we look at this kind of approach to justice it makes a whole lot of sense. Yes perpetrators and those who have been found guilty need to be held to account. They need to be punished at different times but we all know that restitution and restoring things is a very important part of it particularly for victims. So that offender levy is a critical part going forward of what we are going to see ensuring that victims will be helped out.We are seeing an increase in the number of in-court victims’ advisers. They are being contacted by 35000 victims a year and we are seeing that sort of service increasing. We are starting to see people engage with it and I think it is providing long-term benefits for the victims of crime.It was interesting that the previous speaker David Clendon brought up the police. Well we have put more police on the beat.KELVIN DAVIS (Labour—Te Tai Tokerau): I would like to start off by talking about the police as well. I noticed that Jono Naylor the speaker who has just finished said that the National Government is putting more emphasis on victims. Let me tell you now that the resolution rates for high-volume crimes such as burglary and car theft are below 10 percent. If the National Government were really serious about the needs of victims the first thing it would do would be to address those low resolution rates. You cannot tell me that any criminal or burglar would be put off from committing those crimes if they knew they had a greater than 90 percent chance of getting away with it successfully.One of the reasons though that these resolution rates are so low is that the police are being continually asked to do more with less. There is a $15 million cut to the police budget this year. I know that the Minister of Police denied that but the first thing in the Attorney-General’s report in the Finance and Expenditure Committee was to confirm that there was a $15 million decrease in the police budget and in real terms over the last 4 or 5 years there has been about a $300 million decrease in the police budget. So continually the police are being asked to do more with less.I believe there is a police wage round going on. General duties constables have had an increase in their salaries over maybe the last 4 or 5 years of about $5000 while at the same time in the period since I think 2009 to 2013 the Commissioner of Police has had a $100000 rise in his salary. I would like to think that the men and women on the ground who are doing the hard work and who are putting themselves in the front line there and in harm’s way would get a wage increase relative to what the police commissioner gets. But that said if they were to get a substantial salary increase which I believe they deserve then that would mean there would be further cuts in other areas such as police cars or maybe some of the technology that is being rolled out. There has been an 18 percent drop in the number of general duties constables over the last little while as well.Sexual assaults and violent assaults are areas on the rise. In fact the statistics say that only 5 percent of sexual assaults are reported and of that 5 percent only 1 percent will ever see a conviction and that is just simply unacceptable. We need to have a greater emphasis on the investigation of sexual assaults. We need to take it a lot more seriously and violent assaults as well.The policing budget has an emphasis on revenue-gathering policing such as intersection behaviour and lane-changing compliance the use of mobile phones and warrants and certificates of fitness. We can understand that there is some emphasis on that and that people can be killed and are killed by vehicle violations but the reality is that we also need to have an equal emphasis on those high-volume crimes such as burglary sexual assaults and violent assaults as well.I would just like to also talk about the speeding up of court processes which the previous member spoke about. It is a nice segue into the corrections debacle. One of the things that we are hearing about the botch-ups at Serco with all the lockdowns that are going on is that lawyers are having difficulty getting access to their clients. In fact instead of being able to spend 2 or 3 days preparing cases with their clients lawyers are having to spend 2 or 3 days just trying to track down where their clients have been transferred to. There is a lack of communication. So when lawyers finally get in touch with their clients they have a very short time to actually prepare a case and that is basically causing a logjam in the courts. So the whole corrections episode with Serco shows that the Government’s privatisation agenda is a complete and utter failure.One of the main issues around Serco is the fact that it is a business and it wants to make a profit. So it cuts corners and one of the main corners that it is cutting is staffing. So in terms of the lack of staffing in the contract Serco does not actually have to have a ratio of prisoners to corrections officers which is outrageous. The general rule of thumb is that there should be one corrections officer for every 20 inmates. If it is higher security then it should be one to about 15. There are stories emerging from Serco that at times there is one corrections officer looking after up to 55 inmates. You can understand how those Serco guards would be hesitant to get out into the general population. If there were some sort of fracas that broke out their lives would be in danger and they would not have their colleagues there to help them get out of it.I have also been told that most of the contraband that comes into Serco is via guards who because there are not enough guards to check other guards coming in are able to bring in contraband. If you go to Department of Corrections - run prisons anybody who goes through is searched. The other day I was down at Otago Corrections Facility and we were led around by the head of the facility himself. When he came out to greet us and he had to go back in he had to remove his belt his keys his watch his shoes and everything. Apparently in Serco there is just not enough staff to be able to monitor other staff coming in. When you are as poorly paid as the Serco guards it is quite tempting to bring in contraband and to actually get paid for it. So what actually happens is that the inmates have access to cellphones as we all know because they have been taking videos of themselves in the fight clubs. They are also able to ring outside and make arrangements for payments to guards who have brought in contraband.I spoke to a Serco guard who did not want to be named obviously because his life would be in jeopardy if he was named and he was telling me this outrageous figure. In fact it was so outrageous I did not believe him. I said: “Well how much can a guard get? What’s in it for him if he brought in a packet of cigarettes?”. He said: “If a guard brings in a packet of cigarettes from the outside he can get $1000.” I actually did not believe him but the very next day I met with an inmate who had been released the day before and I said to him: “Look I’ve heard this outrageous story about the value of a packet of cigarettes. You tell me because I just want to confirm this.” He said: “Actually for a 50-gram pack of tobacco a guard can get $800.”—for 50 grams’ worth of tobacco. If you are a guard and you can get $1000 for bringing in one packet of cigarettes you may as well bring in 10 packets of cigarettes and get $10000. It sounds outrageous but that is the black market value within prisons for this type of contraband.A cellphone is valued at over $1000 and those cellphones are not only being used to organise a meth ring from the inside as we know but also being used to intimidate families. There was an inmate whose mother got a phone call saying: “If you don’t put money into a certain bank account well then your son will get the bash.”The review of Serco to me is going to be a whitewash because it is Serco reviewing itself and the Department of Corrections reviewing Serco and there is the Ombudsman floating around somewhere. Because we know Serco is such a mess it is interesting that the Minister of Corrections has got Serco to review itself. But when we come down to Tony Robertson we know that the Department of Corrections actually did a good job in monitoring him while he was on release. But it is interesting that the Minister has gone and got an independent person to review it knowing that the review will come out well because the Department of Corrections Chief Probation Officer Darius Fagan actually did a review a couple of weeks back and said that it did a very good job of it.So I ask the question: why is there an independent review of one aspect of the Department of Corrections when it already knows that it has done well and yet when it is looking at Serco Serco gets to review itself and the Department of Corrections gets to review Serco? The first term of reference around Robertson is the management of Robertson prior to and following his release. Well that has already been done by Darius Fagan. Then the second term of reference is the way the Government—DENIS O’ROURKE (NZ First): I want to talk about legal aid because access to justice is becoming more and more difficult. Costs are very high even for relatively minor matters. Legal aid was of course designed to provide legal representation for people who could not afford it by themselves. It was never a grant except to parties who could not afford to repay a Legal Services Agency grant. Originally the qualifying criteria made it possible for people at the lower end of the socio-economic scale to access legal aid and that worked very well. But now the criteria are so tough that very few people actually qualify.I want to refer specifically to the Legal Services Regulations as they now are because they specify that the maximum levels of income for the purpose of determining an applicant’s eligibility for legal aid in respect of a civil matter are: “(a) $22366 per year for a single applicant: (b) $35420 per year for an applicant with—(i) a spouse or partner; or (ii) 1 dependent child: (c) $50934 per year for an applicant with—(i) a spouse or partner and 1 dependent child; or (ii) 2 dependent children:”. So that is a pretty low level. It is even tougher when it comes to the maximum levels of disposable capital for the purposes of eligibility for legal aid. It specifies for a civil matter that the maximum is $3500—an incredibly low figure in my view. However if the applicant has a spouse or partner or one or more dependent children the maximum level of disposable capital for that applicant is calculated by adding an allowance of another $1500 but even then it is an incredibly low total.The income and capital thresholds for qualification for legal aid are now so low that many people will simply go unrepresented. And these are not wealthy people. They are ordinary people who find it too tough to pay legal costs without some assistance. So the capital and income thresholds need urgent revision upwards so that people can get legal representation. Far too many are now forced for economic reasons to represent themselves. That leads of course to poor-quality justice. It leads to a greater burden of time on the courts it leads to greater use of appeals and it leads to more injustice than would be acceptable in a modern society.To make matters worse the Legal Services Commissioner now must refuse legal aid if the applicant is in arrears for repayments on previous legal aid grants subject to an interests of justice test. Nevertheless the commissioner’s assessment about what is in the interests of justice can be very difficult especially for unrepresented parties to argue successfully. In addition to that I actually do not personally trust the commissioner’s discretion on the interests of justice test in those circumstances.This provision concerning arrears is intended to encourage legally aided people to start repaying their debt. There is nothing wrong with that objective but there is actually very little evidence to show that it is likely to have any positive effect on that objective at all. The reason for that is perfectly obvious and it is simply that the people in that position actually do not have the money to do the repayment of debt that is required of them. So it cannot really have a positive effect in those circumstances. What it does do is cause injustice by making legal aid unavailable in far too many cases so that people either give up or have to represent themselves and I have already spoken about the results of that.The Legal Services Act saying that the amount owing is collectable as a debt and that that should be enough is not sufficient in my view. That needs to be reviewed as well. In addition we should be deleting the $50 user-charge. That is wrong. Many lawyers simply pay that on behalf of their client. It really is just penny-pinching on behalf of the State and really is not much more than a blatant attempt to try to suppress demand. That of course is wrong in terms of what the Act is all about and what legal aid should be for. The money lost by the Crown would be very small if that user-charge was abolished but the effect on low-income people would be disproportionately high and very positive.I would like to turn next to the issue of charging interest on legal aid debt. It is absolutely wrong in principle in New Zealand First’s view. It is true that interest could be written off under the existing provisions in the Act but it does require evidence of serious hardship and the definition of serious hardship shows that it is a very high bar to reach. As a result of course it will again be low-income people—not people at the very lowest rung but people just above it—who will suffer and be badly affected by this particular provision which I think is Draconian. The State should not be a banker in these matters seeking interest at the rate of 8 percent. It should be seen as a public service and there should be no interest charged on legal aid debt.The Government has lost its way as to what legal aid is really about. It is really about access to justice. That is what we are losing and it is a very bad trend. Legal aid must be fair for people unable to afford a lawyer so that they can get sufficient assistance to take legal proceedings that have a reasonable prospect of success and to ensure assistance to people who have no choice but to defend proceedings brought against them. Many of them simply cannot afford to do so because they cannot get legal aid. So in the end in its quest to move into surplus this Government through its Budget cuts over recent years has limited access to justice for lower-income people. The very people who need legal aid the most are the ones who are going to suffer.The restrictions in legal aid have gone far too far and combined with the increasing expense of the legal system and legal costs generally the result in far too many cases is that many many people will be effectively priced out of the justice system. I think that that must change. This is a very serious issue and I call on the Government to look at legal aid again especially those thresholds I referred to but also the whole system. It really is not working any more for low-income peopleand it is an urgent matter. It is an urgent matter that has not been addressed in this Budget and it needs to be looked at in the very near future.JAN LOGIE (Green): I am pleased to take a call in the estimates debate on the justice sector this evening particularly in response to the recent initiatives from this Government in response to the crisis we have in this country around domestic and sexual violence. It is nice to stand up and offer unequivocal support for the actions of this Government. It is a very rare event for me to be able to do so and I do. I commend the Minister of Justice for making domestic violence her priority and I acknowledge that she said in the media that she could have gone for easy wins and that this probably will not provide the easy wins. But it is addressing an absolute crisis in this country and I commend her. It is not going to be simple. We are not going to get quick results but it is worth doing.She has rightly noted that there are 100000 family violence call outs to the police every year. That is one call out every 5 minutes and this work accounts for 41 percent of the police’s work. Yet we know that only around 10 to 20 percent of the incidents of domestic violence are actually even reported to the police. We know that although the number of cases reported to the police is going up at the moment the number of cases being resolved has dropped by 10 percent since 2008. There is something going wrong if the number of reported cases is going up and the number of cases being resolved by police is going down. So we need desperately to have a very comprehensive look at this problem. This is one in three women in this country who over their lifetime are likely to be victims of domestic violence.We also have an epidemic rate of sexual violence where one in three or four girls is likely to be a victim of sexual violence in this country and one in six to 10 boys is likely to be a victim of sexual violence in this country. We have a conviction rate for sexual violence of around 1 percent and of less than 2 percent for domestic violence. So this Government is doing the right thing in making this a priority. I would just like to offer it some advice and some encouragement to have the public participate in the consultation.I do think the Government is going to have to review its Better Public Services target to bring down the crime rate. The target is to reduce the crime rate by 20 percent by 2017 and what I am hearing from the community and on the ground is that that reduction and police resolution of family violence cases is a result of that Better Public Services target to reduce crime. We need to have all of the incentives lined up going the right way and when we know that only 10 to 20 percent of cases are coming to the police’s attention we need to be encouraging them to resolve things. That in the short term is going to result in an increase in recorded crime. That is just going to be part of the process and we have to go through it if we are going to get on top of this problem as a country.I also want to point out that the Prime Minister has noted that it is possible that the Government may need to spend a little bit more money in this area. Well from speaking to so many organisations on the ground hearing about the situation around legal aid and knowing the pressures on police there is no doubt that we are going to have to spend more money. The majority of funding in this area is going to the corrections system our prisons. We have a 1 to 2 percent conviction rate so we know that that money is not actually doing anything to resolve the issues in the long term when it is touching only a tiny little part of the problem. And prevention—the amount of money that is being spent in this area is 1.5 percent of the Government’s spending. A similarly small—not quite that small but inadequately small—amount is going towards counselling and support services and wraparound services for offenders and people who use violence as well as towards victims. If we want to be able to break these patterns and get people to change their behaviour and help women and children to get to safety we actually have to resource those efforts in a complete wraparound way.The third point I just want to touch on is that I do hope that the Minister is not dropping sexual violence as her priority though the discussion document is focused on domestic violence because the Law Commission has a comprehensive body of work to look at.ALFRED NGARO (National): It is an honour to speak in the estimates debate about law and order. I follow Jan Logie and the comments that she has made in regard to domestic violence. I know that in the last term we too were involved with the inquiry into the funding of sexual violence social support services. And also just recently there was a hīkoi that Kelvin Davis led and was part of. Again it addressed the issues around men against sexual violence. The whole issue is somethingthat I thinkis of concern across parties and across Government. Prior to entering Parliament I was also on the task force for family violence under the previous Government so this is an issue that has been there for such a long time. It has been a critical issue. It is an issue that has raised both awareness and also along with that a number of systemic areas of concern that we have to deal with and I believe that that has been part of this Government’s focus as well.Violent crime has been rising—we know that. The criminal justice system has needed accountability and focus on victims and that has been the key driver for this Government in the direction of the justice sector. It has been our belief that our having a tough stance on law and order means that New Zealand’s recorded crime rate is falling and is at its lowest level since 1978. Although we can applaud the fact that we now have one of the lowest crime rates in 30 years we know that family violence domestic violence and even sexual violence are still areas of concern and we do not shy away from that. In fact as the previous speaker did I want to applaud again the comments of the Minister of Justice the Hon Amy Adams who has taken a lead in a direction and area for us to be able to champion that. And actually the way that she has been able to do that is that National’s focus is on getting the key justice sector agencies to work together—that is justice police and yes even corrections—in this regard. That is really important.One of the areas that I think has not been addressed or touched on either in the debates so far in regard to law and order is some of the focus and priority areas especially those that impact on both our Māori community and vulnerable children. Several challenges remain and we know that the incidence and impact of crime is unevenly spread. In fact research shows that 6 percent of adults experience 54 percent of the crime. But an area of concern for this Government is the over-representation of Māori in the criminal justice system both as offenders and even as victims of crime. Māori are in prison at six times the rate of non-Māori and it is estimated that 22 percent of Māori males born before 1975 had a corrections-managed sentence before their 20th birthday and that 44 percent had such a sentence by the age of 35. This is an area of concern for this Government. It is an area that we want to address as well because the rate of offending for Māori youth has fallen by 53 percent from 2008 to 2014. However there is still much work to be done and we know that these are critical areas for us.One of the areas of focus for this Government is in putting victims first. We have introduced the $50 offender levy which has generated more than $16.6 million since its introduction. This has gone towards funding 15 new grants and services to provide key victim support services that were not previously available. The ministry funds victim support and it provides nationwide 24/7 crisis response and ongoing support services so that more than 34000 victims were supported in 2013 and in 2014. The Victims Centre manages funding for victims of serious crime through the $50 offender levy. In 2013 and in 2014 the centre funded $5.9 million of grants and services that was provided to almost 5500 victims of serious crime and tailored to their specific needs. During the court process the ministry had 84 in-court victims’ advisers. It contacted about 35000 victims a year and there have been 24000 using the service since 2013-14 as well. There has also been an increase in funding for restorative justice programmes which are available to courts as an option for pre-sentencing and to provide an alternative way of responding to crime and addressing harm to victims. The increase in the penalty for breaching protection orders to 2 to 3 years’ imprisonment has also made a difference.National passed the Victims of Crime Reform Bill in order to improve the rights and services for all victims and we passed the Harmful Digital Communications Bill to protect victims from cyber-bullying as well. What we are also doing is strengthening sentencing parole and bail. We have passed the Bail Amendment Bill in order to tighten up on bail and to introduce electronically monitored bail.ADRIAN RURAWHE (Labour—Te Tai Hauāuru): I would like to speak to Vote Corrections. There are some interesting figures in this document the Estimates of Appropriations. Although the overall increase in the vote for corrections goes up 2.7 percent the total amount paid in the next 12 months to Ministerial Services which the Department of Corrections uses for responses to ministerial correspondence and for the Parliamentary Service actually goes up by 6.5 percent by my reckoning. I wonder what that is in aid of. Why is there the 6.5 percent increase for ministerial correspondence and parliamentary questions? I would hazard a guess and say that corrections is receiving a lot of attention from the Opposition. I think that is probably the reason why that has gone up 6.5 percent and overall the budget has gone up only 2.7 percent.But the key thing that I want to talk about actually is the absolute failure of prison privatisation. We have got the report of select committees on the estimatesand according to the Minister of Corrections the department’s public-private partnership with Serco was proving beneficial to both parties as they could share and model best practice for the most effective use of taxpayers’ dollars. Well I would challenge that. I think the evidence and the information that has come to the attention of the House quite clearly says that it has been an absolute dismal failure. I think that the vote the amount of money put aside within this Budget may not be enough to run the prisons because as we know there are a number of reviews being carried out as we speak the result of which may have implications upon this budget. So I would question that.I also question the statements made in this Chamber by the former Minister of Corrections Anne Tolley who said: “the privately run prison in Mt Eden is exceeding the record of our State-run prisons.” Well I do not think that is correct either. I think that is part of the hospital pass that she has made to the current Minister of Corrections and this experiment in privatisation of prisons is not working. I think that the New Zealand public deserve some assurances that the people who are sent to prison are well looked after and are rehabilitated because eventually they are going to come back out into our communities. So the appropriation should reflect that and I do not think it really does.I do not think there is enough being done particularly in the privately run prisons. I think the numbers that have been used which the former Minister of Corrections Anne Tolley referred to in particular to Mt Eden prison are definitely skewed because that is a remand prison. So the majority of the people in there—those ones on remand of course—are going through the court system. It is the minority who are in there who are going through programmes for rehabilitation.The issue that we have been hearing time and time again is that the most difficult inmates are transferred to other prisons to State-run prisons. That is a huge problem because when you are looking at the statistics around how well that particular prison is doing quite clearly those numbers are skewed. I think we are seeingonly the tip of the iceberg.MAHESH BINDRA (NZ First): I would like to highlight the lack of taxpayer funding being allocated to one of the most important sectors of our law and order machinery and the most important of our public services which is the corrections system. We need prisons to be safe for both staff and prisoners and we need them to function in a way that they will deliver the services they are being paid for. At the moment it is not happening.Serco has been given the contract for some years now to run the old Mt Eden Corrections Facility and Serco was branded by the Minister of Corrections as having the most successful and the highest-performing prison in the country. Well that is not a fact because time and again Serco has proved that it is not up to the game. There were the infamous fight clubs. There have been extortion calls going out to community members. There has been drug taking and home brew being used by those prisoners in Serco’s prisons and the reason for that is that Serco does not maintain the same staff-to-prisoner ratio as the Department of Corrections has. And Serco does get away with it.With the $30 million - odd Serco gets every year its aim is to save the maximum and send it overseas as profits because that is what it is—a profit-making corporate. It does not have the safety and the security of prisoners and officers in mind; what it has in mind is its profits and it has been able to achieve that. But what we have not been able to achieve is getting the service that we pay for. The taxpayers are not getting their money’s worth from Serco and that has been proved beyond doubt starting with the fight clubs the extortion calls that have been going out to the community the use of banned cellphones inside the prison the weaker prisoners being stood over as they call it and the weaker prisoners being thrown off balconies being injured and then being passed on to other Department of Corrections - run prisons just to cover that up. So there is a real danger to the safety of prisoners and staff.Now after the so-called fiasco the Department of Corrections has posted 20 staff from the corrections system to assist with the management of the Serco-run—or rather the Serco-mismanaged—Mt Eden Corrections Facility. Those 20 staff are actually filling in for the shortage of staff that Serco has been making money on. So now our question is: what will happen after the dust has settled? Will they be called back to corrections prisons and if that happens what will happen to the staff-to-prisoner ratio in Serco prisons? That is a question we need to get answers for. Serco-run prisons do not have the rehabilitation programmes that Department of Corrections - run prisons have. Serco had cut funding to that also just to make profits.It is a shambles at the moment. We have got prisoners absconding to Brazil we have got offenders killing women while on electronic monitoring and we have got them cutting off bracelets so they can have some free time on the outside. That is really concerning. We cannot have it and we cannot have prisoners organising fight clubs bullying prisoners or injuring prisoners and even killing them. We just cannot have it. This Minister is letting this slip by on his watch.So why are we even thinking of funding such a public-private partnership? Serco has proved time and again that it is not capable of running a prison like the Mt Eden Corrections Facility and yet it is being rewarded which is a double whammy. It does not deliver and yet it gets rewarded. Recently the Department of Corrections chief executive officer declared that he is going to fine Serco half a million dollars. Well that actually is not a fine; that will be deducted from the bonus it would have otherwise got had it performed to standards—and clearly it has not.What we have suggested is that instead of putting our own staff at risk our own people at risk and our prisoners at risk we should withdraw Serco’s contract altogether.Hon Peseta SAM LOTU-IIGA (Minister of Corrections): It is an honour to take a call on the Appropriation (2015/16 Estimates) Bill. I just want to touch on some of the areas of corrections that members across the Chamber have alluded to. We will agree across this Chamber firstly that the safety and security of staff of the New Zealand public and of prisoners is paramount—it is paramount. Secondly as has been alluded to by colleagues across the Chamber the rehabilitation of offenders is also really important. It is important because most of the offenders who go to prison ultimately get out and we have got to get them reintegrated and rehabilitated so that they can take part meaningfully in our society once they return to civil society.I just want to touch on a couple of points that members across the aisle talked about today. It is about justice for people and I like many across this country was appalled at some of the footage around the fight clubs that were allegedly happening at the Mt Eden Corrections Facility. That is why we put in place a review by the chief inspectorate overseen by the independent office of the Ombudsman which is really important. I urge members in this Chamber as well as the general public that if they have any evidence of the allegations of violence and of corruption that have been bandied around this House and of the accusations loosely made against different people in Serco and people across the prison estate to bring it forward. Bring it forward to the chief inspectorate bring it forward to the investigators who are currently going through all the issues that are being bandied around in society because what we need is a thorough review and investigation of the facts we need a report that will look into these matters and then we need to sensibly make decisions that affect not just Serco but the prison estate right across this country.I just want to touch on the estimates in terms of what we are doing in corrections and how we are doing in corrections. The reoffending rate since 2011 has come down 9 percent—just over 9 percent—so it is currently just over 27 percent. I was in Australia recently for the Ministers’ conference and when you look at reoffending rates in Australia you see that for New South Wales it is over 42 percent—over 42 percent—so that is 50 percent more than in New Zealand. In Queensland it is in the high 30s—high 30s.So when we look at our system and how we are doing compared with our Australian neighbours—who are the most important neighbours we have the most important partners with a jurisprudential system that is very similar to our own—we are actually doing far better in terms of reoffending and we are doing far better in terms of rehabilitation. It is one of the reasons why the South Australian Minister visited me last week and asked what we were doing around rehabilitation and what we were doing around reintegration because they want to know what we are doing that we are doing well.So although some members will bash the corrections system there is actually a lot that is going on in our system that is really good. There is a lot that we are doing with Māori around tikanga Māori in our prisons to get Māori men particularly connected with their culture connected with their whānau back into society and doing well again.There is so much in our system around employment: a goal of every prison in this country is to be a working prison by 2017. Why is that important? It is because we know that jobs reduce dependency on welfare we know that jobs reduce hardship and we also know that jobs reduce reoffending rates. Jobs keep people out in our communities; enable them to look after feed and house their families their whānau; and enable them to be better citizens in this country. That is why we are going for a full complement of working prisons across the estate—that is both within Serco and within the public prisons.We are also increasing numeracy and literacy in our prisons with programmes. We know that two-thirds of those men predominantly who turn up to our prisons cannot read or write. They are functionally illiterate and that is why we have signed a memorandum of understanding with the Tertiary Education Commission and we are now running programmes numeracy and literacy programmes to get these men back learning growing and in jobs.Finally I just want to salute the 8000 men and women in both private and public prisons who are out there every day making this corrections system the best that it can be.A party vote was called for on the question That Vote Justice Vote Attorney-General Vote Corrections Vote Courts Vote Justice Vote Parliamentary Counsel Vote Police and Vote Serious Fraud be agreed to.Ayes 62New Zealand National 59; Māori Party 2; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Votes agreed to.Māori Other Populations and Cultural SectorThe CHAIRPERSON (Lindsay Tisch): Members we now come to the votes in the Māori Other Populations and Cultural Sector—volume B.5 volume 8. The question is that Vote Arts Culture and Heritage Vote Internal Affairs Vote Māori Development Vote Pacific Peoples Vote Sport and Recreation Vote Statistics Vote Treaty Negotiations and Vote Women stand part of the schedules.NUK KORAKO (Chairperson of the Māori Affairs Committee): Kai te Kaiwhakahaere tēnā koe ā huri noa i te Whare e mihi atu ana ki a koutou katoa. The Māori Affairs Committee considered the estimates for Vote Māori Development and for Vote Treaty Negotiations. On Vote Māori Development we heard from the Minister for Māori Development and Te Puni Kōkiri and we received advice from the Office of the Auditor-General.I want to briefly cover the key findings of our report. We questioned the Minister and the ministry about Whānau Ora particularly on the implementation of funding transfers from Te Puni Kōkiri to commissioning agents. The Minister explained the clear lines of accountability that are in place to ensure this money is spent in the way that it is intended. The commissioning agencies have expectations written into their contracts and these will be monitored and refined in the future.We discussed also the inclusion of non-Māori in Whānau Ora. We consider this to be important as Whānau Ora represents a Māori approach to dealing with whānau but it is a programme for all New Zealanders. We questioned the Minister about Māori Television. The Minister assured us of the continuing independence of Māori Television and the rigorous protocols he is putting in place to prevent any appearance of improper influence.The appropriations for Vote Māori Development have been increased by 12.56 percent for the 2015-16 year from $221 million to $249 million. As well as the usual operational funding that is needed to keep Te Puni Kōkiri operating and providing policy advice to the Government there are many great initiatives that Te Puni Kōkiri is leading that will continue to grow Māori capability support our most vulnerable whānau and grow the Māori economy. There is $16 million to fund Māori potential through community investment programmes and the rangatiratanga grants as well and $4 million is going to specific Māori potential programmes such as the Māori Wardens Association and the Māori Women’s Development Fund.We know that one of the biggest issues for our most vulnerable people is housing so $7 million is going to provide practical assistance to Māori housing projects and another $7 million is going to Māori housing development. One million dollars will be spent on strengthening and promoting tourism which is a cause very close to my heart. Over $82 million will be going towards the promotion of the Māori language and culture. That $82 million will fund organisations that are actively promoting Te Reo Māori such as Te MāngaiPāho Māori Television and Te Taura Whiri i te Reo Māori. One of those great initiatives organised by Te Taura Whiri i te Reo Māori happened last week. Of course I am talking about Māori Language Week.Moving on to Vote Treaty Negotiations we heard from the Minister for Treaty Negotiations and from the Office of Treaty Settlements. The great work that this Government is doing in the Treaty negotiations area is very very well-known. The Minister told us that 85 of the settlements are now completed and there will be further agreements in principle and deeds of settlement in the next year. The estimates for 2015-16 put aside a multi-year appropriation of $1400 million to cover the costs of those settlements and put $88 million towards the operational costs of continuing the settlement process.One thing that we were particularly interested in when the Minister appeared before our committee was the post settlements commitments unit. The Government has made over 7000 commitments to iwi through Treaty settlements. As we come closer to having settlements signed with all willing and able iwi the role of the Office of Treaty Settlements will diminish but the role of the post settlements commitments unit will grow. It is good to hear that the Minister is planning for this transition.The 2015-16 estimates represent a good balance of funding to grow the Māori economy support our most vulnerable whānau and strengthen Te Reo Māori. I wish Te Puni Kōkiri the Office of Treaty Settlements and the other organisations that will be putting these goals into action all the best for the year ahead and we look forward to seeing the results that they have achieved when they report to the Māori Affairs Committee next year. Kia ora.Hon NANAIA MAHUTA (Labour—Hauraki-Waikato): It gives me great pleasure to speak to Vote Māori Development. The chair of our committee has aptly summarised the report. However if one was to look in further detail at the issues confronted by the Māori Affairs Committee and indeed throughout the country in relation to the most important factors affecting Māori development then we would simply hinge this particular discussion around the framework that the Government has used to address Māori development.In He Kai Kei Aku Ringa—The Crown-Māori Economic Growth Partnership there are six goals. Those goals in part align to what one might expect Te Puni Kōkiri to be doing. However we question only the significant areas that the vote affected. I raise the issue of He Kai Kei Aku Ringa because goal one of this is probably one of the most fundamental elements of what is going to help propel Māori development and that is the education of our people our kids—lifting skills in training. I was somewhat disturbed by the lack of contribution by the Minister for Māori Development certainly in the estimates debate about how he saw the contribution of Te Puni Kōkiri going forward in this period towards lifting Māori participation and education especially in the early childhood area. I raise this also because one of the most topical debates right now is around the reorganisation and restructuring of kōhanga reo which is a significant contributor to the positive advancement of our children on a Māori-medium language pathway into education. The Minister was absent in terms of his contribution in this space before the select committee.Secondly the committee spent some time investigating the issues around Whānau Ora and more particularly with regard to the Office of the Auditor-General’s report. Whānau Ora commissioning agencies have had $43 million transferred to them in this vote. The questions of the select committee were quite simple: was the Minister satisfied under phase one that enough had been done to evaluate Whānau Ora as an initiative in order to make that substantial decision to transfer the funding obligation to these Whānau Ora commissioning agencies?The Auditor-General’s report helped with the questions at select committee level. We were concerned about a number of areas. Firstly it is very difficult to define what Whānau Ora is. So if it is difficult to define what it is how can you evaluate the outcomes? People who are well versed in this particular area will point to a whānau outcomes framework and a shared outcomes model. But the question is quite simple: did Te Puni Kōkiri have confidence that the phase one evaluation gave it sufficient confidence to be able to make the transfer to the Whānau Ora commissioning agencies? When I asked the chief executive of Te Puni Kōkiri whether it raised any risks with this decision the chief executive nodded her head and said: “Yes risks were raised with the Minister.” We will come back to that particular point.The second point is that in the Office of the Auditor-General’s report one of the insights that the Auditor-General observed—noting that there were innovations in this particular model—was that shifting the funding framework model currently adopted and used by the Ministry of Social Development the Ministry of Health and the Ministry of Education from individual to collective outcomes was going to be a significant challenge. In fact Te Puni Kōkiri recognised that as well. It remains an issue for the Government to confront. If the aspirations of Whānau Ora as an initiative are to work towards shared outcomes whānau-based outcomes then that would require those other ministries to change their funding framework model. That was highlighted in the report.The other aspect was the success of the Whānau Integration Innovation and Engagement Fund (WIIE) plans that were in the phase one stage of the model. Those members who have travelled throughout the country and have visited with various of these Whānau Ora providers will have heard numerous bits of feedback about how successful this particular part of the Whānau Ora initiative has been because it allowed whānau themselves to identify some of the outcomes they were seeking at a very small level. So being able to coordinate services and collaborations around whānau in order to address the issues in the WIIE plans became fertile ground for learning about how to improve service delivery. Interestingly enough in the phase one evaluation and the transfer to forward funding in these estimates the WIIE initiative was actually not picked up. It was only the navigator component of the Whānau Ora funding.In so far as that is concerned here is a question that remains for the Minister to respond to: in respect of those Whānau Ora providers that were successful in phase one but have not been funded in phase two can the Minister explain why that has occurred and whether he is satisfied that the network of services especially in rural areas can be achieved despite the inequity of funding towards navigators in this space? The Minister for Māori Development is I think putting his mind to this particular challenge because he knows like we know that the Whānau Ora commissioning agencies have not addressed this issue and that there are significant gaps especially in rural areas about how Whānau Ora providers can significantly meet the obligations of their whānau when they are not getting the same flow-through of funding through the navigator fund.I will come to the issue of Treaty settlements. I agree that the post settlements commitments unit provides ample opportunity to assess the positive implementation of a number of Treaty settlements throughout the country. Notably just last week the Freshwater Iwi Leaders Groupannounced a high-level memorandum of understanding with Local Government New Zealand which I think foreshadows just how beneficial some of the mechanisms within Treaty settlements will be at a local government level and that they will have a positive impact in their area. However can I say is this: it is probably salient at the front end of the discussions if co-governance and co-management with local government is going to work that local government is included in some of those particular discussions. Given that we have some hefty issues around water around representation around procurement of services at the local government level and also around the funding for utilities infrastructure if there were a front-end participation role for Local Government New Zealand in that space then co-investment strategies with iwi could be a really new opportunity to help support regional development.I know that the Minister is aware of all these issues. I am looking forward to the Māori Affairs Committee monitoring further the role of the post settlements commitments unit to ensure that an even-handed application of the mechanisms within Treaty settlements in so far as local government is concerned can happen in the way that it is intended to.The last part of my contribution is in the space of housing. There was some $7 million appropriated to the Māori housing development initiative and $4 million to the rural and Māori housing component of the role that Te Puni Kōkiri currently undertakes. It seems to me that at a local government level there is still an uneven response to the way in which papakāinga development can continue. Also the whole resource consenting and planning process can make better provision for this. I know this because I submitted to the Hauraki District Council on its papakāinga development plan as well as on the Waikato District Council development plan. There are exemplars throughout the country but it is not even-handed. Here is a really easy space for the Minister for Māori Development to send a signal to councils that best practice is actually the real opportunity if we want to ensure that Māori can build on their own lands to be able to provide housing at a low cost and to be able to meet some of the real challenges of homeownership amongst the Māori population. Again the Minister was silent on that.My last point: both Te Ture Whenua Maori Act reform and Te Reo Māori bills have been an absolute shambles. The Minister has had to delay and defer the report back of the bill for Te Ture Whenua Māori because he knows that it does not meet the needs of those Māori landowners to be able to move their land into a productive space. My colleague Meka Whaitiri is championing that particular issue for our team. In the Te Reo Māori space the poor old Minister is having to do a bit of backwash to save face for the previous Minister who made an absolute kibosh of the issue. He introduced the Māori Language (Te Reo Māori) Bill into the House at the eleventh hour and with I think very little robust consideration around the proposals there. We have had to revamp that. It is going back to Cabinet for further consideration. Poor old Minister Flavell has made a wee mess of it—Hon CHRISTOPHER FINLAYSON (Minister for Treaty of Waitangi Negotiations): I want to take a call on Vote Treaty Negotiations and thank the previous speaker Nanaia Mahuta for her helpful comments on the post settlements commitments unit. She raised some very interesting issues. I agree with her that early engagement particularly with local government provides opportunities and also enables issues to be clarified at an early stage and that is exactly what I want to do on the harbours negotiations that are coming up. I also want to pay tribute to the Office of Treaty Settlements for its excellent work over the past 12 months. It is a very dedicated bunch of people and I am very proud to work with them. Some of them also act as Treaty negotiators. So for example the deeds of settlement for Ngāti Hauā and Heretaunga Tamatea were negotiated in-house and that is my plan with Ngāpuhi as well.But I do want to say something about the money expended on external Treaty negotiators because of what I think was a vulgar crude and intemperate attack on them by the Rt Hon Mr Peters earlier in the day when he said that the fees were colossal and somewhat bizarrely said that I was giving jobs to my mates. I am very fond of both Paul Swain and Rick Barker but I do not know that they would want to be called my mates. Unlike that honourable member I do have great respect for them.I asked Mr Swain some years ago whether he would like to work with me on the Ngati Porou matter and he did such a very good job that I asked him whether he would work on some others. So in recent times Paul Swain has negotiated the Taranaki settlement which will hopefully be signed in September; Mana Ahuriri; Ngāti Hineuru which we are going to debate for the first time tomorrow; and Maungaharuru-Tangitū. Mr Swain is an excellent negotiator and if anything I do not think he charges enough. I have huge respect for him.Hon Clayton Cosgrove: We’ll tell him that.Hon CHRISTOPHER FINLAYSON: Well you tell him but do not tell him too loudly. The second person that Mr Peters insulted was Mr Barker. I approached him after he left Parliament in 2011 and asked whether he would like to do a few negotiations for me and he is doing a great job—for example Te Ātiawa and Ngāruahine which we are debating for the first time tomorrow. So I am very happy to say that these external negotiators are very good value for money are providing excellent service and are achieving results.I say to New Zealand First members that their tendency to personalise things and attack the individual as they have done with my Treaty negotiators is something I resent and something I think is quite simply disgusting. As I said this afternoon to a journalist Mr Peters is nothing more than the Donald Trump of New Zealand politics who wants nothing more than a cheap headline. These people are good people and I am very proud of the work they are doing regardless of party and regardless of background.Another person that the right honourable member attacked this afternoon was John Wood. John Wood who is the chancellor of Canterbury University and has been doing an excellent job there was twice our ambassador in Washington and is an outstanding public servant who has negotiated two extremely difficult Treaty negotiations and done phenomenally well. I refer to his negotiation with Tūhoe and his landmark negotiation in respect of the Whanganui River.These are the sorts of people I have had working with me over the years regardless of party and regardless of background. They are dedicated to achieving just and durable settlements for the benefit of New Zealand and if the New Zealand First speaker Pita Paraone—who obviously wants to stand up next for his penny’s worth—has any decency he will apologise to those people because his leader’s statements were unfair and were simply disgusting.The final point I want to make is in relation to Te Ture Whenua Maori Act reform because I do think that the Hon Nanaia Mahuta was a little unfair on that issue. This is the first comprehensive rewrite of Te Ture Whenua Maori Act for well over a generation. The 1993 Act was never really fit for purpose and so what we are seeking to do is take a fresh look at it. There has been an exposure draft put out to enable proper discussion. There are lots of issues and we make no apologies for the fact that there is a lot of work to be done there polishing the jewel so that everyone benefits from the reform.PITA PARAONE (NZ First): Tēnā koe Mr Chairman.The CHAIRPERSON (Lindsay Tisch): Tēnā koe. I am sorry to interrupt the honourable member—you can go for dinner. Members the time has come for me to leave the Chair for the dinner break.Sitting suspended from 6 p.m. to 7.30 p.m.The CHAIRPERSON (Hon Chester Borrows): Tēnā koe te Whare. Kia ora mai tātou tēnā tātou katoa. Members before the dinner break we were debating Vote Arts Culture and Heritage Vote Internal Affairs Vote Māori Development Vote Pacific Peoples Vote Sport and Recreation Vote Statistics Vote Treaty Negotiations and Vote Women and matua Pita Paraone had the call. All but 4 seconds of it was cast in the pre-dinner break but he has 4 minutes and 56 seconds remaining should he wish to avail himself of the opportunity.PITA PARAONE: I raise a point of order Mr Chairperson. Can I ask for the 4 seconds to be added on to my—The CHAIRPERSON (Hon Chester Borrows): No. I am sorry there is no discount.PITA PARAONE: —lot because I had difficulty understanding from your predecessor his pronunciation of my name and I took time to correct him.The CHAIRPERSON (Hon Chester Borrows): Well I hope that you have not had that problem with me. You have 4 minutes and 56 seconds remaining.PITA PARAONE: Tēnā koe Mr Chairman. Reluctantly I will have to accept that. Before the dinner break the speaker before me Chris Finlayson had a bit of a hissy fit at the comments that my leader had made. Quite clearly he took them out of context because reverting to diversions and straw men in some vain attempt to avert attention from cross-expenditure items to individual Treaty settlement negotiations simply will not do. What Mr Peters was referring to—and he did not name any names other than to say that two of the negotiators had received in excess of $1 million during the period of their tenure as negotiators. That was the only comment that he made. If people want to know the details of what each negotiator got I am quite prepared to table that but that is public knowledge so I do not need to do that.I want to focus particularly on the area of Whānau Ora. That was some discussion during the review of the Māori affairs portfolio. Right from the outset New Zealand First has had some doubts about the programme and how that fund has been used. I want to say that in the 2015-16 Budget $50 million was added to the Whānau Ora programme. The question that I am asking this Committee and perhaps the Minister in the chair the Hon Paula Bennett may be able to give me some answer is that in terms of receiving that $50 million for this programme no evidence and no application was actually made for the funds. If I was an operator in another ministry I would certainly be asking: “Why is it that if I want extra money for my ministry I have to put up a case for it and yet for Māori development they get that extra money without any evidence as to justifying the need for that extra money?”.The other thing that came out during the review when asked of the officials what the major task was in order for Whānau Ora to progress onwards was the answer that they needed to inform the public as to what Whānau Ora was all about. We found that quite surprising given that this programme has been around for some time and here we have officials having to tell us that the public are not quite sure of what Whānau Ora is all about. I just want to have it on record that this is I think pandering to the wishes of a particular political party rather than looking at the issues and whether or not Whānau Ora is a programme that justifies extra funding without a proper case being put to have that extra money.I also want to say that in advancing Whānau Ora I note that the Ministry of Health has put together some comparisons in terms of some of the programmes that the health ministry is responsible for. I need to say that Whānau Ora providers compare very well with general providers so in some respects that is a good point for Whānau Ora to carry on. But at the end of the day what our concern is from New Zealand First is whether or not the funding that has been allocated to that programme is properly administered. As we in this Committee all know if funds are not properly administered then the whole programme falters. We certainly do not want to see that under our watch.In terms of the Treaty settlements I just want to make the comment that although a number of settlements have been made—Hon PAULA BENNETT (Minister of Local Government): I stand to speak to these votes which are wide ranging at the moment on internal affairs Māori development Pacific peoples sports and recreation statistics Treaty negotiations women and arts culture and heritage. I do stand up though right now and just say that one sees the changes we have made in Vote Māori Affairs turning it into Vote Māori Development and the actual progress that is being made in regional development with the Business Growth Agenda and having the Minister of Māori Development working alongside that.I actually stand and take umbrage with the last speech where someone said that there is no evidence to support funding for Whānau Ora. Well how about the evidence of Māori being disproportionately in our jails? How about the evidence of Māori disproportionately doing poorly in our education systems? How about our health sector where they have more health needs that are not identified? How about our education sector where Māori are not doing as well? If one stood up and wanted evidence I would simply say that what has been done in the past is simply not good enough for that population and what their needs are.We do have to be brave and work differently with Māori and alongside them with them being stewards of what is best as far as their social and economic development goes. So as part of this National-led Government I do stand beside our coalition partners with the Māori Party and with the Minister of Māori Development and see that actually Whānau Ora is working. As always with a new initiative if you like that is out there in the communities and working differently and it needs to be worked alongside to see the level of support and expertise.But even today—if we are being negative—I read in the paper that the nurses who are working in Whānau Ora are being paid less than those who are in other areas. Quite frankly that is where we say that they are not sitting there wasting money; they are actually in their communities and in those homes working alongside people to help them reach their aspirations and their goals. Unlike other members I get alongside those people in their communities and get alongside those Whānau Ora navigators. I hear the challenges that they have and I certainly hear how hard the work is and we acknowledge that. So we will be putting more money in and quite proudly to stand across those who are disadvantaged and more vulnerable and who actually need more support and in a different way than has been done in the past.I also want to touch on Vote Women and certainly where that is at and what we are doing. We should be incredibly proud in this country that 64 percent of our university graduates are women—are female. When we actually look at the statistics of how they are going how they are in education and how the education system is delivering for them we can see the difference. I want to stand here and acknowledge the significant reduction in the number of women on benefits. Sole parents who are on benefit have gone down by literally tens of thousands. That is women and their children actually being independent and having a better go at life than they would have had on the lifetime of welfare that they have led in the past.I want to acknowledge the huge reduction in the number of teen pregnancies. I say “teen pregnancies” on purpose because it is not just births to teens; we have also seen a mass reduction in the abortion rate in this country as well. So unwanted pregnancies to our teens have dropped by over 40 percent in the last few years and that is giving those girls opportunities. Hey I am the biggest proponent of babies and more of them and a teen mum can be incredibly successful in life but equally we want them to have opportunities. There is plenty of evidence that says the best opportunity that you can give to a young woman is for her to be educated and for her to be in a stable home in a warm environment and to have some work experience behind her before she starts a family. So I am backing them in that. So I want them to have babies and I want them to have fantastic families and be full of aspiration but if we can actually back them to be planning that so that suits them and their home then that is certainly something that I stand proudly by.You can see the significance of the difference that that will make for them in their lives while they are still teens but more important for when they do go on to be mums in the families that they raise. I do not think we acknowledge that enough in this country—the kind of family planning that is now going on the differences it has made in our health system for those girls. But more significantly I think the educational achievements that they are able to get to—RINO TIRIKATENE (Labour—Te Tai Tonga): Kia ora Mr Chair. I am pleased to speak in this estimates debate. I would like to stick with the Māori development sector which is spearheaded by Te Puni Kōkiri. Te Puni Kōkiri as we know means in Māori “a group of people moving forward”. If you could think of Te Matatini—think of our kapa haka teams—and the precision and the power with which they move that is really what we should envisage from Te Puni Kōkiri.Alas it is very much not that. Te Puni Kōkiri in 2015 is in a shambles. It is in disarray because there is a lack of leadership from the Minister over his ministry. It is evidenced because we had the chief executive and her senior team come to the Māori Affairs Committee earlier in the year. There has been a never-ending restructure happening within Te Puni Kōkiri during the current chief executive officer’s tenure. When we asked the question as to when this restructuring will be completed and when it will have its executive team in place the chief executive said: “Oh by the end of this year.” By the end of this year to get an executive team in place? Prior to that the restructuring had taken 2 years already.What we have is really inept leadership. It goes further than that because we know we understand that there is a breakdown in the relationship between this Minister and the chief executive. It is widely known around town that there is a dysfunctional relationship there so much so that this Minister is now going directly to staff and interfering. He has gone rogue in terms of trying to get his projects done.We have very real concerns about Te Puni Kōkiri. There is no great group moving forward. This is a shambles. It is evidenced by asking what the Minister has actually produced. We have rising unemployment in this country. We have plummeting dairy prices. There is a great deal of concern out there. Families are on the cusp of poverty. This is a very real concern. So what has this Minister and his ministry come up with? Well the first piece of legislation that we have waited for which has come through to this House is a Māori Purposes Bill that updates a private whānau trust in the Gisborne area from last century. It updates it for the 1993 Te Ture Whenua Maori Act which is going to be amended next year. That is the priority that this Minister has set in terms of his legislative programme. That is absolutely appalling.We have also seen the debacle around the Māori Language (Te Reo Māori) Bill. Mr Chair I will not bring you into this debate but members of our select committee are well aware that we have been very charitable I would say to this Minister. We know that there were deep problems with the bill that was sent to us at the Māori Affairs Committee. We have been very accommodating of this Minister to give him every opportunity to try to resurrect the bill and address some of the deep flaws that are contained therein. We are not through the woods yet. It rests on our select committee to complete the job and hopefully we can get there and come up with a workable piece of legislation. But as it stands again it is a failure by this Minister and a lack of leadership. He should just have scrapped it and started again right from the start which is what all of Māoridom was talking about and telling him to do.Can I go on to Whānau Ora. The Minister who just resumed her seat the Hon Paula Bennett said that Whānau Ora is working. Well I would hope that Whānau Ora is working because in the first 4 years of Whānau Ora there was $137.6 million spent on it a third of which over $40 million was spent on administration and research and evaluation—$40 million. So I would really hope that Whānau Ora is working because that is an incredible amount of money which the Auditor-General actually pointed out should have been going directly to whānau in need which is what the kaupapa of Whānau Ora is all about.I could go on to Treaty settlements. I am looking forward to progressing the first readings of some settlement legislation that is coming through the House tomorrow. That is a positive piece of work that we are doing as a select committee. We are not all negative. We do actually work cohesively together to progress that very important work. Thank you.METIRIA TUREI (Co-Leader—Green): I will start by just saying that I agree with the Minister on two issues—one is that Whānau Ora is working and we know that from all of the stories. Even the Auditor-General set out some really clear stories of how the approach which is long term wraparound and about the whānau as a whole is making appreciable major differences to how whānau are operating and to their wellness. There are issues with other parts of Whānau Ora—the evaluation how the money is being spent and the administration—but the concept itself is working. The worst thing that we can do is attack it such that we lose the advantage of the great outcomes from this rethinking about how we deal with whānau as a whole.Also I would agree with Minister Paula Bennett about education being such an important part of a young woman’s way out of poverty. I would urge her to reconsider then the benefit that both she and I received as young women on our own with small babies from what was then a very full training incentive allowance grant which allowed us to have more resources to pursue our educational dreams. In my case it was law school. Under the current situation with the training incentive allowance women are simply not in the same position that I was in 20 years ago to be able to access that level of education because resources are so tight. I am absolutely 100 percent supportive of investing in the education of young women in order to improve their life outcomes. I wish that we could do more. I think that we could do more if it were a genuine priority.What I want to address tonight in just a few minutes is Vote Māori Development particularly with regard to housing. The Māori Affairs Committee asked about housing when the Minister came before it because we know that housing is such a major issue for Māori and the Minister agreed with that. The Minister agreed that Te Puni Kōkiri was preparing to take on more responsibility in leading housing initiatives for Māori. He assured us that the ministry would be making all possible efforts because housing is so closely tied to poverty. I agree with this. We need to make sure that we have secure housing both rental housing and also homeownership for Māori and that that is a core way of making sure that whānau are secure and healthy in their own homes so that they can then pursue their dreams for themselves and their kids. But we have to be aware of the facts. We now have the lowest Māori homeownership rate in this country in decades—decades and decades—because of an erosion of support with a particular focus on the needs of Māori whānau when it comes to housing. According to the 2013 census only 28 percent of Māori own a homenow. That is half of the Pākehā rate—the Pākehā rate is around 57 percent. It is at the lowest end. It should not be getting any worse but in fact it is eroding over time. The number of Māori in homeownership is declining.When we asked the Minister about homeownership he also recognised these critical issues. He said there was more money for Te Puni Kōkiri to help whānau towards homeownership but there were no firm plans by Te Puni Kōkiri for any house-purchasing initiatives it says here in the report. But in fact there are some significant programmes and I just want to mention two of them which are the Kāinga Whenua programme for infrastructure grants and also the individual loans that are available. The Kāinga Whenua programme has enormous potential. It enables whānau to build homes on or to move homes to collectively owned Māori land. So it is a way of our using land that we may not be able to put into productive use for housing in rural areas where it is so essentially needed—and good quality properly insulated housing; housing that has good heating and that is safe for whānau to live in. We need more of that but at this time of highest need we are seeing these funds—these programmes—just not being promoted in such a way that whānau are accessing them.In the years between July 2011 and August 2014 there were only 10 individual Kāinga Whenua loans—10 in those 4 years. There was only one in the previous year. Only three of those 10 have been this year—three individual loans to whānau looking to build on Māori land. It is not enough. There have been Māori organisations getting involved with the social housing fund and with the Kāinga Whenua infrastructure grants but they are still too few.CLAYTON MITCHELL (NZ First): I am very privileged to stand up on behalf of New Zealand First for our estimates debate on the Māori other populations and cultural sector. I am going to talk specifically about the internal affairs section.Before I get started I just want to bring everyone’s attention back to just before we went on our dinner break. There are a number of fine men and women in this Chamber and one whom I consider to be one of those fine gentlemen is Chris Finlayson. So I was as perplexed as many other people in the Chamber when he was completely off-base and off-tangent in some of his remarks when he was referring to the Rt Hon Winston Peters. It got me thinking that perhaps the problem was that he was just a little bit “hangry”—a little bit hungry and angry prior to dinner—and so I have brought him along a Snickers bar which we could perhaps put in a little wee glass box out the back and break it in case of emergency so that next time he gets angry in the Chamber he can go out the back and relax himself. I hope he returns well rested and ready to fight.Specifically what I would like to talk about this evening is the Fire Service. Yet again we see another review in the Fire Service. This is the 17th review in the Fire Servicein the last 21 years—17; this is the 17th review. It begs the question: what is going on? When I trawl through the Budget that was released this year there is not a single solitary cent not a dollar being put forward for our Fire Service and yet the Government is sitting down and spending more money yet again to review the system. It is not fit for purpose it does not work and there is no funding allocated to allow this very crucial organisation which supplies so much for our communities to move forward.Let me just go through some of these statistics. We have got 17000 career firefighters around New Zealand currently. We have got 8300 urban volunteers giving up their time risking their lives in helping out in those communities and another 3500 rural volunteers.At the moment we have an absolute state of disrepair in a number of the buildings that are actually housing our Fire Service equipment. We have got 79 career stations 360 volunteer stations and 187 rural fire forces and the buildings they are operating out of are barely fit for service. I mean we are seriously putting our Fire Service people in some perilous situations if this Government does not come up with a better funding model.Let us talk about that funding model because what we are currently hearing from the Minister of Internal Affairs—the “Minister of Reviews” is what we should be retitling him—is an idea that we are going to put search and rescue and the urban search and rescue into the Fire Service. Well that does make sense. Accolades are to be given where credit is due and credit is due there. However the silos in which this Government places all of our emergency serviceproviders are not fit for purpose. We have got the likes of Surf Life Saving New Zealand providing safety education and saving lives and which is also doing the job of search and rescue and working hard and volunteering its time efforts and energies on the beaches around New Zealand—77 surf clubs around the country. Then of course you have got Coastguard which does another fantastic job of rescuing people at sea—search and rescue looking for them—and yet there is very little correlation or an organisation that can be put under a single heading that enables it to be funded as a whole and to be taken seriously as an emergency serviceprovider.When we look at whether it is a fit for purpose issue and what the Fire Service actually provides with its urban search and rescue and with its search and rescue around the country—it puts out fires. Who do we call when the rain comes down and the floods come in Mr Muller? That is right—your local fire brigade. The number of times it has been out there on the streets pumping water clearing out people’s houses—when your cat gets stuck in a tree who do you call? The local fire brigade Mr Muller—that is correct.And of course as we go on the Fire Service is the first port of call when we have an issue relating to emergency service providers. Who do we call when there is a car accident? Who comes along and issues and administers first aid? It is the Fire Service. Yet we have got these silo situations where the Government is putting these organisations into various blocs and underfunding them and there is complete and utter under-investment within this service.Let me just bring your attention—I am speaking quite quickly because 5 minutes goes so fast when you are in the Chamber—to an Official Information Act request. It was the Minister’s briefing so it was officially released. It says: “There is an under-investment in rural fire reduction and readiness and the changing service scope is making it difficult for the commission to adapt to new demands.” We need to be fit for purpose; we need to be up and ready for the 21st century. I doubt that this review is actually going to do much with regard to what the Government is going to do to put funding into this absolutely vital—JOANNE HAYES (National): I am pleased to stand to take this 5-minute call on the Māori development area of this theme. But before I do that I just want to make a few comments about a previous speaker. It does sadden me and kind of makes me really angry that people can stand in this Chamber on the Opposition benches and have a go at our outstanding Minister for Māori Development. The great work that he has been doing—Sue Moroney: It’s called accountability.JOANNE HAYES: —listen listen—he has taken on the challenges and he is coping very well with the work that he is doing.I want to support Te Puni Kōkiri and the restructure there. This is a senior executive manager who knows what she is doing. She is doing a marvellous job there and I do take umbrage at the fact that people can stand in this Chamber and have a crack at her after the good work that she is doing. The work that she does is not easy—it is not easy when you are restructuring a ministry as complex as Te Puni Kōkiri—but I believe that the work that she is doing is going to be of great value to Te Puni Kōkiri in the future.My next kōrero is about Whānau Ora. I worked in Whānau Ora and I helped in its development on the ground—on the ground. I have seen the whānau I have talked with the whānau and I have interviewed the whānau that Whānau Ora has helped. When Whānau Ora first came about yes it was a new concept but many Opposition members thought it should just start off like it had been going for many many years. It takes time for good things to mature and Whānau Ora is one of those programmes that will take time. It is developing the goods. You just need to talk to some of the whānau whom it has helped over the 4 to 5 years that it has been operating.We talked a little bit I also heard in the Committee about homeownership and Māori homeownership. The Minister for Māori Development has done the most amazing thing which has never been done by any Government before but which has been done in coalition with the National Government and that is being able to build houses on Māori land. In the past that was never able to be done. They are able to actually access loans to do that. I am very proud of what he has done.When we start to look at other areas within the Māori development portfolio under Vote Māori Development we can look at Healthy Families New Zealand. This is a project that Jonathan Coleman launched in the East Cape just recently in April. It is the Healthy Families East Cape project which belongs to the lead provider Te Whare Hauora o Te Aitanga a Hauiti. They established—hello—a Whānau Ora collective called the Horouta Whanaunga Collective a collective that comprises 17 providers and nine iwi groups. It is a collective that has come together to address health issues at a local level. At the end of the day where we are the most effective is with helping our own working with our own and coming up with the decisions and the outcomes at a local level.So when I look at Māori health I see that over 50 percent of Māori are now enrolled in these low-cost accessible primary health organisations. I was there at the start of all of that time when primary health organisations were being developed and at one stage we thought that Māori were going to miss out on that. But low-cost Māori primary health organisations came about and so we have 350000 Māori enrolled in them paying up to $18 for a GP visit which is great for Māori whānau as is the new announcement on 1 July of free GP visits for under-13s. That has never been done in the history of this Parliament and it was the National-led Government that pulled all of that together.Education as I have said many times is freedom. It is freedom to make choices and the tertiary education area for trades academies is one area that Māori have shone in. I want to talk just a little bit about the Ngāi Tahu He Toki ki te Rika. That is pre-trades training that was developed post-earthquake in 2011 and it has over 800 students enrolled in it. Just recently in April the Prime Minister was hosted by Ngāi Tahu where he launched He Toki ki te Mahi Apprenticeship Training Trust programme and that has 10 to 15 apprentice carpenters. This is great news for Māori. It is great news for iwi because of the steps the benchmark and the power that iwi can have within the tertiary sector.I am very proud to stand here and speak on Vote Māori Development. I am a Māori; I support all Māori things—it does not matter what colour the politics are. I support Māori achieving and everybody in this Chamber should be looking at that and at every which way we can help. Kia ora.SARAH DOWIE (National—Invercargill): It is a pleasure to rise and take this call in this debate with such wide-ranging topics. As we have heard they include Vote Arts Culture and Heritage Vote Internal Affairs Vote Māori Development Vote Pacific Peoples Vote Sport and Recreation and Vote Women. I think it is really important and it is a pleasure to say as the lead National member for the Government Administration Committee—as I acknowledge Nuk Korako the lead National member for the Māori Affairs Committee—that these disciplines require attention. They do encompass a richness that is New Zealand and it is wonderful to rise and speak about it.I am actually going to focus on sport and recreation and change tack here. I will talk about some of the wonderful things that sport and recreation does. Of course sport is in our blood as New Zealanders and we usually use sport to signal our prowess on the world stage but it is more than that. Sport and being active means having a healthy lifestyle and it is through Sport New Zealand that $7 million is taken from Vote Health and put into Kiwisport which is a fantastic programme. It recognises the importance of getting children involved in sports. It designs games for little people. It educates them about the needs of health and sport as part of that. Obviously sport helps them with their cooperation and teamwork builds their self-esteem and adds to an all-round healthy lifestyle. So I want to acknowledge that that is a great programme that Sport New Zealand is involved in and certainly it adds to the healthy lifestyle that we need in New Zealand to tackle some of those problems that we see in our community.I had the pleasure on 7 July of actually stepping in for the Hon Dr Coleman and launching the Healthy Families New Zealand initiative in Invercargill. That is an initiative that is based on the Victorian model that has seen significant improvements in health and it creates a platform for getting people involved in an active lifestyle. Invercargill was one of the 10 communities that were selected. It was selected on a range of different factors but mainly because unfortunately in Invercargill there is a prevalence of some diseases that can be prevented through having a healthy lifestyle.Hon Member: It’s cold.SARAH DOWIE: It is not just cold but sport plays a really big part in Invercargill. So it is important to get that initiative going and to start auditing the community and looking at the wins that we can create by getting people involved in sport and understanding the drivers of what creates a healthy lifestyle along with eating plans and just getting people active.That involves stakeholders coming together all within the health field and they audit basically the community and look at the different health organisations that are out there. The sporting organisations come together and they look at what they are doing already so that they can look for easy wins to educate those people who are at risk of different diseases that can be prevented like diabetes. They come together and look at establishing programmes.One of those programmes is through Volleyball Southland. It was my pleasure to meet some of the people who play volleyball through Sport Southland. It has community teams school teams ethnic teams and teams through the Southern Institute of Technology. Again it is a great way to meet people to engage in your community to make friends and to build self-esteem but obviously it is also about getting active and learning about being healthy. So through that initiative we are encouraging families to live healthy lives and obviously Sport New Zealand is part of that.I want to touch on Vote Women and one of the wonderful initiatives that is the brainchild of the Hon Louise Upston. That is the research into family violence and violence against Māori women. I had the pleasure of going—Vote Arts Culture and Heritage Vote Internal Affairs Vote Māori Development Vote Pacific Peoples Vote Sport and Recreation Vote Statistics Vote Treaty Negotiations and Vote Women agreed to.Primary SectorThe CHAIRPERSON (Hon Chester Borrows): Members we come now to the votes in the primary sector—volume B.5 volume 9. The question is that Vote Lands and Vote Primary Industries and Food Safety stand part of the schedules.IAN McKELVIE (Chairperson of the Primary Production Committee): What an interesting time to chair the Primary Production Committee and to lead the discussion in this estimates debate. The committee considered the estimates for Vote Lands and Vote Primary Industries and Food Safety and of course those are the areas of Ministers Guy Goodhew and Upston. I think we need to look back a little to look forward at this time. Looking back at the ministries that merged to create the Ministry for Primary Industries and the Ministry for Primary Industries as it has moved through that process in the last few years there have been some very testing times faced but there have been a couple of factors that I think have emphasised the value of that merger. The fruit fly outbreak in Auckland earlier in the year has been very successfully combatted by an extremely strong team. The 1080 contamination threat was also in my view very well handled in a very difficult environment by a very strong and capable ministry performing cohesively.The recent Budget provided some $179 million for border control and domestic biosecurity risk matters and $24.9 million more has been allocated to border security in increased dog and X-ray - based facilities. I myself witnessed this in action last Wednesday on returning through Auckland Airport with the New Zealand Special Olympics team from the Special Olympics World Summer Games and a very successful team it was too. But it was really quite impressive to watch the performance of the—[Interruption] thank you—biosecurity team at Auckland Airport and in fact the things that I suppose you could call hounds really and I guess that if you are a member of the hunting fraternity they most certainly were hounds. But they were very impressive and I think the system is working really well.The Animal Welfare Amendment Bill passed through this Parliament some 3 or 4 months ago and more money has been provided for this critical leg of our productive sector. The money will ensure that the very high standards we have in this area are maintained and improved which is a really important factor for New Zealand agriculture.Food safety is the second critical leg of our No. 1 industry and some $103 million will be spent on ensuring that this most important area remains secure. It is quite a challenging area for us and of course when you think of our place in the world food industry and our place in food supplies generally it is absolutely critical that this sector of our economy is maintained and maintained very strongly.The Minister in the chair Nathan Guy has faced some challenges in this role—some pretty significant challenges: the whey protein concentrate scare; the 1080 threat which Minister Goodhew of course was very strongly a part of as well; and the fruit fly incursion and the way they have handled those just shows the strength of our biosecurity system. The Rangitīkei Wanganui and South Taranaki flood event just recently is going to make a significant dent and cause some significant impact on our economy—our local economy in my electorate particularly and of course in Mr Chairperson Borrows’ electorate as well.The downturn in dairy prices is certainly a testing issue for us but not one that we in agriculture find unusual. We have gone through these things many times in my lifetime in farming and we will go through many more of them. It is just the cycle we go through in agriculture and food supply and I think it will always happen. It is very difficult to protect us from it. We have never achieved that in 150 years of farming in this country and I do not suppose we will in the future.Has not Fonterra which is so often criticised in this House done such a great job in the last few days of supporting its cooperative members with its 50c announcement last week pointing very strongly to the value of a strong cooperative? It is something the kiwifruit industry is benefiting from right at this minute and something that the Meat Industry Excellence group would dearly love the meat industry to achieve as well. It really does point to the strength of having a cooperative in a very small economy. I think it is most important that we have this kind of strength and that those cooperatives and the companies that operate in New Zealand have the confidence in the Ministry for Primary Industries—and in the various ministries I guess—to ensure that our industry stays in the prime position it is in.I want to touch on building capacity through investment in the Primary Growth Partnership and people and three aspects of that in particular. I want to talk about the Precision Seafood Harvesting Primary Growth Partnership project which is really when you think about the potential it has got going to achieve some hugely exciting opportunities for New Zealand and for the New Zealand fishing industry. If it can achieve what it certainly looks as though it will achieve we are going to see our fishing industry restocked.Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman): If ever there is an area of Government responsibility where there is failure it has got to be in the primary industries. The farmers’ friend—that is the National Party the farmers’ friend.Well well well let us have a look at what we have got facing the agricultural sectors at the moment. My colleague Stuart Nash will talk about forestry but I will just focus on a few things. I welcomed the speech from the previous speaker Ian McKelvie because he has pointed out fruit fly and 1080 contamination a $100 million tax on travellers to pay for biosecurity WPC80 and failure after failure to carry out what the farmers would consider friendly policies.We have a superministry that is responsible for so much it is failing in almost every single area of its responsibility. The dairy industry is a classic example of an outcome of a Government that has failed to lead as it should have. The Government facilitated the capital restructure of Fonterra because John Key wanted his mates in the stock exchange to have a few units to play around with. What that has done is left the company distracted to the point where it has had its eye off the ball.The National Government and its friends have been happy to trade in Fonterra units and the company is now floundering around. Yes there is an international challenge but ask Tātua what it is doing and ask the suppliers of Fonterra in Australia what is happening with payment for their milk. They are being paid considerably more than poor old Fonterra and Westland Cooperative Dairy—dare I say it as well—as suppliers.I have to say that the Government has made lots of noise but it has not done much. The Primary Growth Partnership referred to by the previous speaker has been a failure. The Office of the Auditor-General investigated six of the schemes and found no real economic benefit and many of those schemes were over halfway through their completion—no real economic benefit. It said that it could not identify “additionality” which was its polite word for saying: “This should have been business as usual and the Government spent money and we haven’t really seen any additional benefit.”Biosecurity is the Minister’s No. 1 priority and in the first year of the National Government it slashed funding and it has been playing catch up ever since. This year’s proposal is a tax of $100 million on New Zealanders and foreigners flying in and out of this country to pay for biosecurity because the Government does not want to commit real money to it.Today we had some indication—but not a promise—that there will be 100 percent baggage screening or a trial of it. We in Labour implemented 100 percent baggage screening and we had no fruit fly incursions. The Government removed it and we have had four incursions with potentially huge and damaging results for our economy. If it was the Asian fruit fly not the Queensland one we would be in a desperate situation.There has been no leadership in the meat sector. We have at the moment a temporary beneficial situation for the beef industry. The lamb and sheep industries are still floundering around. Meat Industry Excellence and the farmers themselves are asking for leadership from the Minister and it is nowhere to be seen. Although the previous speaker talked of the cooperatives—and I support them too—the Alliance Group and Silver Fern Farms have not been serving the meat industry and all the players as they should have been and indeed their suppliers have not been served that well as well. They want leadership they want vision and they want a clear direction that will provide a better alternative than in the dairy industry which at the moment is floundering around. Although people may say it is not a crisis go and ask a farmer who is facing the banks and negotiating their way to a future.It is a tough situation brought about by a Government that is laissez-faire and is prepared to accept market signals. The member at the back there Todd Muller the ex-Zespri employee was nodding his head about the wonderful management from Government. Zespri is there because of the Labour Government and its legislation discipline and leadership which we were prepared to show in Government but this Government has not been prepared to show that.The farmers out there want better leadership they want some direction and they want a vision. They have failed to get any from this Government from the expenditure that they have seen through the primary industry sector.Hon NATHAN GUY (Minister for Primary Industries): Well there we heard a very interesting speech from Damien O’Connor. What we did not hear when he was talking about the border levy was that when he was the Minister of Tourism he proposed the exact same thing. He is nodding now. Did you see him nodding? He just said for the Hansard record that he did. So he did propose a border levy when he was the Minister of Tourism in the Labour Government. Now he stands up and says it is terrible that the National Government is indeed implementing in part what he was proposing. So he has forgotten what he was proposing in several speeches when indeed he was the Minister of Tourism.I was so disappointed that that member would not support the border levy when we proposed it on the back of the Budget. In fact we did not hear a squeak from that member. He could not get on a plane to the West Coast quickly enough and he hoped that no one would discover the fact that he proposed a border levy in the dying days of the Labour Government and now he has forgotten. Looking at his face over there we know that he proposed it—and look at that grin. It tells you a thousand words.We should indeed be supporting the primary sector. We support the primary sector on this side of the Chamber. We celebrate the success of an industry and a sector that generates around $4 million an hour in terms of export earnings for this country. I am the first one to acknowledge it is tough times for the dairy industry right now. It is very tough times but I will also acknowledge that the medium to long term outlook for the dairy industry is extremely bright and our farmers know that. Our farmers know that this is a period of short-term volatility.The doomsayers on that side of the Chamber just want to talk it down. Yet again we hear Andrew Little and Damien O’Connor and others saying: “It’s a crisis! It’s a crisis!”. Well we had the manufacturing crisis the day that all the parties pretty much on the other side of the House proposed that. Actually manufacturing has started to grow and has never looked back. So the dairy sector will get through this.Of course what is not acknowledged—and I was talking about it earlier in the House today—is that our red meat sector particularly beef is going incredibly well. That is also happening with our viticulture and our kiwifruit. Kiwifruit has from memory got up to $1.42 billion in export earnings. Zespri has blown through the high level of $1 billion and is almost back above pre-Psa returns which is fantastic. Also our forestry sector is starting to grow and is waiting for new opportunities in the US. I know that Minister Goodhew will make some comments about that.What we also should not forget importantly is the future of seafood. It is great to see in the outlook for primary industries that seafood is forecast to grow to $1.8 billion by 2019 on the back of aquaculture growth. Not a lot happened in aquaculture when Labour was in Government. There is a lot of potential under this Government for aquaculture to grow and prosper more so than under the Labour Government. So this Government has a focus on supporting our exporters through the tough times and actually a big part of the primary sector is growing incredibly well.The No. 1 priority for me is biosecurity. That is why we invested $27 million in this year’s Budget. We made an announcement just last week that there will be 20 more detector dog teams more X-ray machines more people on the front line more auditing of in-country audits and import health standards etc. There will be a real focus on biosecurity because you cannot grow exports unless you focus on the “protect” part which is biosecurity—and food safety where Minister Goodhew is doing an outstanding job.Also trade is hugely important—new market access opportunities—and that is why we are very optimistic about the Trans-Pacific Partnership. It is going to be interesting when those negotiations land just to see where political parties across the House actually fall. Who will actually support the Trans-Pacific Partnership? It will be very interesting to see whether Mr Little can support the Trans-Pacific Partnership. I imagine that Labour’s caucus is split. I imagine its caucus is split down the middle. You will have Sue Moroney there talking out of one side of her mouth. You will have David Shearer and Phil Goff and the guys like David Parker who have a bit of an outward focus realising that New Zealand is not going to grow our wealth unless we sell things to the world and we sell 45 percent into those 11 countries that are involved in the Trans-Pacific Partnership. There are huge opportunities there. I am delighted that Minister Groser landed a free-trade agreement with Korea and Taiwan is also proving to be a very important new and emerging market for us.We should not forget about irrigation particularly in North Canterbury where they are still battling through very dry times. I know the local member will no doubt comment on that this evening because he has been in touch. I am looking forward to visiting North Canterbury in the next week or so. It is going to be hugely exciting when stage one of Central Plains Water storage opens. That is a massive project on the outskirts of Christchurch City. Everyone is talking about the Christchurch rebuild; no one actually realises that just out there on the Canterbury Plains hundreds of millions of dollars are being invested in farming improving water quality improving the environment improving productivity and growing our exports. We should be backing water storage projects. This Government has a real focus on water storage. We collect and store only about 2 percent of the rain that falls in this country. The rest roars out to sea. There are huge opportunities to do more.In the final couple of minutes I have got I also want to talk about the regional economy. We have got four studies under way in East Coast - Hawke’s Bay Northland the Bay of Plenty and the one that was announced recently Manawatū-Whanganui which covers the whole Horizons Regional Council area. What these studies show is that there is a huge amount of potential and upside in these regional economies particularly in the primary sector—particularly in red meat sheep and beef production dairy and also horticulture expansion. So the Ministry for Primary Industries with the Ministry of Business Innovation and Employment and Te Puni Kōkiri will be working with regional leaders to lift the performance of these four regions. These four regions—Mr McKelvie talked about it before and he is well in touch with the potential of his region as is Chester Borrows the other local MP there and Jono Naylor—are all linked in with the opportunities of this regional growth study for the lower North Island.Also we have got a real focus on skills because we know that we need to attract about another 50000 into the primary sector over the next 10 years or so. About half of them will need to be tertiary qualified or have level 4 qualifications. So they will be your food safety scientists. They will be your robotic engineers. They will be your environmental planners. Agriculture is actually becoming a lot more sophisticated. So we have got to attract the youngest and brightest into a big part of the New Zealand economy. We have got to celebrate success. We have also got to retain and upskill our primary sector capability. Of course we cannot do that here in Wellington and the Government should not be doing it on its own so we are reaching out to industry. And when I say “we” we have got some work under way with the Ministry for Primary Industries and the Ministry of Education working closer together looking at pilots in the likes of Ashburton Picton and Kerikeri.There is huge potential in Ashburton for sheep and beef production and also dairying and arable and we are bringing in the local principals so that they understand that there are jobs in their local communities. In Picton it is about viticulture and it is about aquaculture. In Kerikeri it is about sheep and beef and dairying and horticulture. So it makes sense that we wrap our arms around industry and get in touch with the principals of those local schools to make sure that they understand there are jobs in their local economies.Finally we should be backing the primary sector. The Committee this evening should stand up and say that the primary sector matters. We back it more so than the Opposition parties because we know it is hugely important to the New Zealand economy.STEFFAN BROWNING (Green): Tēnā koe Mr Chair. This year the 2015-16 appropriation for the Primary Growth Partnership was $69.8 million almost $70 million. I want to discuss tonight a recipient of Primary Growth Partnership money PGG Wrightson Seeds and touch on the national policy statement on plantation forestry which the Ministry for Primary Industries has been road-showing recently and the very unfortunate direction that this Government appears to be heading in with agricultural research biotechnology and loss of community choice. As I point out the toxic direction of current AgResearch in New Zealand we must be mindful that there is a fantastic opportunity in organic agriculture that can be very profitable for “New Zealand Inc.” while mitigating much of our greenhouse gas emissions and reducing nutrient leaching. It will be hundreds of percent better than conventional methods in product value in dairy alone.PGG Wrightson has said that it wants to compete with GE giant Monsanto and it has been on that path since Dr Allan Freeth the next chief executive of the Environmental Protection Authority set it on that path when he was chief executive officer and managing director of PGG Wrightson. He also got PGG Wrightson to buy into Genesis which was experimenting with GE grasses and was working with ArborGen on GE trees an unusual appointment for the arbitrator of GE in our environment. PGG Wrightson developed herbicide-tolerant swedes with Dupont and a couple of failed GE scientists—scientists who had happily broken the important conditions of the previous GE field trials that the Environmental Protection Authority had set and had assured us that those conditions would deal with any risks. But those scientists happily broke those conditions.PGG Wrightson and the scientists thought that they were really clever and used chemical mutagenesis instead of GE. They did both actually but they popped the other ones out in the market so that they could avoid regulatory oversight and avoid safety tests and the apparently irksome conditions of use. The unexpected happened as can occur with GE and other DNA-disruptive technologies such as that chemical mutagenesis. Hundreds of cows and sheep died and many more were sick because in part it appears that there was an unexpected increase of up to 16 times the natural toxin. A dangerous and unexpected result from a non-regulated technology that is based on the use of three herbicides and DNA disruption—nothing sustainable. That is PGG Wrightson’s direction and this Government is funding Chinese-owned PGG Wrightson for more of the same but funding almost zilch for the organics.I want to touch on the National Environmental Standard for Plantation Forestry. I note that somehow the Governmentwants through the National Environmental Standard for Plantation Forestry to bring in GE trees if the Environmental Protection Authority headed byPGG Wrightson apromoter of GE trees and grasses—it wants to allow GE trees to be decided by only that arbitrator the Environmental Protection Authority and it has made loads of mistakes in the past. I can go through every one of them if necessary. In every field trial that the Environmental Risk Management Authority now the Environmental Protection Authority has done in recent years the major condition of consent for approval has been breached and yet this Government says through that national environment standard that local councils and local communities will not be able to decide for their own region whether the Environmental Protection Authority should grant genetically engineered trees. It looks like a cook-up.Our communities want to be able to sell top-notch product overseas as GM-free and from areas such as Hawke’s Bay. Pure Hawke’s Bay reckons that $100 billion—sorry $1 billion—[Interruption] Yes yes I am getting my figures. One of the producers is working on $100 million on its own but $1 billion of product from the Hawke’s Bay is going out as being from GM-free Hawke’s Bay. How can that carry on if this Government—STUART NASH (Labour—Napier): What an extraordinary speech from the Minister for Primary Industries Nathan Guy. Is there a Minister in this House who is more out of touch with his portfolio and heartland New Zealand—[Bell rung] Mr Chair—second call Mr Chair? Can I start again?The CHAIRPERSON (Hon Chester Borrows): No.STUART NASH: OK. Is there a Minister more out of touch? First of all he stands up and talks about the value of the regional economy. Well those of us who are regional MPs know this. I am sick to death about hearing that the regions are failing because they are not. Regions like Hawke’s Bay are doing well in spite of this Government. In fact you have got two mayors who are saying: “Where is the plan? Where is the strategy from this Government around regional economic development?”. The Government has not got one. Then we get a Minister who stands up and says: “You’ve got to concentrate on primary industries.” Really? There are three major variables for success in the primary industries: one climate; two exchange rate; three commodity prices. And do you know what? We have no ability to control any of those three.So why should we concentrate on an area where we have no ability to control? Sure we are the first to admit that primary industries are the backbone of the Hawke’s Bay economy. They provide around about 45 percent of the revenue into Hawke’s Bay. It is an incredibly important part of our local economy. But let me inform the Minister: there is more to primary industries than red meat and dairy especially in Hawke’s Bay. There is the wine industry which the Minister for Economic Development had the nerve to stand up and tell this House is doing really well as the Government whacks an excise tax on it. The wineries are so annoyed with this Government because it taxes them more. These guys cannot get a break.The apple industry is finally doing really really well in Hawke’s Bay. But do you know what? We do have a problem with labour supply in the regions and the Government’s response to this is Recognised Seasonal Employer (RSE) scheme workers. I have a philosophical problem with the RSE scheme because what we are doing is we are bringing workers in from overseas when there are a whole lot of unemployed people in Hawke’s Bay. The problem with it is that we actually need them at this point in time. We need them because getting these unemployed people off the dole and into work is proving close to impossible.What we really would like this Government to do what the industry would like this Government to do is come up with solutions. It has not had a solution in 7 years so yet again it is up to Labour to provide solutions for the RSE scheme and we have got solutions. Meka Whaitiri and I have been working with the industry. We have the answers. All we need is to get into Government and implement these and what we will do is drive the sort of growth that we need to see in Hawke’s Bay.In terms of the Primary Growth Partnership—I will tell you this is a very interesting thing. I am hearing more and more as I go around. It is a little surprising actually but the sort of catchcry is out there. What I hear is: “We don’t bother with the Primary Growth Partnership—this is just a Minister giving money to his mates.” And I have heard—even the Chair is nodding. Even the Chair is nodding in agreement—The CHAIRPERSON (Hon Chester Borrows): Order! Do not bring me into that in the way that you have. You have been here long enough; you know how this place operates. Do not muck around like that with the Chair. Thank you very much.STUART NASH: I was at a conference just yesterday and a speaker stood up—we were talking about the Primary Growth Partnership—and this speaker said: “We don’t even bother. It is the Minister and his mates.” We were at our regional economic caucus. Our economic caucus did a Hawke’s Bay visit last Tuesday. One of the largest employers in the Bay said exactly the same thing: “Oh we don’t even bother these days. It’s corporate welfare. It is money for the Minister’s mates.”Then there is forestry—a very very important part of this local economy. There was a policy workshop for the New Zealand Institute of Forestry yesterday and the Minister did not even turn up. Not only that the Minister did not even send anyone along at all and the word from the forestry sector is that this Government does not care about the forestry sector—this Government does not care about the forestry sector. It does not understand the forestry sector and as a consequence the New Zealand Institute of Forestry is trying to develop policy on its own because this Government is not providing anything for it at all. Minister if you had been there you would have heard exactly the same as I said.So when I hear this Government talk about the primary industries all it talks about is dairy—which it has done nothing about—and red meat. What I would love the Minister to do is to start coming up with a strategy around the wine sector around the apple sector and employment opportunities around the forestry sector—RICHARD PROSSER (NZ First): I am pleased to rise to take a call in this Committee of the whole House as we debate the Appropriation (2015/16 Estimates) Bill. Before I start berating the Government and the Minister in the chair the Hon Nathan Guy I would like to just take the opportunity to hand out a bit of a bouquet along with the brickbats.I want to say a word in support of the Primary Growth Partnership scheme. It is a bit of an anomaly. I really cannot understand why colleagues on this side of the Chamber are so opposed to the Primary Growth Partnership scheme. It is pure socialism. It is absolutely wonderful venture capital from the Government into the primary sector. There is certainly more that can be done with it and over time I have no doubt that there will be more that is done with it and the Primary Growth Partnership will be extended through other schemes. But notwithstanding Mr Nash’s passion I do not accept that criticism of the Primary Growth Partnership. I think we have barely scratched the surface of what we can do with it.But I do want to pick on a couple of areas a couple of line items in the estimates. The first is in the multi-category section of the appropriations for primary industries which includes safety and it is the appropriation allocated to border and domestic biosecurity risk management. That stands at just under $179 million. As we examined through the Border Processing (Arrivals and Departures) Levy Bill which was one of the enabling pieces of legislation for the appropriations for the primary sector in this Budget we discovered through that process that that amount includes the revenue forecast to be collected from international passengers arriving in New Zealand on airlines and cruise ships. And I say “forecast” because it will take a while for the levy to be designed and a while longer for it to be instituted and then a while after that for the money to start coming in. Then over a period of time that money from the levy will replace the funding that is currently allocated to biosecurity from general taxation.We know this because the Minister very slowly and grudgingly admitted quite tortuously over a period of some time through gritted teeth—he finally admitted that this new levy was not actually going to amount to any increase in funding for biosecurity but in fact was only ever going to be a replacement for the current funding arrangements.So this appropriation is not actually doing any favours for biosecurity. We are not going to see a return to 100 percent screening of all incoming passengers we are not going to see the implementation of 100 percent screening of incoming mail and freight and we are not going to see an improvement on the present rate of about 25 percent as far as the inspection of shipping containers is concerned. We are not going to see an increase in resourcing for border security officers so that the green lane can be done away with. In fact this Government is increasing the number of SmartGate entry points rather than reducing them. So we have no more money for boots on the ground no more money for additional sets of human eyes and the brains and intuition that goes with them but we do have more robots—and SmartGate is not a clever robot; it is just a passport reader. It is quite a dumb robot in fact. This robot is not the “Six Million Dollar Man”.So we do not have the “Six Million Dollar Man” but we do have the $3 million possum. I say that because there is a line item in the non-departmental output expenses column of the appropriation for primary industries that relates to TB vector control. TB vectors are animals that can carry and spread bovine tuberculosis. We need to eradicate bovine TB and keep it out of our cattle and deer herds and that is a good thing and the single most important TB vector we are told is the possum. Feral deer can carry and spread bovine TB as well of course and so can ferrets and pigs and hedgehogs. No one in officialdom seems all that worried about hedgehogs just yet. Rather it is the humble possum that is tarred with being the single most important TB vector and this appropriation allocates $30 million to controlling it.Well we know from answers that the Minister has given in reply to written questions that over the past 10 years TBfree New Zealand has autopsied more than 124000 possums in its search for bovine TB. Of those more than 140000 possums 54 were found to have TB so that is 54 out of more than 124000—0.04 percent—or to put it another way an average of five and a half possums per year. So going by the averages of the last 10 years we can reasonably expect that this year there might be another five or maybe six possums out there with TB. And they are not the only vector as I mentioned—TBfree New Zealand has autopsied a number of feral deer as well. Since 2007 it has autopsied a total of 1751 deer and found that 34 of them had TB.So we have had 54 possums over 10 years and 34 deer over 8 years. That works out to an average of a little under 10 wild animals a year that we might expect to be carrying TB and this Government has allocated a nice round $30 million in order to control them. That is $3 million per animal. We cannot have our shipping containers inspected but we can go chasing the $3 million possum. I am sure—I am absolutely certain—that if the Government were to announce a bounty of $3 million a head on any possum dead or alive found to be carrying TB it would get knocked over in the rush of trappers and ground control operators wanting to take on the job. Instead we are going to carpet bomb thousands of hectares of bush with airdrops of 1080 and kill thousands of native birds and insects and pollinators and lizards and snails—Hon JO GOODHEW (Associate Minister for Primary Industries): It is great to rise and speak on Vote Primary Industries and Food Safety. In particular I want to cover off on my responsibility for forestry and also for food safety within this sector which is so important to New Zealand. We would not necessarily know it from some of the comments that are coming from the Opposition but it is.Let us start with our $4.5 billion forestry sector. This is a sector that is attracting capital from within New Zealand and from overseas at the moment because if we think about engineered timber this is the way that this sector can grow to what it has set as a lofty target of $12 billionby 2022. The sector is going to be able to do that only if the much more valuable products are in fact put together and engineered timber is the way for that. What the Government is doing to support this sector is we are getting in place plans for skills development and for the review of New Zealand standard 3603 which allows engineered timber to be used in a standard measure in a standard fashion by the sector. It is getting those barriers out of the way that will see that sector continue to grow and reach towards its potential.I want to touch on the Afforestation Grants Scheme which was a Budget 2015 announcement—$22.5 million over 6 years. That will see an extra 15000 hectares planted—but you know every week I hear about more businesses going out and planting more. I believe that the tide has turned and there is much more confidence in the sector.Let me address some of the ill-informed comments from the member from Labour who was on his feet before Stuart Nash. You see yes there was an Institute of Forestry conference yesterday followed by the DANA Ltd forestry conference this evening. I have just left from the dinner at the DANA conference and I have been hearing about the Institute of Forestry’s conference yesterday. Back in 2013 the Institute of Forestry asked the Government to put together a forestry sector policy and I said to it: “Why doesn’t the forestry sector put it together? Get the politics out of it.” And that is what it has decided to do. Had I been able to attend yesterday had I not already committed to doing other things yesterday I would have done so but instead in fact I sent three Ministry for Primary Industries people rather than as Stuart Nash said no one. So in fact the Opposition members are out of touch on forestry and they are out of touch on food safety and many other aspects of the primary industries sector as well.You see the Recognised Season Employer scheme was mentioned before. Well the onions do not get packed and the apples do not get picked in my district in the Rangitata electorate unless we have workers under the scheme so that would be millions of dollars out of New Zealand’s primary production sector because we have low unemployment in South Canterbury and cannot get people to pick those particular products. So the scheme is doing a particularly important job down there.The wine industry—well apparently it needs help! It is going better than ever before at $1.42 billion in the last year and is getting really excited about getting geographic indicators from this Government which will be very important for that sector. The wine industry is having one of its best years as is kiwifruit. There are great prices for beef—actually there are lots of things going well but you would not know it if you talked to the Opposition.I want to briefly mention a trip that I had to Viet Nam because from this Government’s perspective not only are we trying to get free-trade agreements and understand the benefit that they would be to New Zealand—the Green members could well listen to this—but at the same time we know there are non-tariff barriers that we also need to be out there trying to reduce. On the forestry and also food safety front which was the reason for my visit to Viet Nam last week—it was the week before in fact—those sorts of non-tariff barriers going into a market that is for the very first time seeing $1 billion of two-way trade will put money into the pockets of New Zealanders. So New Zealand needs to reach out and work out what these non-tariff barriers are work on them with the politicians and with the officials in the countries like Viet Nam because far from just $443 million worth of export produce into Viet Nam we can do so much better. People in Viet Nam trust us. They trust our food safety systems. They trust our honesty and integrity in exporting products to their nation. They want our technology transferred. They appreciate the fact that we have supported them in aid projects as well.MEKA WHAITIRI (Labour—Ikaroa-Rāwhiti): Tēnā koe Mr Chairman. Tēnā tātou katoa. I am happy to take a call on the Appropriation (2015/16 Estimates) Bill on primary industries. Before I do that can I please acknowledge the passing of the last 28th Māori Battalion veteran from Awatere Valley of Te Wairoa Te Hei Mauroa Ben Hook; e te rangatira o te Pakānga Tuarua haere haere haere atu rā.I come from a long line of freezing workers and it is from that perspective that I am going to contribute to this vote that we are discussing today. Can I acknowledge Rose White an auntie of mine who after 40 years and 328 days has finally hung up her apron and knives after working for Silver Fern Farms in Whakatū. I want to acknowledge my auntie and wish her all the very best in her retirement.As a product of our being freezing workers my auntie often told me that freezing workers were the backbone of our economy and I will work with anybody in this Chamber in fit for purpose primary policies that enable opportunities for all New Zealanders. I am happy to be a member of the very hard-working Primary Production Committee and I want to acknowledge both our chair and the Minister for Primary Industries for coming to the select committee when we examined his vote—and it was a very big vote that we had to examine. But my contribution tonight is going to be on the Primary Growth Partnership and there have been a lot of speakers speaking about that tonight.For the benefit of those who may not have been there I will just quickly remind members that the Primary Growth Partnership was established in 2009. Its purpose is to increase investment and innovation and to achieve economic growth and sustainability for multiple industries in the primary sector. It is responsibly administered by the Ministry for Primary Industries. The partnership meets equally or exceeds the investment made by the Crown with private investors and it has an investment advisory panel that assesses all the proposals and business plans before it makes a recommendation.In the last Parliament the Primary Production Committee requested that the Office of the Auditor-General examine the Primary Growth Partnership. The committee was specifically interested in the transparency and management of the programme—hence my reason for making this contribution. On 30 November 2014 the Crown committed $322 million to 18 programmes of which just under $120 million has been spent. The Auditor-General’s office undertook a performance audit of the Primary Growth Partnership and it reviewed six programmes with a combined investment of $491.3 million.So what were the findings of the office? Basically the Auditor-General said that the Primary Growth Partnership was set up too quickly. It encountered some challenges in its early stages—for example the definition of funding conditions and criteria in the early funding rounds appeared to be “loose”. The office expressed concern about the concept of additionality—which my colleague Damien O’Connor talked about—to ensure that the Crown was not just paying for something that should have been just part of the normal process of some of these larger industries.The Auditor-General’s report also identified that given that the size of our country of New Zealand is quite small there were going to be times that you could have conflict in terms of having limited core expertise in the primary sector. The Auditor-General noted however that the limited scope of the audit did not determine whether the investment advisory panel or the programme steering groups had a potential conflict of interest that should have been declared. That is not saying that a conflict of interest was not there; it was just not part of the scope of the investigation.What were the overall findings in relation to the Primary Growth Partnership according to the Auditor-General? Clearly transparency and accountability issues were identified and that was something that the select committee took on board and we are undertaking to investigate it again in about 6 months’ time. I want to just make sure for my colleagues on the committee that we uphold the findings of the Auditor-General ensuring that all Crown money is going to what is intended.I know that this is rushed because we have got only a few minutes but I want to turn your attention now to Crown Irrigation Investments. I want to acknowledge the Minister again for coming to the select committee and for his commitment that we will not be investing—STEFFAN BROWNING (Green): The Green Party supports forestry particularly permanent canopy sustainable production. We need very good forestry rather than—as we are seeing—conversions to unsustainable and intensive dairying. But forestry must be located without impact on the indigenous habitats and it must be done right and at the moment in too many cases it is not.We are very concerned about the direction of the National Environmental Standard for Plantation Forestry which the Ministry for Primary Industries has been driving. It will not protect our indigenous habitats our streams and erosion-prone land from the impacts of forestry as we have been seeing lately. In my own area the estuary was seen as the worst of 32 in the country. The Marlborough Sounds has just been shown to have had an area of habitat the size of Blenheim destroyed by either dredging or forestry sediments and it was only a fraction of the Sounds that was measured. So we are worried about it.I went to seven of the consultations or hui around the country about this. I am optimistic that the Ministry for Primary Industries will tweak the National Environmental Standard for Plantation Forestry a bit but I am not confident that it will go far enough to protect our fisheries fish nurseries and habitats from more sediment because this national environmental standard is for industry. Councils have been submitting—submissions finished today—because they realise that they cannot protect their local environments adequately under this national environmental standard. Once it is finalised and gazetted it will replace councils’ existing district and regional plan provisions for managing plantation forestry across New Zealand unless the national environmental standard specifically says otherwise. When it is a permitted activity there is no chance for further public comment. People will not even be able to comment ahead of a forestry harvesting that will destroy and wreck their water supply for a period of time.The Ministry for Primary Industries said: “Hey you can use the National Policy Statement for Freshwater Management and you can get in the collaborative process and deal with things.” but even just 2 weeks ago the Parliamentary Commissioner for the Environment was talking about that process and said that there are gaping holes. One of the biggest ones is that estuaries are not covered and so our fisheries are still at risk. And that collaborative process is often not quite as effective being dominated by industry all too often with a result that is an increase in pollution rather than a decrease. So we need major changes to the National Environmental Standard for Plantation Forestry.I will go back to the issue I spoke of earlier around genetic engineering. This national environmental standard is being used not only as a Trojan Horse to take communities out of looking out for erosion and looking after their fisheries their awa and their kai moana—it is a Trojan Horse to get GE trees in because the Government lost its ability to do so through Resource Management Act reforms. The Environmental Protection Authority which the Ministry for Primary Industries is saying should be the arbitrator has consistently failed. It has a long history of failure and shortcomings in relation to genetic modification and this Government carries on giving money to those fiddling with it. Crop and Food Research’s brassicas were planted and illegally flowering even when the decision to allow the field trial was being appealed to the High Court. It was ultimately stopped and a foot-deep of soil was removed from across that site and deep-buried at Kate Valley because of potential contamination. Crown research institute AgResearch has GE animals—it has breached its conditions. The Environmental Protection Authority can do nothing about that.STUART SMITH (National—Kaikōura): I would really like to start by refuting some of the comments made by one of the earlier speakers about getting in and managing all sorts of industries. I can say as a former leader of the wine industry which was one of the industries that he spoke about that the last thing we would have wanted as an industry when I was in charge—and I am sure it is the same today—was to have the Government get in and try to run the industry.What industries want is a Government that runs efficient services that minimises the tax burden as much as possible and most important that runs a good framework and particularly takes care of trade by negotiating really good trade agreements and free-trade agreements. I am really delighted to be a part of a Government that is supporting the Trans-Pacific Partnership at the moment which will be such a fantastic opportunity for this country. It was disappointing I would have to say—although perhaps not surprising—to hear the uninformed comments coming from the other side of the Chamber.I want to move on to talk about the drought in North Canterbury which the Minister for Primary Industries alluded to.The drought is a really significant drought particularly around the Cheviot-Hawarden area.It seems to be a horseshoe of land on the east coast of the South Island that is missing out on the rain that comes from the north and missing out on the rain that comes from the south and the west. It is unfortunate; this drought has been biting really hard for quite some time. There are reports of about 100000 breeding stock that have been shifted out of the area to go for grazing some of which will not come back on to the farms to lamb because there simply will not be the feed there. Although it looks green to the uninitiated as you drive by it is what is known as a “green drought”. There is a green tinge with really no feed underneath it and not many root reserves to really kick anything away. The soil moisture is so low at the moment that it will need significant rainfall to really turn that round.I really want to acknowledge the $200000 of additional funding that has gone to the rural support trusts. That will make a big difference. It is gratefully received by those people who are affected—and also the $500000 that was announced at the Fieldays by Minister Guy and Minister Coleman. That was a great initiative—it really is. That is where Governments can get in and make a big difference with actually a relatively small amount of money and I want to acknowledge that. I also want to acknowledge the team that is doing a great job in North Canterbury—Winton Dalley in particular the mayor of Hurunui who is heading up the drought committee along with Doug Archbold the rural support guy for that area who is doing a fantastic job. Sometimes it is a pretty tough job to get out there and do that and I want to acknowledge him tonight. I think that we should really all encourage those people and the job that they are doing.These things will improve. It will rain again. All those things happen and people will adapt their systems to deal with it as best they can. But that segues quite well into my next point which is irrigation. I acknowledge the $25 million towards the Irrigation Acceleration Fund. There has been a lot of talk about funding from the Government and Vote Primary Industries and Food Safety towards irrigation and what that amounts to. But that money is to fund storage and storage is about actually the community benefiting and the environmental benefits from irrigation.The Ōpuha scheme in South Canterbury is I think a wonderful example of how the whole community and the environment benefits from storage. At Ōpuha Dam the irrigators voluntarily reduced their take as the drought really started to bite hard in that area to allow more water to flow and to keep the instream values up in the Ōpihi River which flows out of the Ōpuha Dam. That enabled Fish and Game which was a very vociferous opponent of the irrigation scheme to capture the fish that were in the streams that were drying up and take them and put them into the Ōpihi and then when that finally got to the point where it was drying up to take the fish and put them in the Ōpuha Dam.So we have now certainly a group of people from Fish and Game in South Canterbury who were opponents of the scheme but now very much fans of the scheme because they can see the benefits to the environment from storage for irrigation. So I think the Irrigation Acceleration Fund is very important. Thank you.BARBARA KURIGER (National—Taranaki - King Country): It is a pleasure to be speaking in the Chamber and taking a call tonight. I am very proud of the primary industries and the expectation for the year to June 2015 is that $35.2 billion would be brought in by primary industries. I know that at this point in time we are looking at a volatile situation in the dairy industry and I just want to shout out to my fellow farmers tonight. The falling dairy prices have been a concern but they are temporary. They will come through and we do know that we are looking for a bright future in this industry.I also want to mention and my colleague here Stuart Smith talked about it the funding that is going out to help farmers at this time—the $500000 that was actually delivered at Fieldays which has been used to train more people. There are going to be another 100 people out there working with DairyNZ and working with Beef and Lamb and encouraging those farmers to come forward. Although the industry itself is very resilient we just want to be quite careful about talking too much about individual farmers being resilient because we want them to stand up and ask for help when they need it—and they will. If they do that if they work with their banks they will be resilient and they will come through.But I want to also acknowledge that there is a whole lot more to the primary industries. We focus on dairy and I am very proud of it but over recent weeks I have had the opportunity to visit Zespri with the Primary Production Committee. You know that is an industry that has come through some very tough times. It had the disease Psa unexpectedly come in with the gold kiwifruit variety that it had at the time. It put in a huge effort around getting people through and now that is an industry that is really thriving.What was impressive to me was when we talked to those horticulturalists about what they were growing in their kiwifruit they were talking about the dry matter content the sugar content—everything to those people was important about the taste of that kiwifruit and the experience of that kiwifruit from the time it left the farm until it went to the pack-house.The people at the pack-house we visited were absolutely focused on keeping that quality all the way through to the market so that they knew that the person who picked up that kiwifruit and had it at the end of the day on their plate was having a fantastic experience and will continue to buy the kiwifruit.I have also been to Tegel which is a fast-growing chicken industry in Taranaki. What is really interesting for me and I also note is that in our estimates there is another $10 million going towards animal welfare. Often the chicken people get targeted when it comes to animal welfare. Well actually I can tell you that there are no meat chickens kept in cages. There are no hormones used. There are a whole lot of rumours out in our society about what goes on with chickens and I can tell you that when I was in one of those newlydeveloped sheds on that particular day with 35000 13-day-old chickens it was 27 degrees Celsius inside that chicken shed and it was actually 10 degrees outside. If I was a chicken I know where I would make the choice to go—because it was very hard to go back out into the cold.I also want to acknowledge that if you come into Taranaki - King Country on the way from Taumarunui—which is our esteemed select committee chair’s electorate—across in Te Kūiti just after you leave Taumarunui there is a wonderful little alpaca shop. We do not often think a lot about alpacas when we think about primary industries but these people have very very selective breeding. They have white ones they have black ones and they have brown ones keeping them very pure. They are selling the products in their shops. The wool that actually comes off these alpacas is of a very very high quality. So there it is a combination of the primary industries combining with the tourism industry and providing a product that people want to see. I can tell you that those alpacas are very very cute. They do spit but they are very very cute.I am also very impressed with the extra $7.5 million over 2 years that is being put into developing key skills and systems. I was very pleased when the Minister for Primary Industries talked before about the Ministry for Primary Industries and the Ministry of Education working together. Prior to coming into Parliament I was involved with a group called the Primary Industry Capability Alliance. As part of that group—its role is to encourage new talent to come into our industries. Thank you.A party vote was called for on the question That Vote Lands and Vote Primary Industries and Food Safety be agreed to.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Votes agreed to.Social Development and Housing SectorThe CHAIRPERSON (Lindsay Tisch): We now come to the votes on the social development and the housing sector—volume B.5 volume 10. The question is that Vote Building and Housing and Vote Social Development stand part of the schedules.ALFRED NGARO (Chairperson of the Social Services Committee): I rise as the chair of the Social Services Committee to take the first call on this estimates debate. The Social Services Committee recommends the appropriations for the year ending 30 June 2016 for Vote Social Development be accepted.It is an honour to be able to speak tonight on this. The Budget for 2015 delivers a $790 million package to help children living in some of New Zealand’s poorest families. It is a commitment that was made by the Prime Minister and he clearly made it in his state of the nation speech that we are firmly focused on helping those children who through no fault of their own have been caught in a cycle of hardship. As the Prime Minister has set that vision I also want to acknowledge that the Minister the Hon Anne Tolley has taken on that role to ensure that we deliver that package and that vision as well.One of the things that we often think is the key area of concern and this is also the judgment from those in the sector who provide the service—and I know that my colleague Mr Matt Doocey will be reading from the state of the nation booklet called A Mountain All Can Climb but before he does that I too want to sort of comment on that. In February of this year this was a report that actually talked about it and often it is a state of the nation report that judges the performance of the Government in regards to the social sector. They have 22 indicators by which they judge the Government on its performance. I am happy to say that 14 out of the 22 had the thumbs up out of those social indicators of change during 2014 which gives us the lead that it is a good foundation for us to build on.Just a couple of those to mention—child poverty for instance. The percentage of children living in benefit-dependent households has reduced by 2 percent to 17 percent. We know it is a small change but it is a significant change. It is moving in the right direction. We talk about children at risk and it is a reduction of 15 percent down to 19623. So again it is a small change but the number of substantiated cases of child abuse and neglect has also reduced.Darroch Ball: How many reported? Don’t answer that one!ALFRED NGARO: Educational achievement has increased by 0.2 percent. These are key indicators social indicators that are making a change. If Mr Darroch Ball was there he might have read this. He might have seen that 14 out of the 22 indicators have shown that this Government is heading in the right direction.Let us then look at the Budget of 2015 and what it is delivering for us and for New Zealand as well. We know that Budget 2015 delivers a $790 million package to help children living in some of New Zealand’s poorest families. We know employment is the best way to lift families out of difficulty and hardship and the incentive to work will ensure their children who are living in poverty are supported. This is focused on helping 60000 to 100000 children who through no fault of their own experience material hardship. There has been widespread reform throughout the welfare system over recent years aimed at increasing independence where possible. This is working well with 42000 fewer children living in welfare-dependent homes since this time 3 years ago. I think that is a significant number—42000 children in 3 years are now actually in situations where they can thrive and their outcomes can be improved.This Budget’s announcements continue National’s plan to deliver better services to vulnerable children and New Zealanders who rely on them and to deliver better value for money for taxpayers. Inside of that package I want to talk about a couple of things that I think are quite important. One of the ones that was significant in 2015 which I know was celebrated even on the other side—I know there was acknowledgment—was the fact that under this Government a National Government the benefit rates for families with children will rise by $25 a week after tax. It is the first increase other than inflation adjustments for 43 years—43 years.Darroch Ball: What did you do in 1991 Alfred? What did National do in 1991 to benefits?ALFRED NGARO: I do not think you were even alive in 1991 Mr Darroch Ball. It is the first increase other than inflation adjustments for 43 years and there will be extra support for low-income working families despite Labour voting against both these measures. That is significant because even when there was a time of surplus under the previous Labour Government there was no increase but under this Government there is an increase.Some speculators on the other side said: “What will $25 do?”. Q+A went up to the far north to some of the most deprived communities up there—Māori communities up there—and the question that was asked to Dr Lance O’Sullivan was this: “Will this budget of $25 extra per family that is eligible make a difference?”.CARMEL SEPULONI (Labour—Kelston): Thank you for giving me an opportunity to speak to this. I sat through what was actually a really painful estimates hearing in the Social Services Committee with the Minister for Social Development present. I want to talk to a little bit of what was discussed in that meeting and challenge a little bit of what the former speaker Alfred Ngaro spoke about.There are three issues that came up in the estimates hearing that I really want to discuss today. First was that child hardship package so let us talk a little bit about that today. Second was from benefit to employment—is that really happening? Does the Government have an emphasis on that or not? Third are the Ministry of Social Development dealings with Relationships Aotearoa—it fronted at that hearing so I will speak to that as well.Firstly the member Alfred Ngaro touched on this the Government’s child hardship package. It made this announcement that an additional $25 will be going into the pockets of families who are on benefits. What it did not give when it made that announcement was the detail. So let us look at this Support for Children in Hardship Bill what that entails and what it really will mean for families. The Government said $25 per family—not per child; per family. But actually there are going to be a lot of families who do not get that entire $25 because they are getting access to a disability allowance temporary additional support and a whole lot of other things. So they may not get the $25. They may not get anything. They may get $12.50.The Government is looking to extend the work obligations alongside this additional $25 a week expecting parents or sole parents to go back to work when their youngest turns 3 rather than 5. We asked the ministry for documentation or evidence to support why it might make that call. All of the reports that we got back did not support that move at all. In fact there was no New Zealand evidence to support what it was doing. All of the evidence was overseas evidence and the overseas evidence said that when you impose these types of work obligations on sole parents then you are likely to have the adverse effect where you drive them further into poverty. Was any of that advice or research taken on board? The Minister and the ministry chose to ignore that.We have seen recently that there are real issues in New Zealand with early childhood education in terms of access to quality early childhood education yet with the extension of these work obligations these—primarily—women are going to be expected to go back into part-time work and put their children into early childhood education. The standard of early childhood education available has been questioned recently by experts by New Zealanders and by the general public. It is something that the National Government still refuses to address.I want to bring up the fact that we have been told that with the legislation the Government is introducing there will be an extension of childcare subsidies. Well there is a problem there too because where is there a serious overspend every year? It is in the accessing of childcare subsidies. So the Government is saying that it is going to extend it. The Government is saying that it is pushing people into work and that it is providing more opportunities in terms of childcare subsidies. Well then why are there 1800 fewer people in the most recent year compared with the last who are accessing childcare subsidies? Why has the number of people accessing childcare subsidies over the last 5 years dropped by 2500 people? They are not accessing it because the Government is making it difficult.This Government is not aspirational for people and I want to make that point. It is pushing primarily women these women out into jobs that are any job. I just talked to a woman yesterday who has taught for the last 13 years in Samoa and has come back. She is a qualified teacher. She did her training here. She thought: “OK. Yes I will do this Ministry of Social Development course.” Sixteen weeks she has to do this course for. She goes along. She is a qualified teacher. She is sitting next to a woman who ran an airfield for goodness sake and the person taking the course that they have to attend for 16 weeks is saying: “And at the end of this you might get a job at McDonald’s.” How aspirational is that for these women?I want to move from that over to whether or not people are going from benefits into jobs. When asked in the select committee whether or not it was a primary concern that people were coming off benefits and going into jobs the Minister said: “It is not necessarily about employment; it is about independence.” How independent can you be if not only are you not getting an income from work but you are not getting any support from the State? When we continued down that line of questioning her Ministry of Social Development chief executive said “Well those people who are not in work and are not getting a benefit have other means.” and the Minister sat there nodding her head.Hon ANNE TOLLEY (Minister for Social Development): It gives me great pleasure to take a call tonight to talk about Budget 2015 because as we heard from the chair of the Social Services Committee my colleague Alfred Ngaro of course this is a huge year for those who are the less well-off in our communities. In Budget 2015 a $790 million package was announced by this Government focused on reducing hardship for children in some of our poorest families.It was a 43-year watershed when this Government announced a $25 a week increase in the benefits. No other Government in 43 years has actually focused on those receiving a benefit and lifted that benefit. This Government did it. They hate it on the Opposition because in the very best of economic times that Labour Government did not lift the benefit. It ignored the people who are on a benefit. This Government has announced that as from 1 April next year people will get a $25 increase in the benefit.Brett Hudson: The first increase in real benefits in 43 years.Hon ANNE TOLLEY: Yes 43 years. Not only that we also looked at those who are working hard. We know there are many families in New Zealand that are working hard but are still on very low incomes and their children are still experiencing hardship. We have lifted the minimum family tax credit and the in-work tax credit so that the families that are eligible for those also receive an increase of anything between $12 extra a week and $25 extra a week.And we have increased the subsidy for childcare. We have done that because contrary to the previous speaker we know from experience what is working well particularly for parents reliant on the sole-parent benefit. We know what support is needed to help those people out into work and independence. Independence of the State is extremely important. We know from experience what is working what support is working and we know the determination of many of those people to be independent. From 1 April next year it is interesting that a sole parent now working 20 hours a week on the minimum wage and receiving the minimum family tax credit and the in-work tax credit could be $190 a week better off. That is the difference that it makes—helping people and supporting them into work and supporting their families. They could be $190 a week better off and independent of the State. That is the ambition that this National Party has for those people.We know that the outlook for those children in families that are reliant on the State for a benefit is not great. Their lifetime expectations are not great. The statistics tell us that those children who are born into homes that are included in the main benefit within the first 2 weeks of their life 48 percent of them will have a Department of Child Youth and Family Services notification. Almost half of those kids will have a referral to the Department of Child Youth and Family Services and 48 percent of them will not attain NCEA level 2. We know that that is the minimum qualification that a young person needs to go on to get a good job to go on to further tertiary education or to go into an apprenticeship. Almost half of those kids—we know that if nothing changes in their lives they will not have that and then 45 percent of them will go on to receive a youth benefit. Again the outlook for youngsters going on to a youth benefit is that they are most likely to still be on that youth benefit in 20 years’ time.So the absolute imperative is to help people become independent of the State able to stand on their own two feet able to support themselves and their families and therefore we have put into play these benefits.JAN LOGIE (Green): I did have a whole speech written but I do feel compelled to respond to some of the comments from the Minister who talked about this being the first benefit raise in 43 years. She has conveniently ignored the fact that it would have required a 45 percent increase in benefits to be able to return them to the pre-1990 level when the previous National Government slashed them to the point where we now have the unemployment benefit being worth 24 percent of the average wage where people are consciously being left in poverty. And for children to be in our hospitals and dying because of the policy of this Government—we should be celebrating that in this Budget? Well I am sorry but I am not going to celebrate that.We are being told by this Government that it knows what works. It is these sanctions it is beating people over the head to be able to get them into work because that is how you make it happen—that is how you encourage independence! You cut people’s incomes! That leads them to a life of independence! Well why are more people being sanctioned now in the last year than were being sanctioned previously? If it was working there would be fewer people being sanctioned. But it has been increased by 30 percent. More sole parents have been sanctioned in the last year. That is a sign of this policy failing not succeeding.We know that when benefit levels were set at a higher rate we had lower rates of unemployment. Poverty does not drive people into work—it keeps them stuck in poverty. It puts them into fragile precarious work that is actually not better for them or their family.I really think that this Government with the Better Public Services targets that it has set—of reducing benefit levels by 25 percent and reducing the liability and the pressure on the Government—really shows the lack of awareness in its thinking. That to the Government is what is most important for this country. It is not about the well-being of our society. It is not about getting people into work into decent jobs. It is not about eliminating child poverty. It is not about ensuring that families where women and children leaving violent relationships are able to re-establish themselves with a minimum of trauma. It is not about people who are sick—getting treatment for cancer or any other number of illnesses or even donating organs—to be properly supported and not forced into debt or made homeless; so that they are so stressed out and unable to get the medical attention that they need because of the financial stress on them at the moment which is what is happening now. People are being made homeless while suffering and getting treatment for cancer because this system no longer provides a safety net.We are being told in this House by this Government in response to this Budget that we should be celebrating the fact that there will be an average of maybe $20 a week to families no matter how many children they have. This Government was told in the policy documents that that amount of money would make no difference to the child poverty levels in this country and the Government presented this to the public of New Zealand as a child hardship measure.The New Zealand public cares about our children. We want our children to be well and healthy and able to thrive and live up to all of their potential. Instead of actually creating the environment to enable that for our children this Government has presented a piece of window dressing that is leaving those children in hardship. It is refusing to address the core foundation of poverty in this country.Carmel Sepuloni: She can’t even look up. She’s just texting on her phone.JAN LOGIE: And the Minister is texting—really engaging with the issue!So the impact of these policy decisions is the increasing number of people being trapped in poverty. We are being told by the community organisations I am seeing around the country that they are dealing with a lot of people now who are not even wanting to go into Work and Income because they are finding the situation and the environment in those offices so traumatising.PHIL TWYFORD (Labour—Te Atatū): I am going to talk about housing. The really intriguing thing about this Government’s handling of the housingissue has been that in the face of a crisis that has got worse and worse over the last few years all we have seen from the Minister Nick Smith since he became the Minister for Building and Housing 2½ years ago is a series of grudging half measures. The standard operating procedure for this Minister on housing has been denial trivialisation complacency and refusal to acknowledge the extent of the problem until the focus groups showed that people are starting to get concerned. Then what do we see time after time after time? He tosses out some grudging half measure as a sop to public opinion.Last week the Prime Minister made his most revealing comments yet on this issue in an interview with Leighton Smith on Newstalk ZB where the Prime Minister said that Aucklanders like their house prices going up because it makes them richer. This was very interesting and very significant. It was the most candid that the Prime Minister has been and it explains why we have a non-housing Minister and a non-housing policy.He is a Minister whose job is to look like he is doing something—to provide political cover for a Government that has made such a cynical political calculation a calculation that there are sufficient numbers of Aucklanders who own their homes and who will feel wealthier and happier because of rising paper wealth that they can never cash in unless they move out of the city giving up their job and moving away from family. That does not happen. The Government knows that but it is content to make that calculation—that there are enough homeowners who feel that they are getting wealthier because of skyrocketing house prices. In doing so it will throw under the bus the 50-plus percent of Aucklanders who do not own their own home—who rent. It will condemn Generation Rent to a lifetime of renting—the very tenants in their own land whom the Prime Minister talked about only a couple of years ago.Nick Smith talks a big game on supply—the supply of houses. His diagnosis of the housing crisis in Auckland is simply that there are not enough houses. It is all about supply and nothing about demand. But he has singularly failed to deliver supply. In 2½ years as the housing Minister there is such a shortfall in houses that the Productivity Commission—his policy touchstone on housing; the Government’s pet thinktank—predicts that at current rates that shortfall is going to go from 32000 now to 60000 houses in 2020. That is a failure by anyone’s reckoning from a Minister who made it his ambition to increase the supply of houses. It is getting worse by 5000 every year.That is why house prices in Auckland are skyrocketing and that is why the New Zealand Herald reported that they have been going up by $511 a day on average for the last year—$511 a day. You can make more money under this National Government’s policy by owning a house than by working. There is only one way to get rich under this Government and that is by speculating in residential property. That is its policy. The National Party is the party of property speculators foreign and domestic. That is whom it stands for and the Prime Minister’s comments revealed very clearly that the Government is selling out New Zealand and selling out young Kiwi first-home buyers because it does not care. It has made a cynical political calculation that it would rather count on the votes of Auckland homeowners who think that they are getting wealthier. It does not give a damn about the lost generation that will never ever have the Kiwi dream of affordable homeownership.The crowning glory of Nick Smith’s tenure as housing Minister so far has been his Auckland Crown land fiasco—Carmel Sepuloni: I thought it was him lying on the road.PHIL TWYFORD: It is hard actually to choose which one is the real fiasco. Documents released under the Official Information Act the other day revealed exactly what everybody knew. His Budget policy on developing vacant Crown land for Auckland housing was rushed. Treasury said that it was almost too late. It was past the deadline and we know why—DARROCH BALL (NZ First): It is a pleasure to rise on behalf of New Zealand First to speak on Vote Social Development. I would just like to concentrate on the Limited Service Volunteers programme and its—Brett Hudson: Great programme.DARROCH BALL: Is it? Oh why did you cut it then? Why did you cut the funding then?I would like to talk about the funding or the lack of it and actually the reduced funding for a couple of reasons. One is that youth is one of the most important age groups that we have in our country but it is also one of the most underfunded and actually neglected by this Government. A second reason is that I was actually a platoon commander in the Limited Service Volunteersprogramme. I know the actual benefits and that it is a great course the Limited Service Volunteers course.I would just like to start by quoting the previous Minister for Social Development Paula Bennett and her explanation before the Government actually bolstered up the numbers from around 800 to about 2000 positions for trainees there.Paula Bennett said: “It’s not always easy as a young person to know what direction you are taking. Self confidence is sometimes lacking and the courage to take risks and open yourself to new opportunities is sometimes missing. I have seen first hand the light that switches on for young people while on LSV. They gain confidence they learn about themselves and what they are capable of. They come out with a plan. Sometimes it’s not just an employment or study plan but a life altering direction that they will take.”Actually they have gotsome statistics and results here in this release and it says that they have shown that of all those who have completed the course since 1993 45 percent gained employment and a further 30 percent entered trade-related training within 3 months of the course finishing.But apparently if you fast-forward just a few years theNew Zealand Herald says that “The Government has quietly scaled back boot camps for young beneficiaries and Treasury has advised that they should be scrapped altogether because they are not effective.”But not effective about what? And how is the Government measuring the success of the Limited Service Volunteers courses and why should it be cutting the funding to the Limited Service Volunteers?In fact a spokeswoman for the Minister for Social Development Anne Tolley said that the previous rise in funding was because of high youth unemployment during the financial crisis which was around the 2010-11 year. Well that is a load of rubbish because if we actually look at the statistics in the third quarter of 2010 there were 33000 15 to 19-year-olds who were unemployed—around 23.8 percent. If you fast-forward to 2015 when the Government wants to cut it from 2000 to around about 800 trainees there is exactly the same number of youth who are unemployed—33000—and it is around just over 21 percent. So there has been no change whatsoever in unemployment but apparently in 2010 that was a cause to increase the numbers of Limited Service Volunteers and increase the funding and in 2015 that was a cause to cut it. In fact if you want to look at the age group from 20 to 24 which does include positions for Limited Service Volunteers in 2010 there were just 26000 and in 2015 there are 30000. It has remained at 11.9 percent.So where is this Government getting its statistics from? It is making them up. What it wants to do is cut costs and it wants to do it by any means necessary. It is an absolute cop-out. It is letting these kids from this successful programme—the Limited Service Volunteers which the New Zealand Defence Force is running—go towards yet another youth benefit scheme. We have got a bill going through the House at the moment about extending the Youth Service. The Youth Service is actually fully focused on just one thing and that is education and National Certificate of Educational Achievementlevel 2. So how can you compare that—The CHAIRPERSON (Lindsay Tisch): No no—not me.DARROCH BALL: Sorry Mr Chairman. How can members in this House and how can the Government compare that with the self-confidence the courage and the new opportunities that these trainees gain in the Limited Service Volunteers programme? They cannot.I would just like to finish with this. In the Treasury report it says that “The package does not include funding to continue the Limited Services Volunteer programme. There is limited evidence of its effectiveness in achieving [its] outcomes.” Well in 2010 the Government had the evidence to increase it and now it does not. What I would like to say is that I say and everybody else who has been involved with the Limited Service Volunteers says that you cannot measure the confidence the courage and the self-realisation that these individuals gain.MARAMA FOX (Co-Leader—Māori Party): For a number of years the Māori Party has come into Government and decided to work with the National Government. It is something that we are willing to do because actually it is easy to sit and throw stones but we are actually more interested in providing an avenue for working collaboratively together. The increase this year of the benefit rates—for 43 years no matter who had been in Government nothing had been done about it. Nothing had been done about it. So there has been an increase but I agree that actually that increase is not going to eliminate poverty. That increase is relief for hardship. We must commit to having ongoing measures that will eliminate poverty eradicate poverty.This year in September the Prime Minister will be attending the UN General Assembly for a sustainable goal agenda where the No. 1 goal is eradicating poverty by our own country’s measurement. There is a whole lot of debate about how we do measure poverty. Well if we look at the one that the Government likes—the severe hardship index—by that measure 100000 children still live in poverty. That is 10 percent of our children. I want to say to the Committee tonight that it is within our grasp right now to do something about it so that we can eliminate and eradicate poverty in this country. If we stall any further measures to do something it will soon be outside our capability and our capacity as a country to do that and to realise the actual goal of eliminating poverty.The No. 6 goal on that agenda in September is to set a target to halve and eradicate poverty by our own measures. I want to call on our Prime Minister and our Government to sign up to that goal agenda to continue to work together. I am willing to work together with the Ministerial Committee on Poverty to do just that: to find ways where we can take a purposefully targeted approach to eliminating and eradicating poverty in this country before it is outside our ability to do so. We can do it through a number of simple measures that do not actually cost a lot of money—it is not about putting an extra $500 in everybody’s hand and therefore making it impossible for us to do.But we can do some things like indexing benefits to the median wage—why have we never done that before?Because in a few years the small gain that we have been able to make will again be widened we could index our benefit rates to the median wage so that they continue to keep pace and not widen the gap.Another thing that we can do is we can ensure that we extend the—what is it called; it has gone out of my blinking head—the paid parental leave. Extend that to the full 26 weeks; allow mothers to be with their babies in those formative first months so that they can give greater input into their lives and into growing and developing the brain which needs to happen. One of the factors for poverty and keeping ourselves in the poverty cycle is actually poverty of the mind.The other thing we can do is have security of tenancy. It does not cost much at all but it guarantees people that they can live in a home for at least the life of their children in school so that their children are not transient so that they can stay in one place and so that they can have a secure warm and safe home to come home to.We can do these things and I call on the Ministers on the Ministerial Committee on Poverty to work with us to work with me. I am willing to do that. That is why this party—the Māori Party—goes into a coalition agreement of confidence and supply with the National Government. It is so that we can make some changes and have some influence.The Prime Minister can commit to this in September. We can set targets for reducing poverty and eradicating it and we can continue to build on the good work—because it is good work because nobody had done anything for 43 years. The Hon Dame Tariana Turia will tell you that nobody talked about poverty in this country until the Māori Party came in here. Why? Because we know poverty.Iain Lees-Galloway: Oh come on.MARAMA FOX: That is what she says and I hold her to it because it was in our relationship agreement the very first one in 2008. It was in the next one in 2011 and it was in the next one in 2013. Because of the Ministerial Committee on Poverty we have seen benefits to our people.Hon Dr NICK SMITH (Minister for Building and Housing): I firstly want to acknowledge Marama Fox and the work that the Māori Party has done with this Government that has enabled us to deliver things like a $25 increase in benefit payments—the first in more than 30 years. I want to acknowledge its work that has enabled us to provide for free doctors visits for those under the age of 13.An area I want to particularly acknowledge the Māori Party on in which we are also making progress is improving the quality of housing. Let me talk about this area because we have provided in this Government’s term for the insulation of 290000 homes through the Warm Up New Zealand: Healthy Homes initiative. We have also insulated 30000 State houses and we have also set down a programme just announced with tenancy changes for 180000 other homes to be insulated. That is 500000 homes—1.2 million people living in warmer drier homes. I challenge the Labour members who are interjecting: how many did Labour do in its 9 years?Hon David Cunliffe: Resign.Hon Dr NICK SMITH: We did 500000—Mr Cunliffe—The CHAIRPERSON (Lindsay Tisch): Sorry. Order! The continual barraging across the Chamber is unacceptable. Tone it down. I actually want to hear what the Minister is saying and I am sitting right beside him.Hon Dr NICK SMITH: I am happy to compare the record: 500000 homes are warmer and drier under our Government. Under the 9 years of Labour it insulated not 500000 but 15000 and Labour members have the gall to stand up in the Chamber and to pretend that they are the only ones who care.I want to talk about HomeStart because this Government is providing the most generous support for first home owners in more than a generation. Some of the older grey hairs may remember the State Advances Corporation loans. They may remember the capitalising family benefit. What we are doing in this Budget is putting $430 million into helping young New Zealand families get over that hurdle and be able to buy their first home. There is only one problem that we have had in the last 3 months and that has been dealing with the tsunami of applications of new first home owners from Invercargill to Kaitāia who are picking up on that scheme and getting themselves into a home.I want to challenge Phil Twyford because never have I faced such a duplicitous Opposition spokesperson who is all over the paddock. He challenges us to put loan-to-value ratios in place and when they are put in place he opposes them. He is a spokesperson who when interest rates go up complains and says it is bad and when interest rates go down complains and says that it is bad. When I first became Minister for Housing he demanded that I not interfere in the Auckland Council. He organised for my hoarding to be put up all over Auckland and then he has got the gall to say: “Oh but the Minister’s not doing enough in Auckland.” Well let me give the numbers. Every year that I have been Minister since 2013 the number of new houses being built in Auckland has grown by 20 percent. There has never been a period in the last 3 years or in any time in Auckland’s history when there has been as fast a pick up in the rate of house building.But here is the really embarrassing bit: never have I seen a spokesperson tear up the heritage of a party that I thought stood for inclusion as he did with his cynical attack on those with Chinese-sounding names. You only need to see the reaction of spokespeople in the Labour Party who now cringe every time Phil Twyford gets to his feet because in one of the most clumsy manoeuvres we have seen in this Chamber this year Phil Twyford has burnt up 50 years of hard work where people thought the Labour Party stood for racial equality and stood for inclusion. Now we know that the Labour Party is out to cynically target one ethnic group with this housing challenge.POTO WILLIAMS (Labour—Christchurch East): That last speech was from a Minister Nick Smith the Minister for Building and Housing who has done such a poor job at housing that they had to put three people in his place. That is appalling.Let us start with the Housing New Zealand rebuild in Christchurch shall we? The new builds—700 new homes in Christchurch. When is the deadline? The deadline for that is December 2015. How many of the 700 houses have been built?Carmel Sepuloni: How many?Hon David Cunliffe: How many?POTO WILLIAMS: It certainly ain’t 700; I can tell you that. We are closer to 300. The last time I got the answers to our written questions we were at something like 296. Now how many does that mean need to be built by the end of the year?Hon David Cunliffe: 402.POTO WILLIAMS: That is right. How is that going to be done? I will tell you how it is going to be done Minister. How it is going to be done is that we will have a deadline that National puts in place which was going to be December 2015 and now it is going to be March 2016. So at the estimates discussion we hear: “No it’s not December 2015.” even though over the last 2 years the ministry has been saying that yes it will get these houses built because the people in Christchurch desperately need them. What did we hear at the estimates discussion? March 2016 at the earliest. Do you think that is good enough? I do not think it is good enough and I have been talking about this for a long time. I knew that that was ambitious at the beginning and I was right.Oh boy it makes me wild to know that this Government does not care about the people in Christchurch and their housing concerns. Let us talk about the housing accord in Christchurch shall we? Let us talk about the case of the disappearing $52 million. There has been $22 million spent on the housing accord for affordable housing in Christchurch and what has happened to the other $52 million? Well I will tell you what has happened to it. It has gone to Auckland. It has gone to Auckland to deal with the Auckland housing crisis. How do you think people in Christchurch feel about that Minister? They do not feel very good about that. On top of that let me quote from one of the city councillors Glenn Livingstone. What did Glenn Livingstone say? He is the chairman of the council’s housing task force and he said this was the first he had heard that the money was to go to Auckland. So this Government could not even front up to the council in Christchurch and tell the council that it was taking $52 million out of the housing accord to send to Auckland. It could not front up to it. The council got that information from this news report. How is that for relationship building with the Christchurch City Council—that the council had to find out from a news report that that $52 million was going to Auckland? I think that is pretty appalling. How did we find out about that money? Did the Government front up and say: “Hey we think Christchurch is actually doing OK. We’re going to send some money north.”? No it did not. This cynical Government left it to a backbencher to find the information in the Treasury dump of documents. That is what it did. Did you get up here in the Chamber Mr Smith and say to the people of Christchurch: “You are doing so well in your housing issues. We’re going to send this $52 million up north.”? No you did not.Let us see what reaction we had in Christchurch to that shall we from the Salvation Army? “From a Salvation Army Christchurch perspective it’s very alarming. There is still a major need and major issue [with affordable housing]. The impact that will have on all agencies is significant.” And let us see what the City Mission has said—The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to report progress.Progress to be reported presently.House resumed.The Chairperson reported the New Zealand Flag Referendums Bill without amendment and progress on the Appropriation (2015/16 Estimates) Bill.Report adopted.Sitting suspended from9.56 p.m.to9 a.m. (Wednesday)