Volume 654 Week 12 - Tuesday 12 May 2009 
Volume 654 Week 12 - Tuesday 12 May 2009 
[Volume:654;Page:3051] 
Tuesday 12 May 2009 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Motions 
New Zealand Police—Death of Senior Constable Len Snee in Napier Armed Siege 
Hon JOHN KEY (Prime Minister) 
: 
 I seek leave to move without notice a motion on the death of a serving police officer in Napier. 
Mr SPEAKER 
: Is there any objection to that course being followed? There is none. 
Hon JOHN KEY 
: I move  
That this House express its sorrow at the death of serving police officer Senior Constable Len Snee of Taradale Police who died during an armed siege at Napier last week that it express its support for his two fellow officers who were seriously injured during that siege and that it acknowledge the excellent work of the New Zealand Police who brought this terrible situation to a close. 
On behalf of the Government and all New Zealanders I offer my deepest sympathies to the family of Senior Constable Len Snee: his wife Vicki Snee and his sons Sam and Joe. Senior Constable Snee tragically lost his life on Thursday last week while on duty in the service of his country. He was a member of the police for 32 years and was a hugely popular and respected member of the community. All of Napier mourns his loss. Mr Snee made the greatest possible sacrifice anyone can make for his or her community. The members of this House the people of Napier and all New Zealanders owe him and his family a debt of gratitude which we can never hope to repay. 
My thoughts and those of this House are also with two other officers involved in this incident: Constables Bruce Miller and Grant Diver. They remain in hospital after being shot during the armed incident. 
We are reminded at this time of the risks our police officers take every day to protect the public. Their job is a dangerous one and the events in Napier over recent days are a stark reminder of that. Let us commend the excellent work of the police who brought this terrible situation to a close with perseverance courage and professionalism. I especially acknowledge Superintendent Sam Hoyle for his leadership in a time of extreme crisis and the team who supported him including members of the Armed Offenders Squad the Special Tactics Unit the New Zealand Defence Force and Napier’s ambulance officers. It is thanks to their efforts that this siege came to an end without further loss of life of police or of innocent members of the public. 
I would also like to acknowledge the huge efforts of the people of Napier in supporting the police during this crisis. Although these events are undoubtedly tragic they also tell a story of a community pulling together to support one another. I am sure the House joins me in acknowledging the efforts of the Mayor of Napier Barbara Arnott who initiated the civil defence operation that operated during the siege and all those members of the community who helped out with accommodation cups of tea meals and support. The people of Napier can be proud of the support they offered the police and one another at a truly testing time. 
Our thoughts are also with the civilian who was seriously injured in the shooting. I understand that this man acted heroically in trying to stop the offender from shooting at police officers. 
The incident that unfolded in Napier last week highlighted the bravery and operational expertise that make our police among the finest in the world. So today let us take this opportunity to thank all those police officers who each day put their lives on the line in order to protect their fellow New Zealanders. We join them in their mourning of a much-liked and respected colleague. We salute them for all that they do for us and we offer them our support and condolences at this very difficult time. 
Hon PHIL GOFF (Leader of the Opposition) 
: 
 On behalf of the Labour Opposition I want to join with others to express our sympathy and condolences to the family the friends and the colleagues of Senior Constable Len Snee who was killed in the course of carrying out his duties in Napier last week. To Grant Diver Bruce Miller and Lenny Holmwood and to their families and friends we likewise express our sympathy and concern and our hope that they will quickly recover from the injuries they sustained during the shootings. 
For Len’s family words cannot adequately express the loss that they have suffered. To lose a husband a father and a brother in this way is absolutely a tragedy and our thoughts are in particular with Vicki his wife and their sons Sam and Joe. Our thoughts are also with Len’s colleagues in the police force because for those who work as police officers their workmates are also their family. They work as part of a team; they often face danger together. Because of the nature of their jobs they know each other well and they rely on each other. 
Len Snee is the 29th police officer killed in the line of duty. Last year equally tragically we saw two police officers Sergeant Don Wilkinson and Sergeant Derek Wootton killed in the line of their work. Police officers work to keep our community safe and to protect the lives of people in our society. In this House we need to remember that every day police officers around the country put their safety and sometimes their lives at risk on behalf of their country. They deserve our support in carrying out that work. 
All of the facts of the shootings that occurred in Chaucer Road in Napier last week are yet to emerge. We will have a better idea of exactly what happened and what we can learn from this tragedy when a full inquiry has been held. I believe that there will be stories of considerable courage on the part of those involved and in due course we will be able to pay tribute to those people. We will also need to look for lessons about how we can hopefully reduce the risk of situations of this nature reoccurring and questions I believe will validly be asked about how people are able to unlawfully acquire and hold military-style weapons. But for now we join with Len Snee’s family in acknowledging and paying tribute to him and expressing our feelings of loss. On Police Remembrance Day on 29 September we will sadly add Len Snee’s name to the roll of honour of police officers whom we remember as having given their lives in the course of their duties. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 On behalf of the Green Party I would like to add our sympathy and send our condolences to the family and friends of Senior Constable Len Snee. We would also like to send our sympathy to those who have been shot in the incident and are recovering. Losing a husband a father a brother—losing a loved one—is always really difficult. We are thinking of the family now and I think all of us can identify with and feel for them in what they are going through at the moment. We in the Greens offer our gratitude to our hard-working police for the job they do to keep New Zealand a safe place. New Zealand is generally a peaceful society—generally—and we hope we will not see further tragedies like this one in the future. We would like to send a tribute to Len Snee and to thank his family for all that they have done. We would also like to acknowledge him. On behalf of the Green Party I thank all New Zealand police for the hard work they do. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 On behalf of the ACT Party I express our sympathy at the loss of Senior Constable Len Snee killed in the line of duty. Our thoughts go out to his family his colleagues and the community in which he played such a supportive role. The thoughts of the ACT Party and of course this Parliament are also with the other injured policemen Senior Constable Bruce Miller and Senior Constable Grant Diver and the injured neighbour Leonard Holmwood. We are thinking of them and their families. 
This tragedy highlights the extreme risk our police face every day. We can all be thankful for the professionalism and courage of our policemen and policewomen. That was there for all of us to see as our brave police continued their task of protecting the citizens of Napier long after one of their own had fallen. Every man and every woman who puts on a uniform is a hero. They put their lives on the line for us every day. Tragically Senior Constable Len Snee paid the ultimate price. We mourn his passing today and we salute the brave men and brave women who serve us. Thank you. 
Hon Dr PITA SHARPLES (Co-Leader—Maori Party) 
: 
 A kai te rangatira tena koe kai te Whare tena tatou katoa. E te Whare kua kapohia a te tangata e te ringa kino o kohuru. Koia tera e okioki ana i runga i tona moengaroa e tiraha ana i raro i te korowai i tona whanau. He pera te mamae o mate ahakoa he tangata ahakoa te ahuatanga o te hinganga. Engari te mate kua pa atu ki te tangata kua tu hei whakaruruhau hei tauira hei poupou mo te hapori a he parekura ano hoki tera. Aue taukuri e. 
[ 
Greetings Mr Speaker and to us all. I say to the House that a person has been taken out by a cruel and murderous hand. He is the one resting there upon his bed of eternal slumber stretched out beneath the cloak and before his family. Regardless who one is and the circumstances that is the nature of death. But when a person regarded as a protector icon and pillar of the community dies in the manner he did then it becomes a devastation and a real travesty 
.] 
The roll-call of lives lost over the last century—officers killed in the performance of their official duties—is a tragic memorial to people who paid the highest sacrifice for their commitment to public service. Last Thursday that list grew longer. We in the Maori Party pay our deepest respects to the family the colleagues and the community who now grieve their loss. It is indeed appropriate for this House to mourn with those who are most affected by the heartbreak caused by the shooting in Napier. All of us in this House will know the pain of losing a loved one through death—the loss of a father a son a brother a cousin an uncle or a partner. That grief is dramatically and traumatically heightened when it is under such tragic circumstances as this. We extend our support also to the families of the two officers and to the brave member of the public injured in this event and forever scarred by the events of the day. 
This is an extremely serious and sad moment for all New Zealanders. The context of the shooting itself cannot be overstated. That day will always be marked for the people of Bluff Hill by vivid memories of the chaos that rolled out that morning. They will think of the threats of munitions. They will be haunted by the shots that pierced the air. They will remember the reports of the high-powered weapons the involvement of the armed offenders squad and the Special Tactics Group the lockdown of all the schools in the vicinity the rescue helicopter circling the deployment of the dog unit the ambulances on stand-by and the police cars searching the streets. Well over 2000 children now have an experience of terror that no one would wish for our young. The children of Carlyle Kindergarten Nelson Park School Napier Central School Napier Intermediate School Sacred Heart College and Napier Girls High School were all unwilling participants in the incident that erupted around them. 
This is the not the New Zealand that we believe in. The horrific shooting and the subsequent siege that occurred over the weekend will have massive impacts rippling across many communities. First and foremost we think of the families who grieve and who suffer the enduring legacy of that day. We think of the police officers throughout New Zealand who will each take on the pain of the slaughter of one of their colleagues but will get up each day and go to work. We think of the Napier community: the children and the members of the public who are shell-shocked at the events that unfolded in their town. We think of Takapau a small town of relatives and friends of Maori and Pakeha—the home base of the Snee family—who shed tears and mucous together as the village said goodbye to a loved son on his marae. And we think of ourselves as New Zealanders haunted by the violence that took over a community and asking why it happened and how things could have been done differently. 
We must never let this happen again. If there is one thing I hope we can do to honour the memory of Lenny Snee it is to cooperate across this House to invest in peaceful communities in all that we do. 
Na reira kai te tamaiti kai te rangatira haere i te huarahi kua wharakitia te mana ki o tipuna matua. E Lenny haere haere haere. 
[ 
And so to you Lenny son and leader tread the pathway to your ancestors which is paved with integrity. Go forth depart farewell 
.]  
Waiata 
Hon JIM ANDERTON (Leader—Progressive) 
: 
 I too join with other party leaders in expressing my deepest condolences to the family of Len Snee. I too wish a speedy and full recovery to the injured as they lie in hospital. I send my best wishes to their families who must be desperately worried as they pray and wait at the bedsides of the fallen. 
Maybe the most sombre thing we do in this or any other Parliament is to send men and women into danger on behalf of New Zealand citizens and communities. The plaques on this Chamber’s walls reflect their sacrifice. We send them out knowing that sometimes on the darkest days they will not come back. When we send them out we send them to defend New Zealanders. They are there for us. They go out as our bravest and when they fall something of us all falls with them. Every police officer knows that when he or she goes about his or her duty even on an apparently normal day danger and unpredictability lurk. Police officers take on that danger on our behalf. We can never repay sufficiently our debt to them and we cannot begin to repay the debt we owe to those who give their lives for us. 
Most of us have learnt a lot about Len Snee in the last few days. We learnt about his professionalism as a police officer. We learnt about his popularity in and his commitment to his community. I pay tribute to him personally and I hope that as his family grieve they can find some small comfort in the respect and admiration his countrymen and women are universally expressing. I hope New Zealanders will show their respect by declining to seek political mileage from this death while the wounds are still so raw. It is very easy to exploit the strong emotions we feel over a tragedy like this. It is easy but it is wrong. I congratulate the Prime Minister and say that I agree with his reaction when he said he was not going to be stampeded into a call for arming New Zealand’s police in their day-to-day operations. That response in my view was the right response. 
There will be lessons to be learnt from this tragedy of course and we will all have to reflect carefully on them. But the time for making political judgments is not now. I am sure the family of the murdered officer are not yet ready to have him used for point-scoring about guns nor for political mileage about drugs crime policing mental health or any of the other issues that will inevitably give us pause. This is simply a time to give thanks to the men and women whom we ask to protect us to share the grief of Len Snee’s family and friends and to express our strength as a New Zealand community that comes together in a way that makes our bond stronger whenever we are confronted with a tragedy like this. 
Hon PETER DUNNE (Leader—United Future) 
: 
 Across New Zealand nearly every day of the year families farewell each other in the morning as they go off to work to college or to school to go about their normal daily lives and they look forward to the time when they come home at the end of the day. So it was I suspect in the Snee household last Thursday morning. No one could have imagined that within a few short hours Senior Constable Snee and his two colleagues would have confronted the awesome reality that they did and that Constable Snee would lie dead. That is hard enough for any family to have to come to grips with—the sudden traumatic loss of a father a husband and a loved one. The circumstances make it so much worse in this case. 
We can stand here in this House and genuinely express our sympathy and our horror at what has happened but I doubt that any of us would be bold enough to say that in so doing we have even a modicum of understanding of the feeling that the family who are suffering today as a consequence of these actions have. I think it is right and proper to pay tribute to an outstanding police officer. I think it is right and proper to call to mind the expectations we as a community place upon the police and how for granted we take the fact that they will always be there to undertake those unpleasant tasks. 
I agree with other speakers: this is not the time to draw political lessons. There is much work to be done in understanding what happened on this occasion and in learning over time the lessons so that these events cannot be repeated. But for now our response as a community has to be to come around the affected families to support them in their moments of deep despair and distraught grief to encourage them to try to face the future with some confidence to give them the assurance that we recognise the contribution of their loved ones and to honour Constable Snee Constable Miller and Constable Diver by these words in the House this afternoon. This has been a horrific week for New Zealand. I think New Zealand has reacted with some dignity and calm and now we need to show that same dignity calm and space as we support the affected families who are recovering from this tragedy. 
Motion agreed to. 
Honourable members stood as a mark of respect. 
Questions to Ministers 
Auckland Local Government Reform—Consultation 
1. Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he intend to deny Aucklanders the right to vote on the reorganisation of local government in Auckland as they would have if the reorganisation was carried out under the Local Government Act 2002; if so why? 
Hon JOHN KEY (Prime Minister) 
: 
 The Government wants Aucklanders to have the maximum impact into the proposals and believes there should be a greater opportunity to give input than just a yes or no answer as would be the case on a referendum question. That is why we have set in train a select committee process which the member will be able to participate in and we look forward to his contribution. Furthermore the approach being taken on this matter by the Government is in line with the royal commission’s thinking which said that despite the “superficial attraction” of a referendum it is not the right approach for Auckland. 
Hon Phil Goff 
: Why are Aucklanders being denied the right to vote for or against the changes that the Prime Minister is seeking to impose on Auckland other than for the obvious reason that he lacks confidence that the people of Auckland see these changes as being the right changes and as being in the form that is best for them and their city’s future? 
Hon JOHN KEY 
: There are two points. The first of those is that the royal commission itself quite correctly pointed out that a poll of electors which by a simple majority would determine whether the proposal would proceed is plainly insufficient—that this is a complex and wide-ranging recommendation and more is required than a yes or no. But I take this opportunity to thank Ross Robertson who today in the  
Manukau Courier 
 said: “I think a super-city to deal with city-wide issues is needed.” I agree with him. 
Hon Phil Goff 
: Why is the Prime Minister not listening to Aucklanders who by a margin of two to one have said they have not been consulted adequately about the governance changes; and why is the Prime Minister totally ignoring the people of Mt Albert who overwhelmingly in their submissions said they do not want 600 houses and their green spaces destroyed by a surface motorway rather than a tunnel? 
Hon JOHN KEY 
: I can assure the member that I am listening to Aucklanders. I am listening to Ross Robertson who thinks a super-city is a good idea. Funnily enough I am going to listen to another Aucklander—George Hawkins—who is today also in the paper saying “I support the Auckland Council concept for the region as a vehicle for getting rid of development and economic stumbling blocks to progress in the area as a whole.” A majority of Aucklanders support the super-city and it is rapidly emerging that a majority of the Labour caucus support a super-city as well. 
Dr Russel Norman 
: Will the Prime Minister guarantee that as long as he is the Prime Minister the sections of the Local Government Act that prevent the privatisation of water will not be repealed or amended? 
Hon JOHN KEY 
: That is an issue that we have not considered. 
Hon Phil Goff 
: Does the Prime Minister not understand that although many Aucklanders are in favour of the concept of strong regional cross-city governance they do not want his “at large” seats and they do not want his second tier of local government that has been so gutted of power and responsibility that it means nothing at all? 
Hon JOHN KEY 
: Firstly the select committee process will allow Aucklanders to have their say on what they want. The Government has a strong sense of what it wants for Auckland and that is an Auckland Council that will provide leadership and guidance to the region. Mr Goff may not know his own mind. At one moment he seems to support a single regional body; then he says he opposes the establishing of the very council that would achieve that. He then says he sort of does not support the royal commission but then says he does but does not recommend various councils “at large”. Actually the reality is that the Government is showing leadership in this area and that is what is required. 
Sue Kedgley 
: Is it not an extraordinary situation when a day before legislation that will initiate the most radical restructuring in local government in recent times neither Opposition MPs nor most mayors of Auckland have even seen the legislation or have a clue what it will contain? 
Hon JOHN KEY 
: Firstly the bill is being delivered to all of the research units around the various parties of Parliament today. Secondly as the royal commission itself pointed out it is important to set up a transition agency with some urgency. The first bill simply establishes the single unitary authority for Auckland of the transition agency and sets out the limitations of its powers. All of the bulk of the other work that might take place is in the second and third bills. 
Hon Phil Goff 
: Are urgency and the decision to rush through the Prime Minister’s changes on Auckland governance not a kick in the guts for Aucklanders who have said they want the right decision not a rushed decision and is his decision on State Highway 20 not a kick in the guts for the people of Mt Albert whose genuine concerns about a surface motorway have been ignored both by him and Melissa Lee? 
Hon JOHN KEY 
: No but can I just remind the Leader of the Opposition of one small thing? 
Hon Phil Goff 
: Why did you cut her off at the knees? 
Hon JOHN KEY 
: Well I know the Leader of the Opposition does not want to hear this but the one reason why we actually had a royal commission was that the previous Labour Government thought that Auckland governance was dysfunctional was not working and needed reform. By the way I tell Mr Goff not to ask me but to ask Trevor Mallard about that. He is the one who could not get his stadium proposal through the dysfunctional governance of Auckland. 
Hon Trevor Mallard 
: So you’re funding Whangarei! [ 
Interruption 
] 
Mr SPEAKER 
: Members please show respect to Sue Kedgley who has the floor. 
Sue Kedgley 
: Further to the Prime Minister’s assurances that the way for Aucklanders to make their views known on the radical restructuring of their local government will be through the select committee process can he assure Aucklanders that all of them will be able to make submissions on this radical restructuring proposal; if they cannot how will they be able to make their views known to this Government? 
Hon JOHN KEY 
: Yes I can assure the member that Aucklanders who want to put a submission before the select committee on issues of Auckland governance will be able to. I can tell the member that we are actually setting up a special select committee so that— 
Hon Annette King 
: Why? 
Hon JOHN KEY 
: Oh for goodness’ sake! So that we can actually listen to Aucklanders and to people who understand the situation and give them time to make submissions. 
Hon Phil Goff 
: What is the cost of the restructuring that the Prime Minister is proposing to impose on Auckland—or is it true as Mr Hide’s office says that the Government does not know the cost of what it is planning to impose? 
Hon JOHN KEY 
: What I know is what the royal commission pointed out regarding governance in Auckland. I think reforming it will provide tremendous gains for Auckland over time. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. You heard the question. It was very straightforward: what is the cost? If the Prime Minister does not know the cost he should simply tell the House. 
Mr SPEAKER 
: It is a shame the honourable member did not ask that question. 
Hon Phil Goff 
: That is the question I asked. 
Mr SPEAKER 
: The problem is that members put a whole lot of other stuff into a supplementary question. If the member had just asked that question then the Prime Minister perhaps could have answered that question but the Prime Minister is entitled to latch on to whatever part of a supplementary question he chooses to. It is a salutary lesson about making questions brief succinct and to the point. 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. I accept the point you have made but the Leader of the Opposition asked the Prime Minister what costs were involved with that proposal and then drew a comparison with what one of the Prime Minister’s own Ministers had said about it. That hardly introduced extraneous material. That was two members of the executive and it was a question about costs. What we got from the Prime Minister was a response about savings. That was not the question the Leader of the Opposition asked. 
Mr SPEAKER 
: The honourable member has just pointed out the problem with that supplementary question. The Standing Orders do not provide for the introduction of further material. They provide for the asking of one question and one question only with no further material added to it. If the member doubts me he should read the Standing Orders. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. The Standing Orders might well say that but it has long been the ruling of Speakers in this House that people have been allowed to ask supplementary questions with two and sometimes three legs. In this particular case there was only one question. There was some additional evidence in the question; there was an additional point in the question. There was one question and the Prime Minister showed that he was unable to answer it. 
Hon Simon Power 
: Rubbish! 
Mr SPEAKER 
: There will be no comment while I am ruling on this point. The member has just pointed out the problem. It is quite correct that Speakers do not intervene because otherwise the House would be interrupted all the time. I did not intervene; I do not intervene when members ask more than one question. But if other material is introduced the Minister is perfectly entitled to comment on it. If members want an answer to be given to their question they should ask a succinct question. The honourable member himself— 
Hon Trevor Mallard 
: Mr Speaker— 
Mr SPEAKER 
: I will not take this matter further. I make that very clear. I am going to call Dr Russel Norman and that is the end of this matter. 
Dr Russel Norman 
: Can the Prime Minister understand the concerns of Aucklanders that their assets are at risk of privatisation when the Minister for Local Government who is leading the process has a clear privatisation agenda and when on two separate occasions now the Prime Minister has refused to guarantee that the water assets of Auckland will not be privatised? 
Hon JOHN KEY 
: There is nothing in these bills about privatisation. The changes that are proposed in the legislation do not make privatisation easier or harder. Ultimately if there were to be the privatisation of assets in local government that is a matter for the local councils. 
Hon Phil Goff 
: What is the cost of the Government’s current super-city proposal to implement and run annually? 
Hon JOHN KEY 
: I cannot give the member an annual charge. 
Question No. 2 to Minister 
CHRIS TREMAIN (National—Napier) 
: 
 How will Budget 2009 address large spending commitments made in Budget 2008? 
Mr SPEAKER 
: I apologise to the member. I invite him to repeat his question. I could not hear. I invite members please not to interject continuously across the House. I have called Chris Tremain. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 I raise a point of order Mr Speaker. You possibly quite properly intervened on the Leader of the Opposition but it was a two-way conversation with the Prime Minister. You looked only at this side of the House when you made those comments. 
Mr SPEAKER 
: I apologise if that is the impression that I created. [ 
Interruption 
] There will not be comment on this. I was indicating both sides of the House with my hands. Forgive me; both sides were equally guilty. I do apologise if I gave the honourable Leader of the Opposition the impression that I was blaming only him—I was not. It was not only him at fault at all. I accept that point and I apologise for it. 
Budget 2009—Spending Commitments 
2.  
CHRIS TREMAIN (National—Napier) 
 to the  
Minister of Finance 
: How will Budget 2009 address large spending commitments made in Budget 2008? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The previous Government made a number of large unfunded commitments that were not consistent with this Government’s policies. Some of the commitments had funding attached. In those cases the Ministers have assessed whether to continue with them or whether the money is better spent elsewhere. A second group of commitments were simply promises with no funding set aside in Budget 2008. We have indicated that we are weighing up these commitments against other spending priorities. Some of those commitments have been kept but many have been dropped either because they had no funding or because they were the wrong priorities. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. You will be well aware that during the preparation of questions for the House today the Government submitted a question that used the phrase “unfunded commitments” or the word “unfunded” which is the wording that the Minister used in his reply. That word was removed by the Clerk’s Office for being out of order because it presupposes a misuse of parliamentary procedure for which no evidence has been submitted. I ask whether the Opposition—the previous Government—has any relief in the circumstance where the Minister has used in his reply exactly the same phrase— 
Mr SPEAKER 
: I ask the member to sit down. This is not a matter that can be dealt with by way of a point of order. The member is questioning the quality of the Minister’s answers. Unless the member feels that matter is a personal affront to him he can question the quality of the answer only through further supplementary questions not the point of order process. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. Forgive me; I may not have made myself clear. It is not a— 
Mr SPEAKER 
: Forgive me. The honourable member made himself perfectly clear. I have pointed it out to him that this is not a matter for a point of order. Questioning what the Minister said in his answer and whether the Clerk had approved it as part of a question is irrelevant. If the member disagrees with the answer given by the Minister he should use his supplementary questions available to question the Minister in detail on that. 
Chris Tremain 
: What will be the effect of ending these unfunded commitments? 
Hon BILL ENGLISH 
: The most important effect of it is that it will tell people who have been expecting money from those commitments that they should be realistic and not to expect the money. Most of the unfunded commitments related to future years so ending them will have little direct effect. It simply means that people who have high expectations based on promises by the Labour Government now realise that those promises were not backed by funding so they will not receive that funding. 
Hon David Cunliffe 
: Is not the largest unfunded spending commitment the multimillion-dollar broken promise that his Government pulled on New Zealanders by campaigning for unaffordable tax cuts for the rich months after Lehman Brothers collapsed and dire signs of international trouble were already obvious? 
Hon BILL ENGLISH 
: The member who just resumed his seat may not be aware that the cost of National’s tax cut programme was exactly the same as the cost of his programme. 
Hon David Cunliffe 
: Can the Minister confirm that the Auckland governance changes are a massive unfunded promise given that his own leader confirmed in the House today that he has no idea how much the changes will cost the country; and can he also confirm that the Government has broken its promise to maintain New Zealand superannuation by failing to contribute to the scheme at a time when good assets are cheap? 
Hon BILL ENGLISH 
: With regard to commitments made to Auckland what the people of Mt Albert may know now is that the Labour Government promised them a tunnel with no money to build the $3 billion project. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. As a member of the previous executive I do take exception to that phrase and I will draw attention to a report published by— 
Mr SPEAKER 
: The member will resume his seat. Is he seeking leave to make a personal explanation? I am just trying to ascertain exactly what the issue of order is that he is trying to have addressed. 
Hon David Cunliffe 
: Mr Speaker I take personal objection to the phrase “unfunded commitments” which that member has used. Taking personal exception to that is an entitlement under the Standing Orders. 
Hon Gerry Brownlee 
: I refer you Mr Speaker to Speakers’ rulings 163/6 165/6 165/5 and 165/3 all of which I think satisfactorily deal with the concerns that the Hon David Cunliffe has. Those concerns are about the quality of the answer he has received. You Mr Speaker over and above the rulings by the Hon Jonathan Hunt and the Hon Margaret Wilson that I have referred to have also said that the Speaker is not responsible for judging the quality of answers. You have been very clear that if a direct question is asked then a direct answer should be given. This side of the House is endeavouring to comply with that. It is incumbent upon the other side of the House to ask responsible questions. The reality in this case is that the Government itself does not bear a direct cost for the restructuring of the Auckland governance. 
Hon David Cunliffe 
: In your consideration of the point of order I wonder whether you could also consider Standing Order 377(2)(b) which prohibits a Minister to answer using arguments inferences or imputations that are inappropriate. The phrase “unfunded commitment” which the Clerk has ruled out arguably falls within that category. Also Speaker’s ruling 164/7 reminds us that a Minister in answering about a report that he has seen may not use this to cast an inference on the policy of another political party for which he is not responsible. 
Mr SPEAKER 
: I do not want this debate to go any further because actually I think there is some misunderstanding over the concern the member first raised. It is not that the question was not answered that was the issue the member raised. The member raised the issue whether the Minister used language that the member took exception to. The dilemma around the Standing Orders in respect of an answer to a question is that either the member takes personal exception to it and wants to make a personal explanation to clear it up or it is simply a matter of the quality of the answer which I cannot get involved in as the Speaker. That is the dilemma around our Standing Orders. So either the member wishes to make a personal explanation or he has to pursue it through further questions. That is why question time is handled this way under the Standing Orders because you do have questions to pursue the issue if that is what the member wants to do. 
Chris Tremain 
: In what areas has the Government identified unfunded commitments? 
Hon BILL ENGLISH 
: We have identified unfunded commitments in a range of areas including the Ministry of Foreign Affairs and Trade and in tertiary education. In both of these areas most of the unfunded commitments have been dropped. However spending in Vote Foreign Affairs and Vote Education will rise over the next 4 years. In the case of education the increases are substantial and I am confident that the money spent to implement the Government’s commitments will be well spent will get results and will be backed by funding. 
Hon David Cunliffe 
: Can the Minister confirm that his PR onslaught about unfunded commitments is actually a deliberate act of confusing a Government’s stated future intention to spend with the technical process of appropriating money each year through Parliament; and does the Minister therefore agree with his previous statement that it is perfectly proper practice to specify funding commitments as specified unspecified or contingent fiscal risks in the Budget as the Minister has confirmed he will continue to do? 
Hon BILL ENGLISH 
: Our discussion about unfunded commitments is an expression of frustration at finding that many New Zealanders believed the promises made by the previous Government of large amounts of extra money when those promises were not backed by a specific allocation of funding; and even when they were we found they were often misdirected priorities and that is why we have done a reasonably comprehensive exercise in the time available of knocking out those promises of the previous Government that were unrealistic and reprioritising that money that was misdirected. 
Hon David Cunliffe 
: I seek leave to table a statement by the Hon Bill English to this House where he confirmed that he will continue to use the same practices in future Budgets around unspecified fiscal risks and contention liabilities. 
Mr SPEAKER 
: Is this in the  
Hansard 
? 
Hon David Cunliffe 
: Yes. 
Mr SPEAKER 
: Leave is sought to table a  
Hansard 
 record. Is there any objection to that course of action? There is objection. 
Hon Sir Roger Douglas 
: Could the Minister please explain to the House why he places a higher priority on massive increases in expenditure in areas such as broadband State highways and subsidies for small businesses in the 2009 Budget than he does on tax cuts and improvements in productivity in areas such as health and education via the reintroduction of prices? 
Hon BILL ENGLISH 
: It is possible to emphasise all of those things and I appreciate that we are likely to take a different view of it from the member but we think it is important to continue investing in infrastructure because the economy is going to grow and we would like to relieve those bottlenecks. We agree with the member that it is time for an increase in productivity in the public sector. There have been large increases in expenditure without much increase in services and we are setting out on a 3 to 5-year programme to remedy that. 
Hon David Cunliffe 
: I seek leave to table chapter 4 from the Pre-election Economic and Fiscal Update October 2008 which runs through the specific fiscal risks facing the Budget and nowhere uses the phrase “unfunded commitments” when listing those. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? 
Hon Dr Nick Smith 
: It’s already been tabled. 
Mr SPEAKER 
: It is already tabled. I take it there is no objection? We get into difficulty when points of order are interjected upon. I take it there is no objection to part of a document that has already been tabled being tabled again? There is no objection. Sorry there is objection to that course of action. 
Families Commission—Appointment of Christine Rankin 
3.  
Hon ANNETTE KING (Deputy Leader—Labour) 
 to the  
Minister for Social Development and Employment 
: Why did she appoint Christine Rankin as a Families Commissioner? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 Because I believe she will be good in the role and she is a strong advocate for children and their families. 
Hon Annette King 
: Is Christine Rankin a suitable appointee in light of the culture of extravagance and sideshows she created when last employed in public service including the $1 million spent on a new logo for and the rebranding of her department; the $80000 spent on roadshows; the $25000 spent on self-promotion videos in which she appeared alongside Martin Luther King and Gandhi; the $250000 spent on advertising to overcome her bad publicity; and not forgetting the $1650000 spent on charter planes to take her staff to a luxury resort for a meeting? 
Hon PAULA BENNETT 
: In the last few years Christine Rankin has been a strong advocate for children and their families. She is one of seven Families Commissioners and I believe she will do a fine job in that role. 
Dr Jackie Blue 
: What other appointments have been made to the Families Commission? 
Hon PAULA BENNETT 
: Today I also announced the appointment of Mr Bruce Pilbrow the Chief Executive Officer of Parents Inc. to the Families Commission. Parents Inc. is a well-known and long-established organisation that offers practical solutions for parents. Mr Pilbrow and his team run nationwide programmes covering parenting skills family coaching and attitude programmes. This Government believes that families need practical solutions and we are appointing people with first-hand experience in the realities that New Zealand families face. 
Hon Annette King 
: Why did the Minister support Christine Rankin’s appointment in light of her comments to colleagues that Christine Rankin’s behaviour that had led to the sacking of a Television New Zealand staffer was outrageous and she avoided having anything to do with the woman? 
Hon PAULA BENNETT 
: I have no recollection of making any comments like that at all. I support Miss Rankin’s appointment to this role. I think she is a strong advocate for families I certainly agree with her stance on child abuse and neglect and I look forward to seeing the work she does on it. 
Hon Annette King 
: What message is the Minister sending to the 200 hard-working Ministry of Social Development staff who have just learnt that they are to lose their jobs in announcing the return of a person who brought the social welfare portfolio into disrepute and ridicule through wasteful expenditure? 
Hon PAULA BENNETT 
: I take umbrage at that member using what is a tough time for the ministry today as it is working through some difficult situations. [ 
Interruption 
] Shame on them! That came through in the briefing to the incoming Minister. It is a very difficult time and we will not be playing petty party politics with it. 
Mr SPEAKER 
: I have allowed the House to let off a bit of steam after some provocation. I am now calling the Hon Annette King to ask a supplementary question. 
Hon Annette King 
: Does the Minister agree with the comment of the Hon Peter Dunne that Christine Rankin is a divisive and disruptive person and did the Minister consult Mr Dunne before she took the appointment to Cabinet in line with the much-vaunted no-surprises confidence and supply agreement; if not why not? 
Hon PAULA BENNETT 
: No and yes. 
Middlemore Hospital—Redevelopment 
4.  
Dr PAUL HUTCHISON (National—Hunua) 
 to the  
Minister of Health 
: What announcements has the Government made regarding building developments at Middlemore Hospital? 
Hon TONY RYALL (Minister of Health) 
: 
 Yesterday the Government announced approval of a $208 million upgrade of Middlemore Hospital. This includes a $100 million contribution from central government. The main parts of this approval include completion of the Edmund Hillary block including additional in-patient beds; the establishment of a clinical services block including three new theatres; the replacement of the ageing theatres; a 48-bed assessment planning unit; and an 18-bed high dependency unit. This is the single biggest commitment to a hospital redevelopment since 2004. 
Dr Paul Hutchison 
: When will the people of the Counties Manukau District Health Board area see the benefits of this necessary and significant investment? 
Hon TONY RYALL 
: The member is right; this is a very necessary development because the Counties Manukau District Health Board area is predicted to— 
Hon David Cunliffe 
: Is this an unfunded commitment? 
Hon TONY RYALL 
: No it is not an unfunded commitment but I have inherited $600 million of unfunded capital claims from the Government of that party opposite. This is a very necessary development because the Counties Manukau District Health Board is predicted to have the highest growth in health demand in the country in the next 20 years. The commissioning of the new wards in the block is expected to occur in the middle of next year and further construction over that next period will I am advised create up to a thousand jobs in South Auckland. Lastly I am advised that this approval finally means the demolition of Middlemore Hospital’s last remaining World War II buildings. This Government is bringing the health service into the 21st century. 
Hon Annette King 
: Was the Minister told that the three-phase redevelopment of Middlemore Hospital including the beginning of the Edmund Hillary block was already under way—and had been for several years—before he announced the redevelopment yesterday as National Party policy and will he now commit funding to all of phase three of the project; if not why not? 
Hon TONY RYALL 
: I missed the question. If an announcement was made that those projects were being completed and there was no money set aside for them then that is another unfunded commitment made by the Government of that party opposite together with the $600 million worth of capital requests that it provided no money to cover. 
Climate Change—Australian Scheme 
5.  
CHARLES CHAUVEL (Labour) 
 to the  
Minister for Climate Change Issues 
: Is he sure that he was correct to claim in the House last Thursday that “the Australian Government did notify my office in advance of the changes it was proposing to make to the emissions trading scheme”; if so when did that notification occur? 
Hon Dr NICK SMITH (Minister for Climate Change Issues) 
: 
 Yes Australian officials informed my office on Monday 4 May at about 2 p.m. prior to the public announcement of the changes to their Carbon Pollution Reduction Scheme. New Zealand was the only country to be informed prior to the announcement. 
Charles Chauvel 
: Is the Minister aware that the Prime Minister told the media last week that the New Zealand Government had not been informed in advance of Australia’s decision; if so why did the Minister’s office know about the announcement and the Prime Minister did not? 
Hon Dr NICK SMITH 
: Firstly the member misquotes the Prime Minister. But as members of the Cabinet would know as a hard-working Government we were still hard at work in Cabinet. By the time I returned to my office and received the information it was publicly known. 
Nicky Wagner 
: What dialogue has the Government had with Australia over proposals to align the New Zealand and Australian response to climate change? 
Hon Dr NICK SMITH 
: This initiative was first advanced by Prime Minister John Key at his summit in early March with his Australian counterpart Kevin Rudd. Work was further advanced when I met with my counterpart Senator Penny Wong later that month when we established a trans-Tasman officials group and agreed on terms of reference. I had further discussions by phone last week with Senator Wong and I am further meeting next week to advance these issues. 
Charles Chauvel 
: When the Minister invited Labour members during question time last Thursday to “engage constructively in the Emissions Trading Scheme Review Committee” can he confirm that he did not mean to suggest that this cooperation was not already being extended in light of numerous examples of constructive engagement in the committee from members on this side of the House—such as by David Parker and me who provided a quorum to the committee yesterday so that it could actually meet? 
Hon Dr NICK SMITH 
: I am pleased that the select committee is doing a good job. The Government made quite a deliberate decision to have Peter Dunne as the chair because climate change is an issue that will outlive the life of any Government and the broader the consensus we can build in this Parliament about the way forward I think the better we serve New Zealand and this important issue. 
Charles Chauvel 
: Does he stand by his answer during question time last Thursday that “What is lacking from members opposite is an understanding of how critical an emissions trading scheme is to the New Zealand economy.” in light of the fact that it was his Government that suspended the scheme and in light of Labour’s written offer to him to cooperate in talks to allow the scheme to proceed a letter to which a written response is still awaited 6 weeks later? 
Hon Dr NICK SMITH 
: The first point I would make is that I wrote then as climate change spokesperson for National in December 2005 to the then Minister David Parker. I would note that to this date I have not received a response to that letter. I am pleased to have received a letter from Charles Chauvel suggesting that there may be opportunity for some dialogue between National and Labour about the future of climate change and that is something I have had discussions about both with Mr Chauvel and with Mr Parker. It is something that the Government is happy to advance. 
Firearms—Registration 
6.  
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
 to the  
Minister of Police 
: Does she agree with Chester Borrows MP that “the horse has bolted” and that it is too late to find all of the unregistered weapons in New Zealand; if so what action can she take as police Minister to address the critical issues around the registration of gun owners? 
Hon JUDITH COLLINS (Minister of Police) 
: 
 New Zealand does not have a universal registration system for firearms. The Arms Act 1983 moved to a licensing regime to ensure as far as possible that only fit and proper people can legally have access to firearms. Reasons for change at the time were that the previous firearms registration scheme was inaccurate had low compliance did not assist crime prevention and was costly. There are however very serious issues around unlicensed gun owners who are criminals. 
Hone Harawira 
: Is the Minister aware that New Zealand is probably the only country in the world to allow online sales of guns and that as result we have one of the highest rates of gun ownership per capita in the world? Can she please tell the House what action is planned to respond to concerns that little is being done to revise one of the weakest weapons monitoring systems in the world? 
Hon JUDITH COLLINS 
: I am advised that other countries—including the UK Australia and the US—have online sales of guns. The online sale of guns is one of the issues I will be asking police to consider. 
Keith Locke 
: I seek leave to table the 1997 report by Sir Thomas Thorp which advocates a system of licensing of guns. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? 
Hon Member 
: It has already been tabled. 
Mr SPEAKER 
: I have asked whether there is any objection. There appears to be no objection although it has been suggested that it has already been tabled. 
Document by leave laid on the Table of the House. 
Young Offenders—Boot Camps 
7.  
JACINDA ARDERN (Labour) 
 to the  
Minister for Social Development and Employment 
: Does she stand by her statement in the House on 30 April 2009 with regard to submissions made to the Social Services Committee on the Children Young Persons and Their Families (Youth Courts Jurisdiction and Orders) Amendment Bill that “Actually I did not say that those groups had misled the public”; if so why given that in her press release of 29 April 2009 she said “The narrow focus on boot camps by the media and critics has I believe misled the public.”? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 I just make it clear that the member’s original question asked whether I was claiming “groups such as Barnados Unicef and the Families Commission misled the public”. I have never said that those groups misled the public. What I have said time and time again is that critics of the scheme have not given the public the full story about Fresh Start—that is about mentoring programmes parenting programmes drug and alcohol rehabilitation and a whole set of programmes around the military-style camps. 
Jacinda Ardern 
: Is the Minister of Justice Simon Power one of the critics she thinks is misleading the public given that in a recent meeting with Grey Power he stated that on the matter of boot camps he is of the opinion that they do not work for offenders? 
Hon PAULA BENNETT 
: I go back to my original statements. I did not say that those groups were misleading the public. But I know that my colleagues also share with me the view that intensive wraparound services around these young offenders long term are what will make a difference in their lives. If we keep doing what we are doing now we simply will not get different results. 
Chester Borrows 
: Has the Minister received any information about what tools the judiciary feels it needs in order to deal with youth offenders? 
Hon PAULA BENNETT 
: Yes the Youth Court judges have been calling for some time for a wider range of options for young offenders particularly for those who have already been through existing programmes. The Fresh Start package will allow judges to hand out longer sentences and give them the ability to order offenders into custom-made programmes to address the causes of their offending. 
Jacinda Ardern 
: Can the Minister explain what proportion of the Fresh Start programme will include the other interventions she has outlined and what proportion will be military-style training when the New Zealand Army has been confirmed as the provider for the entire programme? 
Hon PAULA BENNETT 
: It is quite clear in the legislation that we envisage up to 40 young people in the first year being involved in the military-style camps. However all youth offenders may be sentenced to the other programmes. The Fresh Start programme is a tool box that is given to the judges which they can then use to sentence young offenders. There are no strict numbers around the programme. It is for those young people who come before the Youth Court. The judges actually make the decisions as to what sentences they give out. It is pretty straightforward. 
Oil and Gas Exploration—Promotion 
8.  
JONATHAN YOUNG (National—New Plymouth) 
 to the  
Minister of Energy and Resources 
: What is the Government doing to encourage exploration for oil and gas in New Zealand waters? 
Hon GERRY BROWNLEE (Minister of Energy and Resources) 
: 
 Last Friday I announced that over the next 3 years the Crown will spend $20 million acquiring and processing seismic information about New Zealand’s offshore subsurface geography. Petroleum exploration and investment companies will be able to use that data to assess the oil and gas potential of those prospective basins. 
Jonathan Young 
: What are the benefits of seismic data acquisition by the Government? 
Hon GERRY BROWNLEE 
: Good seismic information is the first step towards understanding the hydrocarbon potential of any particular area. The previous surveys have resulted in $1.4 billion of expenditure by exploration companies. So far for every $1 invested by the Government explorers have invested a further $50 so it was very surprising that the previous Government chose to cancel what has been a very successful economic development project. 
Jonathan Young 
: What benefits do oil and gas developments bring to New Zealand? 
Hon GERRY BROWNLEE 
: Indigenous oil developments like the Tui and Maari fields provide economic benefits such as jobs for New Zealanders and also help our balance of payments. For the 11-month production period ended 30 June 2008 the Tui joint venture paid the Crown $210 million in royalties and at least a further $250 million in related corporate taxes. This year will be no different. These are significant benefits. 
David Garrett 
: Does the Government have any plans to return the rights to oil and gas lying beneath the land of private landowners from whom that right was confiscated by a Labour Government in 1937 which was confirmed in the Crown Minerals Act 1991; if not why not? 
Hon GERRY BROWNLEE 
: No this is a settled matter of law. 
Emissions Trading Scheme Legislation—Prime Minister’s Statements 
9.  
JEANETTE FITZSIMONS (Co-Leader—Green) 
 to the  
Prime Minister 
: Does he stand by his statement to  
Investigate 
 magazine in March that “the select committee that has been set up that will review our ETS legislation and come up with recommendations for potential changes …”? 
Hon JOHN KEY (Prime Minister) 
: 
 Yes. 
Jeanette Fitzsimons 
: Which one of the Emissions Trading Scheme Review Committee’s terms of reference asks it to come up with recommendations for potential changes to the emissions trading scheme legislation? 
Hon JOHN KEY 
: The whole purpose of having the select committee is to consider what the appropriate climate change response is that the Government should adopt. The Government is working hard with all parties actually and the submitters to try to find the appropriate response so that New Zealand can balance both its economic opportunities and its environmental responsibilities. 
Jeanette Fitzsimons 
: If the Prime Minister is unable to find in the terms of reference anything that directs the select committee to actually consider the legislation or amendments to it has he discussed with his coalition partner the ACT Party which is the greater hoax: climate change or an Emissions Trading Scheme Review Committee that is not tasked with reviewing the emissions trading scheme? 
Hon JOHN KEY 
: I will repeat my answer to the first question. The whole purpose of the select committee is to come up with a response that the Government thinks is the right response to the long-term problem of climate change. 
Charles Chauvel 
: Can the Prime Minister confirm that consideration of alignment of our scheme with Australia’s is a term of reference of the Emissions Trading Scheme Review Committee; if so can he confirm that the Australian Government’s position on alignment of its scheme with New Zealand’s was set out in public by Australian officials at the select committee yesterday—namely that in order to link with Australia’s scheme New Zealand will have to either take whatever price exists at any time on the Australian carbon market or wait until Australia gives 5 years’ notice of an intention to link with New Zealand’s emissions trading scheme? 
Hon JOHN KEY 
: I cannot confirm whether it is a term of reference of the select committee; I can confirm though that I think it makes sense if it is possible for New Zealand’s climate change response to be aligned with that of Australia. I would have thought that that member would think so as well given the fact that New Zealand gives fairly bipartisan support to CER. It does the same to the single economic market. I cannot for the life of me see why we would want to develop different climate change responses on either side of the Tasman; it could lead to perverse outcomes and the wrong incentives being faced on either side of the Tasman. 
Charles Chauvel 
: I raise a point of order Mr Speaker. The question I asked was whether the Prime Minister could confirm the very clear position set out by Australian officials yesterday in describing the Australian Government’s position which was that we either take the price it offers or wait 5 years to come in. I would like the Prime Minister to address the question of whether he understands that that is the position New Zealand is in. 
Hon JOHN KEY 
: The member needs to go back and look at his own  
Hansard 
. His very first question was about whether it was a term of reference and I addressed that directly. 
Charles Chauvel 
: I raise a point of order Mr Speaker. There were two elements to the question— 
Mr SPEAKER 
: The member will take his seat. We are not going to have a debate over the quality of the answer. The member knows that if he wants an answer to a question the question must be succinct. Then there can be no debate. I look forward to that happening. 
Internal Affairs Minister—Ministerial Requirements 
10.  
Hon PETE HODGSON (Labour—Dunedin North) 
 to the  
Minister of Internal Affairs 
: Can he confirm that as Minister of Internal Affairs he has met all the requirements of a Minister of the Crown as set out under “Conduct public duty and personal interests” in part 2 of the  
Cabinet Manual 
? 
Hon Dr RICHARD WORTH (Minister of Internal Affairs) 
: 
 Yes I believe so. 
Hon Pete Hodgson 
: When he told the  
Indian Express 
 in an exclusive interview: “We will be making it easy to get visitor visa as the rules will be relaxed” had he spoken to his colleague the Minister of Immigration beforehand or did he do so on his return? 
Hon Dr RICHARD WORTH 
: All the comments that I made on immigration issues in India reflected National Party policy as set out in the manifesto. 
Hon Pete Hodgson 
: When the Minister told the  
Indian Express 
: “We have asked the government to start a direct flight between India and Auckland and also an India Trade Centre in Auckland.” had he received the Government’s response at the time of the interview in late February; if not has he received the Government’s response to each of those requests since? 
Hon Dr RICHARD WORTH 
: There are two questions there. As to the first the position of the India Trade Group has been obvious for a number of years and—Mr Goff will know this—we are very keen to see direct trade links established between India and New Zealand. That is a straightforward statement of fact. I had no further discussion with the Minister of Transport when I returned to New Zealand. As to the second question about the India Trade Centre that is something I know nothing about and it has never been India Trade Group policy. 
Hon Pete Hodgson 
: Does he recollect telling the same newspaper about 10 weeks ago: “My personal commitment to Punjab Deputy Chief Minister Sukhbir Singh Badal is that New Zealand will be committed to improve efficiency and productivity of the farmers in the state” and was he speaking then as a Minister of the Crown as reported or was he speaking as a private individual? 
Hon Dr RICHARD WORTH 
: That was a private trip on which I was chairman of the India Trade Group and all times I spoke in that capacity. 
Hon Pete Hodgson 
: I seek leave to table answers to 25 questions to the Minister of Immigration the Minister of Agriculture the Minister of Trade the Minister for Tertiary Education and the Minister of Transport which show in their collective that on the honourable Minister’s return he approached none of them about any of the issues he grandstanded on— 
Mr SPEAKER 
: Leave is sought to table a collection of answers. Is there any objection to that course of action? There is objection. 
Drought Conditions—Reports 
11.  
SHANE ARDERN (National—Taranaki - King Country) 
 to the  
Minister of Agriculture 
: What reports has he received on drought conditions throughout New Zealand? 
Hon DAVID CARTER (Minister of Agriculture) 
: 
 The Ministry of Agriculture and Forestry has been providing me with regular updates on the developing dry conditions on the East Coast of both the North Island and the South Island over the last several months. Until very recently dry weather has meant that conditions have deteriorated in many of those areas and a high number of farming families are facing extremely tough conditions. As such in recent weeks I have declared medium-level droughts in Gisborne Wairoa Hawke’s Bay the Bay of Plenty Taihape Wairarapa and North Canterbury. 
Shane Ardern 
: What do these drought declarations mean? 
Hon DAVID CARTER 
: Declaring a medium-level drought means that Government officials can provide a number of vital recovery measures for financially and emotionally stressed farmers. These include tax flexibility under the Income Equalisation Scheme funding for rural support trusts to provide welfare and counselling to affected farm families and funding for field days and publications to give advice on drought management options. The declarations are also an important psychological step in demonstrating to affected farmers that they have this Government’s full support. 
Shane Ardern 
: Why are droughts being declared now when we are heading into winter and some of the wettest months of the year? 
Hon DAVID CARTER 
: The recent rain has simply been too late for these drought-affected areas. Plummeting soil temperatures mean that grass will not grow and farmers have been left desperately short of feed. Even with sustained heavy rain over coming weeks the outlook is bleak and making matters worse is the fact that many of these farmers have endured back-to-back droughts for the last 3 years and are now suffering from the cumulative effects of those tough conditions. 
Hon Jim Anderton 
: Has the National Drought Committee established by the previous Government met yet on these issues; if so what recommendations or initiatives is it advocating? 
Hon DAVID CARTER 
: The National Drought Committee has been meeting on a regular basis including today and I visited it about an hour or so ago. It is happy with the initiatives that the Government has taken to date. I seek leave to table two maps that demonstrate quite clearly the effect of the drought around New Zealand. 
Mr SPEAKER 
: Leave is sought to table those two documents. Is there any objection? There is none. 
Documents by leave laid on the Table of the House. 
Internal Affairs Minister—Ministerial Responsibilities 
12.  
CHRIS HIPKINS (Labour—Rimutaka) 
 to the  
Minister of Internal Affairs 
: Does he believe he has adequately fulfilled all of his responsibilities as Minister of Internal Affairs since accepting the role; if so why? 
Hon Dr RICHARD WORTH (Minister of Internal Affairs) 
: 
 Yes I believe I have carried out my responsibilities as required. 
Chris Hipkins 
: Why has he refused to answer basic written parliamentary questions and Official Information Act requests regarding his activities as a Minister including refusing to release any information about reports he has received from his department or whom he has met with? Is it because he is embarrassed to admit that he has not done anything or is it that he has something to hide? 
Hon Dr RICHARD WORTH 
: That member has asked 1483 questions of various members since December 2008. He has also asked similar fishing-expedition questions of other Ministers and has received similar responses. There is a real double standard in place here; there were at least 142 written questions during the last Parliament to which a Minister responded that an answer would not be provided on the basis of the time and/or the resources that that would have required. 
Hon Gerry Brownlee 
: I raise a point of order Mr Speaker. I ask you to consider whether the line of questioning from Mr Hipkins is appropriate. He is asking questions that relate to written questions and I have to say that we have been somewhat surprised by the quality of the written questions coming from the Opposition. You know Mr Speaker that you— 
Mr SPEAKER 
: Order! 
Hon Gerry Brownlee 
: Well it is a reasonable point— 
Mr SPEAKER 
: No no. The member cannot use the point of order process to criticise the Opposition. Commenting on the quality of questions is an implied criticism; there is another process for dealing with that. The member’s primary question related to the Minister’s responsibilities as Minister of Internal Affairs; answering questions is part of a Minister’s responsibilities. The nature of the question enabled the Minister I believe to say almost anything he liked because the question went all over the place. I am sure the Minister is perfectly capable of responding to that kind of question. 
Hon Gerry Brownlee 
: I raise a point of order Mr Speaker. I am not wanting to question your ruling but the fact is that a number of written questions have been submitted to you that ask whether certain matters are a reasonable use of a Minister’s time. A small example would be one from the member for Hutt South who asked me whether I had visited Hutt South recently. You— 
Mr SPEAKER 
: The member will resume his seat. The member is the Leader of the House but when I am on my feet he will resume his seat. This is not a matter for the order of the House and he knows that. I accept that there are issues around at the moment about the nature of written questions being asked and that they need to be sorted out but there is a process for dealing with that— 
Hon Darren Hughes 
: And answered. 
Mr SPEAKER 
: —and answered—and we will deal with it in the appropriate way. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I am sorry but I have been brought into this. I want to say that the Minister— 
Mr SPEAKER 
: The member will take his seat right now! Senior members are setting a wonderful example to newer members of the House of how not to behave. Senior members should know the point of order process and not abuse it. That is something I take a dim view of because it wastes the time of the House— 
Hon Trevor Mallard 
: Have a coffee! 
Mr SPEAKER 
: I am on my feet and the member will not interject. Let us allow this matter to lie here because I have made my position very clear. 
John Hayes 
: What is the Minister doing to address concerns in the community regarding the gambling— 
Mr SPEAKER 
: I apologise to the member asking the question. There was such an exchange going on up the front of the House here that I could not hear the member. I invite him to repeat his question. 
John Hayes 
: What is the Minister doing to address concerns in the community regarding the gambling sector? 
Hon Dr RICHARD WORTH 
: My two key priorities in the gambling arena are first of all to maximise community funding from non-casino gambling machines in commercial venues and second to resolve dubious grant-funding practices in the sector. I am keen to see gambling trusts address real community needs and provide long-term benefits through their funding decisions. In the current economic downturn when gaming-machine revenue is declining just as demand for community funding is rising I believe that this is a critical issue. 
Chris Hipkins 
: Is the Minister aware that during the term of the last Parliament the Minister of Internal Affairs the Hon Rick Barker answered 892— 
Mr SPEAKER 
: I fail to see the responsibility that this Minister has for what a Minister during the last Parliament did. I will not cut the member’s supplementary question but I invite him to— 
Hon Members 
: Sit down! 
Mr SPEAKER 
: To the National members or any members who were interjecting I say that that is not appropriate. I was going to deal with the member who must resume his seat. I invite him to ask a question that is in order. 
Chris Hipkins 
: Why is the Minister refusing to answer the 140 written parliamentary questions that have been put to him when Ministers in previous Parliaments have answered exactly the same questions without any trouble? 
Hon Dr RICHARD WORTH 
: I do not accept the statement of assumptions and fact in the question. I have in fact answered the questions; it is just that the member does not like the answers. 
Te Ururoa Flavell 
: Tena koe Mr Speaker. [ 
Interruption 
] 
Mr SPEAKER 
: I want to hear the question. 
Te Ururoa Flavell 
: Has the Minister received numerous written questions from that member Mr Hipkins that ask the same question asked by other backbenchers and Ministers; and would the Minister in his view agree that that is wasting a huge amount of Ministers’ resources and time? 
Hon Dr RICHARD WORTH 
: It is—[ 
Interruption 
] 
Mr SPEAKER 
: I want to hear the answer. 
Hon Dr RICHARD WORTH 
: It is right to say that the member is on an open fishing expedition. Ministers have to decide whether it is appropriate for significant departmental resources and time to be spent on preparing answers to such open questions. 
Chris Hipkins 
: Has the Minister instructed the Department of Internal Affairs to change its output plan which currently estimates between 550 and 650 written parliamentary replies per year; if he has not why is he refusing to answer questions on the basis that it would take too many resources to do so? 
Hon Dr RICHARD WORTH 
: I have already answered that question. The member has been receiving answers; it is just that he does not like them. 
Chris Hipkins 
: I seek leave to table several documents. The first is the reply from the Minister to an Official Information Act request in which he refuses to provide information on all stakeholder and lobby groups he has met since becoming a Minister. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is none. 
Document by leave laid on the Table of the House. 
Chris Hipkins 
: The second is a reply from the Minister to another Official Information Act request in which he refuses to provide information regarding all reports briefings and submissions he has received since becoming a Minister. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is none. 
Document by leave laid on the Table of the House. 
Chris Hipkins 
: The third is a compilation of answers to written parliamentary questions to the Minister in which he refuses to provide any information on who— 
Mr SPEAKER 
: I apologise I missed—[ 
Interruption 
] There must be no interjections. This is a point of order process. I missed the description of that document. I apologise. 
Chris Hipkins 
: I seek leave to table a summary of answers the Minister has provided to written parliamentary questions in which he refuses to reveal any information about— 
Mr SPEAKER 
: Leave is sought to table answers to questions— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I think it is important that the leave is put accurately. It is a summary of those answers. The member did not— 
Mr SPEAKER 
: I accept the member’s point. Could I just seek guidance on who wrote the summary? 
Chris Hipkins 
: I wrote the summary. 
Mr SPEAKER 
: Leave is sought to table that summary of answers to questions. Is there any objection? There is objection. 
Questions to Members 
Emissions Trading Scheme Review Committee—Terms of Reference 
1. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
 to the  
Chairperson of the Emissions Trading Scheme Review Committee 
: Do the terms of reference of the Emissions Trading Scheme Review Committee include a review of the emissions trading scheme legislation? 
Hon PETER DUNNE (Chairperson of the Emissions Trading Scheme Review Committee): 
 The committee’s terms of reference which were set by the House do not expressly refer to reviewing the legislation. However they are broad enough to allow the committee to recommend changes to the scheme that might require amending the legislation. 
Jeanette Fitzsimons 
: Were submitters informed that their submissions did not need to stay within the written terms of reference; if not were not those submitters misled by the ACT Party’s terms of reference about what was acceptable? 
Hon PETER DUNNE 
: Submitters were informed that they needed to submit in accordance with the terms of reference of the select committee. Whether they felt misled is for them to determine. I draw the member’s attention to the fact that one of the terms of reference was to “examine the relative merits of an emissions trading scheme or a tax on carbon or energy as a New Zealand response to climate change”. Within that term of reference there would have been scope to make comments about the emissions trading scheme. 
Urgent Debates Declined 
Waterview Connection—Funding Announcement 
Mr SPEAKER 
: I have received a letter from the Hon Darren Hughes seeking to debate under Standing Order 380 the Government’s announcement on funding options for the Waterview Connection. Standing Order 380 requires that the matter for debate be a particular case of recent occurrence involving ministerial responsibility. Not every announcement by the Government can give grounds for a debate. The New Zealand Transport Agency board is meeting today to consider alternative options and is scheduled to announce its decision tomorrow. The announcement today is part of a decision-making process. No decision of the preferred option for the Waterview Connection has yet been made. 
For there to be a particular case of recent occurrence an event on which an urgent debate is sought must have occurred. The purpose of the debate is to hold the Government accountable for its decisions. This does not mean that the matter is not of sufficient importance to require the attention of the House. It simply does not meet the requirements of an urgent debate procedure today. The application is therefore declined. 
Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill 
First Reading 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I move  
That the Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill be now read a first time 
. At the conclusion of the first reading debate I will move that this bill be referred to the Finance and Expenditure Committee with an instruction that the bill be finally reported back to the House by 15 June 2009. For reasons I will explain in my speech it is essential that the bill is passed before 1 July 2009. 
This is a short bill that provides an interim definition for the term “funding entitlements for parliamentary purposes” for the purpose of clarifying the principal duties of the Parliamentary Service. The bill provides an interim definition that is very similar to the meaning set out in the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Act 2007 which expires on 1 July 2009. 
Generally speaking the bill maintains the legislative framework that has been in place since legislation was passed in 2006 and preserves the convention observed by members of Parliament before 2006 which was that Parliamentary publicity entitlements should not be used for electioneering. As I have said this has been a convention for many years. It was first provided for in legislation in 2006. The interim arrangements that were made in 2006 were renewed in 2007. Extending the current interim definition by passing the legislation will ensure certainty and transparency for all parties while a permanent definition is developed and enacted. 
If the definition lapses we will return to the unclear and uncertain situation that followed the Controller and Auditor-General’s inquiry into  
Advertising expenditure incurred by the Parliamentary Service in the three months before the 2005 General Election 
. That inquiry highlighted the need for Parliament to define very clear rules about services and funding for parliamentary purposes and particularly the need to make a distinction between publicity that is for a parliamentary purpose and publicity that is not for a parliamentary purpose because it is by its very nature electioneering. The bill preserves the relatively simple and straightforward provisions of the current interim Act and maintains the long-understood rule that members cannot use the fund for publicity or communications that solicit votes for themselves or their parties that solicit donations or that solicit for membership of their parties. The bill enables members to get on with the job they were elected to do. It also enables the Parliamentary Service to do its job and avoids creating an environment of uncertainty for officials while the electoral finance review is in progress. 
I think it is worthwhile reminding the House that the history of the interim definition is that the Controller and Auditor-General’s report on advertising expenditure during the 2005 general election concluded that some of the expenses that were met from the Vote Parliamentary Services appropriation were in fact election expenses and should not have been paid by the Parliamentary Service. Members will remember that there were some famous examples of that. The most notable was the instance of the Labour Party’s pledge card when the Parliamentary Service was required to pay for—not just in the 2005 election but also during the successive election—a pledge card that essentially outlined the Labour Party policy that would form the basis of any Government action should Labour be successful in being elected. Of course in 2005 a Labour Government was elected. The Controller and Auditor-General brought down his report and as a consequence a process was enacted to see that the money was refunded to the Crown. 
Following the Controller and Auditor-General’s report there was a need to establish and define exactly what “parliamentary purposes” were and in particular what was meant by “electioneering” when considering communications and publicity by members and parliamentary parties. Concern was also expressed that while the Controller and Auditor-General’s report focused on the advertising expenditure it had implications for all expenditure under the Vote Parliamentary Services appropriation. The Appropriation (Parliamentary Expenditure Validation) Act 2006 was subsequently introduced to give clarity to the phrase “parliamentary purposes”. One of the little-known facts is that the uncertainty created by the Controller and Auditor-General’s report at that time might have meant that all expenditure by all parties on any matter could have been considered somewhat illegal at that time. The legislation specified that publicity was within the scope of “parliamentary purposes” unless it included explicit electioneering. Basically the Controller and Auditor-General said and the law at the time was changed to say that material could not explicitly seek votes donations or party membership. Although that had been the practice of political parties for some years the Auditor-General’s report left open the question of what could be considered in that regard. 
The 2006 Act expired in 2007 and was subsequently rolled over into the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Act 2007 which expires on 1 July 2009. The current interim definition needs to be rolled over to avoid a requirement of the Parliamentary Service to apply and observe a narrower definition of “parliamentary purpose” developed by the Controller and Auditor-General. The interim definition provides a brightline test with a very clear guide about what is prohibited. That is generally considered to be satisfactory because it has stood the test of time. There were no incidents such as occurred in 2005 repeated in 2008. It has been maintained through two interim statutes which have been in place for some 2½ years. The bill provides an interim meaning that is substantively the same save for some minor technical changes which have been included. It has proven to be administratively practical by the Parliamentary Service since introduction. There has not been the need to require major changes in the practices of members and parties which would have been the consequence of the Controller and Auditor-General’s approach. 
The interim definition is clear about the publicity material that can be funded using parliamentary funds. It is preferable to have the interim definition continue so that the Parliamentary Service is not faced with having to develop new policies and guidelines for members before having to respond to any requirements that could arise from the electoral finance review. It is more sensible to allow this review to be completed and in the meanwhile for the current definition to continue so that policies and administrative guidelines need not be changed twice in the next 18 months. 
Developing a permanent definition has taken longer than was originally envisaged. The Government has already signalled that it intends to review the electoral finance rules and will soon be releasing a discussion paper to facilitate that. It is worth noting that all political parties have signalled a willingness to participate in that review in order that there is settled law around electoral financing for future elections. Therefore it seems reasonable to allow the current legislation for the definition of “funding entitlements for parliamentary purposes” to continue so that where any changes need to be made they are done in conjunction with that electoral finance review. The Government expects the review to be completed and any resulting legislation to be enacted in this term of Parliament. That is why the bill provides an expiry date of 31 December 2010—that is we expect the permanent definition to be developed by that date. 
Although the bill maintains the status quo in most respects there are a small number of technical changes to be included. The changes are as follows. First the bill covers more than one financial year so the reference to appropriations needs to reflect that fact. Secondly the new meaning of the bill excludes reference to inter-parliamentary travel programmes as that is not funded from Vote Parliamentary Service but from Vote Office of the Clerk; it does not need to be there. Thirdly the bill has been drafted to take account of the Parliamentary Service Amendment Act 2008 which allowed for the Speaker to make directions for services and funding entitlements to be available to certain electoral candidates in periods between polling day and the declaration date—that is where a candidate is deemed to be elected on election night but not sworn in for some time later. That interim period left them totally uncovered. This bill takes care of that matter. 
In the meantime the interim definition is consistent with the purpose of the appropriations and has set what is considered to be an acceptable threshold for material to be considered as electioneering and therefore outside the scope of being regarded as for parliamentary purposes. I commend this bill to the House. I indicate that the bill will be referred to the Finance and Expenditure Committee. 
Hon DARREN HUGHES (Labour) 
: 
 I immediately signal that the Labour Party will be voting in favour of the first reading of the Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill. This bill has had a long history in the Chamber. It is not the first time the contents of this legislation have been debated. In fact this is the third occasion on which our attention has been drawn to the contents of the legislation—as the Leader of the House indicated. What is different on this occasion is the calmer nature in which the House finds itself considering the bill and as ridiculously tempting as it is to quote back from some earlier  
Hansards 
 when this issue was addressed by the Chamber I will resist doing that and say that I think it may be possible finally for the parties in Parliament to work together to come up with an enduring and proper definition of “parliamentary purposes”. If we are able to do that then that would be a significant achievement for Parliament. 
Clearly we would not want to see the current definition expire on 1 July but extending it only until the end of next year puts a responsibility on the House to come to a solution that will be a permanent definition rather than an interim meaning of funding for parliamentary purposes. I am sure the Leader of the House will bring all his drive energy and determination to ensuring we achieve that target by December 2010. The Labour Party will certainly be working constructively with him in order to make sure that that can happen. 
In the meantime it is important to reinforce some of the points that Mr Brownlee made. First of all this bill enables members of Parliament to do their work but it draws an absolute line between the work of members of Parliament in terms of their constituency their legislative work and their representational work and what would be considered electioneering. It is very clear that it will continue to be against the law for the Parliamentary Service to fund advertising in particular for anything other than a proper parliamentary purpose. In other words it will exclude electioneering—that is to ask somebody to vote for a certain person or a certain party to seek support for the election of a certain person or of course to ask for donations or financial support for or membership of a political party or for a financial donation to a particular candidate. Ruling those things out continues the practice that members of Parliament have been working under since we have been applying those new rules. I have to say that the processes that Parliament now has through the Parliamentary Service are far more robust than anything we have seen here before and I think they will assist us in coming up with a permanent meaning of “funding entitlements for parliamentary purposes” Nobody would like to see the legitimate work of members of Parliament impeded but it is important that people know that that funding cannot be used for those areas I just mentioned. 
The bill extends the time line for the definition until the end of next year and I repeat what I said about the desire of Labour to work with the Government on it. It is true that many of the aspects covered by this bill are covered by conventions that have built up in Parliament over many many years for representing and serving the people of New Zealand. Many of those conventions are now documented by way of the Speaker’s directions. That has been very helpful for members in terms of seeking funding for their work. I believe the pre-approval system of publicity in particular has ensured that members do not—particularly inadvertently—find themselves in a situation where they have not complied with Parliament’s rules when they are advertising for their purposes. 
I pick up on the point the Leader of the House mentioned about funding for certain candidates. There is an important category very rarely seen where a member of Parliament may be elected on the night but not be able to be sworn in for a period of time or conversely elected on the night required to take part in post-election Government formation and planning but then not finally sworn in because of a change either in special votes at a constituency level or in party votes across the country. Of course we had an example of that at the last election: Mr Cam Calder a National Party list MP was named as a member of Parliament on election night but in the final count was not sworn in to the Chamber. I do not think anybody would want to see him have to fly to Wellington from his home in South Auckland and stay in Wellington for a period of weeks only to find that he was not joining the Parliament and therefore needed to reimburse the money. I think the rules are very clear about tidying that up. It is probably appropriate in the case of Mr Calder because of course in the Mt Albert by-election the National Party candidate is a sitting list MP and if she was to be elected it would be Mr Calder who would come to Parliament to replace her on the list—the people of Mt Albert would be sending somebody from Manurewa down to Wellington as their representative. So it is probably quite important we have those provisions in the legislation—not that of course I see that scenario happening but it is very important that the people of Mt Albert know that a vote for Melissa Lee is a vote for somebody called Cam Calder. 
Hon Dr Jonathan Coleman 
: It’s a vote for progress. 
Hon DARREN HUGHES 
: It is not a vote for progress at all. In fact today it is a terrible vote because today it is a vote against tunnels for Waterview. I have never seen a candidate have his or her legs chopped from under him or her as disgracefully as we saw today when the Minister of Transport did that to Melissa Lee. The only other time I have seen that happen was when Jim Bolger took the legs out from under a candidate in Wellington Central called Mark Thomas. And guess what? He is the campaign manager for Melissa Lee in this particular election. So what is it about National that when it seeks to pull the rug out from people it does it so royally? I am sure there is a support group for the two of them in Mt Albert at the moment. 
But to return to the bill Labour will be supporting it. The Leader of the House has indicated a shorter period of time for the select committee process than would be normal. But we will be facilitating that on the proviso that we are serious about working towards that period of the end of 2010 when political parties are able to come up with a proper definition. It seems to me that we cannot for a fourth time—Mrs Turia shakes her head but I am sure she will want to work with us to make sure we do not—come up with an interim meaning of “parliamentary purposes”. It does start to stretch credibility if for the fourth time we are not able to achieve a permanent meaning. I am certain we will have her goodwill when it comes to that particular matter. 
Hon Tariana Turia 
: No. 
Hon DARREN HUGHES 
: She is indicating that maybe we will not. But I think it is important that all parties give us their goodwill—we have to get together on that matter. We support the first reading of this bill and look forward to it proceeding transparently through the House at this time. 
NATHAN GUY (National—Otaki) 
: 
 I rise to take a call on the Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill in its first reading this afternoon. It has a short report-back time through the Finance and Expenditure Committee but it is important that it goes through that process. In essence this bill that we are addressing this afternoon will provide an interim definition for an important piece of work for the Government and the whole of the House. I say to members as a little bit of background that the definition is currently provided in the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Act 2007 which expires in July 2009. A roll over is needed so that the interim definition can continue until Parliament is able to consider a permanent definition. 
I will talk a little bit about some of the things that have already been covered by the previous two speakers and indeed will make my own personal remarks as well. The need for the bill came when the Auditor-General in 2006 conducted an inquiry into advertising expenditure following the 2005 election. Some changes were recommended—and indeed made—as a result of the rort that occurred with the pledge card. It is imperative that that mistake is not made in the future and that we learn from it. 
Some measures in this bill relate specifically to electioneering and that is an important part of this bill that we need to get right. There are two forms of publicity. One is around parliamentary publicity where MPs are out promoting themselves in their own community so that their constituents come and see them in their electorate offices. Then there is the other one that crosses the line and that is to do with electioneering. 
Clause 4(3) of this bill defines the term “electioneering” to mean “any communication that explicitly—(a) seeks support for the election of a particular person or people; or (b) seeks support for the casting of a party vote for a particular political party or political parties; or (c) encourages any person to become a member of a particular political party or political parties; or (d) solicits subscriptions or other financial support.” It is great that this bill spells that out very very clearly. 
Another important part of this bill excludes from the funding for travel that which comes from the Office of the Clerk’s vote and that is an important point to make in terms of the inter-parliamentary travel programme. It covers things to do with accommodation communication and travel outside of the scope of this bill. 
It is important that we get this bill right. We need to ensure that it goes through the select committee process and it should have wide-ranging support from the House this afternoon. It is great to hear that Labour has acknowledged that it believes that Cam Calder—who was a list member for the National Party for a short period of time before the special votes were counted and concluded—will come back into the House given the opportunity that National has to secure the Mt Albert by-election. We are working particularly hard in that area but we realise that it is a strong Labour electorate. We are getting on with the business at hand there rolling out the proposal on the Waterview Connection—the very important road that will reduce Auckland’s congestion. 
In conclusion I say that this is an important bill. It also covers the amendment Act of 2008 and it is important that I remark on that. I spoke on that Act towards the end of last year when we found out that a member who was voted in on election night not declared in the House and not sworn in had a window of 6 weeks when that person was not necessarily funded in terms of support budgets for electorate offices—phones and leases were not covered. This bill captures that as well. This is an important bill which is heading off this afternoon to the Finance and Expenditure Committee with a very tight report-back date of 15 June. I commend this bill in its first reading in the House. 
Hon DAVID PARKER (Labour) 
: 
 The Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill deals with a very difficult public policy issue. In order for democracies to work people who vote for political parties have to know what the different parties or members of Parliament stand for. It is very important that members of Parliament be able to express what they stand for and stand against so that when people come to exercise their vote they do so in the knowledge of what the people and parties stand for. Virtually everything that we do in this Parliament or at least a great proportion of it is highly politicised. It is the very nature of this place that it is political. It is nonsense to suggest that when we communicate with people about where we stand on a particular issue we are not influencing their view of us as a politician or of a particular political party. 
Therein lies the difficulty because some people say we as politicians ought never to use the taxpayers’ money that is used to fund this Parliament to influence how people vote in the future. Yet everything we do is intended to have that effect. In the contest that we have in this Parliament every day we have National putting a proposition in support of a piece of legislation—or not necessarily a piece of legislation but a policy setting—and on the other side of the House we have another political party Labour or other members of the Opposition putting forward an alternative viewpoint. We are funded to do that. It is very important that it is a transparent process. It is important that people understand what we stand for. 
This bill tries to draw a line between that sort of conduct and conduct that goes a step too far and uses public money to explicitly seek support for the election of a particular person. Some people would say that test is not the right test and there should be some other test. The test that is in this legislation and has been in the legislation for the past couple of years has been termed the “brightline test”. This is where we try to draw a difficult line by saying any other line is so grey as to be impossible to properly police because so much of what we do is so intrinsically political and so implicitly seeks the support of people at a future election that it would be caught by a grey line. 
This legislation resolves that problem by imposing a brightline test. It says that in order for someone to infringe the rule that is set out in this legislation that person has to explicitly ask for someone’s vote explicitly ask someone to join a political party explicitly encourage someone to become a member of a political party or explicitly solicit financial support. And if one does any of those things this legislation says it cannot be done out of money that is voted through Parliament. But if one does other things that are political like the National Party does on any issue—be it Auckland governance tax policy or accident compensation policy; whatever the issue is—then it is perfectly proper for members of Parliament to advocate either in support of or against that proposition and in doing so to highlight the role of the different political parties in support of or in opposition to the proposition that is being discussed. 
I think that this legislation is appropriate and that is why the Labour Party supports this bill. I go into the background of the difficult policy issue that lies behind this bill because it is very difficult to do better than the brightline test that we have currently. That is why I am quite pleased to hear the National Party members today use moderate language surrounding this bill. It does represent even as a stop-gap measure a considerable reversal of National’s prior stance. National opposed this bill—or the Acts that already had these provisions in them—using very strong language. It described the bill as Mugabe-like legislation and as utterly disgraceful legislation. It was described as a rort by some people who are now Ministers and it was described as a disgrace by yet other National members who are now Ministers. But the reality is that the difficult public policy issue behind this bill is as I have described it. 
This legislation allows politicians to do what people elect politicians to do which is to take and to promote different points of view but it does not allow them to go so far as to take that extra step of using the money that funds this place and that funds politicians to go about their business to ask people to vote for or fund politicians. For those reasons the Labour Party will be supporting this bill. 
I say one further thing in respect of the underlying discussion that is taking place on appropriate rules around campaign expenditure. These are very difficult issues. I think the difficulty is shown by the rules that we had at the last election which have since been repealed. The financial returns of the political parties following that election purported to show that less was spent by the National Party on that election than was spent by the Labour Party. We all know that in reality the amount spent in pursuit of election at the last election by the National Party was a lot more than was spent by the Labour Party in pursuit of election. 
Paul Quinn 
: How do you know that? 
Hon DAVID PARKER 
: We know that the National Party is better funded than the Labour Party and the historical record of that goes back many many decades. The suggestion was made before the last election that the rules were so Draconian that the National Party would not be able to spend money in pursuit of its election aspirations. The reality is that it was so able to spend but it was not caught by the rules. So far from being Draconian those rules particularly around the transparency of donations were if anything too lax. 
It encourages me that the current Minister Simon Power has said that the transparency issues are at the heart of the current work that is going on regarding the election spending rules and he will look very seriously at them. There should be transparency around donations. People ought to know how much parties are being paid and by whom they are being paid so that they can make informed decisions on whether policy is being bought or sold. That is a very easy accusation to make; it is hard to disprove. It is very undermining of people’s public confidence in democracy. We in this Parliament should try to maintain the confidence of people in our democratic processes so we need to do better than we have been doing in respect of the transparency of donations. The Labour Party supports this bill. 
Dr KENNEDY GRAHAM (Green) 
: 
 I rise to address the Parliamentary Service (Continuation of Interim Meaning of Funding of Parliamentary Purposes) Bill. Allow me to state from the outset that the Green Party will support the first reading of this bill and its referral to the Finance and Expenditure Committee. The bill will provide as has been noted already an interim meaning until 31 December 2010 for the term “funding entitlements for parliamentary purposes”. 
The bill’s genesis goes back to the Auditor-General’s report of 2006 on advertising expenditure for the 2005 election. Legislation was needed to give clarity to the term and this was done through the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Act 2007 which expires on 1 July this year. Thus a new interim meaning is needed that can be extended to the end of next year within which time New Zealand’s electoral finance provisions will have been reviewed and no doubt relegislated. Clause 4 of the bill before the House today essentially conveys three principal differences from the previous meaning that have been noted by speakers already namely the time extension of 18 months the exclusion of inter-parliamentary travel and the provision of services and resources to certain electoral candidates whose particular circumstances have been noted. 
I have to say as the member in this House who came in on special votes and replaced Mr Cam Calder I carry something of a feeling of personal responsibility no doubt shared by 4.2 million other New Zealanders in enacting that. In terms of his indirect candidacy in the Mt Albert electorate it is not for me to try to predict the result in any way other than to express the confidence that it will be Dr Norman the third candidate who will win that electorate. But if fate did decree by chance that the election went the way of the National Party I would simply set aside all other political considerations and extend a very warm personal welcome to Mr Cam Calder should he come in. I am told on reliable authority that he is in fact the greenest of the BlueGreens in the National Party. He is a great man and the greenest of the BlueGreens which may be rather a faint-hearted test in terms of green commitment but none the less perhaps it is better than nothing in terms of a litmus test of the commitment of the Government to green issues. But it would be a pleasure in that potential event to welcome him to the House. 
Let me just conclude by reiterating and recalling the proposal the Green Party put forward when the issue was discussed last in November 2007 for a citizens’ assembly. We believe that under the current conditions there is something of a structural bias that accords inherent advantage to incumbents during elections—both individuals and parties—and we believe that that should be rectified and a more level playing field restored by way of the House and its procedures taking further advice from the citizenry of this country. We look forward to further discussion of this in the committee and we are prepared to support the bill as it stands. Thank you. 
Hon TARIANA TURIA (Co-Leader—Maori Party) 
: 
 Tena koe tena koutou katoa. The Maori Party is pleased to support the Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill which is after all a transitional measure. The bill is required to respond to the fact that the existing legislation the Appropriation (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Act 2007 expires on 1 July 2009. An extension of the interim meaning is needed to allow time for a permanent meaning to be considered and enacted. This is simply part of the process that we understand to be taking place within the Government’s review of electoral finance. The new provisions in this bill are not limited to a particular financial year and need to take account of the 18-month period during which time this bill is to remain in force. 
This bill is necessary to ensure that this Parliament makes the appropriate investment in accountability and integrity for public money used for Parliamentary purposes. It comes out of a shadowy murky past. Maori Party members can recall vividly the circus that fell out of the consequences of the Controller and Auditor-General’s 2006 report into advertising expenditure. That report responded to the inconsistencies and illegalities that were a feature of the 2005 election. The validation Act was passed with an interim meaning and after that an Appropriation Act was passed to extend the interim meaning. 
We have no interest in rehashing arguments and issues that arose in 2005 2006 and 2007 about the ways that the purposes of parliamentary funding were used or misused to promote performance by a political party for political purposes rather than exclusively for its role and function as a parliamentary party. It is now on the record that we supported the Electoral Amendment Bill to repeal and review the Electoral Finance Act and within that we hope that the definitions around electioneering and funding entitlements for parliamentary purposes will be well and truly worked out. 
However I cannot let the opportunity go by without referring the House to an editorial this morning in the  
Otago Daily Times 
. The editorial makes it blatantly clear that the forced disclosure of funding sources put upon political parties has to be seen as one of the problem areas that emerged under the aptly described “mysterious fog of the Electoral Finance Act a piece of legislation … which no-one—least of all its architects—fully understood.” The editorial points out that “The distance between what the major parties spent on their election campaigns and what they listed in their donation returns is so great as to suggest sufficient loopholes still existed to legally exploit.” This is a shoddy state of affairs that we as a Parliament cannot ignore. 
There is a specific anomaly identified in that while the previous Electoral Finance Act was presumably to constrain “secret trusts from making large donations without declaring the source … there was nothing to prevent one entity making many donations which were under the $10000 disclosure barrier.” These are all excellent points of discussion that we hope to see will take place at the select committee stage of this bill. 
There is one final statement from the editorial that I believe is appropriate to share with the House in supporting this debate that we are engaged in around transparency and accountability; that is the revelation made this morning that “the Maori Party spent a mere $222000 (but won five seats and some might argue holds the most powerful minority influence in the Government)”. This is not a question around how much money is available. What is the extent to which secret trusts and corporate donors can back political parties? The disclosure from the official returns suggests that the level of spending had little to do with the outcome of the polls. This bill cuts to the very heart of what New Zealanders believe that Parliament should practice; that is the practice of a healthy democracy where the tikanga of integrity transparency and accountability count. The Maori Party believes that it is such tikanga that give expression to rangatiratanga and kaitiakitanga. We accept without reservation the need for the prudent management of public money. We are happy to continue the debate around what legitimate parliamentary purposes are as opposed to electioneering purposes. 
I end with some rather harsh words from political commentator Gordon McLauchlan in his book  
The Big Con 
: “it is not that difference of opinion on policy has engendered the anger frustration and sense of powerlessness among New Zealanders. We are angry because the policies were borne of the dissembling the betrayal and the lies of politicians. People feel democracy has let them down.” The public perception of politicians is frequently described as one of contempt or at least mistrust. The level of dissatisfaction with politicians has been a feature of New Zealand politics mai ra ano. 
We have a chance to change this view. This bill and the Electoral Amendment Bill enable us to have the opportunity to work cooperatively and collaboratively in consolidating definitions of parliamentary purposes to guide our future practice. Politics is absolutely fundamental to the fabric of our society. We owe it to the people and to the integrity of this Parliament to make sure that we get it right and in doing so improve the public perception of our performance. Na reira tena koutou. 
CHRIS TREMAIN (National—Napier) 
: 
 I rise to take a call on the Parliamentary Service (Continuation of Interim Meaning of Funding for Parliamentary Purposes) Bill. With the Speaker’s leave I would like to take the opportunity in this speech to allude to some of the events that occurred in my electorate last week. Before I get there I start by touching on the bill. It provides until 31 December 2010 an interim meaning of the term “funding entitlements for parliamentary purposes” for the Parliamentary Service Act 2000. 
As the Leader of the House Gerry Brownlee said it is a short bill that provides an interim definition for the term “funding entitlements for parliamentary purposes” for the purpose of clarifying the principal duties of the Parliamentary Service. A number of principal duties are defined in the Parliamentary Service Act. Section 7 alludes specifically to those principal duties. We see in section 7(a) that the duties include providing “administrative support services to the House of Representatives and to members of Parliament;” and section 7(b) continues: “to administer in accordance with directions given by the Speaker the payment of funding entitlements for parliamentary purposes.” 
It is at this point that I wish to focus on the parliamentary purpose of travel that is provided for in this bill. That is one of the funding streams that is allowed as a parliamentary purpose. It provides for the needs of constituent MPs who would not be able to serve their role without that parliamentary purpose being defined. You see one of the primary roles of a constituent MP is to support one’s community. Being able to get home quickly in times of tragedy is very important. This bill provides a means for that to take place. No more pertinent an example of this can be given than the events that occurred in Napier last week. I promised my community that at the first opportunity I had to speak in this House I would somehow find a way even before the general debate to stand and acknowledge the people who were involved in that event. Given that I will be attending the funeral of Senior Constable Len Snee tomorrow I take that opportunity now. 
Words cannot describe the tragedy that took place last Thursday morning in Napier. The senseless loss of Senior Constable Len Snee is inexcusable and unfathomable. He was a local man whom many of us including myself knew. He was a hard-working police officer who got things done. He was a family man a sportsman and a community man. He was the type of guy whom we all respected and looked up to. My thoughts my family’s prayers and the thoughts of the entire Hawke’s Bay and Napier community are with you Vicki your awesome boys and your extended family. Our thoughts are also with the families of Senior Constable Bruce Miller and Senior Constable Grant Diver together with neighbour Leonard Holmwood. Their bravery and courage was simply outstanding. We cannot thank them enough for what they did last Thursday morning. We are all thinking of them and praying that they recover from this ordeal as quickly as possible. It has been said before but if there is anything that our community can do for those constables or that civilian then we are here for them and their families. 
Our police are now mourning a mate and they deserve our thanks for the excellent work done in bringing this dangerous situation to a close. Superintendent Sam Hoyle and Napier Commander Kevin Kalff led their teams strongly in a time of extreme crisis. As I walked around the various cordons and through the police station it was clear that there was a steely resolve to get the job done despite the fact that three of their best had fallen. Incidents such as this demonstrate the bravery and operational expertise that makes our police force exceptional. 
Faced with an incredibly dangerous situation and loss of life our community responded pulled together and supported those who were displaced or who had suffered. I thank on behalf of the community Barbara Arnott and her civil defence team ably led by Dennis Morgan. To arrive home early on Thursday night from Parliament and see the level of organisation that was already in place was remarkable. Their actions meant that Napier residents knew someone was in charge and that kept people calm. Although many others deserve to be thanked I cannot finish without acknowledging the work of the Salvation Army which from the word go had its mobile kitchen set up in Thackeray Street and which fed literally hundreds of people throughout the course of this crisis. I will close this part of my speech by again saying that the thoughts and the support of the entire community are with the families of those who have suffered in this terrible tragedy. 
This bill allows members to get the job done that they were elected to do. Allowing members to go home to support their community at times of tragedy is a key part of the bill. On that point I say that I support this bill entirely. Thank you Mr Assistant Speaker. 
Bill read a first time. 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I move  
That the Finance and Expenditure Committee consider the bill and report finally to the House on or before 9 June 2009. 
Motion agreed to. 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I raise a point of order Mr Speaker. I would like to record my thanks to the House for its indulgence in respect of the slight straying off the topic by Mr Tremain. I think it was a generous move by the House and it should be recognised. 
Regulatory Improvement Bill 
First Reading 
Debate resumed from 7 May. 
AMY ADAMS (National—Selwyn) 
: 
 I am delighted to stand and take a call in support of the Regulatory Improvement Bill. I begin by commending the Minister for Regulatory Reform Rodney Hide for his commitment—in bringing this bill to the House—to reducing red tape for businesses. Anyone who has worked with and around businesses or has been in business and certainly anyone who has spent time canvassing businesses as part of his or her job as a member of this House will understand that a lot of the red tape and compliance that businesses struggle with and that really holds them back are often not found in the primary Acts that this House passes. More often they come about in regulation. Although this House often has its mind on bigger and seemingly more important issues if we really want to make steps in allowing business to get ahead we have to do what the Minister has done and is doing through this bill and that is look at our regulatory system and ask ourselves where improvements can be made. 
This National-led Government is committed to helping business through these tough times because we recognise that business will lead New Zealand out of the recession. Because of that barriers to growth and things that are going to stop our businesses moving ahead and continuing to grow and develop need to be addressed and where possible removed. I suggest that removing unnecessary barriers red tape and compliance costs is a little bit like the journey of a thousand miles: the only way to tackle it is one step at a time. That is really what this bill does. Each change on its own is not large and each change on its own is not going to change the platform on which business in this country is done but when we combine them we get the beginning of real progress in the area. I also say on this point that even though the changes that this bill makes—and there are 22 of them—will not put shock waves through the business press and the mainstream media I suggest that the people who are affected by them will find them a real important and significant improvement to the systems that they operate under. 
I understand that the regulatory improvement process is to be an annual process and that each year we will see a bill of this sort used as a sensible way to address regulatory hurdles that are unnecessary ambiguous and uncalled for. The amendments can be combined into a single omnibus bill to make the most of this House’s time. As the bill progresses and we get to the Committee of the whole House stage the bill can of course be broken into a number of separate amending bills as appropriate. 
In this bill as I said there are 22 separate legislative changes. In this 2009 collection the changes before us arise in the main from the Quality Regulation Review that was carried out over 15 months through 2006 and 2007. The changes fundamentally address regulatory duplication gaps and inconsistencies. They aim to produce more sensible outcomes and at reduced cost to business. Having worked as a lawyer—as I have said in this House before—I mention that there is nothing more frustrating than a regulatory system that is not clear that has duplications and that produces inconsistent results. I certainly support anything that goes towards clearing up some of that confusion. 
I will now focus on just a couple of the changes. I will start by looking at the amendments to the Fisheries Act 1996. I have not spent much time working in this area but when we read through what the legislation does we see that it is a good example of why this sort of bill is necessary. This part of the bill makes changes to ensure that the catch balancing regime works fairly efficiently and effectively. I will outline the issue here as I understand it. When commercial fishers are balancing their annual catch entitlements—which are obviously part of the quota management system—at the end of the fishing year they have to balance that actual catch with their annual catch entitlement. That seems simple enough but there is a problem in that the annual catch entitlement register closes off 15 days after the fishing year ends yet the balancing between the actual catch and that annual catch entitlement occurs some 20 days after year end. In most situations that works perfectly well but what has happened from time to time is that after the annual catch entitlement register has closed for the year administrative errors have been identified where transfers that have been lodged have not been processed. Fishers then find themselves in a situation where their catch is not balanced by their annual catch entitlement register. 
That may not sound like a big deal to any of us but when it happens a debt is generated and if the fisher does not pay that debt he or she risks having his or her fishing permit suspended. That permit is the fisher’s livelihood and if we are going to jeopardise fishers’ livelihoods we need to ensure that the basis for doing so is fundamental and robust. In this case as I have said there have certainly been situations where because of administrative errors transfers to that system have not been progressed and the deadline has passed—there is no entitlement in the Act to address that. So to put it simply these amendments will allow for requests to be made to the chief executive for catch balancing relief and for the annual catch entitlement transfer to be recognised even though that 15-day close-off period after the fishing year has ended and even though that balance would otherwise be fixed. 
So we have—and I think this is a good example of the work that this bill does—the removal of an unexpected and unfair consequence of a simple administrative error. This is not about the mischief this law addresses; this is not the mischief that the original Act was designed to catch. This issue does not threaten the sustainability of a catch of various species; it is simply an unexpected consequence of administrative oversight. To allow for a simple process for that problem to be addressed when it turns up is the sort of streamlining and removal of unnecessary barriers that I wholeheartedly endorse. Importantly I note that that change in particular has been endorsed and supported by both the New Zealand Seafood Industry Council and Commercial Fisheries Services Ltd. 
I just briefly highlight some other examples. I highlight these examples because they go back to the point I raised earlier which is the necessity of tidying up duplication between two pieces of legislation. As I have said before when one is acting to advise clients on their legal obligations a situation where two unrelated pieces of legislation deal with the same area is depending on how one looks at it either a lawyer’s nightmare or a lawyer’s goldmine. This is because the potential for inconsistency is rife. Often the pieces of legislation have not been considered properly together when each one was put in place which leaves clients and New Zealand businesses absolutely at a loss as to how they are to properly address their obligations. 
The first example that I will look at also relates to the fishing industry. It is the amendment proposed by this bill to the Ministry of Agriculture and Fisheries (Restructuring) Act 1995. The bill would revoke section 18 of that Act. Section 18 of the Ministry of Agriculture and Fisheries (Restructuring) Act imposes a compulsory 10 percent penalty that has to be paid on any unpaid debts under the Act. I have no issue with that. It is appropriate that if a debt is unpaid there should be a penalty. But the issue here which through this bill the Minister has correctly identified and is working to fix is that these matters are also penalised under the Fisheries Act. In effect we have a double-dipping regime where for one breach clients can be penalised twice under two separate regimes. That is simply inappropriate and unfair; it is unnecessary duplication. Under the Regulatory Improvement Bill section 18 of the Ministry of Agriculture and Fisheries (Restructuring) Act 1995 is revoked entirely. The penalties regime applicable under the Fisheries Act will apply and fishers will not have to address a double-penalty regime. 
The second issue I want to touch on in closing is the change to the Weights and Measures Act 1987 which has a similar effect in that the change addresses the fact that two separate legislative provisions currently apply to the supply of LPG in gaseous form. Those provisions are in the Weights and Measures Act and the Gas Act 1992. Once again when two pieces of legislation address similar provisions we will get inconsistent results and we will get confusion. I certainly applaud the work of this bill in tidying that confusion up in this case by removing confusion from the Weights and Measures Act. 
In closing I once more commend the Minister for his work in looking at the small details. The House often forgets them and does not have time to deal with them but they are of massive importance to the business community. Combined the amendments go a long way towards fixing up unnecessary red tape and compliance in this country. I support the bill and I commend it to the House. 
CHARLES CHAUVEL (Labour) 
: 
 I rise to say a few words on the Regulatory Improvement Bill. I would like to start by sharing with the House my perspective as the chair of the Regulations Review Committee—and we have just heard from Amy Adams the deputy chair a very able speech if I may say that respectfully. I will cite the experience of the committee because it provides very important accountability from this House and this Parliament back to the community as far as sub-delegated legislation is concerned. Indeed many of the principles that we on the committee look for in our work are reflected in the bill; for example the Regulations Review Committee recently had cause to express some real concern about whether when a regulation incorporates say a New Zealand standard by reference that standard is sufficiently accessible to citizens for it to be said to have been satisfactorily incorporated into the law or whether we ought to recommend that the standard be contained in the delegated legislation itself so that people can have free and easy access to it. It is interesting to see that this legislation does something very similar on a point of sub-delegated legislation—a point to which I will return. 
I turn now to the analogy between the work of the Regulations Review Committee on delegated legislation and the work of this House now with this first—hopefully it will be annual—Regulatory Improvement Bill. It is a similar way of engendering accountability—in this case back to the business community by and large—in respect of primary legislation which is something that this House really has not thought about a lot. Parliaments overseas have for example looked at the question of whether all legislation should have sunset clauses built into it. That way we can make sure that legislation that sits on the statute book for many years does not simply get out of date. After all it has the effect of the law of the land yet there is no mechanism that we as legislators have to make sure that the law of the land is refreshed and always remains relevant. This bill I see as a first step in that direction and it is a very welcome step in the same way as the reforms put in place by that great reforming Attorney-General and Leader of the House the Rt Hon Sir Geoffrey Palmer spearheaded the way for a proper regime of accountability in respect of delegated legislation one of the fruits of which is the Regulations Review Committee—which as I have said I have the honour to chair. 
I will say a few words about the Quality Regulation Review because that will set this legislation in context. The Quality Regulation Review came out of the previous Prime Minister’s statement in the House back in February 2006. In her statement the Rt Hon Helen Clark said: “We will also be taking a fresh look at regulatory frameworks. Feedback from business suggests that higher-quality regulation would lead to more growth and investment and we want to engage with business on how to achieve that.” That is another point that I think is important to make. This legislation is important as the previous speaker said in that it tidies up bits and pieces of legislation that have presented a problem from a compliance or duplication point of view but have not warranted legislation in their own right. It is important that this Parliament looks at that sort of legislation and tidies it up. That sort of exercise will lead to greater confidence in our ability to foster the sort of growth climate we need in this country to make sure we have the kind of equitable society that we want to see in New Zealand. 
But the point about the content of the bill is only half the matter; the other point is the process that led to it. It was a meaningful consultation process. If this type of legislation is to become an annual feature of the business of this House we must not lose sight of the need to consult. We must continue to consult the businesses and the other stakeholders who are affected by legislation and we must make sure that we are not simply imposing further problems on them by legislating for problems that we see exist. We have to make it a two-way street: to ask the businesses what the problems are go through a meaningful consultation exercise and then make sure that we respond in a proper and proportional way. 
The beauty of the Quality Regulation Review is that that was exactly the exercise that the then Minister of Commerce the Hon Lianne Dalziel undertook. The review took over 15 months to complete and involved a wide range of Government agencies as well as more than 200 businesses. The final report identified a number of issues that required the sorts of amendments to legislation that we now see in this omnibus bill. If we look at this legislation we see that it covers quite a remarkable range of activity but all of it is aimed at the same objectives and they are to improve the regulatory frameworks and to reduce the compliance burden on business. 
Before I talk about some of the specific examples in the legislation I want to make this point. A visitor from Mars arriving in New Zealand just before the election might have presumed from the sorts of speeches being made during the election campaign that New Zealand was not a very prosperous stable or fair place to live. I think that one of the unfortunate features of New Zealand politics is that there seems to be a temptation on the part of whoever happens to be in Opposition—but certainly not the honourable members on this side of the House of course—to run the country down to say that the economy is in a mess New Zealand is a terrible place to live and we have to claw our way back up the rankings somehow. It would be useful I think—again to set the legislation in context—for members to recall that New Zealand does not start from a zero base in this area. It is easy to do business in New Zealand. To set up a business for example we are second to Singapore in the World Bank’s rankings. [ 
Interruption 
] I think Mr Tremain would concede that the World Bank knows a bit about how easy it is to set up a business in the various countries in which it operates. We are No. 2. So let us not lose sight of the fact that we are doing pretty well in at least one of these important areas. Another important area is the amount of transparency that exists in New Zealand. We are up there with the Nordic countries—I think we are second to Finland—as far as our complete lack of corruption in public life is concerned. 
Hon Rodney Hide 
: That’s because Labour’s gone. 
CHARLES CHAUVEL 
: Mr Hide is quite right; that is the legacy of 9 years of Labour in office. It is something we can be very proud of because that lack of corruption is something that other countries and businesses overseas would absolutely die for. 
I said I would speak on some of the details of the bill and I will move to the incorporation by reference point which I touched on earlier. It is a well-known principle of the law that in order for people to be able to comply with the law that this Parliament makes including regulations made under legislation the law should be well known to people and accessible. One of the important things this legislation does is address an important incorporation by reference point when we have the standards requirements or recommended practices of national as well as international organisations. This change will resolve some potential issues that have arisen from the current wording of the Hazardous Substances and New Organisms Act. The current provisions make it difficult to refer to the preferred standards of an organisation such as the British Standards Institution because it might be considered a national organisation of the UK rather than a properly recognised and reputable international organisation. This creates unnecessary confusion and obstacles to the incorporation in New Zealand regulations of high-quality standards developed by such organisations. That situation will be addressed by this bill. 
Two other matters that are dear to my heart as Labour’s energy spokesperson are dealt with in the bill. First the gas governance regime will be amended to allow gas to be used as feedstock. This amendment is intended to create certainty that the governance regime will cover participants using feedstock gas and to ensure that industry participants are treated consistently. The current provision in the legislation could be interpreted as exempting feedstock gas from any rules or regulations made under Part 4A of the Gas Act. Part 4A was intended to provide for an effective governance regime for the gas industry. This exclusion was not the intention of the original legislation and it clearly creates unnecessary confusion and uncertainty. 
The last point I will make was touched on by the previous speaker. It is important to align the treatment of liquefied petroleum gas under both the Weights and Measures Act 1987 and the Gas Act 1992. Gas industry consumers will gain greater clarity and thus reduced compliance costs. That is another example of the excellent measures contained in this bill. Thank you. 
Hon TARIANA TURIA (Co-Leader—Maori Party) 
: 
 Tena koe Mr Assistant Speaker. I rise to speak on the Regulatory Improvement Bill’s first reading. Winston Churchill and Rodney Hide have something in common apart from looks though Rodney is definitely in better shape. It was Churchill who famously said that if there are 10000 regulations all respect for the law is destroyed. Almost 80 years later Mr Hide has introduced a bill to do something once and for all to address the duplications gaps errors and inconsistencies that make a mockery of our law. It is great to see the ACT Party going to such steps to implement Maori Party policy. 
The Maori Party campaigned before the previous election on a commitment to support the growth and sustainability of small businesses. We committed ourselves to reduce the tax on businesses with a net income of $100000 or less from 33 percent to 25 percent. We laid it on the line that we wanted to support collective business development strategies that encouraged local and regional self-reliance. But a fundamental principle was woven through all of these policy targets: the understanding that we would review compliance costs with a view to their minimisation. We appreciate the support of the ACT Party in getting this policy in place with this bill. The bill sets in train some changes that make complete and utter sense. 
I know that the member from National who spoke before has already referred to the matter that I am about to raise. The way the law currently works is that commercial fishers are required to balance their catch with the annual catch entitlement as part of the quota management system. They have 20 days after the end of the fishing year to do so. However the register closes after the 15th day so what has been happening is that fishers have been incurring a debt in the form of an invoice for that debt. That just does not make sense. If the law says they have 20 days and someone shuts the register on day 15 that is as good a reason as any to change the legislation. The late Dr Martin Luther King once said: “Just as it is the duty of all men to obey just laws so it is the duty of all men to disobey unjust laws.” I have always heeded that bit of advice pretty seriously myself. 
Also affecting fishers are the changes to the Ministry of Agriculture and Fisheries (Restructuring) Act. The changes in this bill will revoke the sections that deal with the removal of penalty fees and the ability to deduct costs from the collecting of levies. This change is not to suddenly stop collecting fees costs and levies—as much as I am sure that that would be a highly popular move. But the change is a good change anyway because these costs are already covered by the Fisheries Act 1996 so there is no good reason in my mind to repeat them. 
There are some other bits and pieces in this bill. The Designs Act will be amended so that when a design registration has lapsed because of the unintentional non-payment of a renewal fee the design registration can still be restored just by paying that registration fee. 
The only area we might need to take a closer look at relates to the Hazardous Substances and New Organisms Act. Tangata whenua have raised prolonged and consistent concerns around the risks to matauranga Maori the ownership of biological resources the inadequacy of the existing statutory frameworks and the fundamental significance of protecting article 2 rights to taonga katoa. The bill proposes that the Environmental Risk Management Authority should be able to delegate technical and administrative decision-making powers to its chief executive and other staff. The concern for us is to establish an ethical framework for moving forward such as that recommended by those who are pursuing the Wai 262 flora and fauna claim. We will be keeping a watch over the select committee process to hear what submitters have to say about the ways in which this bill takes into account the recommendations of Wai 262.  
We will therefore take our lead from tangata whenua in subsequent readings of the bill but for its first reading we are happy to support it. Kia ora. 
RAYMOND HUO (Labour) 
:  
Winston Churchill would have been very pleased to hear what I am going to say in the next 10 or so minutes. 
Hon Simon Power 
: No just 10. 
RAYMOND HUO 
: Just 10 minutes—the member is right. 
Mr Churchill was a great statesman and a great historian. Let us look briefly at the historical side of the Regulatory Improvement Bill. I congratulate the Hon Lianne Dalziel who introduced this bill in September 2008. The Hon Lianne Dalziel made history in September 2008. She introduced a brand new bill that aimed to improve some existing laws and reduce compliance costs for businesses. More important the bill was introduced as a result of a careful 15-month Quality Regulation Review and reflected consultation between Government agencies and 200 businesses. Therefore I rise to support this bill both for its content and for the way it was introduced. In that regard to some extent the bill itself may be more important than the content. The Hon Lianne Dalziel and the Labour-led Government listened to business people and set about implementing their recommendations. 
That consultation is particularly relevant today as we have witnessed in the past weeks in this honourable House the way recommendations can sometimes be ignored and how new plans are rammed through. Every member in this House knows what I am talking about. Yes I am referring to the so-called super-city and the way these new ideas new plans and new agendas are being rammed through. 
I come back to the bill. First of all the way it was introduced set a good example. [ 
Interruption 
] Secondly and if members listen carefully they will appreciate this let us look at the content. This omnibus bill makes amendments to legislation with the objective of improving the regulatory framework and reducing the compliance burden on business. The Regulatory Improvement Bill resulted from the Quality Regulation Review that was completed in September 2008. It addresses issues raised by business Government agencies and other stakeholders that require changes to legislation. As the Hon Lianne Dalziel said last week in this House the Quality Regulation Review came out of the statement made by the previous Prime Minister the Rt Hon Helen Clark in the House in February 2006. In her statement the Rt Hon Helen Clark said: “We will also be taking a fresh look at regulatory frameworks. Feedback from business suggests that higher-quality regulation would lead to more growth and investment and we want to engage with business on how to achieve that.” 
The bill also offers some assistance to me personally. While practising law in Auckland prior to becoming a member of this House I was often asked why certain companies with overseas ownership must appoint an auditor under the Companies Act 1993 yet these companies are no longer required to file audited financial statements with the Registrar of Companies under the Financial Reporting Act 1993. I did not have an answer then but I have an answer now. The bill puts such companies with overseas ownership in the same position as other companies. We may find a similar situation in other legislation such as the Conservation Act 1987 the Designs Act 1953 the Gas Act 1992 the Fisheries Act 1996 etc. This omnibus Regulatory Improvement Bill aims to fast track a number of legislative changes that are badly needed. The changes cover a diverse range of policy areas and legislation. They are all focused on the same objectives—namely improving regulatory frameworks and reducing the compliance burden on business. These objectives are the unifying theme of the clauses in the Regulatory Improvement Bill. 
The first reading debate on this bill began in this House last Thursday. What surprised me was the level of interjections or noise from the members opposite. This is a business-friendly bill. It is a non-controversial bill. Of course it was a Labour bill that according to the Minister responsible the Hon Rodney Hide was reinstated for very good reasons. While preparing for my speech against those interjections or noise I spotted a line relevant to this bill from a newsletter or press statement—or whatever it was—which my learned friend Charles Chauvel just mentioned. It reads: “New Zealand does not start from a zero base. We rate number two in the world according to the World Bank’s Doing Business survey second only to Singapore.” 
To add more I also note that in 1999 161128 of our people were on the unemployment benefit. In March 2008 the number was 19034. That is a decline of 88 percent since Labour came into Government in December 1999. New Zealand was the only OECD country to have kept unemployment under 4 percent since late 2004. I note that members opposite appear to have adopted a standard chanting slogan of “Nine long years.” I say to those members that yes over the last 9 years Labour did what many members said was impossible. We halved Crown debt at the same time as investing in the future of all Kiwis. Thank you very much. 
AARON GILMORE (National) 
: 
 I rise to support the Regulatory Improvement Bill which has been taken over by the Minister for Regulatory Reform the Hon Rodney Hide. As other members have said prior to this call this bill is another big step forward by this Government which is business-friendly and wants the economy to grow faster. 
Our Government cares about the level of compliance costs of business and it cares about getting rid of some of the red tape that stifles the ability of businesses everywhere to do what they want to do—serve their customers earn a reasonable return for their shareholders employ good people and make our communities the way we want them to be. Communities need things like this bill to make small businesses grow faster. This is a tidy-up bill and it is hoped that it will become an annual bill to tidy up the regulations that cause problems annually. 
This bill has a broad range of amendments 22 in total that will wither away some of the red tape that strangles many businesses in New Zealand. Prior to becoming a member of this House I was in business working for a large US multinational—a US$7 billion business. I was part of the Asian management team. I travelled across 14 different countries and I worked regularly in 11 of them. As some members opposite have said I found that it is very easy to set up a company in New Zealand. It can be done very quickly—in 24 or 48 hours. The interesting thing is that the ease of doing business day to day is quite remarkable relative to some other countries that I operated in—in particular Hong Kong and Singapore which is one of the countries mentioned by the previous speaker Raymond Huo. We have seen economies grow at a rate four to five times the rate of New Zealand’s—8 to 10 percent and even up to 13 and 14 percent. In New Zealand economic growth has averaged quite a lot lower. One of the reasons for that as outlined to me by my prior employers their shareholders and also by small businesses in the street is the number of things they have to deal with that they do not really want to deal with—red tape as they call it. I will talk a little bit about that. 
The difference between working in Hong Kong and working in New Zealand is that it takes a little while to set up a company in Hong Kong. Once the company actually gets there the compliance costs and operating costs are much lower in terms of what has to be done for reporting relative to what is seen in New Zealand. I will take just one example contained in this bill that would benefit the business I used to run and I will talk a little bit about that particular change—the change in the Companies Act 1993. That Act has a significant number of compliance costs with it particularly when compared with other nations that I have worked in and that Mr Chauvel referred to earlier. Yes it is easy to set up a business in New Zealand relative to some other nations but it is not necessarily easier to operate those businesses—for smaller companies in particular especially special-purpose entities or overseas-owned rapid-growth entities that are subsidiaries of overseas-owned businesses. I was pleased to see that this bill has changes to a particular Companies Act requirement for overseas businesses. 
My last role before being elected to Parliament was as the managing director of one of those businesses. We were established to commercialise a revolutionary technology in the area of high-temperature superconductors. This business has the potential estimated by external entities in Europe to be a market worth US$20 billion. It is an industry that is being developed right here in Wellington. I was pleased to be the leader of that business and today it is progressing very well. I was proud to be the leader of that business in its early stages and today that business continues to expand. At the time of establishment one of the hardest things to do for an early-stage business is to preserve cash flow and management time. Time of management is absolutely critical and is very hard to value. It is absolutely critical particularly for companies at their early stages and even if they are part of a larger overseas operation. It is in the time of the management that procedures can be at their weakest because the focus is on cash flow on trying to get revenue and on trying to get the product to market as fast as possible. So it is wonderful that this bill will allow some changes for businesses like those that I used to manage to give some degree of leniency in removing that Companies Act requirement if the business has fewer than 50 employees under $10 million in assets and under $20 million in revenue. Where such businesses are more than 25 percent owned by overseas operators or where they themselves are subsidiaries of an overseas incorporated company they will no longer have to incur the costs and time commitments of undertaking an audit should they pass a resolution not to do so. 
My own experience of auditors has been an interesting one and I would like to touch a bit on that. I used to work in one of the world’s leading commercial accounting and advisory businesses and having subsequently become a client of such firms it has given me some strong understanding of the costs that such firms may put in place for a business and the effort required for such an audit and for the preparation of financial statements for a company even if it is just a subsidiary of a much larger business. I can tell this House that this can amount to tens of thousands of dollars in fees paid to some sort of chartered accountant or audit firm and thousands of hours of management time. Collectively across New Zealand I estimate that would amount to millions of dollars of fees that could be shaved off the chartered accountant firms floating around New Zealand. More important thousands of hours of management time could be saved which could be used for what firms actually want to do—productive business decision-making to make New Zealand grow faster. What a wonderful thing that would be. That would help to create wealth for the benefit of New Zealand and get our economy growing at the speed we want it to grow. 
For many early-stage businesses the window of competitive advantage is narrow particularly in New Zealand where we have many global competitors to operate with. That was my experience in the business I used to manage. Additional time and costs saved early on in the first few months or years can be absolutely critical to the success of that business in subsequent years particularly when the growth flowing through is exponential. The business I used to operate in had a situation where we went from a few hundred thousand dollars in revenue to millions of dollars in revenue in a very short space of time. But if I had had to spend more time and effort dealing with auditors than I really wanted to the impact of that today would be significant. 
Another change in this bill is also an administrative technical one in nature and it is one that I commend for being an omnibus measure. We are not just dealing with all these 22 changes of provisions in individual fashion; we are dealing with them in one group. I think that that is a good thing; in itself it is an example of productivity in this House. Rather than dealing with 22 separate bills we have one bill dealing with a whole bunch of regulatory changes which will mean some efficiency gains will come from that process. 
I will talk now about one of the other amendments which would have also impacted on me in my former business career. It was talked about before by a couple of prior speakers and it concerns the Hazardous Substances and New Organisms Act. As outlined the regulatory improvements to that Act are those where many of those small businesses—particularly when they are in start-up type operation—have major problems going through some of the compliance issues for dealing with some of those hazard issues. It can take many many months—or that was our personal experience when we had a small amount of radioactive material to deal with in one of the things we were trying to create. It took us between 4 and 6 months to get approval. We could not operate any faster; we could not change the situation. Exactly the same process in Australia took 4 days but in New Zealand the approval took 4 to 6 months. That meant that in that time we could not proceed with the development of our product and as a result that led to loss of revenue and it actually led to the loss of competitive progress for our technology relative to that of our competitors particularly in Europe. The result of that was that we lost a contract of around US$4.5 million. That is US$4.5 million that was lost to this country because of that particular regulation which concerned some of the things we dealt with. 
Hon Maryan Street 
: Are you surprised? It was radioactive material. 
AARON GILMORE 
: Yes radioactive substances are an important sort of example. So we had a situation whereby if we had developed that technology overseas—in this case in America or Australia—we would have had approval in 4 days but instead it was 4 to 6 months and that was over US$4 million lost to the New Zealand economy. That is an example of why New Zealand in the last few years has been growing at a much lower rate than what we are seeing in China in other countries in Asia and in other places around the world. New Zealand has had to settle for second-best with growth rates of 2 to 3 percent. That is all we have—2 to 3 percent—to pay for the things we want in health education pensions and everything else. I must say that instead of taking a blatant line that—as in the case I dealt with—just because something is different means that it is wrong and it is bad we should be thinking of a practical solution and asking what is done overseas in dealing with these products. If we could speed these things up by the changes we have here—like changing the provisions in the Hazardous Substances and New Organisms Act—it will allow businesses like the ones I used to manage to get their products to market faster so that they do not have to wait for such a long period of time and those businesses will be in a position to grow faster which will help New Zealand to grow faster. 
Those are the reasons why these changes to the Hazardous Substances and New Organisms Act and the Companies Act are such good changes. They are wonderful changes to help our economy grow faster. Thank you very much. 
Mr DEPUTY SPEAKER 
: The question is that the motion be agreed to. Those of that opinion will say Aye; to the contrary No. The Ayes have it. 
Hon RODNEY HIDE (Minister for Regulatory Reform) 
: 
 I move that the Regulatory Improvement Bill be referred to the Commerce Committee. 
Mr DEPUTY SPEAKER 
: The question is that the motion be agreed to. Those of that opinion will say Aye; to the contrary No. The Ayes have it. 
KEITH LOCKE (Green) 
:  
I raise a point of order Mr Speaker. I forgot that the Green Party wanted to vote against that bill. 
Mr DEPUTY SPEAKER 
: Well I have already announced the result. If you wish to have your vote counted then you will have to seek leave. I have already announced the result. 
KEITH LOCKE 
: I am sorry; I forgot to call for a party vote. I seek leave for a party vote. 
Mr DEPUTY SPEAKER 
: Leave is sought by the Green Party for the vote to be retaken. Is there any objection to that course of action? 
Hon SIMON POWER (Minister of Justice) 
: 
 I raise a point of order Mr Speaker. I apologise to the member but if the member just indicates what his vote is surely we should just be able to record it without having to go through the whole process of a party vote. 
KEITH LOCKE 
: I am happy to— 
Mr DEPUTY SPEAKER 
: No. No we cannot do it that way; we must have a party vote. Leave is sought for the Green Party to have its vote recorded. Is there any objection to that course of action? There is no objection. 
A party vote was called for on the question  
That the Regulatory Improvement Bill be now read a first time. 
Ayes 112 
New Zealand National 58; New Zealand Labour 42; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a first time. 
Bill referred to the Commerce Committee. 
Securities Disclosure and Financial Advisers Amendment Bill 
Second Reading 
Hon SIMON POWER (Minister of Commerce) 
: 
 I move  
That the Securities Disclosure and Financial Advisers Amendment Bill be now read a second time 
. From the outset I would like to thank the Commerce Committee and in particular the chair the Hon Lianne Dalziel for seeing this bill move through the committee at a pace that equates with the urgency that surrounds legislation of this nature. 
The objective of the bill of course is to respond to the global financial crisis by removing unnecessary impediments to the raising of capital in New Zealand while continuing to ensure the timely disclosure of relevant information to prospective investors. I thank the various parties in the House for their support both of the legislation and of the select committee process. The financial crisis has highlighted the need to act decisively to address credit rationing which has restricted access to capital for New Zealand firms. However the crisis has also taught us that companies cannot ignore the interests of investors—an important point. This means that any action the Government takes in response to the crisis should not serve to undermine investor confidence in the financial sector particularly when it is already frail. 
This bill addresses a number of the recommendations made by the Capital Market Development Taskforce in its interim report of November last year. The bill amends the Securities Act 1978 to provide for a simplified disclosure prospectus that may be used by listed issuers who are already subject to continuous disclosure requirements and would otherwise be required to produce a separate disclosure document for each offering. Listed issuers would therefore be required to produce only one disclosure document for a securities offering instead of producing both a full prospectus and an investment statement. The intention of the simplified disclosure prospectus is not to reduce the amount of information provided to investors but to reduce duplication between forms of disclosure. 
In addition the bill proposes other relatively technical changes to the categories of persons who are exempt from the disclosure requirements for offers of securities under the Securities Act which will make it easier for all businesses whether they are listed or unlisted to raise capital. The bill also amends the Financial Advisers Act 2008 through the correction of a minor error in the final version of the Act and through other minor tidying-up amendments. 
Since the first reading of this bill the Commerce Committee has recommended a number of amendments to strengthen the bill so that it may meet the objectives I have outlined so far. Overall submitters welcomed the introduction of the simplified disclosure regime. They were also supportive of the proposed amendments that relate to categories of persons who are exempt from the disclosure requirements for offers of securities under the Securities Act. 
It is important to note that I am aware that other issues were raised by submitters and that some people in the industry consider we have not gone far enough with the bill. Let me remind the House that this bill has been swiftly prepared in response to the need to address the current credit crisis and that I have already asked my officials to carry out a more thorough comprehensive review of the Securities Act. The committee considered the additional proposals that were raised by submitters and concluded that they were either outside the scope of the bill or better dealt with in a more fundamental review of the Act. No substantive changes are proposed to the part of the bill that relates to simplified disclosure prospectuses. 
The intention of the simplified disclosure prospectus is not to reduce the amount of information provided to investors but as I have said to simply reduce the duplication between the forms of disclosure. Any relevant announcements made through continuous disclosure will need to be referenced in the simplified disclosure proposal and to be made freely available to investors by for example publication on the issuer’s website. Liabilities penalties and remedies for the disclosure of false or misleading information will continue to apply to a simplified disclosure prospectus as they do to a full prospectus. 
However the committee recommended three changes to the provisions in Part 1 that deal with categories of persons who are exempt from the disclosure requirements. Where subsequent offers are exempted from the standard disclosure requirements the committee recommended that exemptions from standard disclosure requirements for subsequent offers by persons who have made subscriptions of $500000 be allowed to include offers for different types of securities rather than being limited to securities where the rights privileges limitations and conditions attached are identical to those attached to the initial securities. The committee concluded that it is unnecessary to restrict the securities to those that are identical to the initial securities and the proposed amendment recognises that an investor who has previously invested half a million dollars in one transaction prior to allotment does not need necessarily the protection of the Act. I agree that limiting the securities to those that are identical to the original offer would needlessly restrict a company’s ability to use a range of investment vehicles to raise further capital from its initial investors. 
The committee also recommended in relation to clause 5 that section 3(2)(a) of the Securities Act be extended to allow offers subsequent to an initial half a million dollars to be made within 18 months of the first allotment rather than 12 months. The committee thought it appropriate that the half a million dollar initial investment should be made within a reasonably small window but did not consider that 12 months would allow the issuer enough time to complete a full annual reporting cycle and to decide whether additional capital needed to be raised. I think this is a pretty sensible move. 
The committee has also suggested that the Securities Act be amended so that people who are experienced in investing money will be required to acknowledge that as experienced investors they will not receive the disclosures that are typically required in relation to a public offering. The committee thought it was important that those investors acknowledge that they are not to receive any of the information usually provided by an issuer who is offering securities to the public. I consider this to be another useful amendment. 
The committee also considered further amendments to the Financial Advisers Act designed to remedy errors that have come to light since the bill was introduced. These issues are all of a minor technical nature but are important to ensure the legislation works as intended. The committee also recommended changes firstly to remedy an oversight in the Financial Service Providers (Registration and Dispute Resolution) Act that potentially exempts some financial advisers from registration secondly to clarify that information contained in the disclosure statement that is required to be produced under the Retirement Villages Act 2003 is not financial advice—and you will be interested in that Mr Deputy Speaker—and thirdly to clarify the disclosure obligations and potential liability that applies to financial advisers operating as part of a qualifying financial entity. 
Hon Maurice Williamson 
: Excellent excellent. 
Hon SIMON POWER 
: These amendments are consistent with the policy decisions on the Financial Advisers Act so I too support their inclusion in this bill. I am confident that the amendments made by the committee will help the bill to achieve its objective of facilitating access to capital for New Zealand businesses. 
I conclude where I began the Hon Maurice Williamson will be pleased to know. I conclude by thanking members of the select committee and in particular the Hon Lianne Dalziel for her cooperative approach to working on this bill. Having been the Minister who put in place the Capital Market Development Taskforce she understood just how important this legislation was when we introduced it in recent weeks. I acknowledge the members of that committee for their swift consideration of the bill and in fact for their helpful suggestions for amendments. I acknowledge the contributions of those who provided submissions on the bill. I commend the bill to the House. 
Hon DAVID PARKER (Labour) 
: 
 I rise to indicate the Labour Party’s support for the second reading of the Securities Disclosure and Financial Advisers Amendment Bill. We will support the second reading of the bill. As has been indicated this bill is the outcome of work that was commenced by the previous Government and led by the Hon Lianne Dalziel who would ordinarily be speaking first on behalf of the Labour Party in this debate but is unable to be here today to do so. 
The Capital Market Development Taskforce was established by the previous Government in July 2008 and it included members from Government departments and the private sector. Its objectives were to identify constraints on and opportunities for the development of New Zealand’s financial system. It wanted to identify and debate the different options that were available to improve the performance of our financial system and to develop a blueprint to enable its proper development. Originally when the task force was set up it was envisaged that we had the luxury of more time than has turned out to be the case. When the task force was set up the global financial crisis was not as serious as it had become by the end of last year. So although it was originally intended that the task force would take a year to produce specific recommendations that would then be implemented because of the seriousness of world events it decided to produce an interim report in November of last year. 
In simple terms the world financial crisis has done two things: it has put pressure on the ability of institutions and companies to raise the money they need to go about their business—that is a pressure that they are already facing—and in addition it has created suspicion on the part of some investors particularly smaller investors as to where they should put their money what information they should rely on and how they can have confidence that risks are being properly assessed. This bill tries to grease the wheels of commerce. It tries to put in place improved rules so that it is possible for institutions and companies that need to raise capital to be able to do so whilst at the same time giving investors greater confidence to place their money in those investments. 
I do not think anyone in this Parliament pretends that we can legislate away risk; I certainly do not hold that view. There are risks inherent in investing. This Parliament ought not to try to avoid risk because plainly we cannot but what we can do is make sure that investors have the confidence to make investment decisions by ensuring they have the appropriate level of information. 
The current regime is imperfect and this bill is being passed to improve it. One of the problems with the current regime is that alternative sources of information are available to investors: the investment statement which can be relied upon and the prospectus. Both of those documents are available but in practice most investors are given an investment statement rather than a prospectus. I think it is the experience of many more knowledgable investors that the level of information provided in an investment statement is inferior to the more detailed provisions in a prospectus and perhaps is not enough information for an investor. So although in theory investors have access to a prospectus if they want it the reality is that normally they get only an investment statement with an inferior set of information which is not enough to give them confidence that all of the risks and benefits have been properly outlined to them before they make their investment decision. This legislation says that certain public issuers must revert to a prospectus. 
There is an additional improvement. At the moment the prospectus requirements require the repetition of information that has already been made publicly available pursuant to the continuous disclosure obligations of certain public issuers certain companies on the stock exchange etc. At the moment the rules require that much information that has already been made available to the public is included in the prospectus. That information may be relevant but it certainly does not need to be repeated every time. This amendment enables the prospectus to focus on items that are more important to the investor so that the investor has a higher level of information than might be provided in an investment statement but none the less is not overwhelmed with copious quantities of documents that have already been disclosed by the public issuer. If that sort of overly prescriptive level of detail is required to be disclosed then the poor old investor unless he or she is full-time in the business of interpreting those things is so overwhelmed with information that it is sometimes hard for the investor to see the wood for the trees. Hopefully through this legislation we are getting to a better balance. 
Hon Maurice Williamson 
: Keep the trees you cut down. 
Hon DAVID PARKER 
: Well trees are at risk of being cut down at the moment because of the Government’s suspension of the emissions trading scheme but that is nothing to do with this bill. 
Another change made by the Commerce Committee which I endorse as the Minister did amends the strange situation where investors who are wealthy enough to afford to subscribe $500000 in a single investment in a public issuer seem to need to be protected against making other investments in that same issuer albeit in a different class of security. This bill remedies that situation by saying that if an investor had $500000 to invest and did so then presumably he or she could afford to take the risk inherent in investing in other securities in that same entity. Certainly if an investor was able to afford a $500000 investment he or she could afford to seek advice as to whether a different class of security would be a better investment than one from that same public issuer. That change is a sensible improvement. 
I address also one other change that has been made. Another feature of the bill changes the central supervision of financial advisers to be by the Securities Commission rather than as was originally proposed via a co-regulatory model with the industry. The bill establishes a Commissioner for Financial Advisers who will be a member of the Securities Commission and will have a code committee and a disciplinary committee. Both of those committees will include advisers with industry experience in order to make use of their expertise but will come under the ambit of the Securities Commission rather than as was originally proposed using a separate co-regulatory model with the industry. That again is appropriate. 
There is less rather than more public confidence these days in self-regulation of the financial sector. One of the outcomes of the crisis internationally has been to show that there is a very proper role for centralised Government-controlled regulation of the financial sector. Against that background it is very appropriate that the regulatory model that is now proposed is effectively under control of an arm of the Government albeit independent of the Government in its decisions. The appointments to the Securities Commission are controlled by the Government; the commission then acts independently of Government and industry. Although the regulator has the ability to avail itself of members who have experience in those industries the regulator is not a co-regulator with the industry; it is separate from the industry. That is important and should give investors confidence that they are making wise decisions when they take risks and invest. That maintenance of investor confidence should make it easier for financiers to raise the funds they need in order for them to go about their business and for our economy to prosper. I recommend this bill to the House. 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I rise to speak to the second reading of the Securities Disclosure and Financial Advisers Amendment Bill. Like the two previous speakers I fully endorse and support the recommendations made within the bill and the changes to the Securities Act that have been recommended through this new bill. Before doing that may I acknowledge firstly the Minister of Commerce the Hon Simon Power for his leadership and his guidance in bringing this bill to the House and the cooperative manner in which all parties on the Commerce Committee have worked towards refining and debating the various points of the bill. I also acknowledge the previous Minister of Commerce the Hon Lianne Dalziel who sadly is not in the Chamber at the moment for her work on the bill her chairmanship of the select committee and her experience as Minister in initially bringing this legislation to the House. 
As has already been described this afternoon the Securities Disclosure and Financial Advisers Amendment Bill was developed in response to the interim report of the Capital Market Development Taskforce which was released last year in November. That report was in response to the current financial crisis and its report focused primarily on increasing the availability of capital to New Zealand firms and reducing the costs of raising that capital. This bill goes some way to addressing some of the difficulties that we are currently experiencing in the international financial crisis. It is related to the financial sector due to the breakdown in credit rationing and credit market access for small to medium sized enterprises. The bill really goes to removing some of the barriers to raising capital whilst maintaining importantly the relevant information that is required by investors to be informed and to make rational decisions on their investments in companies. 
So it is a balance: it is a balance between requiring disclosure of financial as well as company information to investors whilst also recognising that over-regulation of the finance sector will only lead to less desirable outcomes for our investments. Across the OECD Governments are working with financial regulators to shore up some of the financial institutions. We have seen recent reductions by the Reserve Bank of New Zealand to the official cash rate so that businesses are able to access capital more cheaply. 
The bill really looks at the simplified disclosure prospectus and it is to be used by listed issuers who are already subject to what we call the continuous disclosure requirements. Those issuers would otherwise be required to produce a separate disclosure document for each offering. But this new type of prospectus the simplified disclosure prospectus really aims to reduce the red tape. The committee had the benefit of assessing one such document which came to 22 pages in length compared with the documents in excess of 100 pages that are regularly produced in terms of prospectuses for large companies raising capital. So the Securities Disclosure and Financial Advisers Amendment Bill aims to bring about a reduction in red tape. 
Many of the submitters noted that the devil will be in the detail and that the short-form prospectuses that I have referred to need to be made available. The regulations that will dictate the type of information to be disclosed within those particular documents will need to be readily available for market participants to fully understand and be informed as to the requirements going forward. 
As the Hon David Parker has referred to the Securities Commission will monitor and enforce compliance of the simplified disclosure prospectus—or SDP—regime once it is introduced. However a submission from various parties did say that a dual role for regulatory supervision was desirable. The role of the Securities Commission will be particularly important going forward. 
A number of firms made submissions to our select committee. They ranged through legal firms financial advisers firms and various governing professional bodies that are particularly interested in this bill. The three areas that the bill addresses relate to the simplified disclosure prospectus; the Securities Act 1978 in relation to categories of persons who are exempt from those particular disclosure requirements for offers of securities under the relevant Act; and the Financial Advisers Act 2008 through the correction to minor errors that were made during that process. The primary objective is to enable firms to have cost-effective access to capital whilst ensuring that investors continue to receive accurate and timely information. 
Let us look at those three particular changes that the honourable Minister referred to. The first change is to omit from the bill new section 3(2)(c)(i) in order to allow offers of subsequent securities to the initial $500000 to be for different types of security rather than limiting it to securities where “the rights privileges limitations and conditions attached … are identical to those attached to the initial securities;”. A number of submissions were made in this area. Concerns were expressed by various parties that a debt security for example that differed markedly from an initial public offering of equity securities could be deemed to be sufficiently different that the terms and conditions of that subsequent security would require a full new prospectus. 
Many on the committee understood these concerns and accepted the concerns of the various parties but we deemed that in order to fast track some of the raising of security the continuous disclosure provisions of the regime would be sufficient to cover a lot of the disclosure of information. 
Secondly we deemed that extending the provision in section 3(2) of the Securities Act to allow offers of subsequent securities to an initial $500000 to be made within 18 months of that first allotment was particularly critical because the reporting cycle of companies is typically 12 months. If that period were shorter there would be deemed to be compliance costs and interim accounts would have to be produced for the company raising those securities. 
Finally there were a number of technical amendments to Part 2 of the Act which the honourable Minister referred to in his presentation. In conclusion I say that this legislation is part of our response to the global financial crisis. This is just one step in a range of measures being taken by our Government. The bill is really to balance the investor confidence in the market by allowing for companies to raise capital effectively and efficiently whilst accepting that individual investors as well as sophisticated investors need to access timely and relevant information in that process. 
CHARLES CHAUVEL (Labour) 
: 
 It is a pleasure to follow the previous speakers including the deputy chair of the Commerce Committee. I am a member of the committee but have not had a chance to attend it yet because of the Emissions Trading Scheme Review Committee meetings conflicting with the meeting dates of that particular committee. I must say that for all sorts of reasons I am looking forward to the conclusion of that process and rejoining the Commerce Committee. 
As my colleague David Parker indicated Labour supports this bill. Its purpose is to amend both the Securities Act 1978 and the Financial Advisers Act 2008. Right up front I will say just a word about the amendments to the Financial Advisers Act. I see that there are members of the Finance and Expenditure Committee from the last Parliament in the House this evening. They will remember that the Financial Advisers Act 2008 was a piece of legislation on which submissions were heard by that committee last year and Parliament managed to pass it through all its stages prior to the last election. I think it is fair to say there was broad support for that Act as well as for the suite of measures of which it formed part. There will be members in the House who remember also the Financial Service Providers (Registration and Dispute Resolution) Act and the Reserve Bank of New Zealand Amendment Act 2008 which extended the prudential supervision regime of the Reserve Bank to non-bank deposit takers. 
Listeners might be wondering why legislation passed so recently by this Parliament requires amendment. A couple of technical amendments are required to be made to the Financial Advisers Act. As the report of the committee records the amendments were of a minor technical nature that really does not cause any difficulties. I think probably the first thing to say is that there should not be a concern about amending those minor technical errors. It is pleasing to see that the House is addressing them in a good-natured way. 
Overall the bill responds to the international financial crisis which we are all currently doing our best to cope with by removing unnecessary impediments to capital raising but at the same time ensuring the timely disclosure of relevant information to prospective investors. It also makes a number of minor tidying-up changes as I have said to the Financial Advisers Act. As I have indicated the bill is to be seen in the context of the Financial Advisers Act the Financial Service Providers (Registration and Dispute Resolution) Act and the Reserve Bank of New Zealand Amendment Act. All of this legislation is designed to tighten the oversight regime for financial institutions in New Zealand which for far too long was a Wild West regime and which for far too long did not do good things for this country’s reputation as a safe place in which to invest money. 
It is intended that the bill will be divided into two separate pieces of legislation at the Committee of the whole House: the Securities Disclosure Amendment Bill and the Financial Advisers Amendment Bill. Part 1 will amend the Securities Act by providing three main things. First simplified disclosure prospectuses instead of investment statements will be sent to investors. We heard David Parker speaking on this earlier. That will be a good way to reduce the legislative burden and the duplication of requirements that currently exist. It will also provide for all prospectus amendments to be sent to investors before subscription and it will provide for additional Securities Commission powers to ensure that these prospectuses are used only by appropriate advisers and that potential investors will have sufficient time to consider advisers’ information before subscribing. I have said before that members on this side of the House support the legislation because basically the proposals arise out of the outcome of recommendations made by the Capital Market Development Taskforce in November 2008. The taskforce was set up by my colleague Lianne Dalziel in July 2008. 
Labour launched that task force to identify ways to improve access to capital. Probably all members in this House know that the need to be able to access capital in appropriate ways that are not at a ruinous cost is a perennial problem for New Zealand business. That is one of the major motivating features of course behind the setting up of the KiwiSaver scheme which was an attempt to broaden and deepen the amount of capital that is available onshore. It is one of the reasons why it is essential to retain in public ownership the State-owned enterprises and the great capital accounts of the Government. The task force provided some other ideas on that matter. 
The main proposal in the bill is to provide for the use and regulation of a simplified disclosure prospectus by stock exchange - listed issuers offering certain debt and equity securities. The proposed requirements do not reduce the amount of information required to be disclosed in total. They simply remove the duplication requirements of information already provided under the continuous disclosure requirements that apply particularly to listed companies. Similar recommendations were consulted on in the review of financial products and providers and this is included in the current review of the Securities Act. It also tidies up the rules for exempt persons and people deemed by the Act not to be members of the public for the purposes of disclosure. As I said there are some minor amendments to the Financial Advisers Act that are purely technical. 
I would just like to speak for a moment or two on the Capital Market Development Taskforce because as I have said adequate amounts of capital is one of the continual bugbears of New Zealand businesses that need to access capital at reasonable cost. I have mentioned some strategies that were put in place by the previous Government to try to address that problem. Let us remember another one and thank goodness for the decision to support the existence of an independent New Zealand stock exchange. I think if we look back now at the prospects for this country had there been a merger of the Australian Stock Exchange and the New Zealand Exchange we would see a much less vibrant and much less interesting business community onshore. 
The Capital Market Development Taskforce had some other ideas about how to deal with that perennial problem of cost and shortage of capital in New Zealand. The task force was set up to identify some of the key constraints and key opportunities for the development of New Zealand’s financial system to identify and debate options to improve the performance of the financial system and to develop a blueprint for the development of New Zealand’s financial system. Originally a year was given to the task force to produce its specific outputs but because of the global financial situation it produced an interim report in November 2008. That report outlined a package of proposals designed to boost access to capital for New Zealand businesses and reduce the cost of raising capital. Rob Cameron who was the chairperson of the task force noted in the interim report that in response to the financial crisis access to capital would be a key issue in the survival of many businesses. Indeed a number of members of Parliament who met with Mark Weldon on Thursday night had the truth of that observation made back in November last year confirmed to them with the experience of the past 6 months of weathering this crisis as to how far-sighted the recommendations of the task force were. In the time available I will not seek to run through the recommendations of the task force. I simply note that many of them are embodied in the provisions of the legislation. 
As I have said this bill furthers the strengthening of the New Zealand financial system a task that was taken up in earnest by the Hon Michael Cullen and the Hon Lianne Dalziel in the term of the last Government. It is pleasing to see this legislation being carried forward. It is a good bill. Labour will support it and I commend it to the House. 
JO GOODHEW (National—Rangitata) 
: 
 I rise today to speak in the second reading of the Securities Disclosure and Financial Advisers Amendment Bill. I do so with the benefit of having sat on the Commerce Committee as the bill was examined. The Securities Disclosure and Financial Advisers Amendment Bill responds to the current international financial crisis by removing unnecessary impediments to raising capital while ensuring the timely disclosure of relevant information to prospective investors. We—that is New Zealand—are a capital-deficient nation. Therefore it is particularly important that bills such as this are both safely and speedily progressed through the House. 
We bring this bill to the House in the knowledge that there were 19 submissions to the select committee. We heard from six interested parties who wanted to discuss further with the committee aspects of the bill. I can say that the recommendations for amendments that we bring to the House show that the select committee process was a robust one and also a necessary one because the bill is in a better state now than it was when it came to the committee. I note that we gave quite a short period of time for submissions to come to the committee and we acknowledge those who did submit and the fact that they had to do so with quite short notice. 
To begin with I would like to reiterate the principal objectives of the bill. Firstly the bill provides for the use and regulation of a simplified disclosure prospectus. Members of the select committee were interested in what a simplified disclosure prospectus might look like and we were given an example that was some 50 pages long. At that stage we wondered just how simplified “simplified” was but in reality when we compared it with an ordinary prospectus which in that case would have been 300 pages long we could see that there was significant simplification of what would be offered to the potential investor. This new type of prospectus would in connection with regulations to be made under existing regulation-making powers allow stock exchange - listed issuers to offer certain debt and equity securities but without duplicating information they had already publicly disclosed under their continuous disclosure obligations. 
It would be fair to say that New Zealanders who have suffered losses through finance companies and through loss of property value and those who are relying on Government guarantees are often lost in the technical terms and minefield of the finance sector. What we want to achieve with this bill is a balancing act between giving investors the opportunity to have the information they need without additional cost arising from considerable amounts of information being duplicated. 
Part 2 amends the Financial Advisers Act 2008 to correct an error in the Royal assent version of the Act and to make a number of other but very minor amendments. 
Again what we see tonight as we go through the second reading of this bill is an example of a National-led Government’s dedication to the principle of helping businesses to do business. It would be fair to say that we have drawn on work that was undertaken by the previous Government but this National-led Government is totally committed to putting through this Parliament initiatives that will help businesses to do business. A key objective as I have already said was the balance between the cost of doing business versus security and adequacy of information for the investor. 
Finance company failures have undermined confidence in the finance sector and this added to the current international finance crisis has resulted in quite understandable unease amongst investors. Each and every week members of this Parliament have representations from business people who come to their offices. They are experiencing difficulties in accessing capital. In my own electorate those businesses are often the young—in other words still largely in development mode—businesses. They are hardest hit by this credit tightening. 
This bill was spawned by the Capital Market Development Taskforce interim report which was released in November last year. I again acknowledge the work of the previous Government and in particular the current select committee chair the Hon Lianne Dalziel. Recommendations made in that report included how securities law could be improved to increase the availability of capital and to reduce the compliance costs of raising capital. This bill is about responding to the global financial crisis and the need to raise capital in New Zealand and ensuring not only disclosure of relevant information to prospective investors but also timely disclosure of that information. 
The committee recommended that exemptions from standard disclosure requirements for subsequent offers by persons who have made subscriptions of $500000 be allowed to include offers for different types of security rather than being limited to securities where the rights privileges limitations and conditions attached are identical to those attached to the initial securities. Our committee concluded that it is unnecessary to restrict the securities to those identical to the initial securities. The proposed amendment recognises that an investor who has previously invested that much money—$500000—in one transaction prior to allotment does not need the protection of the Act. 
We also recommended amending clause 5 to extend section 3(2)(a) of the Securities Act in order to allow offers subsequent to the initial $500000 to be made within 18 months of the first allotment. There was debate around whether 12 months or 18 months was an appropriate period of time. The decision made by the committee was that 18 months was a better time because in reality it would allow the issuer enough time to complete a full annual reporting cycle and to decide whether additional capital needed to be raised. 
The committee also suggested that the Securities Act be amended so that a person who is experienced in investing money will be required to acknowledge that as an experienced investor he or she will not receive disclosures typically required in relation to a public offering. The way I understood this during the committee deliberations was that it was something akin to—in terms of my own experience—informed consent; in other words those investors knew exactly what they needed to know they acknowledged that they did not need any more information and they signed off so to speak. In making the recommendation the committee said that those investors had to acknowledge that they were not going to receive the information usually offered by the issuer. 
The committee also considered and recommended further amendments to the Financial Advisers Act that are designed to remedy errors that have come to light since the bill was introduced. Those issues were as I have said of a minor technical nature but they were important to ensure that that legislation works as intended. 
We recommended changes to remedy an oversight in the Financial Service Providers (Registration and Dispute Resolution) Act 2008 that potentially exempted some financial advisers from registration. We also recommended changes to clarify—and this was rather interesting for me with my interest in the aged-care sector—that information contained in a disclosure statement required to be produced under the Retirement Villages Act 2003 is not financial advice. We also recommended that there was a need to clarify the disclosure obligations and potential liability that apply to financial advisers operating as part of a qualifying financial entity. These amendments are consistent with policy decisions on the Financial Advisers Act so their inclusion in the bill will be supported. 
Overall as I have mentioned there were 19 submissions on this bill—given at short notice I might add. In the main they were in favour of the simplified disclosure regime. We had the opportunity to discuss the bill with six of the submitters. Some submitters stated that they did not think the Government had gone far enough with regard to the bill but the bill has been swiftly prepared in response to the current credit crisis and it should be considered in the context of a more comprehensive review of the Securities Act. The select committee often discussed that because there was concern about the bill not going far enough. But the Minister of Commerce has instructed officials to carry out that comprehensive review of the Securities Act. 
Indeed this bill is yet more evidence of the Government’s commitment to helping New Zealand through the recession. The amendments made by the Commerce Committee will help the bill achieve its objective of facilitating access to capital for New Zealand. This bill is part of the Government’s commitment and the Government acknowledges that as well as bringing this important bill to the House this work must be ongoing. 
CLARE CURRAN (Labour—Dunedin South) 
: 
 I rise in support of the Securities Disclosure and Financial Advisers Amendment Bill in its second reading. Labour will be supporting this bill. As mentioned the bill will amend the Securities Act 1978 and the Financial Advisers Act 2008 and was considered by the Commerce Committee. 
The main proposal of the bill is to provide for the use and regulation of a simplified disclosure prospectus by stock exchange - listed issuers offering certain debt and equity securities. The bill is intended to respond to the current international financial crisis by removing unnecessary obstacles to raising capital while ensuring the disclosure of relevant information to investors—both very important aims. It is intended that this bill be divided into two parts at the Committee stage. The bill provides for simplified disclosure prospectuses to be sent to investors instead of an investment statement for all prospectus amendments to be sent to investors before subscription and for additional Securities Commission powers to ensure these prospectuses are used only by appropriate issuers. Part 2 will amend the Financial Advisers Act by correcting an error in the assent version and making other minor amendments. 
The bill was dealt with at the Commerce Committee of which I am a member. I thank members for the time devoted to this bill and I particularly thank and acknowledge my colleague the Hon Lianne Dalziel who is the chair of that committee and whose expertise and knowledge has helped steer this bill to the House in a timely fashion. 
I thank the people who gave their time to make submissions on this bill. In total 19 submissions were received and six of them were heard by the Commerce Committee: I acknowledge Kensington Swan NZX the Capital Market Development Taskforce the Institute of Chartered Accountants of New Zealand the Property Council of New Zealand and Lazelle for appearing before the committee. 
The select committee considered and recommended amendments to the bill relating to offers of further securities to investors who have made subscriptions of $500000 or more and it recommended allowing subsequent offers after an initial subscription of $500000 to cover different types of security rather than limiting this to securities carrying identical rights privileges limitations and conditions to the initial securities. It recommended amending clause 5 to allow offers subsequent to an initial $500000 to be made within 18 months of the first allotment rather than 12 months as is currently the case. Importantly this bill amends the Securities Act because it is unnecessary to restrict the securities offered to those identical to the initial securities as the proposed amendment recognises that an investor who has previously invested $500000 in one transaction prior to allotment does not need the protection of the Act. The bill as it was allowed people who had invested $500000 in the past 12 months where the rights privileges limitations and conditions attached to the further securities are identical to those attached to the initial securities to make incremental investments without the protection of the Act. 
Experienced investors were also considered and amendments were recommended. We recommended amendments to clause 7 of the bill to allow a new subclause requiring experienced investors who are made an offer of a security to additionally sign written acknowledgment that they will not receive information usually provided by an issuer particularly in investment statements and registered prospectuses. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
CLARE CURRAN 
: Wealthy investors were also considered in this bill and although members of the select committee did not oppose the specific amendment some were concerned that changes were being made to the wealthy investor exemption when that exemption may be repealed as part of the review of the Securities Act noting that the relevant Review of Financial Products and Providers discussion document described it as “the least principled of all of the exemptions.” 
During the submission process the Commerce Committee noted some other issues where there were no amendments; it is important to touch on some of these. Streamlining the disclosure regime was one issue raised. No amendments were put forward in relation to this but it is important to comment on it. The cornerstone of the disclosure regime for listed issuers is the obligation of continuous disclosure imposed by the Securities Markets Act 1988 in combination with stock exchange listing rules. This bill will not reduce the amount of information available to investors but rather the duplication between two forms of disclosure. Weight was also given in the committee to the potential gap between all information that is material to new securities being issued and that which is “material information”. Information that may be material to the issued securities but not to the securities already listed could include information about the terms of the new securities such as interest rates conversion rights reset rates and pricing. 
The select committee amendments to Part 2 of the bill which amends the Financial Advisers Act 2008 were of a minor technical nature. The committee recommended the insertion of clause 16A in the bill which clarifies that the disclosure statements retirement villages must make under the Retirement Villages Act 2003 do not constitute financial advice for the purposes of the Financial Advisers Act. The Commerce Committee also recommended the insertion of new clause 16D and 16E in the bill to clarify liability and disclosure obligations. These obligations would apply to an employee of a qualifying entity when he or she provides advice about the products issued by that entity. The amendment corrects an oversight and aligns the liability and disclosure obligations that apply to an employee of a qualifying financial entity when advising on different financial products. The committee also recommended that these new clauses confirm that disclosure and conduct obligations of authorised financial advisers apply whether or not they are employed by or are agents of a qualifying financial entity. 
Clause 19A was also inserted into the bill to remove an unintended conflict between the registration requirements under the Financial Advisers Act and the Financial Service Providers (Registration and Dispute Resolution) Act 2008. The result of the amendment is that employees of financial services providers would not be required to register and belong to a dispute resolution scheme unless the individual were required to register under the Financial Advisers Act. The proposed amendment preserves the status quo and aligns the two Acts. 
As mentioned at the beginning Labour will be supporting this bill. The bill responds to the current international financial crisis by removing unnecessary impediments to raising capital while ensuring the timely disclosure of relevant information to prospective investors. The proposed requirements do not reduce the information required to be disclosed but rather remove the duplication of information already provided under continuous disclosure. This bill tidies up the rules for exempt persons and people deemed by the Act not to be members of the public for the purposes of disclosure. As a member of the Commerce Committee I support the amendments it has put forward and I look forward to participating in the Committee of the whole House. 
KEVIN HAGUE (Green) 
: 
 Some months ago the New Zealand public was treated to the image of a rolling maul—a rolling maul of initiatives from the Government to tackle the financial crisis that faced New Zealand and indeed the world. It seems to me that it has been some months since we have heard that analogy being used. I guess that perhaps that is because it called to mind the suggestion that there was some kind of plan of attack. I think events have shown that that seems to be not the case and that on the Government benches we are faced with a team that is out of ideas. Certainly in my speech notes I have written “All Blacks—Rugby World Cup 2003” because that seems to be the kind of situation we are facing. 
I think that a more apt analogy would perhaps be the idea of speed to the breakdown because if we think about it we realise that it requires a team to show an overall understanding of the game situation and it requires capabilities of strength speed and vision in order to see the opportunity to score from the breakdown. The Government’s response to the crises that are besetting New Zealand suggests instead the lumbering loose forwards of yesteryear: not understanding the dimensions of the problem lacking the strength to be able to respond to the problems with sufficient vigour hopelessly off the pace and lacking the vision to see this as an opportunity to make the big changes required to transform our economy. 
It is possible to think about money and debt in the same picture. Most of the money supply is created by banks and at the same time that they create money they create debt so money and debt get transferred to a person. Of course that creates an even balance sheet—it is double entry bookkeeping. In order for people to become wealthy from this situation money and debt need to become de-linked. The speculative economy can be viewed as a mechanism for this de-linking. The money is siphoned away from ordinary New Zealanders and productive New Zealand businesses into the hands of a wealthy few while the debt goes nowhere—it stays with those ordinary New Zealanders and decent businesses. 
Some of the individual investment schemes we have seen in New Zealand over the past several years can be viewed as channels for exactly that mechanism. The process that we have witnessed in New Zealand and indeed in other countries—and we think of Madoff and his Ponzi scheme—has involved a fundamental betrayal of trust. But from the point of view of the luminaries who ran some of the many finance companies and investment schemes I guess they would say that one cannot make an omelette without breaking some eggs—or perhaps they might more honestly say that one cannot rort people out of their life savings without losing a bit of trust. 
In the first reading debate on this bill I highlighted three issues. I said that the aims of the bill were indeed laudable—to secure easier access to capital for good businesses—but in order to rebuild trust and confidence and thus enable good businesses to gain access to capital we needed greater transparency and greater disclosure not less as this bill proposes. The second point that I raised in the first reading debate referred to the provisions for special habitual investors where even less disclosure is proposed. I said that the history of the past several years showed that these special habitual investors in fact showed exactly the same mix of gullibility and greed as did anyone else. Indeed poor decisions on the part of precisely that group of people have profoundly negative consequences for our economy and for all of us. The third main point I made in the first reading debate was that it was woefully inadequate for the Government to rely on research and consultation undertaken by the Ministry of Economic Development in 2006 as this bill does. In my notes today I have one word written next to this point and that word is “Iceland”. In 2006 just to remind the House I note that Iceland was considered by the IMF to be one of the wealthiest nations in the world. 
Since the first reading debate on this bill some greater detail has emerged around some of the practices of the finance companies that have failed. I will mention just a couple of them. First of all there is the widespread rolling of defaulting loans into new loans. It is a win-win situation for lenders who want their books to look good for potential investors and for those borrowers who are defaulting. But it is a losing one for the public and for potential investors because the effect of that practice is to obscure the financial health of those companies and institutions. Sunlight is the best disinfectant. 
I referred in that first reading speech to the example of Enron. Those of us who followed the debacle of Enron will have a sense of déjà vu when reading in the newspapers about the practice pursued by some of New Zealand’s finance companies of taking the defaulting loans on their balance sheet selling them to another company days before balance date and repurchasing them several days later. Precisely those kinds of shenanigans were indulged in by Enron and there are many other shonky practices that these New Zealand companies engaged in. My point is that these companies were not just light or hazy on the disclosure of their financial health and the risks that were being taken by investors. They actively set out to deceive potential investors and to deceive the New Zealand public. 
I am aware that there are still some miles go to in investigating what has occurred in the New Zealand financial sector and I look forward to the further disclosure of that history with some trepidation. In my first reading speech I indicated the Green Party’s commitment to hearing from New Zealanders who have been victims of this extraordinary scandal and of course the people who stood behind those finance companies owned them and reaped the profits in the first place do not typically stand amongst those victims. I will offer in this House today the Green Party’s support for John Boscawen’s call for a proper inquiry into the collapse of these companies. 
The select committee’s report on this bill calls effectively for a form of written consent from some of the special investors in relation to the fact that they will receive a lower level of disclosure than other investors. The obvious parallel is with the health care setting—a situation that I know well. Even in health care we know that informed consent does not always occur. That is a situation where typically the health care provider or health care professional does not have an enormous incentive to secure the consent of the patient. The health care professions also have a long history of professional standards and indeed of ethics. That history and culture seems to be sadly lacking in the financial sector. 
We have spoken many times of a Green New Deal. Although we have mainly concentrated on the need to tackle the financial crisis simultaneously with the environmental crisis other aspects of the original New Deal also apply. The New Deal re-established and redefined the social contract between State and citizens. One of its tenets was the reform of the banking and financial sector. That is an aspect we require of the new Green New Deal. The Green Party in this case will continue to oppose this bill. 
JOHN BOSCAWEN (ACT) 
: 
 It is a great privilege to speak in support of the Securities Disclosure and Financial Advisers Amendment Bill. Before I go further I will acknowledge the huge amount of work that has gone into this bill by colleagues on the Commerce Committee from Labour National and the Maori Party. I say that because I have not been involved in a great deal of the detail. The Commerce Committee meets on a Thursday morning from 9.30 a.m. to 1 p.m. During the course of starting deliberations on this bill I was seconded by my leader to the Emissions Trading Scheme Review Committee which meets at the same time. So I have not been able to spend nearly as much time at the Commerce Committee as I would like and I am very conscious that we have heard speeches in the House this afternoon from people who have been more intimately involved in hearing submissions and debating. Nevertheless I do want to speak on this bill. 
The bill is designed to respond to the current international financial crisis by removing the unnecessary impediments to capital raising while at the same time disclosing all relevant financial information. This bill was initiated by the previous Labour Government and it comes out of the recommendations of the Capital Market Development Taskforce. One of the things this bill gives rise to is a simplified disclosure prospectus. 
There have been a number of speeches on this bill during the course of the day setting out in detail the provisions of the bill. I do not want to go into the details other than to say that our economy—our future prosperity—depends on investment on saving and on raising our living standards. If we are to raise living standards we need to have investment savings and a very efficient economy. We also need risk taking. It is very important to have a strong financial sector that rewards risk taking but acknowledges the risks associated with that. 
A strong economy depends on investment in infrastructure and I was very pleased to read that the National Government had announced today that it intends to proceed with the Mt Roskill to Waterview option—an option that it costed at $1 billion to $1.4 billion. It is infrastructure that will lead to a more productive and more efficient economy with higher living standards. But it concerns me greatly that National still talks about the loss of some 400 homes; I have a scheme that would involve a surface route through that area and it would involve the loss of fewer than 50 homes. I find it quite fascinating to hear Labour and National debating this issue in the media when there is a much simpler option. I call on Labour members to support my option. If they are truly concerned about the people of Mt Albert they will support my option which would provide an efficient connection from Mt Roskill through to Waterview. 
One of the most important things we need to do to lift our economy is to raise confidence in our financial markets. We need to restore confidence. That is the No. 1 challenge our country faces if we are to get people to invest and save money. Although a huge amount of money has been lost in finance companies over the last 2 to 3 years—in fact some $5 billion to $6 billion is estimated to be tied up in moratoriums or losses—there is a need for a thriving financial sector. There is a need for successful and well-run finance companies because they help fund the economy. 
It was interesting to hear Kevin Hague acknowledge my call for an inquiry into finance company failures. I have been calling for this for the last 3 months. It has been frustrating because wheels move very slowly in this place. The affairs and the discussions of the Commerce Committee are held in confidence and as a member of that committee I am not able as members will be well aware to talk about some of the things we are discussing. However I think it is safe to say—I think it is on record—that Lianne Dalziel has acknowledged that the select committee is considering an inquiry. I think I can say that but I cannot go any further. 
When I first raised the issue of an inquiry I was very concerned about what I thought was fraud or near fraud in a number of cases. I wanted to know how I could address that. I was repeatedly told that we have the Serious Fraud Office to deal with cases of fraud and that it is not the job of a politician. I was told by my leader Rodney Hide that if we are to have an inquiry it has to have a parliamentary purpose. It has to look at lawmaking. I was not sure what would come out of that inquiry but I was aware that some $5 million to $6 million had been lost mainly by the elderly and in large instances by elderly people who had been misled. 
I needed to try to help them. I did not know how I was going to help them but I needed to try. In the last week it dawned on me how I can help them and how Parliament can help provide some support to those people who have lost so much money. It dawned on me that a number of finance companies have gone into moratoriums. A number of finance companies went to their shareholders investors and bondholders last year and said “Look we have lost a lot of money but we have a scheme of arrangement. We want you to support us but we need you to agree to varied terms of repayment. You have an entitlement to appoint a receiver but we do not want you to appoint a receiver; we want you to back us and the management that has previously lost so much money for you.” I think virtually every one of those moratoriums that were put to bondholders passed. It is a sad reflection on human psychology and behaviour that when faced with realising a loss and acknowledging that we have made a mistake and that our money is lost we do not want to do it. In most cases those moratoriums were overwhelmingly supported. 
I am very cynical about a number of the finance company managers. I say that because I know some finance company managers. In fact I know two people who have intimate knowledge of how one particular finance company was run because they were associated with the borrowers. They were aware that when the directors of this particular finance company—I will not mention its name—took a moratorium proposal to its bondholders last year the directors knew they could not meet the obligations they were making. In fact that was part of their plan. Their plan was to go and get the bondholders to take what they would call a “haircut”—to acknowledge the write-off of some of their money and then to go back to those same bondholders a year later and say to them “I am sorry. Times are tough. Things have worked out a lot poorer than we thought they would. We have another proposal for you and we want you to write off some more of your money.” That was part of their plan. 
Over the last week it has occurred to me that the one thing this Parliament can do to help these people is to pass a law that would require any company that wishes to vary the terms of its moratorium to first of all go to the court—to an independent officer a judge—and to say to the judge “This is what has happened. This is our plan.” and for that judge to order an independent inquiry. I say that because I have here the moratorium document for one Hanover Finance. This moratorium was supported by some 93 percent of the bondholders by value as I understand it. I will read sections to members. The document states: “Under the plans … Hanover Finance is aiming to fully repay …” That is very generous is it not? I am aware that there were I believe two expert opinions on this report and neither of those expert opinions was as optimistic as the directors. 
The report talks about the shareholders of Hanover Finance agreeing to provide financial support of up to $96 million. A bondholder when faced with realising the loss of his or money might take some comfort from thinking that the shareholders were going to put up to another $96 million. When one reads the cold hard print one realises that that calculation is based on property valuations and directors’ property values at that. The reality is that the directors of Hanover Finance could get away without putting in a single cent to that company. The first $10 million has to get paid into a solicitors’ trust company and then that money is drawn down only if the bondholders do not get the first 8c in the dollar—a measly 8c in the dollar. When companies such as Hanover come back seeking to vary the moratorium—and it may not be Hanover but it will certainly be other companies because it has already started—I would like to see this Government passing a law that states that we will make those companies go to the court we will not allow the spin we will not allow the company directors to employ a public relations company and we will not allow them to produce documents that state “up to $96 million”. It would be far better off stating that the shareholders have received dividends of $84 million in the last 2 years. That would be a far more meaningful statement. Thank you. 
RAYMOND HUO (Labour) 
: 
 I rise to support the Securities Disclosure Financial Advisers Amendment Bill at its second reading. The reasons for that can be summarised in one sentence. The introduction of a simplified disclosure regime is not to reduce the amount of information provided to investors but simply to reduce duplication between forms of disclosure. Therefore the primary objective of the bill is to enable New Zealand businesses to have cost-effective access to capital while ensuring that investors continue to receive full accurate and timely disclosure of information. More accurately the bill addresses three areas: firstly the Securities Act 1978 to provide for a simplified disclosure prospectus that may be used by listed issuers who are subject to continuous disclosure requirements; secondly the Securities Act 1978 in respect of the categories of persons who are exempt from the disclosure requirements for offers of securities under the Securities Act 1978; and thirdly the Financial Advisers Act 2008 through the correction of a minor error in the assented version of the Act and a number of other minor tidying-up amendments. 
In the past weeks the Commerce Committee of which I am a proud temporary member received 18 submissions from a variety of sectors. I am very grateful to our officials and parliamentary counsel for the great job they have done in putting together those valuable views. Generally those submissions on the bill welcomed the introduction of the simplified disclosure regime and supported the bill’s proposed amendments to the Securities Act that related to categories of persons who are exempt from the disclosure requirements for offers of securities under that Act. 
Regarding the simplified disclosure prospectus there is currently duplication of the information released by listed issuers under their continuous disclosure obligations and the documents required at the time they make a securities offer. All public offerings regardless of whether the issuer is listed on the registered securities exchange such as the New Zealand Exchange must comply with the disclosure and other requirements of the Securities Act 1978. In the case of an offering by an issuer who is already listed on a registered exchange two disclosure regimes apply: the continuous disclosure requirements for listed companies and the disclosure requirements for a public offering. 
The proposal in this bill is for listed issuers to produce one disclosure document for a securities offering instead of producing both a full prospectus and an investment statement. The intention of the simplified disclosure prospectus as I mentioned at the very beginning of my speech is not to reduce the amount of information provided to investors but simply to reduce duplication between forms of disclosure. In that respect as many submitters rightly stated the regime should and would promote effective disclosure to investors in a streamlined form. 
At the committee meetings members requested an example of what a simplified disclosure prospectus might look like. Consequently an example of what it might look like for the recent bond issue for Auckland International Airport Ltd was prepared and presented. Although the simplified disclosure prospectus for an offer of fixed-rate bonds for the company was prepared purely for what the officials called illustrative purposes I can say that it was very impressive. It was about 25 pages long—yes only 25 pages long—compared with the 300-page length of the original investment statements and prospectus. This demonstrates the simplification that is possible through avoiding duplication of material including material released under continuous disclosure. I agree with the officials that the effect could be even greater as many other offers are likely to contain significantly more information than has been released under continuous disclosure. 
The existing provisions for exemptions from standard disclosure requirements in the Securities Act will be amended in order to allow a single offer of securities to persons who are exempt from disclosure requirements under two different sections of the Securities Act without requiring the issuer to prepare a full prospectus. This would correct the anomaly where issuers are able to take advantage of reduced disclosure requirements for an offer only to persons who qualified under one section but not to persons under both sections together. 
My learned colleagues the Hon David Parker Charles Chauvel and Clare Curran covered this issue in detail in their speeches this afternoon and earlier this evening. I will follow the spirit of the bill and not repeat those points to avoid shall I say duplication. But what is worth reiterating and what I said in my speech during the bill’s first reading is that this bill followed recommendations made by the Capital Market Development Taskforce in November 2008 for steps to respond to current financial conditions that are particularly relevant for listed issuers and also reflect the recommendations made by New Zealand Exchange. To introduce legislation such as this is very important particularly at this time when New Zealand along with the rest of the world is in the midst of a financial crisis. The impact of the financial crisis on businesses and households will depend in large part on how we respond. 
I conclude my contribution by asking the National Government where its real plan is. Thank you. 
DAVID BENNETT (National—Hamilton East) 
: 
 It is my pleasure to follow that thrilling speech from Raymond Huo. We are talking about the Securities Disclosure and Financial Advisers Amendment Bill— 
Darien Fenton 
: A great topic. 
DAVID BENNETT 
: Yes it is a great topic. Members of the Labour Party are sitting there looking at us in awe of the ability of this National Government to deliver for the country and for business at a time when it is most needed. Those members had their opportunity and they failed to deliver. Now the National Government is actually delivering and it is good to see. 
It is important to think of this bill in the context of what is going on in the worldwide markets at the moment. We have something called a credit crunch which means that basically there is a lack of credit out there for businesses. Businesses are finding it difficult to access the credit they need to keep their organisations and their enterprises going. That is the simple nub of what is happening out there. If we look at the business people who are coming to our constituency clinics we see that their issue is availability of credit so that they can maintain their operations. It is a cyclical approach. Once credit is denied to one company it is denied to the next company and the next. Sales of products go down and down because as one company shuts up shop the next one shuts up shop and the next one. That is the effect of the credit crunch. 
The National Government has seen this and is delivering some solutions. This bill is one part of the solutions that can be made available to New Zealand businesses to help them get through the credit crunch. The overarching aim of the bill is to free up available capital for businesses in order to help businesses do business. That is what we are after. We want to see businesses continue to employ people to produce products for New Zealand and to build the GDP of this country. That is why we need legislation like this which assists that process. We want to make sure that firms have cost-effective access to capital whilst ensuring that investors receive full accurate and timely disclosure of information. 
New Zealand has grappled with the need for disclosure of information in a full accurate and timely manner for a number of years. New Zealand was seen as the Wild West of the financial markets in the late 1980s. That was basically in response to there not being the degree of control that operated in some other markets. I think that is partly why New Zealand felt the sharemarket crash of the mid-1980s a lot more than other countries did. We did not have the right system in place. The sharemarket was on such a big high that New Zealand was seen as the Wild West. A series of measures have been undertaken since that time to try to alleviate that problem and that perception so that we are seen as a stronger market for investment and also so that there is more protection through more information being made available to investors and businesses. That has been a long process I guess in the sense that we are still working on it now. This bill is part of that process in making sure that we have the best laws in operation to protect investors and businesses in a free market. 
The recommendations in this bill were made by the Capital Market Development Taskforce. That task force looked at some of the issues involved in removing unnecessary impediments to raising capital while continuing to ensure that that relevant information was available to prospective investors. It had to deal with the double-edged sword of the financial markets in making sure that capital was available during a credit crunch and also making sure that information was available to protect investors so that we can move away from the Wild West perception. The two elements come together in this legislation in the sense that we not only have to protect investors but also have to protect the market that those funds are being drawn from. This bill has a number of elements in it to do that. 
The bill provides for simplified disclosure prospectuses. The simplified disclosure regime applies only to those securities offered that rank equally and is preferential to the issuer’s existing securities. Essentially the work around prospectuses is very important when one is looking at investing in something. A number of pieces of legislation have been passed since the Wild West days to try to make sure that prospectuses are more certain for investors and to make sure that investors who want to invest in a company find that the prospectus gives them the comfort and degree of reliance that they would expect. A lot of the time when people are investing they do not know the detail of the organisation or company and they are relying on a prospectus in many cases. In the past those prospectuses have been quite flashy documents but sometimes they have not given the detail required. That was tightened up a number of years ago but this bill brings it all together in a sense; it tidies up the total legal framework that those prospectuses deal with and undertake to be part of. It is about giving information to investors—not hiding it—so that they can make the right decisions on the basis of prospectuses and the information available to them. It is not just about having glossy pictures for investors; they need some hard-core information and that is why there are some requirements as to what information needs to be held in prospectuses. 
This is all part of allowing businesses to grow and develop because if businesses can attract capital and if there is a mechanism whereby there is safety for investors in being part of the process of investing so that businesses can have that capital to grow and develop then we avoid a lot of the complications that we have had when companies go under and we reduce the problem of the compliance costs that businesses have to incur in order to provide those prospectuses and information to assist them in raising capital. It is actually there to help ensure that businesses are not disadvantaged by red tape and bureaucracy. You know we want to make sure that businesses can give as much information as they can in a way that does not restrict their activities. This Government is putting business ahead of bureaucracy; we are making sure that we set up the rules and systems so that businesses can flourish and take advantage of what capital is out there and also giving certainty to those investors who are putting up that capital so that they will put up more capital and we get the investment that we need at this point in time with the credit crunch. 
Removing some of the barriers and excessive duplication will not only help growth but create and keep more jobs in the economy and that is crucial at this time because we need businesses to perform. There is no quick-fix solution I guess to these issues. They have been something we have worked on for many years now. It would be nice to think given that over a period of 20 to 30 years we have been working on capital raising prospectuses and confidence in the market that we could have done all of it in one hit and at an earlier time but it has not happened in that way; there has been a series of adjustments to our law in this area and this bill is the next part of that. 
The bill amends two separate pieces of legislation: the Securities Act 1978 and the Financial Advisers Act 2008. By amending those two Acts we set out to create a more simplified system that people can understand and to give that support to businesses and investors that they need. 
The Commerce Committee made a number of recommendations. Its members recommended that certain exemptions for subscriptions up to a certain value be allowed rather than their being limited to securities where the rights privileges limitations and conditions attached are identical to those attached to the initial securities. There was some work around some financial thresholds that were put in place through this legislation which gave the select committee the ability to make certain recommendations. There were also some recommendations around time frames. The 18-month time frame that has been mentioned by other speakers was something that the select committee looked into. It is a practical matter of looking into the way that these securities are offered and the way that investment is made in these organisations and companies. 
The committee also recommended changes to remedy an oversight in the Financial Service Providers (Registration and Dispute Resolution) Act of 2008. 
NATHAN GUY (National—Otaki) 
:  
I wish to make a contribution on the second reading of the Securities Disclosure and Financial Advisers Amendment Bill. This is an important bill; it is the Government getting on with its business. Indeed this bill has two parts and two clauses covering the title and commencement. The important point of this bill is that it will free up capital which will be very important for business and in particular corporate business but it will flow through to small and medium businesses as well. The important thing is to get our economy moving in a forward direction and I guess this bill also covers things like the collapse of financial companies as occurred last year. We have heard other speakers speak about that and about the hardship it has caused right across New Zealand. It has affected all sorts of Kiwis and right now those who are lucky enough to have some money in the bank are concerned about interest rates. Of course that helps young couples as well but I guess it is to the demise of people who may be lucky enough to have some money in the bank. 
The other thing that is really important with this bill is that it will make changes around the way shares are issued. Currently there are a whole lot of double-ups around the information that is provided when shares are offered. This amendment bill aims to reduce the inefficiencies of the reporting processes leading ultimately to less bureaucracy and less time and money spent on reporting. There are some key definitions that I think are worth traversing in this second reading including that around the prospectus which is the financial bill of health. The other important area is the investment statement which allows banks and companies to confer on exactly what the investment statement should include. That is for non-export investors as well. There is also information about disclosure which is the process by which companies and banks give financial information to investors or indeed to the public. 
This is the second reading of an important bill this evening and most speakers across the House have concurred with the current situation in relation to the financial slow-down across most of the world—the credit crunch—and the difficulty a whole lot of people have in accessing capital and accessing debt as well. It is interesting that banks are placing on businesses quite a bit of stress and strain concerning debt levels as the cash flow of some businesses tends to be slowing up. Yet other businesses we speak to when going around the streets as I do in my Otaki electorate say to us “What recession?”. So it is wide and varied across the whole of New Zealand. 
This bill will reduce compliance costs. Investors at all levels will be given information that is easy to understand which is imperative. The bill is part of the Government’s response to the current economic climate in order to help ease the credit crunch we find ourselves in. The amendments also cover businesses listed on the stock market and unlisted businesses as well. The Government supports the second reading of this bill and I commend it to the House. 
STUART NASH (Labour) 
:  
I have heard a lot of rubbish about the Securities Disclosure and Finance Advisers Amendment Bill. David Bennett’s speech was— 
Hon Darren Hughes 
: Stock standard. 
STUART NASH 
: Well it was actually rubbish—absolute rubbish. 
Hon Member 
: It was outstanding. 
STUART NASH 
: Yeah sure! 
There is no doubt about the fact that in the 1980s the New Zealand Stock Exchange was made up of a bunch of cowboys operating in an unregulated environment and we were viewed in a very very poor light overseas. That was tidied up but we must remember how it was. David Bennett talked about glossy pictures and prospectuses. The reason why a lot of those companies offered dodgy prospectuses was that they did not undertake to comply with securities regulations. Our securities regulations were actually very very good. But this bill allows some companies if they comply with a certain set of criteria under securities regulations to issue prospectuses that do not require the level of detail that was required before. That is all I have to say on that. 
I want to take a moment to make a statement about what happened in Napier. As a Napier-based member of Parliament I would like to say that I endorse everything that every political leader and Mr Tremain have said about Senior Constable Len Snee. He was a police officer in Napier for 33 years. He was a community constable and a very highly regarded man as a member of Napier’s community as well as a policeman. Our thoughts go out to his family to his children and to all the police in Napier who do an absolutely fine job. I would also like to say that the civil defence organisation in Napier was absolutely first-class. 
Another thing I would say is that Napier has been in the press recently for the wrong reasons. Napier is a fantastic place; it has wonderful citizens. Its wine is the best in the country. It has the highest sunshine hours of any place in the country. It has art deco. Napier is about the art deco festival in February when people dress in 1930s livery have fun and enjoy the sunshine each other’s company and opportunities for tourism. Napier is not about the violence that we have seen in the paper and on the television screens. Once again I pass on my condolences to Len Snee’s family. It is a dreadful circumstance but it is not what Napier is about. Thank you very much. 
A party vote was called for on the question  
That the Securities Disclosure and Financial Advisers Amendment Bill be now read a second time. 
Ayes 112 
New Zealand National 58; New Zealand Labour 42; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a second time. 
Gambling Amendment Bill (No 2) 
Second Reading 
Debate resumed from 5 May. 
JACQUI DEAN (National—Waitaki) 
: 
 There can be no doubt that gambling damages both individuals and homes and that to an extent it damages and affects whole communities. I do not think that fact is much disputed around this House so it is with pleasure that I speak for a few more minutes on the Gambling Amendment Bill (No 2). 
This bill makes good progress in bringing into effect what Parliament has desired to introduce in terms of the mitigation of problem gambling. As I have just a few minutes left to speak I refer to the select committee consideration of this bill. It seems to me that the Government Administration Committee of the previous Parliament had a really thorough look at the issue of problem gambling under the chairmanship of Shane Ardern and a number of other excellent members. It is notable that of the 168 submissions received on this bill while 32 of them expressed general support for the bill the rest of the submissions were not necessarily against the spirit of the bill; they were outside its scope perhaps or they advocated for measures that were beyond the intention of the bill. It is worthwhile to reflect on the intention of Parliament—both the previous Parliament and now this Parliament—to acknowledge and recognise that we still have some way to go in New Zealand to address the issues of problem gambling. 
The amendments to the Gambling Act are intended to tighten the regulations around the monitoring of gambling in New Zealand. Importantly organisations or people who receive grants from gambling societies need to be accountable for how that money is spent. I think that is one of the critical amendments that has been brought in by this bill. I read with horror about money that is raised from gaming machines in South Auckland and is then spent in North Otago on stakes for horse racing. I know that that issue has attracted the attention of a number of people. 
Importantly this bill allows for the regulation of the collection of important information around the gaming industry. For example if somebody on a gaming premises is viewed as having a problem with gambling that person must not be approached only once. That person must be approached a number of times making the intervention more effective. It is not good enough for a person with a gambling problem to be approached only once and for the people who made the approach to then wash their hands and say that they have done their bit. With those few words I commend this bill to the House. 
DARIEN FENTON (Labour) 
: 
 It is a pleasure to take a call on the second reading of the Gambling Amendment Bill (No 2). It is a very good bill that was introduced by the previous Labour Government and indeed I see it still has your name on it Mr Assistant Speaker Barker. That is a good indication of the work the previous Labour Government did on this very very difficult issue. 
I must say that this bill was one of the more controversial and difficult bills that I dealt with in my time as a member of the Government Administration Committee during the last Parliament. It was frustrating both to committee members and to submitters that the scope of the bill restricted the committee from considering in any real way the broader concerns that were raised. However that was not the intent of the bill. 
I acknowledge the submitters. They were passionately concerned about problem gambling and its impact on our communities and society. They made powerful arguments for real change. It was not that the bill itself was controversial; it was just that many of the submitters wanted the bill to be a lot more than it actually was intended to be which was a tidy-up of the Gambling Act 2003. It was intended to be a collection of small but important amendments to make the original Act work better. However I acknowledge that the submitters reflected genuine concerns of anyone who has experienced the problems that gambling causes and the harm it can cause to families and communities. 
Quite frankly I think pokie machines are a blight on our society. I would like to wish them away as I am sure many people would but unfortunately it will take a lot more than an amendment bill like this one to have that effect. I am interested to see how the National Government will respond to these challenges and I was interested in Dr Worth’s comments in his contribution the other day and in his answer to a question today about dodgy pokie trusts. 
I wish gambling did not exist but to some extent it always has existed. Many of us—not I but my father and many others—like to have a flutter on the races. The critical thing is that they have always kept their flutters within reason and within control. Unfortunately it is those people who become addicted to a fix of gambling who are at risk. Easy access to pokie machines and other forms of instant gambling have brought the problem into every corner of New Zealand’s communities and that was reflected by many submitters to the committee. 
There is also the difficult question of the myriad community organisations that rely on funding from gambling to provide services in their communities or the local clubs that absolutely depend on gambling money to fund local activities. Many New Zealanders believe that there must be a better model but it will take some work to put it together. Ultimately if community funding from gambling money is to be abolished the community will rely on the Government to fill the gap and there is no sign of that happening under this Government. 
I also say that casinos are a blot on our society. It is a newer form of instant entertainment with all of the associated problems. When this bill was introduced last year there was a lot of publicity around money-launderers and gambling sharks at Skycity’s Auckland casino. Luckily that seems to have died down and I acknowledge the work of the Department of Internal Affairs in getting on top of those issues. Thank goodness the previous Labour Government’s 2003 Gambling Act prevented the spread of money-launderers and gambling sharks throughout the country with its moratorium on the building of new casinos. Out went a focus on economic gain and huge profits at the expense of the local population and in came harm minimisation and keeping the lid on casino gambling. We were delighted that the explosion of casino building came to an end. However I note that last week Skycity said it would love to build a casino here in Wellington but that it would take a change of law for it to do so. So they are still out there wanting to build more casinos. I look forward to hearing from the National-ACT Government as to whether it is prepared to change the law to accommodate Skycity’s casino or whether it will put a lid on this issue once and for all. I look forward to hearing contributions from members opposite. 
It was a Labour Government that brought in the Gambling Act and it was far-reaching world-leading legislation. The purpose of that Act was to control the growth of gambling which had been running away in terms of growth in the number of casinos and pokie machines; prevent and minimise the harm caused by gambling including problem gambling; authorise some gambling and prohibit the rest; facilitate responsible gambling; ensure the integrity and fairness of games; limit opportunities for crime or dishonesty associated with gambling; ensure that money from gambling benefits the community; and facilitate community involvement in decisions about the provision of gambling. The legislation we are debating today was designed to build on the work of the previous Labour Government to clarify the law and to remove any uncertainties arising from the Gambling Act 2003 which became law in 2004. 
Another big change to gambling came about with the introduction of the Labour Government’s 2003 legislation to ban smoking in the workplace. I believe that that legislation changed the culture of gambling and hospitality workplaces. I know that workers were right behind it because they were the ones who were being affected most by second-hand smoke. Sure it caused some angst in smaller clubs but today that foresighted legislation by the previous Labour-led Government is widely supported by the public. 
I note one issue in the select committee’s report where the committee could not agree. As a consequence of Labour’s 2003 amendments to the Smoke-free Environments Act some determined gaming venues have altered the layout of their outside gaming areas so that smokers can gamble outside and obviously that is in contravention of the intention of that Act. Labour wanted that issue cleared up in the bill. The National Party would not agree. It seemed to me that Richard Worth indicated some acknowledgment of that issue the other day. So I look forward to a Supplementary Order Paper coming forward in the Committee stage that will tidy up that particular issue. The issue is a loophole in the current law and I would be very pleased if the loophole was closed. 
As other speakers have said this is a technical bill. It contains technical amendments and minor policy enhancements to clarify the law and make it work as it was intended to do. The aims of the bill are to make recipients of pokie-machine grants use their grants appropriately to extend conflict of interest safeguards to all persons making decisions on gaming-machine grants to strengthen the requirements on venues banking gaming-machine profits to widen the offences and regulations for gaming-machine operators and licensed promoters to introduce requirements for the accurate disclosure of non-cash prizes and to provide more flexibility for clubs that want to merge gaming-machine operations. As members can see from the select committee report some other amendments were proposed by the committee which we support—with the exception of the one I have already mentioned about smoking and gambling. As I said this bill is largely technical and it is not the right vehicle to make the kinds of wide-sweeping changes that many of us would like to see. 
Unfortunately because of the narrow scope of the bill some communities that deal with the harm caused by gambling were unhappy that the select committee was not prepared to hear all submissions. They felt we were not listening. I want to assure those communities that I read every single submission and I listened very carefully to those who appeared before us. I was listening and I heard their very legitimate concerns. The conversation will carry on within Labour. The issue is not dead with this bill. I share the worry of those communities about the impact that pokie machines in particular have on family life. Therefore I am supportive of the proposed amendments that will assist with the Act’s harm prevention and minimisation objectives. However I do want to reflect on how bad gambling-related problems would be if Labour had not passed the 2003 Gambling Act. Members need to continue to work together with the community to ensure that local government uses the tools already provided in the Act as effectively as possible. It pleases me to note that many territorial local authorities in conjunction with their communities are becoming much more active around this issue and we are seeing sinking-lid policies being implemented with the active support of the community. 
This bill is another step forward in the debate about what needs to be done in the future to ensure that we continue to deal with the harm that gambling can cause and to limit the growth of gambling. The select committee process demonstrated that there is a lot more to be done and that is why the select committee report recommends further consideration in the future of the issues raised by the submitters. Once more I want to acknowledge the submitters and acknowledge the work of the officials. The work must go on. 
SUE BRADFORD (Green) 
: 
 It is going on for 2 years now since we debated the first reading of the Gambling Amendment Bill (No 2) in this House in August 2007. I think many MPs not to mention members of the public and interested groups will have just about forgotten that the bill ever existed. In the interim we have had the whole select committee process the bill’s report back to Parliament and a general election. I was beginning to wonder whether this bill would ever see the light of day again and I have to say that despite the Green Party’s many reservations about its manifest inadequacies it would have been a big waste of a lot of effort if this bill had just quietly died as a victim of the change in Government. So I thank the new administration for bringing the bill back to the House but at the same time I call on National and its partner parties to consider doing what Labour seemed so unwilling to do at the time—that is amend the bill so that it can achieve substantially more than it does at present. 
The problem of pokies and the harm that they cause to individuals families employers and communities has not magically disappeared since August 2007. Although pokie spending dropped by nearly 10 percent in the first quarter of 2009 over $200 million was still lost by punters during January to March this year. That is a phenomenal amount of money when one considers the currently rising levels of unemployment and poverty. I also note that in the second and third quarters of last year spending on pokies actually increased. So it is hard to say whether the recent drop-off is seasonal and temporary or whether it is a result of other factors like the recession. I also see that for the year ended June 2008 over $2 billion was lost altogether in all forms of gambling—the second-highest amount ever despite the tighter laws and regulations that have been brought in since the passage of the Gambling Act 2003. Behind all those figures of course are countless tales of human misery: the devastation that ripples outwards when the actions of a problem gambler impact not just on the individual but on all those around him or her often with devastating consequences. 
The bill before us as reported back from the select committee is basically a series of mainly technical amendments—fixing up or improving a number of issues that have arisen since the original Gambling Act became law back in 2003. For example the bill extends criteria on which suitability of people to hold a class 4 gaming licence are judged; does more to define and regulate those who are seen as persons of significant influence in a venue; extends specifications as to what property or services may not be offered as a prize for gambling; clarifies that the venue manager or the holder of a casino operator’s licence must have a policy to identify problem gamblers; and puts more definition around the circumstances in which corporate societies may put gambling proceeds to their own purposes. 
One area where the bill was slightly strengthened by the Government Administration Committee was around information gathering. Many submitters were concerned about the lack of accurate and publicly available information around the distribution of funds. As a result a new clause has been inserted into the bill to require more from the Secretary for Internal Affairs both in terms of what information is collected and how it is published. 
On the other hand the bill was actually weakened during the select committee process in relation to the question of gaming machines being confined to internal areas. The Green Party had welcomed the bill’s original commitment to ensuring that pokie machines could no longer be moved outdoors so that people who smoke can continue to gamble and smoke simultaneously uninterrupted by any considerations of health finance or ethics. Unfortunately the committee saw fit to get rid of this clause and I would like to make a plea to parties in this House to consider seriously reinstating it in a stronger form to ensure that outdoor venues of any nature should be declared unsuitable for class 4 gambling. 
However the much bigger problem with the Gambling Amendment Bill (No 2) is that it does not deal substantively with the harm being inflicted on individuals and communities by pokies. As the Green Party said in its minority report attached to the commentary on the bill we believe that the Government should act urgently on a number of measures including devolving greater power to local authorities so that they can reduce the number of pokie venues in their own district—down to zero if they so choose. We should speed up the investigation and application of new technologies such as player tracking and pre-commit cards which can help minimise the harm done in terms of creating and maintaining problem gambling. 
Racing should be capped as an authorised purpose with restrictions on how pokie funds committed to racing are applied. Some trusts give large percentages of their proceeds to racing; a lot of it goes on high-end stakes. The Greens do not think funding the rich end of the racing industry is a suitable purpose for funds extracted from low-income communities and problem gamblers. 
We would like to see it be a requirement for the Department of Internal Affairs to publish class 4 grant reports every quarter along with the electronic monitoring system reports including clear information about where funds come from as well as where they go. At the moment gaming trusts are required to regularly publish whom they give grants to as legislated for in the earlier Gambling Act. However it is considerably harder for those of us with an interest to work out where the funds have come from. What analysis has been done shows a number of inequities such as how much of the gambling proceeds come out of some very low-income communities and how little goes back to them in comparison. 
The Green Party would also like to see reforms to improve the fraught question of the way in which the problem gambling levy is administered. I will be putting forward a number of amendments to the bill when we reach the Committee stage in the House. I hope other members will join the Greens in seriously considering what we might do to improve the bill within the scope of what is possible. I call on National members as well as colleagues from Labour to take a serious look at those amendments when they come forward. 
Many individuals and organisations made submissions on the Gambling Amendment Bill (No 2). However the process by which the select committee dealt or attempted to deal with submitters was atrocious—unlike anything else I had ever seen since becoming a member of Parliament. Some submitters were treated well; others were treated with downright contempt. Some who had asked to make oral submissions were simply denied the opportunity altogether. Some submitters had their submissions returned without any record of the submission’s arrival at the select committee having been kept in the first place. Some returned submissions were sent back not to the original submitter but to someone else entirely. Very arbitrary decisions were made about what was inside or outside the scope of the bill and so on. I found to my surprise that all of this was deemed legitimate behaviour on the part of the committee but I am glad it is not common practice. 
I see select committees as the engine room of Parliament and of the democratic process. This is the place where MPs work on the minutiae of legislation informed by relevant Government officials and parliamentary staff. It is also the place where any citizen can make representations to us about matters that concern them. I have sat on committees dealing with much more contentious issues than the bill before us tonight. These committees have literally had thousands of submissions—for example on the Employment Relations Bill in 2000 the prostitution reform bill and the bill reforming section 59 of the Crimes Act. Yet those committees when we had far more submissions did not turn away people who wished to make an oral submission. Everyone got their chance to be heard—even if sometimes the time allotted may have been brief. On the whole in every other committee I have been on there was an attempt to treat submitters with fairness and equity even if sometimes mistakes or omissions occurred. I understand that at the moment there is another select committee acting in a similar cavalier way in dealing with submissions on the resource management legislation. 
I would love to see some action taken on a cross-party basis to change the rules by which committees operate so that all submitters have a right to a fair go. I believe we owe it to the democracy that we are here to serve and to the voters who collectively put us in this place to treat submitters whoever they are with some minimum standards of decency and respect. 
DAVID GARRETT (ACT) 
: 
 One of the most pleasant things about coming to Parliament is being able to stand up and say that I agree with the speakers who have spoken before me who are nominally on the opposite side of the House. I think I am perhaps in the unique position tonight to be able to say that I was listening to Sue Bradford and Darien Fenton and I could identify with much in their speeches. I picked out just a couple of phrases. 
Chris Hipkins 
: That’s a worry! 
DAVID GARRETT 
: Mr Hipkins is probably a bit young to remember that wonderful quote about not wanting to be a member of the club who will accept that man but I suspect that that is behind what the member is saying. 
Darien Fenton said that there was much work to be done—we agree. We are supporting the Gambling Amendment Bill (No 2) at this stage but we agree that there is much to be done to make the bill better as it is far from perfect as it is. Sue Bradford the immediately preceding speaker might be afraid that I agree with her sentiments entirely about racing. I fail to see how this Parliament or this Government should devote any funds at all to racing—it is the epitome of waste and badly targeted expenditure. I have never been a great fan of gambling on races but like Ms Bradford’s and Ms Fenton’s parents my parents enjoyed a bit of a flutter. But why we are supporting it with Government money is totally beyond me. 
It is the hope of the ACT caucus that the bill will be further amended and refined when we come to the Committee stage. The Gambling Act is large and complex legislation. Here inevitably I depart somewhat from my colleagues on the opposite side of the House. Regulation is not the answer to all ills. Gambling is one of the most regulated activities in New Zealand—more so than hunting prostitution or even pleasure boating which is one of the leading causes of accidental death in New Zealand. For all the regulation of those leisure activities and for all that “nanny knows best” Government intervention we are told almost daily of the perils of gambling and of the havoc that it is wreaking in our society. I do not know when Mr Hipkins was last in a gambling studio in a public bar but I would hazard a guess— 
Chris Hipkins 
: Last week! 
DAVID GARRETT 
: Last week? I ask the member where it was. I ask him which pub it was. 
Chris Hipkins 
: Upper Hutt! 
DAVID GARRETT 
: Quickly now! I ask him what the name of the pub was. 
Chris Hipkins 
: Upper Hutt! 
DAVID GARRETT 
: Oh he has forgotten. 
Occasionally I am down in the Bay of Plenty and I find it very sad when I go into an old county pub in Paeroa. The old dining room is now full of nothing but gambling machines. If one calls in there for a quick beer at 5 o’clock or even at 2 o’clock there will be almost no one in the bar but the gambling area will be full. Sadly it will be full of people who one can tell are not really able to spend money in that way. There certainly is a problem. The extent of it I am told is that $5.5 million every day is lost in gambling in this country—$5.5 million. So $5.5 million a day is lost by New Zealand gamblers and that has to be bad thing when the people who lose that money are those who can least afford it. 
Sir Roger Douglas my co-MP likes to have a bit of a flutter I am told—but he can afford it. It does not do him any harm; he does not need regulation. Sadly other people cannot treat it as an enjoyment and an enhancement to life and those people are the problem. We are not talking about people who have a bit of a flutter like Ms Fenton’s parents and Ms Bradford’s parents. We are not talking about those people all over the country who have a sweepstake on the Melbourne Cup. 
Some say that funds from the pokies are lost to our communities. Like all things and all stories there are two sides to it. Between 80 and 90 percent of funds invested for want of a better word—it is not a good one; bookmakers are called turf accountants in England which has always amused me a little—or punted by punters are paid out as prizes and about 40 percent of what is left is paid out to community groups. For example just three out of dozens of pokie-machine operators in New Zealand—the Lion Foundation the New Zealand Community Trust and the Southern Trust—pump more than $100 million into the community each year. Members should think about that for a moment. They should think about the less than $20 million appropriated to Vote Community and Voluntary Sector. Five times as much money is provided to that same sector from gambling. There are two sides to every story. 
The Hohepa Homes Trust Board the Waimate Croquet Club and the Foveaux Harmony Chorus are not large organisations with deep pockets wealthy big-business donors behind them and a direct line to the decision makers in Wellington. They survive on the hard work of volunteers and are helped immensely by community grants from pokie-machine operators. Where would this funding come from if it were not for these grants? Would it come from the Government? That is unlikely especially in these straitened times. Would it come from a sudden rush in philanthropy? Well that would be nice but even less likely. Although philanthropy contributes more than Government ever can to the arts small sporting and cultural groups would continue to miss out. 
I have a few more: Literacy Taupo the Canterbury Land Search and Rescue Trust and the Waihi Beach Volunteer Coastguard. A very good friend of mine Mr Brian Harrison is a skipper of the Waihi Beach Volunteer Coastguard and he might be a bit surprised to hear that when we have a beer up at the Waihi Beach Memorial RSA—we never go near the gambling area and just talk the normal kind of male bonding stuff—some of the revenue from that gambling area which comes from the pokies goes to the Waihi Beach Volunteer Coastguard. I say good on Brian and his helpers. Where would we be without those organisations? When the anti-pokie lobbyists approach members over this and other gambling legislation I urge them in the words of the recently departed member Dr Michael Cullen to lighten up a bit and remember where we would be without them. 
ACT will be supporting this bill through to its second reading. However we expect to see substantial amendment and improvement before we can pledge to support it into law. Thank you. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe Mr Deputy Speaker. Kia ora tatou katoa i tenei po. In doing some research about this particular bill today I came across some information that set me back a little bit. The 2006-07 Gaming and Betting Activities Survey revealed that 86 percent of Maori had participated in gaming over the last 12 months; that Maori spent more on average than any other demographic group with an annual spend of approximately $644; and the third figure was that three-quarters of Maori who participate in such activities believe that they break even when playing the pokies. 
I think that the last statistic is probably the saddest one. Breaking even simply does not add up when one looks at the long list of criminal activities associated with gambling. Perhaps the more correct term might be breaking and entering or theft forgery embezzlement fraud credit card scams counterfeiting assault child neglect prostitution vandalism loan sharking money-laundering and home invasion. We could describe all of these as the collateral damage associated with or caused by gambling. Perhaps the most tragic outcome of all is the crime against families that occurs when those who are drawn to the casinos and pokie machines gamble away relationships by breaching the trust of family members—and I have seen that myself first hand. 
This bill today does not reduce the activity of gambling. It does little to address the path of pathological gambling or to develop strategies that address the harmful effects on our communities—the wider social economic and health costs. But there are some increased provisions within the bill that will identify and assist problem gamblers and this is a gain. 
I want to outline the Maori Party position right from the outset. Our commitment to this issue is such that my colleague Hone Harawira sat on the Government Administration Committee when it considered this bill as a non-voting member. I am told there were 168 submissions. We wanted to respond to all of those submissions. We were also involved in and influenced by the community hui the national conferences the advice of key organisations along with the problem gambling network and the excellent advice from expert specialists such as Dr Lorna Dyall from Te Herenga Waka o Te Ora Whanau and John Stansfield of the Problem Gambling Foundation. The expert analysis of all of these individuals and organisations is invaluable in advising us of the significant and harmful effects caused by gambling. 
I want to remind the House that Maori and Pasifika peoples are more likely than other groups to suffer gambling-related harm and that there is a ripple effect that goes all the way through whanau families hapu and iwi from gambling. The best estimates from Dr Dyall predict that up to 239000 people could be potentially adversely affected by Maori problem gambling when we take into account the impact on whanau and others—239000 people. This is one of the great concerns that I see around the expansion of gambling in our modern lives. Personally I am opposed to the practice of gambling as an unwise potentially addictive habit. The decision to indulge in unwise investments has I believe a destructive and damaging influence on families and whanau. In essence those with money to burn on gambling should remember their responsibilities to care for their whanau. 
I am told that Katherine Pau a counsellor from the Problem Gambling Foundation in Christchurch demonstrated the factual nature of this point of view. She gave evidence about relationship problems financial stresses personal stresses loss of employment crimes and suicide as examples of the devastation incurred by families and communities. From that same city the 198 Youth Health Centre was concerned that gambling is still in oversupply and spoke of the need to address the significant and ongoing negative social health and economic costs on families and communities. 
The bill has responded to these concerns with a very specific provision around problem gambling. The Government Administration Committee has recommended that a venue manager should be liable for any failure to display a notice in the gambling area advising customers that the venue has a policy for identifying problem gamblers. We support and note the clear and absolute statement of responsibility as outlined in the report from the select committee. But there are many many other issues that need to be addressed to reduce the harm being done by pokies particularly to Maori Pacific Island peoples Asian low-income workers beneficiaries and of course their communities. As a consequence of our concerns we included a minority report in the bill recommending that the Government should act with urgency to firstly devolve greater power to local authorities to reduce venue numbers; secondly to investigate new technologies such as player tracking and pre-commit cards; thirdly to restrict how pokie funds committed to racing are applied and others have spoken about that; and fourthly to require the Department of Internal Affairs to publish clear reports about where funds come from as well as where they go. We carried on and said that there is a need to address serious issues around the role of trusts in the distribution of pokie funds; and finally to reform and improve the way in which the problem-gambling levy is administered. 
I did want to point out the real irony within the industry. As I understand it more than $58 million per year is being siphoned out of the charitable gaming sector into the racing industry. Others have sort of touched on this matter but it is worthy of mention as we discuss this bill tonight. The recent controversy that erupted over the Christchurch based Eureka Trust giving over $75000 to the Oamaru Harness Racing Club has drawn criticism from some quarters. Morally one would expect that gambling profits accrued within Canterbury should stay within Canterbury not diverted south. But even more important is the simple principle that money taken from the activity of gambling should not be redirected to another form of gambling. 
In speaking about the submissions again I point out that the Porirua problem gambling network urged the select committee to ensure that any new devices or machines should at least be less harmful than existing machines. The Waitakere Association for Gambling Action highlighted the oversupply of gambling opportunities with more than 300 pokie machines available within a short distance of the Auckland casino. Terry Huriwai project manager for Matua Raki the National Addiction Treatment Workforce Development Programme advocated a need to strengthen consumer protection measures and other strategies to minimise harm. The Wellington People’s Centre specified far more meaningful avenues for profits generated from gambling to be distributed. Its position was that the amounts given in grants should be increased given the cost of gambling to the community. This at least was a move towards the recognition of the impact of poverty family breakdowns suicide bankruptcy and so on. 
These are just a few of the strong and consistent views that advocated for further consideration of issues around problem gambling. It is my understanding that in all some 108 submissions held the view that more comprehensive amendments are needed over and above the changes proposed in this bill and I have some empathy with the position that substantial reform is needed to achieve the original intent of the Gambling Act. 
I remind us all that the purpose of the Gambling Act is extremely significant. There is a commitment to control the growth of gambling and the aspiration to prevent and minimise the harm caused by gambling including problem gambling. There is a call to ensure the integrity and fairness of games while at the same time facilitating responsible gambling. Importantly the Act makes a commitment to ensure not only that the profits of gambling benefit the community but also that they facilitate community involvement in decisions about the provision of gambling. 
These are important principles that we must reconsider and revitalise in the work ahead. My own kinsman Anaru Bidois who is heavily involved in supporting those with gambling issues in Rotorua is one who acknowledges that this bill does not go far enough but it does go in the right direction. It is a first step and the Maori Party will support this bill as one way of supporting the change that we want to see. 
Dr JACKIE BLUE (National) 
: 
 I am pleased to speak on the second reading of the Gambling Amendment Bill (No 2). Gambling is a growth industry in New Zealand. It is an industry that can cause great harm and devastation to individuals and families. New Zealanders have a reputation as some of the world’s heaviest gamblers. Gambling a tradition in New Zealand has gained strength over the last 10 years through the rapid growth and expansion of the gambling industry. For many people gambling is an enjoyable recreational activity. For some it may be once a year—a bet on the Melbourne Cup—but for many it is a normal part of their week’s activity. Those who have serious interests in gambling usually devote a great deal of money and time to it. Unfortunately problem gambling can result in relationship problems including separation and divorce; job problems such as absenteeism and loss of employment; financial stress such as bankruptcy; legal problems such as stealing and other illegal acts to finance gambling; and family problems including domestic violence and neglect of family life. 
I will talk for a short time on problem gambling and domestic violence. There is a link. There is evidence that domestic violence is more prevalent among problem gamblers than the general population. A number of studies support this conclusion. A few years ago a survey of 144 spouses of compulsive gamblers indicated that half of them were physically and verbally abused by their spouses and 12 percent had attempted suicide. A 1993 study found that 23 percent of pathologic gamblers admitted to hitting or throwing things at their spouse or partner more than once. One in 10 gamblers in counselling reported domestic or other violent incidents related to their gambling. There is no doubt that gambling affects family members. A 1999 survey of 215 spouses of pathological gamblers indicated that they suffered from symptoms such as headaches stomach problems dizziness and breathing difficulties in addition to emotional problems of anger depression and isolation. These symptoms were usually due to psychological abuse. The children of problem gamblers were reported to be two to three times more likely to be abused by the gambler and his or her spouse than their peers were. This is a tragedy. Gambling affects families; it rips them apart. 
This bill goes some way to address these serious issues of gambling. The proposed amendments to the Act tighten the regulations around monitoring gaming. Importantly with the proposed amendments organisations or people who receive grants from gambling societies will need to be accountable for how they spend that money. Gambling is a money-making business—there is no doubt about that. As a result of the increases in expenditure on non-casino gaming machines racing and sports betting and Lotteries Commission products gambling expenditure in 2006-07 increased for the first time in 3 years to just over $2 billion which matched the 2003-04 figure. As a result of the electronic monitoring that all non-casino gaming machines have now been connected to since March 2007 we have accurate and up-to-date figures for that part of the sector. Expenditure on these machines was almost $1 billion to the end of June 2007. In the 2006-07 year turnover exceeded $14 billion; expenditure was just over $2 billion. Gambling provided $400 million to community purposes almost $90 million to racing clubs and over $285 million in sector-specific taxation. In the calendar year 2007 problem gambling intervention services funded by the Ministry of Health assisted over 5500 first-time clients with gambling problems. Gambling is epidemic. 
The purpose of this bill is to update the Gambling Act 2003 which took effect on 1 July 2004. The Act brought major reforms and in particular changed the focus towards the minimisation of harm associated with gambling. However since it came into effect a number of issues have emerged and are addressed by this bill. The bill was introduced in August 2007 and was reported back by the Government Administration Committee in May 2008. The Government has elected to progress this bill with a number of minor policy and technical amendments. The amendments to the Act will tighten the regulations around the monitoring of gaming. 
Organisations or people who receive grants from gambling societies need to be accountable for how that money is spent. This bill addresses that. There are concerns that there have been instances where gaming profits have been used to ease an organisation’s or a person’s cash flow and then have been unable to be accounted for. That is not satisfactory. Therefore an amendment requires that gaming-machine profits be banked directly into the gaming-machine society’s back account. There is also a requirement that community grant recipients use grants only for the specifically authorised purpose for which the grant was made. Importantly the justification for requesting the grant cannot be changed and I am sure members will not have any issues with that particular amendment. Specifically there is an amendment that sets out the circumstances where a gaming-machine society may use proceeds for its own authorised purpose rather than distributing grants to the wider community. 
There will be an absolute duty for gambling venues to assist suspected problem gamblers. Those venues cannot turn their backs on those people. It will not be sufficient for gambling organisations to approach a person on one occasion provide information then do nothing. Further if the person’s gambling behaviour continues to be of concern gambling organisations will have to be accountable. There are regulation-making powers that will enhance harm prevention and minimisation measures. For example mobile eftpos devices will be prevented from being placed close to gaming machines and players. This means that a player would have to walk away from a gaming machine to obtain additional cash from an eftpos device. 
Currently the Secretary for Internal Affairs can collect information from people involved in the conduct of gambling to facilitate the objectives of the Act. The new clause 99A enables the secretary to specify what information should be collected how often and the manner and form in which the information should be provided. This information may include details about how gambling profits are distributed or granted. The amendment further requires the secretary to publish any resulting statistical information on the Department of Internal Affairs’ website or in another publicly accessible electronic form. The bill gives the secretary the power to conduct gambling equipment research in gambling venues. Currently the secretary is not authorised to test gambling equipment in a real-life gambling environment which makes it difficult to assess the likely impact of equipment. 
A number of technical amendments have been included in the bill. There will be a clearer definition of the term “gaming machine” to ensure that equipment associated with gambling is not captured. For instance electronic card shufflers do not need the same level of regulation as gaming machines. The insertion of clause 80(1AA) will provide that rather than the holder of the venue licence a venue manager will be liable for the failure to display a notice in the gambling area that advises customers that the venue has a policy of identifying problem gamblers. Most of all this bill addresses some serious issues in regard to problem gambling. Under this bill a licence holder or casino operator will be required to keep a record of every person excluded from their venue and to provide this information to the Secretary for Internal Affairs on request. 
In summary gambling damages homes and communities. This amendment to the Act will tighten the regulations around the monitoring of gaming. Licensed venues and the people who work in them will be responsible for the monitoring of people who come to gamble. The people who work in gaming venues at casinos will now be vetted more strictly. The bill allows for regulation of the collection of important information around the gaming industry—the people the money and the organisations involved. The amendments are consistent with the intent of this Act which is to minimise harm. I commend this bill to the House. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 It is a pleasure to join in this debate. It has been a very interesting debate in one sense because of the clear view across the House that there is significant further work to do in terms of our gambling laws. The Gambling Act 2003 was excellent legislation but it dealt with what we all know to be a very complex and troubling area. It is an area that is full of moral hazards but which is of course the source of funding for many of our sporting and cultural organisations. The balance that was attempted to be struck in the Gambling Act 2003 produced many good outcomes and we have already heard about those tonight. My colleague Darien Fenton has mentioned the moratorium on casinos. There has been a drop off in the number of class 4 gaming machines or pokie machines as they are more commonly known so we have seen some good consequences from that legislation. 
The Gambling Act itself in 2003 was also bluntly the result of a need for the then Labour minority Government to put together a majority to pass the legislation. As a result there were a number of negotiations that I in a previous life participated in. It was difficult to bring the law together and it had of course some imperfections once it was finally passed and this bill deals with some of those imperfections. But it is largely a technical bill. As other speakers have noted when the Government Administration Committee heard submissions many of those submissions sought a mandate to go much further than the bill does. As I have said it is pleasing to hear members across the House address some of those issues and I hope that this Parliament will be able to take up a number of them in one form or another. 
It is important to note that this bill will not address those deep issues of concern but that does not de-legitimise them. A number of other speakers have mentioned the impact of gambling on New Zealand society and I think it is worth setting out that context so that people can be aware of the importance of having regulation around an issue such as gambling. We know that every day in New Zealand $2.77 million is lost on pokie machines. That is not the amount of money that is bet in pokie machines; it is the amount of money that is lost every day—over $2 million. We know that disproportionately that money is being lost in low socio-economic areas. If we use the decile categories in decile 9 there is one pokie machine for every 75 people. In decile 1 there is one pokie machine for every 465 people. So problem gambling and the problems associated with pokie machines are far more evident in our low socio-economic areas. We also know that 3 percent of the adult population are problem gamblers and they account for 24 percent of the expenditure on gambling. Obviously that is the very point—they are problem gamblers because they are betting far in excess of others in society and often far in excess of the resources that they bring to the gaming machines. The problem of gambling in New Zealand is deep it is widespread and the original Gambling Act made an attempt to deal with that. 
I also want to refer to the speech made by Richard Worth at the beginning of the first reading debate. 
Hon Darren Hughes 
: What did he say? 
GRANT ROBERTSON 
: He avoided talking about some of the conflict of interest categories in here but I want to praise the Minister who has been under a little bit of pressure lately because he made clear his commitment to working on a number of issues related to gambling in particular wanting to work to ensure that a greater percentage of money involved in the gambling sector gets to support community groups. I think all of us in the House having acknowledged that gambling is part of our society would want to see proceeds being returned to the community. What we know at the moment is that of the money from class 4 machines from pokie machines effectively 20 percent of it goes in duty and 37.5 percent of losses should go out in grants to the community but this does not necessarily benefit the community where the money was actually bet. We also know that venues and pubs can claim a maximum of 16 percent of losses for administration costs. So that leaves around 40 percent of money that could be paid out. I join the Minister in his crusade to try to ensure that more money does go to the community and I hope we can work on an issue like that across the House. 
This bill seeks to enhance the purpose of the original Gambling Act and I think it is important to set that context. The purpose of the 2003 Act is to control the growth of gambling. It is a harm-minimisation approach and that is the approach we were able to gain a consensus for in 2002-03. There were some in Parliament at that time who wanted to go further but that seemed to be the consensus we could get. The Act was also able to facilitate responsible gambling and ensure the fairness of games. It tried to limit opportunities for crime or dishonesty associated with gambling and as I mentioned earlier ensure that money from gambling benefits the community. 
This bill tries to deal with some of the imperfections and one I particularly want to talk about is the suitability of a person who holds a class 4 licence. A class 4 licence is the licence that governs most of the pokie machines that we are talking about. Although in the original Gambling Act a number of good measures were put in place to try to determine the suitability of people to hold licences this bill widens that. One thing in particular that it does is takes into account matters that a person has been involved in in the previous 7 years rather than the 10 years currently in the bill. That is an improvement that I think will allow significantly more investigation and significantly more factors to be taken into account when a decision is being made as to whether someone should be able to hold a class 4 licence. 
The powers have also been extended so that the director of a company that has been placed into receivership put into liquidation or who has been involved in events leading up to that happening will have that factor taken into account when seeking a class 4 licence. Anyone who has been prohibited or disqualified from acting as a director in a company is also put out of action in terms of holding a licence and other clauses have been inserted to ensure that anyone who has had any impropriety in terms of his or her role as a company director is also not able to hold a class 4 licence. That is a positive step forward. We are all aware of the stories in our community about the rorts that perhaps apocryphally have taken place in a number of parts of the country whereby pubs or clubs have forced sporting or community organisations to come into a pub and drink there in order to be able to receive the benefits of money that has come from pokie machines. Earlier speakers in the debate mentioned specific examples of that across the community. I think we all recognise that that is not a satisfactory situation. There has been an improvement in that and the Gambling Commission has had a role in monitoring that but I think one area that we could continue to look more into is the distribution of grants not only being in the territorial authority area in which the gambling takes place but also to ensure that those who run pubs and clubs where there are gaming machines are not acting in a way that community organisations and sporting organisation feel they have to follow. 
I want to echo one other comment that my colleague Darien Fenton raised earlier. That is the question of the placing of gaming machines in outdoor areas. This is a concern that I know the Labour members of the select committee raised when the bill was before the select committee and we hope that we can come back to this question later on during the Committee stage. A harm-minimisation approach will not be helped if people can gamble outdoors which means that they can continue to smoke and drink in that outdoor area. Part of the original intention of the Gambling Act was to try to provide a situation in which there were opportunities to break in to a pattern of gambling. We already know that in the Gambling Act—and we are now in the process of seeing this further implemented—there is the provision for the pop-up messages that appear on gaming machines to indicate to the user of the machine how long he or she has been there and how much money he or she has spent. Those kinds of harm minimisation messages are important and they are enhanced by this bill. 
There are several other useful changes and improvements brought in by this amendment bill. One of these amendments widens the number of people required to work on the question of who a problem gambler is in a particular premises. At the moment the casino operator has that obligation but it has been extended and the fine for not fulfilling that role has also been extended. 
This bill was brought in by the previous Government. We are very pleased to continue to support it. I am pleased to say that this Parliament appears interested in taking on more widely the issue of problem gambling. I look forward to working with others across the House on this bill. 
TODD McCLAY (National—Rotorua) 
: 
 I rise to speak on the second reading of the Gambling Amendment Bill (No 2). As I have done research today as I have listened to others participating in this debate and certainly since I was elected a member of Parliament for Rotorua with a great majority of 5065 only 6 short months ago it has become clear to me that this is a very important issue. One thing often comes up in Rotorua—and others have given us a name or a nickname about Rotorua which I prefer not to use here today. Gambling can and does damage homes communities and of course individuals. 
The bill before us today will do a number of things. It amends the Gambling Act and will tighten the regulations around the monitoring of gaming. The intention of the bill is to reduce harm on people who have difficulty with gaming. It will mean that organisations and people who receive grants from gaming societies need to be accountable for how that money is spent. 
Hon Darren Hughes 
: The size of my majority! 
TODD McCLAY 
: Was that the former member for Otaki asking about the size of majorities? How about we have a little competition before I go on? Could all the members opposite put their hands up if they won their seat. In fact the only hand I did not see go up there was that of the former member for Otaki Darren Hughes. 
A month ago I was driving through that electorate and I had my daughter who is 4 years of age in the back of my car. All of a sudden as we went through the beautiful town of Levin my daughter started whimpering and crying. I pulled over and asked what was wrong. As I looked to the left there was a very large obscene photograph of the former member of Parliament for Otaki Darren Hughes. The grin on that member’s face at the time was almost obscene. It looked to me very clearly like it was a photograph used in an application for the Milky Bar Kid auditions. The only thing that happened on 9 November was the horse was gone. The member must have had to ride his big white horse out of that town. 
Coming directly back to the bill I say that it is my intention to support it. I believe that the challenge is to balance the private and social costs of gaming machines whilst respecting the right of the majority to gain enjoyment from gambling. We must recognise that there are social benefits for the community that come from funding derived from gaming machines and also that for some gambling becomes an addiction and that families can be harmed by this gambling problem. The bill will make a number of amendments to gaming policy with a view to tightening up on how the gaming industry is operated and addressing activities targeted at those who are deemed to exhibit problem-gambling behaviour. 
Gaming machines in New Zealand are legal. But when one reads the newspapers this is not always obvious. They play a role in our society and members of this House have previously decided that the enjoyment that can be gained from these leisure activities is acceptable. In my home of Rotorua around $20 million is spent in gaming machines each year. From this significant funds are reinvested in the community. In Rotorua a number of charitable trusts do very good charitable work and the funds they spend come from gaming. I say to members that without these funds very many community groups and some very important social and community projects would not get off the ground. This House will need to look very closely in the future at where this money is collected from and then at where it is spent. I would like to see all the funds that are collected from gaming in Rotorua—especially in the small community of Kawerau—spent only in those communities. More than $4 million is spent each year by these trusts in Rotorua. We need to recognise the important work that some of those funds already do. 
Hon Darren Hughes 
: Put up a member’s bill then. Put your money where your substantial mouth is! 
TODD McCLAY 
: That is a great idea but I already have a member’s bill in the ballot and we can have only one at a time. We will get that one out we will fix Easter trading for Rotorua and I will call on the members opposite to support that. Then we will come back to that issue very happily. 
In Kawerau the Lion Foundation committed a substantial amount of money last year to build and upgrade a number of youth facilities including a BMX track. Without this foundation and the funds it collected from gaming in Kawerau and elsewhere this BMX track would not have been possible. The track is used by the world-renowned BMX cyclist Sarah Walker of Kawerau who went to the Olympics last year and has just achieved fourth place in the world championships in Europe. The track is used by the community and the young people of Kawerau and as I said without the funds collected from gaming it would not have been possible. 
We need to also recognise that in Rotorua and from the many contacts I have had the venues that have gaming machines by and large are responsible. They do not gain great financial reward from having the machines there but they do have them to provide enjoyment for their clients and in doing so to provide funds for the wider community. 
Having spoken about some of the positive things that funds from gaming can achieve I think it is also important to recognise that there needs to be a balance and that great harm can be caused from gaming. 
The Rotorua District Council has recently put out a report on the impacts of gaming in Rotorua and I will quote from that for a moment if I may. The council said: “Rotorua is a high-risk area for problem gambling. It has a relatively youthful population profile as well as an increasing number of elderly an above-average unemployment rate … and it serves as the hub for many satellite areas.” According to the council’s social impact assessment in February 2007 there are between 500 and 1150 problem gamblers in the district depending upon how problem gambling is defined. The report estimates that gaming-machine gamblers in Rotorua lose between $17 million and $22 million a year and this loss is not borne evenly across the community. The majority of the loss is borne by the minority of gamblers. 
If we look further at gambling and problem gambling in New Zealand we have heard from others that just over $2 billion a year is waged in New Zealand on gambling. In 2007 the figure was just over $2 billion and $950 million of that was lost on pokie machines outside of casinos. Statistics also show that 3 percent of the adult population are considered to be problem gamblers. There are 1537 gambling venues but in total there are almost 20000 pokie machines in New Zealand outside of casinos. 
The member of Parliament who spoke earlier Te Ururoa Flavell mentioned that Maori and Pacific Island people have a greater incidence of problem gambling in our community. But when we look at those who seek help for problem gambling from the services that are available in the community we see that in fact only 28 percent of Maori people seek help. This figure compares with 48 percent of Europeans and about 7 percent each for Asians and Pacific Islanders. If we look at where the problems have been caused throughout all those groups we see that 68 percent of those who have problems with gambling gamble on non-casino pokie machines. 
I will talk for a moment specifically about some of the things in the bill that I think will help us greatly in making sure that this industry is regulated properly and will allow us to do much more to help those who have issues and difficulties with gambling. The bill will do a number of things—in particular address problem gambling. It will create the requirement to bank gaming-machine profits directly into gaming-machine societies’ bank accounts. This means that the revenues will be used for their intended purpose as described in the Act which reduces the chances of misappropriation or misuse of those funds. There will also be a requirement that community grant recipients use grants only for specific authorised purposes for which the grant was made. The justification for requesting a grant therefore cannot be changed. This means also I believe that there will be less chance of the misuse of funds and that the profits from gaming will benefit the community directly. 
A number of other important measures in the bill set out circumstances in which gaming-machine societies may apply gaming-machine proceeds to authorised purposes. We have heard a lot about that from other speakers in the debate tonight. There will be a duty on gambling venues to assist potential problem gamblers with ongoing gambling problems and where ongoing gambling problems are suspected. Essentially it will not suffice for a venue to approach a person on one occasion to provide information about problem gambling and then do nothing further should the behaviour continue. The bill will also enhance the harm prevention and minimisation regulating powers. 
IAIN LEES-GALLOWAY (Labour—Palmerston North) 
: 
 It is a pleasure to be probably the penultimate speaker on the Gambling Amendment Bill (No 2) this evening. I have listened to the debate during the evening and I have heard the bill being described variously as a technical tidy-up a fix-up an improvement on the original Act and an improvement to assist with the intent towards harm minimisation and controlling the growth of gambling venues and the availability of gambling in our communities. But I think—and this has been discussed a lot—that this bill does somewhat more than that; it is trying to address issues that are incredibly important to our communities and families. It essentially looks at two areas. The first is the transparency around how gaming funds are both collected and disseminated in our communities. The second looks at issues of problem gambling. Although I acknowledge some of the comments by Mr McClay and also by Mr Garrett around the good that funds from gambling can actually do for our communities it is important that we look closely at the transparency of how those funds move around our communities how they come in from gambling and how they go back out and at exactly to whom they are going and how trustworthy the processes are. 
It is good that we are looking at those issues but I will focus a little bit more on the problem-gambling side of things in this bill. The Act currently requires the holder of a class 4 venue licence or a casino operator’s licence to develop a policy for identifying problem gamblers. This bill widens the class of people who are required to use the policy to identify actual or potential problem gamblers to include the venue manager the holder of a casino operator’s licence or a person acting on behalf of either of those persons. The offence provision for the venue manager the holder of a casino operator’s licence or a person acting on behalf of either of those persons is amended to include those persons as well. The offence is punishable on summary conviction by a fine not exceeding $5000. 
The bill also requires the venue manager holder of a casino operator’s licence or a person acting on behalf of either of those people to take all reasonable steps to assist a person if the person’s behaviour gives rise to ongoing concerns about problem gambling. It also provides that an exclusion order must be issued to a self-identified problem gambler if the person has identified himself or herself as a problem gambler and has asked to be banned from a gambling venue. 
This is one of the very interesting things about gambling: it is addictive. Problem gambling is an addiction. People can actually self-identify as problem gamblers and still find themselves overcome by the compulsion to return to a gambling venue. This places the onus on those venue operators to make sure they have a plan in place to help and assist those people who identify themselves as problem gamblers. 
I will talk and reflect a while on some of the health issues associated with problem gambling. As it is addictive—it is not a substance like alcohol or drugs but it is equally addictive—gambling is a health issue and the health implications need to be considered alongside what we are trying to do here tonight with this bill. With a large number of New Zealanders each year being characterised as problem gamblers a range of harmful and socially damaging effects have been evidenced to impact individuals families whanau and communities. Individuals defined as problem gamblers can suffer from depression poor physical health and physical feelings of withdrawal and compulsion. They may also display signs of mental addiction similar to drug users and drastic changes to normal patterns of social interaction and behaviours. 
A recent Australian study found a number of key indicators around problem gambling. The study showed that 20.3 percent of problem gamblers evidenced physical symptoms associated with their problem gambling—the like of which Dr Jackie Blue referred to earlier on; 64.5 percent had significant anger problems that were identified as contributing factors to incidents of violence; 60 percent suffered varying forms of clinical depression; and 1.7 percent of suicides were linked to problem gambling with between 17 and 24 percent of all problem gamblers having attempted suicide at least once. Seventy-five percent of problem gamblers also suffered from alcohol addiction problems. The two are inextricably linked. The Ministry of Health statistics in 2006 showed that 58 percent of problem gamblers were cigarette smokers compared with only 23.5 percent of the rest of the population. Problem gamblers were identified as three times more likely than non - problem gamblers to be daily persistent smokers. Gamblers who smoked on a daily basis gambled on more days and spent more money than non - daily smoking gamblers. They also craved gambling more than other gamblers did. 
It is highly concerning to me that the select committee was not able to come to a conclusion on the question of pokie machines being placed outside of gaming venues in order to allow people to smoke and gamble at the same time. Not only that they are able to smoke drink and gamble at the same time. There is nothing like the ultimate cocktail the ultimate mix— 
Hon Darren Hughes 
: The trifecta. 
IAIN LEES-GALLOWAY 
:—exactly—of addictions. What a fantastic way to send people at the margins of our community into a spiral and push them further out on to the margins! It is very disappointing that the select committee was not able to come to a conclusion on that one but I am very pleased to see that the Minister seems to differ from his colleagues who were sitting on the select committee and that we might yet see some progress in this area. 
But it is not just addiction and health issues that we need to focus on in regard to problem gambling. In a recent international survey 62.9 percent of problem gamblers responded that they had perpetrated or been the victim of domestic violence in the last 12 months 55.6 percent reported perpetrating physical assaults and/or sexual coercion and 25.4 percent reported severe incidents of domestic violence. In Australia up to 1600 divorces per year are directly related to the stress of problem gambling leading to the creation of possible dysfunctional and damaging impacts upon children. The children of problem gamblers were reported to be two to three times more likely to be abused by both the gambler and his or her spouse than were the children of non - problem gamblers. 
Often due to the financial strain placed upon families and households with a problem gambler money set aside for food and children’s needs is redirected into gambling. This can lead to absences truancy children dropping out of school entirely and a greater chance that the children may undertake risky behaviour themselves such as drinking smoking drug use and problem gambling. It is a never-ending cycle unless we are prepared to do something about it. 
This bill this evening is great. We are trying to do something about it. But just as with the sale and supply of liquor it has to be backed up at the other end by what we are doing in the health sector. The strategies we have for dealing with drug use alcohol abuse and gambling abuse have to be not only at the justice end not only at the end of the supply and the availability of those substances and opportunities but also at the health end. How do we make sure that there is addiction treatment and appropriate treatment available for people? 
One would think given some of the statistics I have read out this evening that the Government would have a clear focus on those health issues. But what area do they come under? Where does the funding come from? It comes from mental health. What has just dropped off the priority list for this Government? It is mental health. How can we possibly be serious about dealing with drug addiction alcohol addiction and gambling addiction if we do not have a focus on mental health? How frustrating it must be to be Simon Power at the moment. He is trying to deal with alcohol issues. Bills have gone through the House and he is trying to have a discussion in the community. That is fantastic. But without the support of his health Minister how will we get anywhere? It is just appalling that the health Minister clearly does not think that mental health and the maintenance of good mental health in our communities is a priority. When work absenteeism family violence and addiction issues are so prevalent in our communities now is the last time with a recession upon us and all the mental health issues that come with unemployment to turn our back on mental health. 
TIM MACINDOE (National—Hamilton West) 
: 
 It is a sad irony that just a few moments before rising to take this call I learnt of the death of one of my most distinguished constituents. Retired Hamilton lawyer Mr Athol Bishop passed away today. The reason I mention that in the context of this debate apart from the fact that he was a man who did great work in our community and who gave great service to his profession is that I think of Athol at the races at Te Rapa. He was a very enthusiastic member of the Waikato Racing Club and a man who always behaved with great dignity and decorum but who loved a flutter. I mourn his passing and I send my condolences to his family. 
I have no doubt that Athol would be strongly in support of the Gambling Amendment Bill (No 2) which we are debating tonight. For most members of our society gambling is an occasional affordable and pleasurable activity. A day at the races is a great social occasion as it always was for Athol but it is such only for those who set out knowing what they can afford to lose and who have the self-discipline to stick to their limits. An occasional deposit in a pokie machine is a bit of light relief and merely a momentary indulgence and that is as it should be. That is how it is for most of us most of the time. But it is sobering to reflect on the fact that right around our country as we consider the second reading of the Gambling Amendment Bill (No 2) in this House tonight people who can ill afford to waste their money are doing just that because of their addiction to lotteries pokie machines scratch cards the lure of the TAB or long hours spent in a casino. 
Problem gambling is a significant and very distressing form of addiction. It can be catastrophic for families and personal relationships. It can lead to friction in the home the neglect of children conflict and dishonesty in workplaces and a loss of life-savings and self-worth. The distressing consequences of this problem are reflected in some sobering statistics associated with other forms of addiction—and members on all sides of the House have drawn attention to some of these tonight—including mental illness family breakdowns and sometimes even suicide. So it is right that we do all we can in this House to minimise the risk of harm from such an insidious addiction. It is for that reason that I commend the past and present Ministers of Internal Affairs and the Government Administration Committee for the good work they have done in updating the original Gambling Act in focusing on a number of issues that have arisen since the Act took effect nearly 5 years ago and in furthering the important objective of minimising the considerable harm that some in our communities suffer as a result of their own gambling or that of a close family member.  
As my colleague from Otago noted this bill is a practical measure designed to achieve effective interventions in those areas where problem gambling is most likely to occur. As technology is constantly updated and new gambling opportunities are devised it is important for legislation to keep pace with evolving trends. To a large extent this bill as many members have commented is of a technical nature designed to amend the principal Act so that it may operate as it was originally intended. That is among the reasons why the select committee has recommended a new definition of a “gaming machine”. It was also necessary to ensure that the definition of “gaming machine” did not unintentionally capture equipment associated with gambling that does not need to be regulated as such such as electronic card shufflers. 
Those in my city of Hamilton who do sterling work to tackle problem gambling and to support those who suffer from it will welcome the amendments in this gambling bill that require licence holders and casino operators to keep a record of every person who is excluded from their venues and to provide that information upon request to appropriate authorities—not to cause shame or humiliation but to assist problem gamblers to break their serious and calamitous habits. It is appropriate that those who obtain licences to operate gambling establishments and those who are employed in those establishments should be required to exercise responsibility and effective monitoring of those who come to gamble on their premises especially those who do so on a regular basis. And I am sure that all of us at times have seen pictures of such misery—for that is what it is. For that reason it is also appropriate and necessary that the people who work in gaming venues and casinos should be carefully vetted. They must be up to the job they must be responsible in the way they conduct their activities and duties and they must be empowered to take effective steps to intervene when it is obvious that their patrons are doing themselves and their dependants considerable harm. This bill sets out those expectations. It allows for regulation of the collection of important information around the gaming industry: the people the money and the organisations involved. 
We can never hope to protect all of our citizens from all of the afflictions and temptations that can lead them down the path to serious harm but as my colleague Dr Jackie Blue recounted the problems arising from gambling can have particularly tragic effects. It is often innocent family members who suffer the most. The link between problem gambling and domestic violence cannot be ignored. This bill is not about sitting in judgment or removing the obligation for people to exercise personal responsibility for their actions but rather is about minimisation of harm and protection of the highly vulnerable. 
As I am the final speaker in this debate I acknowledge the thoughtful contributions to this debate tonight from members of all parties. As Mr Garrett commented it is refreshing to take part in a debate that is characterised by common sense consensus and compassion. Those were not Mr Garrett’s exact words but I am sure he will recognise the spirit of them and readily agree to them. The clear expression of collective will that the passage of this bill will send out to our communities will give heart to those who do such important work to tackle problem gambling and it will strengthen the arm of responsible gaming operators and their employees everywhere. 
There is no question that many clubs community groups and charitable organisations depend heavily upon the proceeds of gambling in the form of grants to conduct their activities and to do much good work for a myriad of causes. In my career before I came to this House I was the chief executive of a trust that depended heavily on money from those sources so I appreciate that the money is often put to very good use and that it is absolutely essential for much that is good in our communities to happen. But I am sure that almost all of the office holders and grant administrators will welcome the extra safeguards that are built into this amendment bill. Those groups exist to do good works and I am confident they will share the sentiments that have been so widely expressed during this debate. Nobody working in those areas wants to see others come to great harm as a result of gambling. 
Gambling is a serious issue. It is a major problem for a small but significant group of our population right around the country. I commend everybody who has worked on this bill in order to try to minimise the harm that gambling can do. I thank those who have spent long hours at select committee meetings working to bring about improvements to the bill. I have pleasure in supporting it and I commend it to the House. 
Bill read a second time. 
Inquiries Bill 
First Reading 
Hon CHRISTOPHER FINLAYSON (Attorney-General)  
on behalf of the  
Minister of Internal Affairs 
: I move  
That the Inquiries Bill be now read a first time 
. I intend to move that the bill be referred to the Government Administration Committee. 
Public inquiries have always played an important role in New Zealand society for much of our history. For instance the first formal inquiry held in New Zealand took place in 1864 to determine the best site for the seat of Government. Obviously the inquiry reached the right conclusion. Since that time public inquiries have continued to provide an independent means by which to investigate matters of importance. The Commissions of Inquiry Act 1908 sets out the legal framework within which commissions of inquiry and royal commissions of inquiry currently operate. 
However it has become clear that the law relating to public inquiries is not without its problems. In 2006 the Law Commission began to review this law. In its 2008 report on that review entitled  
A New Inquiries Act 
 the Law Commission concluded that the Commissions of Inquiry Act was antiquated and contained confusing provisions. In addition the legalistic and adversarial practices that have arisen with commission proceedings were seen as potentially adding to the cost and delay associated with inquiries. The Law Commission also noted the need for a flexible form of statutory inquiry that Ministers could use for the less complex discrete issues that require independent investigation. 
Hon Clayton Cosgrove 
: We’re going to have a few of those with old “Richo” I think.  
Hon Darren Hughes 
: Discreet! Ha ha! 
Hon CHRISTOPHER FINLAYSON 
: The Law Commission observed that there has been a move towards the use of so-called ministerial inquiries which take place outside of the statutory framework. And I can see why members opposite are getting so excited because most of them were the subject of ministerial inquiries over the last 3 years. We had Mr Phillip Field— 
Hon Annette King 
: Two minutes! It took 2 minutes for you to become nasty. 
Hon CHRISTOPHER FINLAYSON 
: I do not think the “Minister for Common Sense” was involved. She was too busy suppressing the freedom of New Zealanders with the Electoral Finance Act. Ministerial inquiries can be unsatisfactory as these inquiries do not have the powers to obtain evidence and must therefore rely on witness cooperation in order to be effective. There are also no immunities for those who take part in ministerial inquiries. I will say to the member for Rongotai that if she promises to stop her incessant inane interjections I may vote for her for mayor. 
The Law Commission recommended that the law relating to public inquiries be reformed and modernised through the introduction of a new inquiries Act and this bill responds to that recommendation. The bill provides for the establishment of two new types of inquiries. 
Hon Clayton Cosgrove 
: Speak up! We can’t hear you. 
Hon CHRISTOPHER FINLAYSON 
: We will have public inquiries I say to Mr Cosgrove and we will have Government inquiries while recognising and providing for royal commissions that are established under letters patent. 
Public inquiries will replace commissions of inquiry and will be appointed for matters of significant public importance—[ 
Interruption 
]—like whether the former member for Otaki will ever grow up. Public inquiries will be appointed by the Governor-General by Order in Council. The reports of public inquiries will be tabled in Parliament. The provisions of the bill relating to public inquiries will also apply to royal commissions. 
Hon Darren Hughes 
: When does the band strike up? 
Mr DEPUTY SPEAKER 
: Order! 
Hon CHRISTOPHER FINLAYSON 
: I am enjoying it! 
Mr DEPUTY SPEAKER 
: I know you are. I would like to hear what you are saying. Interjections should be rare and reasonable. There is not much time to go and I would like to hear what the member is saying. 
Hon CHRISTOPHER FINLAYSON 
: Government inquiries will be appointed by and report directly to a Minister and those inquiries will deal with smaller and more immediate issues where a quick and authoritative answer is required from an independent inquiry. The appointment of Government inquiries and their terms of reference will be notified in the  
Gazette 
. 
This bill provides that all types of inquiries established under the new legislation will have the same legal powers and protections available to them. Those include the powers to obtain evidence and immunity from liability for inquirers for anything that is done in the course of exercising their functions unless the inquirer has acted in bad faith. There is a new provision covering legal assistance for certain persons who appear before public inquiries—like Thai workers. Legal aid is not available to those who participate in inquiries yet there are circumstances where the person may need legal representation or advice in order to protect his or her interests. Inquiries are to be given the ability to recommend to their overseeing department— 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. I wonder whether you could give the House some advice on a very serious matter. The member is quite an important member of the executive. He is the Attorney-General and he is commenting on matters that are before a court at the present time. I think that is a most unwise thing for him to do. Could you advise the House as to whether that was an appropriate matter for him to raise in the case of— 
Mr DEPUTY SPEAKER 
: I am sure the member with his legal background will be able to determine whether it was appropriate. 
Hon CHRISTOPHER FINLAYSON 
: Inquiries are to be given the ability to recommend to their overseeing department that funding will be provided for legal representation and it will be the decision of the overseeing department as to whether to grant such funding from the budget for the inquiry. 
The current Act refers to concepts regarding parties and persons who are entitled to be heard. Those participants have an automatic right to appear and be heard and then to be represented before commissions and that can add to the cost and to the adversarial nature of inquiries. Under this bill those concepts will be replaced with the ability for inquirers to decide whether to conduct interviews call witnesses hold hearings and so on. However inquiries will be able to appoint core participants where it is identified that a particular class of persons has a particular interest in the inquiry. Core participants will still have the right to give evidence and make submissions but the manner in which they do so is to be determined by inquirers. Under the provisions of the bill people who appear before inquiries will have the same privileges as those who appear in civil proceedings as is provided in Subpart 8 of Part 2 of the Evidence Act 2006. 
The bill contains new and updated offences to improve the ability of inquirers to control behaviour surrounding inquiries and avoid abuses of their processes. Some of those offences are already contained within the existing Act. However some new offences—such as intentionally preventing a witness from giving evidence and threatening or seeking to influence a witness before an inquiry—have been added. Those offences will be summary offences with charges to be laid by the police on reference from an inquirer. The penalty for committing any of those offences will be increased from $1000 to $10000. 
The bill also sets out procedures for public access to inquiries and to their documentation. At present information held by commissions of inquiry and royal commissions is not subject to the Official Information Act 1982. This bill provides that once an inquiry has been completed documentation from both public inquiries and Government inquiries will be subject to the Official Information Act. However information will be able to be withheld on specified grounds such as where a submission provided to an inquiry contains sensitive information. 
Sections 2 and 15 of the Commissions of Inquiry Act which relate to the appointment of commissions of inquiry and royal commissions will be repealed. However the remainder of the Act will be left in force in the interim as a number of other statutory bodies such as the Waitangi Tribunal take their powers from that Act. I particularly refer to clause 37 which provides for a mandatory review in a few years’ time of the continuing application of the Act. 
Debate interrupted. 
The House adjourned at 10 p.m.