Tirikatene Rino: Border Processing (Trade Single Window and Duties) Bill — In CommitteeText is incorporated into the Bound VolumeTirikatene Rino: Border Processing (Trade Single Window and Duties) Bill — In Committee[Sitting date: 11 March 2014. Volume:697;Page:16528. Text is incorporated into the Bound Volume.]RINO TIRIKATENE (Labour—Te Tai Tonga):I know we have been at cross purposes with the Minister of Customs in relation to his reluctance to expand on contractual matters in relation to IBM but I think it is very clear that this legislation the Border Processing (Trade Single Window and Duties) Bill underpins the implementation of the Trade Single Window. If we look at clause 16 which replaces Part 11 of the principal Act it does talk about the Joint Border Management System being a computer system. That is defined in the Act as “designed” so it is a designed system that enables entities to transmit information and receive information through systems such as the Trade Single Window. Actually central to the bill I think is the fact that the system has been designed for and is the actual heart of the Joint Border Management System. It is absolutely on point for us on this side of the Chamber to be asking the Minister to provide a bit more information as to the contractual arrangements and the implementation of the Trade Single Window.If we look at the list of consultants who have been involved in this project it is the single biggest project that the Customs Service has undertaken for the past 3 years at least; 85-plus percent of all its consultants have been used on the system and some $40 million has been paid out to IBM to build this system let alone the literally numerous contractors who are invoicing eye-watering amounts amounting to tens of millions of dollars over the past couple of years to build this system. The Minister says there is a little more testing to be undertaken and we can understand that a computer system of this complexity and of this size covering multiple Government departments and different users is a big project—no doubt about that. But I believe that is why we need to have the confidence that this system is robust that it is actually performing to standards that the contractors are not just stringing the project out and that there is actually a tight governance of the project. I know that the Customs Service has been quite meticulous in terms of its governance its executive and involving senior management on the oversight of this project so it is perfectly on point for us to be asking the Minister these questions around the contractual arrangements which do underpin the actual legislation that we are discussing here in the Committee at the moment.I would like to also add something new to the debate to talk about another matter and I would welcome some input from the Minister. It is in relation to clause 15 and the de minimis thresholds. I know that the ability is being put in to the bill for regulations to I guess set whatever the threshold will be under which no duty will be collected. I know that for the Foreign Affairs Defence and Trade Committee—and I am not a member of the committee but I was fortunate enough to sit in on a couple of meetings and we did the field trip to the Customs Service offices to see the working demonstration—the de minimis threshold was an issue of great concern to everyone. We know that the New Zealand Retailers Association is advocating very strongly that there is unfairness in terms of collection. I am talking about the GST component but it all fits around online purchases and crossing of goods over the border which is a big issue.We all purchase goods online I would imagine. Online purchases are so pervasive these days and the use of the internet and the growth of online purchases are just going to get bigger and bigger. We know there is an issue around the de minimis threshold in terms of not only maybe forgone duty that could be collected but also lost GST that could also be collected and put into the Government coffers. The issue really is that according to the New Zealand Retailers Association there is unfairness towards the New Zealand retail sector. We know that it is struggling and that people are using online purchases practically daily but there seems to be a simple solution.I do a bit of purchasing online myself. Yes I am old-fashioned; I still get just CDs. I am not into digital music; I like the tactile CD. Unfortunately there are no more record stores so I cannot actually find what I want. The only way I can get it is overseas. As you click through to make any purchase these days you go through the PayPal sites or you go through using your credit card companies. It would be very simple I would imagine. It would be just an automatic little calculation that they would probably be able to do pretty easily it would seem to just add a GST component on that or automatically add an assessed duty amount. There are no qualms about it—if you really want the product you just click on that extra amount. It is all there in black and white it is all laid out for you and bingo there you go the GST is paid and duty collected. So I would just like to invite the Minister in the chair Maurice Williamson to shed some light on that for us because I know that under the bill there is provision for the de minimis amount to be set at any level.We know from the Retailers Association that in other countries such as Canada I believe and the UK—I may be wrong—the thresholds are very low. They are very low and are set around $27 equivalent to an online purchase. It would be good if the Minister could shed some light on that. We understand that there are some 50 million mail pieces that come across the conveyor belt every year. I can just see those little beagles—that was just for my colleague Ms Darien Fenton; she wanted me to mention the beagles—as they do their best on the conveyor belt to try to sniff out all the illicit materials or whatever they sniff for. A significant bulk of those 50 million items would be purchases under the de minimis or $400 amount. That is duty and GST as well that could be collected on some of those items and it just seems that it could be just a click away and a way of making it a bit more of a level playing field for the struggling retailers out there. So I just invite the Minister to shed a bit of light on that. Kia ora.