Faafoi Kris: Student Loan Scheme Amendment Bill (No 2) — In Committee 
Text is incorporated into the Bound Volume 
Faafoi Kris: Student Loan Scheme Amendment Bill (No 2) — In Committee 
[Sitting date: 26 March 2013. Volume:688;Page:8961. Text is incorporated into the Bound Volume.] 
KRIS FAAFOI (Labour—Mana) 
: 
 Thank you very much for the chance to speak to the title and commencement clauses of the Student Loan Scheme Amendment Bill (No 2). 
As my colleagues David Clark and David Cunliffe have both chosen to do during their contributions to this title and commencement clauses debate I have chosen a number of alternative titles for this bill. I wanted to offer up one: the “Student Loan Scheme (Can We Trust This Government With Our Information?) Amendment Bill”. If I can I would like to just paint a picture as to why I think that should be the alternative title for this bill. 
Turning to clause 34 in Part 1 which looks to amend section 208 of the parent legislation it says “The purpose of this section is to facilitate the exchange of information between the Inland Revenue Department”—and I will come back to that soon—“and the New Zealand Customs Service for the purpose of establishing an information-matching programme to assist the Commissioner …” to do a number of things. Those things are offered in clause 34 of the bill. They are to: “(a) verify whether borrowers are New Zealand-based or overseas-based; and (b) verify whether borrowers are New Zealand residents; and (c) locate when they enter or leave New Zealand borrowers who are in serious default (within the meaning of … the Customs and Excise Act 1996) in relation to student loans.” 
I would suggest to this Committee and to the people at home that a lot of that information would be very sensitive information—information that you would not want to necessarily see go flying into the hands of people either who do not have the need to have it or whom you certainly would not want to have it if they had other agendas for using that information. I do think that we should consider looking at an alternative title to this bill for those reasons because of the track record of this Government around the security of very sensitive information. 
This week we have seen a rather large case around the security of information which is sensitive information that we are looking at here. So we want to make sure that within the bounds of the Student Loan Scheme Amendment Bill (No 2) and clause 34 that that information is held very tightly because we have seen 83000 pieces of information for a large number of quake claimants in Christchurch getting into the wrong hands. Again we would want to see some safeguards in this bill to make sure that did not happen again. 
Also in respect of the Inland Revenue Department which I say again I quoted as one of the parties here for the information exchange in clause 34 it has had an incidence where I believe—and I am looking at David Clark here for some guidance—around 6300 individuals were caught up in another improper release of private information. That is pertinent to clause 34 because we are talking about an agency within this bill that has been given the right to exchange information with another Government agency. We need to be sure around the security of the information that we are talking about in clause 34 because we have had a past transgression—6300 individuals concerned. We need to be sure there is some security put in place I guess at an operational level around this legislation to ensure that that does not happen again. So we do have the Inland Revenue Department involved directly in clause 34. I think that because it has had some past history of an incident we need to make sure. 
Maybe it is a question I can put to the Minister in the chair the Minister of Immigration—whether he knows what kinds of safeguards are being put in place to govern the operation of clause 34 in this bill and what kinds of safeguards there will be around that private information. 
We have also had the Accident Compensation Corporation and the Ministry of Social Development caught up in very large privacy breaches— 
The CHAIRPERSON (Lindsay Tisch) 
: Order! That is not in the bill. 
KRIS FAAFOI 
: Yes and I certainly would not want to see this happen with this student loan scheme bill because there are 101000 New Zealanders who have got student loans. A lot of them are overseas but a lot of them are here in New Zealand. If we were to see a large privacy breach of that scale concerning 101000 New Zealanders—and I am one of them I am still paying my student loan back—I would be very upset as a citizen of this country and as someone who does not want their private information put out there. So it is a serious question to the Minister in the chair as to what safeguards have been put in place to govern clause 34 of this bill. If the Minister in the chair could afford me an opportunity to answer that I would very much appreciate that as a citizen and as a member of Parliament. Around that I guess that is where the alternative title “Student Loan Scheme (Can I Trust This Government With My Private Information?) Amendment Bill” does come through. 
Another alternative title to this bill would be the “Student Loan Scheme (A Glimmer of Hope With This Government) Amendment Bill” because Part 3 I think it is of this bill does open up the bill to change the definition of income to ensure there is a principle of fairness that applies to this bill with measures to expand the definition of what income is. So as opposed to just a general old PAYE or whatever you get paid in your contractor’s terms this provision will expand the definition of income to include people who receive their money from a company a trust a superannuation scheme or other source which should be treated in the same way as those who earn a weekly wage. 
I guess in terms of that alternative title there is a glimmer of hope that there may be a principle of fairness on the other side of the House because they are applying it to this bill. As Andrew Little said in his I think it was Part 3 speech on this bill there is a sense that the student loan scheme levels the playing field for New Zealanders to let all people regardless of their level of income to be able to get a tertiary education. That is a very fair system. Of course everyone has to pay the money back and what this bill is about is making sure we can be much more efficient with that. 
What has not been fair in the past has been when people who have been able to manipulate their earnings whether they are in a trust or a company or through their superannuation scheme or through any other source of information have not necessarily been pulling their weight to pay their fair share of their income—which is what is contained in this bill—to repay their student loan. I think in that respect this does close a number of small loopholes in the scheme which on this side we are very happy to see. Because of that I think there is an alternative title to this bill of “Student Loan Scheme (A Glimmer of Fairness From The National Party) Amendment Bill”. 
Can I just—and I do not want to try the Chair too much—go back to the privacy issue because there were quite a number of submissions to the Finance and Expenditure Committee around that. One of them came from an organisation within my electorate of Mana the Whitireia Community Law Centre which did make a very strong submission against clause 34 the use of the exchange of private information and data matching. Can I take the opportunity to speak to that because in its submission to the select committee it did point out very strong opposition to that data matching because it did have reservations with that aspect of the bill. In particular it said: “… we are concerned about the potential breach of privacy over an individual’s personal information where data matching occurs.” 
If I can just carry on to another part of the bill where on point eight of the submission it said: “The Law Centre acknowledges that there are benefits to Government Departments sharing information however the more information that is shared leads to greater risks around an individual’s civil liberties and the reason for the information being provided by an individual.” So although the Chair might have been pulling me up in terms of going maybe outside the scope of some of those instances with the other agencies there is genuine concern out there in the community because of what has happened in the past around the security of the information that is contained in clause 34 around that exchange of information between the Inland Revenue Department and the New Zealand Customs Service. 
So I do reiterate my request to the Minister in the chair given the recent events and given the historical events around the exchange of information whether he can give us some kind of indication of what the Minister or the departments are doing around the security of information which I think is a very topical issue at the moment given what has happened at the Earthquake Commission.