Parker DavidHon DAVID PARKER (Associate Minister of Finance): This has got quite an interesting and somewhat convoluted history. Hon Michael Woodhouse: It's called a coalition agreement.Hon DAVID PARKER: The member said It's called a coalition agreement." Actually not quite. We discovered when the prior National Government signed up to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) that they were locking New Zealand into the screening of asset classes that were already in the Overseas Investment Act regime as at the time the agreement came into effect not at the time the agreement had been agreed in principle. When we came to power we found that the screening regime did not in effect cover forestry as it did not cover residential housing. And unless we change the Overseas Investment Act quickly New Zealand would effectively have had to pay a very high price to fix that because we would have found ourselves in breach of not just CPTPP but other agreements that leveraged off it that had been signed in earlier years including the free-trade agreement with China and various other free-trade agreements under the most favoured nation clause which carries the best investment protocols from subsequent agreements into earlier agreements.So we had two issues that we needed to resolve urgently. One was the inclusion of house sales because if we hadn't included that in the investment screening regime we in effect wouldn't have been able to later and we did that quickly. And the other gap was in respect of forestry. Now purchasers of freehold and leasehold interests in forestry were already included in the Act but forest registration rights under the Forestry Rights Registration Act were not. And by that time it was already clear that in order to avoid the Overseas Investment Act requirements relating to freehold and leasehold some overseas investors were already using the forest registration right path which was not regulated. A forest registration right can last for multiple rotations. It's not limited to a 30-year period or anything like that. So unless you had forest registration rights in the overseas investment screening regime for forestry there was effectively no control of it.The Government then moved to close that loophole and the member is right that there were negotiations with other coalition partners at that time. There were also discussions with the industry because the industry and other members have been right to point out that the forest-growing industry is dominated by overseas owners in New Zealand and has been for some decades. They were nervous that we were effectively going to close down that investment industry and they came to the Government and said "Look OK we accept you need forest registration rights within the new system but in order for us to agree that can you have a relatively light-handed approach to how you do give effect to the regulations under the Overseas Investment Act once they are put in there?" We agreed to that as a Government then and we brought forest registration rights within the ambit of the Overseas Investment Act. But then we had as the Hon Eugenie Sage noted a relatively light-handed approach and still have a relatively light-handed approach to their ability to get an approval under the Overseas Investment Act.Now because we've got them in the regime under our free-trade agreements we can change the rules about that in the future. We have actually preserved policy space for this Government or any future Government to address those issues. At the moment we aren't proposing to tighten those rules and we will be voting against the amendments that are on the floor here in respect of those issues. There are some other issues which have arisen since we introduced that relating to both carbon forests and the use of highly productive lands for forestry. And sometimes those overlap; mostly they don't. But if members want me to go into that more I'm very happy to give a more fulsome explanation of some of those other complexities but I won't do it on this particular call."