Shaw JamesHon JAMES SHAW (Associate Minister of Finance): If you'll allow me to pick up where the previous speaker Andrew Bayly left off about some of the important aspects of the Financial Markets (Derivatives Margin and Benchmarking) Reform Amendment Bill. I just wanted to acknowledge the previous speaker who gave I think a fairly detailed rundown of what's in the content of the bill. I just wanted to sort of lift it up—this being the third reading of this bill's passage through the House. So of course it will shortly become law.Andrew Bayly: Second readingHon JAMES SHAW: As the—sorry. I beg your pardon the second reading.Hon Members: Third.Hon JAMES SHAW: The key point that the previous—it is the third reading? All right I beg your pardon. You got it wrong Andrew.DEPUTY SPEAKER: It is the third reading. We are on the third reading.Hon JAMES SHAW: He had it wrong. Yes yes.DEPUTY SPEAKER: I'm saying that.Hon JAMES SHAW: I was getting confused. Yes I should always follow your guidance rather than an Opposition MP Madam Speaker. The point that the previous speaker was making was that the whole point of the bill is to enable organisations that are engaged in these cross-border transactions to have an ability to manage their risk including as he said the ability to actually take further risks if they want to but in an environment that enables that. Current regulation as it stands doesn't quite get there.So I think there are a couple of key points that I'd like to make about this particular piece of legislation which I think help to enable that environment. The first is—and again Mr Bayly referred to this—that what we're doing with this piece of legislation is really aligning the New Zealand regulatory environment to that primarily of the European and Australian environments with whom we've got quite close contacts and a generally accepted global regulatory environment. I do want to acknowledge the officials that have worked on this because this is a very complicated and technical area of regulation. To ensure that we are able to update our own regulation in a way that actually matches what's going on in the rest of the world and to attempt to keep pace with that is no easy task.I think actually one of the things that's going to have to happen of course is that as soon as this piece of work is complete we're going to have to be looking at what's coming next—what's coming down the pipeline—because certainly when it comes to financial services regulation always follows innovation. If you don't keep abreast of the innovation and you allow your regulation to stagnate at a point in time whilst things move on then you actually end up creating more instability in the market place. It can lead to the use of unregulated financial instruments which can lead to some pretty negative consequences the most famous of course being the global financial crisis that we all lived through in the not too distant past. So I say that both to commend the officials and to just to kind of put on the record that we cannot stop here. We actually need to keep up the work and make sure that we're not falling behind and that we're staying current not just of the rest of the international regulatory environment but of what's going on in industry as well.The third point that I'd like to make about this having spoken on this bill a number of times is that this is one of those pieces of legislation that does have unanimity across the House and that is significant when it comes to this form of regulation because what it means is that the markets are able to look at this and say that the will of Parliament is completely clear. There is no one who is questioning that this is the direction of travel that we have to go in. That means a much more secure operating environment for those businesses that are participating in the market. I think those things combined—the fact that we're bringing our legislation up to date with the international environment and the fact that we've got unanimity in the House on this particular piece of legislation—do actually create that environment for businesses to be able to say that they are able to manage their risk in a supportive environment. But I say that again with the caveat that this is essentially past-looking and it's saying well we are literally just catching up with where industry and other markets have gotten to. The risk always that we as a House need to manage and that the Ministry for Economic Development and Inland Revenue and so on and Treasury need to constantly monitor is what is going on in the market place that we need to stay abreast of. So I am pleased that we've managed to get to this point with this legislation. As Mr Bayly was just saying it is a very technical bill and not an easy one for people to follow but it is important because a good regulatory environment in this case enables a more secure financial environment and a more stable financial system for us all to operate within. That particularly given the current headwinds in the global economy I think is important for us to maintain. So with those thoughts I'd like to say again to the officials: thank you for your work. Thank you to the Finance and Expenditure Committee who have pored over this for many hours and to the submitters. I think that what we've got here is a good piece of legislation; I commend it to the House. Thank you Madam Speaker.