Bayly Andrew; Parker DavidANDREW BAYLY (National—Port Waikato): Thank you Mr Chair. I want to turn to the question of the New Zealand Consumers Price Index which underpins a number of the benefit increases particularly with the Best Start tax credit and the family text credit etc. In clause 13(1) as the Chair will know it is proposed to replace section MF 7(1)(a)(i) with correspond to the movement in the New Zealand Consumers Price Index after the quarter ended … 30 September 2021 that has not yet been taken into account by an increase:". So the big question here is: previously it was pretty clear what the Consumers Price Index (CPI) was specifically and all groups excluding cigarettes and other tobacco products measure. So what has happened in this bill is that we're going to revert back to a CPI—a Consumers Price Index—which I'm not quite sure whether it includes tobacco or not because it just seems to talk about a generic Consumers Price Index. I understand that the rationale for the change is that there was a discontinuance of the annual tobacco excise tax increase that occurred at the end of 2020 and that seems to be the reason why we're reverting back to a Consumers Price Index which is the way it's referenced here in the actual bill.So what I'd appreciate from the Minister is: does it include tobacco? Because whilst there may no longer be an annual tobacco excise tax because that was discontinued the fact is that if you go into any corner store the price of tobacco could be and has been subject to significant price increases. So is tobacco included—and cigarettes—and if not what is included in the Consumers Price Index and is it the standard measure of the Consumers Price Index or have we got something that has been tailored to this arrangement? Because I think in terms of the people that will most benefit from these benefit increases having a clear understanding of the nature of the types of basket of products and services that are taken into account in the Consumers Price Index is a pretty important aspect to be considering. So I'd very much appreciate the Minister's view on that and what other advice he may have received from officials as to other more appropriate alternative indexes to use in terms of continuously reassessing the inflation component of compulsory increases in these benefits. As he knows once inflation breaches or exceeds a 5 percent increase that triggers an increase and that's why we're seeing these changes come through in this piece of legislation tonight. But obviously there's a wide range as he's aware he's got the producer price index which probably more likely is about 15 percent inflation rate at the moment and there are many types of CPI.So to what extent did he receive advice on it? What other options were considered? And how do we know that this is an appropriate mix and whether in fact it does include tobacco and cigarette products? So I'm looking forward to his response on those issues. Hon DAVID PARKER (Minister of Revenue): I'll do my best to answer that question. As it happens Corin Higgs the adviser in my office has got a Master's in the Consumers Price Index and I suspect he's still in his office so if I get this wrong he'll send me a text. That's the first time that I've put his name on Hansard and he deserves to be there.The member is correct that the Consumers Price Index (CPI) measure is changing to reinsert cigarettes. The reason that it was previously excluded for a period was the last Government—National Party and the Māori Party—decided to significantly increase excise duty on tobacco as a price-based measure to discourage tobacco use. It was thought at the time with some justification that if you just flowed that through to compensatory adjustments to benefits the price effect would be muted and therefore it wouldn't have the desired health outcome which is a reduction in the consumption of cancer-causing cigarette products. That particular policy has now moved through the system and that change to the CPI measure is no longer appropriate going forward therefore cigarettes come back into the CPI measure that is used."