Volume 655 Week 17 - Thursday 2 July 2009 
Volume 655 Week 17 - Thursday 2 July 2009 
[Volume:655;Page:4875] 
Thursday 2 July 2009 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Business of Select Committees 
Meetings 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 I seek leave for the Foreign Affairs Defence and Trade Committee to meet outside New Zealand with its counterparts in Tonga Samoa Niue and Rarotonga from 7 July to 10 July 2009 as part of its inquiry into New Zealand’s relationship with South Pacific countries. Mr Speaker you will be aware that the select committee is travelling with the Prime Minister next week. 
Mr SPEAKER 
: Is there any objection to that course of action being followed? There is none. 
Business Statement 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 The House goes into adjournment from today for the next 2 weeks. When the House resumes on 21 July the Government will make progress on the first readings on the Order Paper complete the Disputes Tribunal Amendment Bill and advance the Committee stages of the Immigration Bill and the Building Amendment Bill (No. 2). 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 Could the Leader of the House tell us when he is likely to make time for the Minister of Health to make a ministerial statement updating the House on his management of the swine flu given that he has discontinued his practice of nightly updates to the media now that he is unable to contain the swine flu and given the concerning reports that greater numbers of people are being admitted to Wellington Hospital than are being admitted in the entire state of Victoria? 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 Although that request does not particularly relate to the business of the House I can assure the member that the Minister of Health ensures that there are daily updates on the Ministry of Health website on the progress of the management of the swine flu. The matter of a ministerial statement of course is up to the Minister. 
Marriage of Speaker 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 Mr Speaker I wonder whether I might take a moment on behalf of this side of the House to offer you and Alexandra our very very best wishes for your forthcoming wedding on 4 July. I do not think a Speaker has got married during his time in the Chair in the history of the New Zealand Parliament; certainly there has not been a celebration of this type by a Speaker during his time in the Chair. I would also like to congratulate you on choosing 4 July for the occasion. It will ensure there are fireworks somewhere in the world to celebrate that particular day! We offer you our very very best wishes for your future life with Alexandra. We wish her all the best. She knows what she is taking on with you and she is a lucky woman as you are a lucky man. With that regard we give you our very best wishes and we hope you enjoy your day. 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 Mr Speaker the Opposition could not let this opportunity go without joining with the Government in wishing you and Alexandra a very joyful wedding with your family and friends. I hope that you are able to hear the vows on Saturday and that you will be over your flu. We hope you have a very long and happy marriage. On behalf of the Opposition best wishes from all of us. 
Mr SPEAKER 
: Honourable members I thank you most sincerely. I feel very humbled. The Hon Annette King mentioned my health problem. My ears are still terrible; I have 2 days to get them right. I hope that by Saturday morning I can hear. I thank honourable members very much. I feel very humbled. 
Questions to Ministers 
Government Expenditure—State Sector Pay Settlements 
1. AARON GILMORE (National) 
 to the  
Minister of Finance 
: How is the Government’s budget affected by State sector pay settlements? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The Government now faces 10 years of deficits including the largest structural deficits the country has seen for decades. Both the Government and the public sector owe it to those people who are dependent on public services to achieve the Government’s aim of providing smarter better public services with limited funding. State sector pay settlements therefore need to take account of fiscal constraint and of the need to develop better ways of working so we can meet public expectations of service without rapid growth in expenditure. 
Aaron Gilmore 
: Has the Minister received any reports on recent pay rises in the State sector? 
Hon BILL ENGLISH 
: The Government has stated a number of times that it would honour those agreements that were entered into in pay rounds before the change of Government. I have seen reports that for instance senior doctors received a 4.25 percent pay increase on 29 June. Alongside their automatic moves up the scale this amounts to a total pay rise of $11000 a year for senior doctors. Nurses received a 4 percent increase in March alongside automatic progressions. Under his or her contract the average nurse is receiving a pay increase of around $6000 a year. In the current climate most New Zealanders are receiving little or nothing extra. No one should take those pay increases as an indication of settlements in the near future. They are legally binding agreements that the Government will stick to but we have made it clear that that kind of pay rise is no longer sustainable. 
Aaron Gilmore 
: Has the Minister received any reports on pay movements in the private sector? 
Hon BILL ENGLISH 
: It is a little more difficult to get detailed information on private sector pay increases but there are a number of reports on organisations that have for instance frozen their wages such as Sealord’s ASB the New Zealand Rugby Union and several media organisations. Many New Zealanders see State sector workers as having relatively secure jobs and would be concerned if the representatives of State sector workers were out of touch with what was going on in the wider community and the private sector. 
David Garrett 
: Has the Government considered performance-based pay with financial penalties for chief executives such as Mr Barry Matthews as planned in the contracts for privately managed prisons; if not why not? 
Hon BILL ENGLISH 
: The Government will consider any arrangement that will enable us to provide smarter better public services with limited new funding. The State sector has been used to having compound increases of around 8 percent a year. In the Budget the Government signalled that next year there will be only a $1.1 billion increase in the operating allowance. We have given the whole public sector 12 months’ notice that it needs to be looking at a much wider range of tools to be able to secure productivity gains and to meet public expectations without large and reckless spending increases. 
Grant Robertson 
: Does the Minister accept that imposing a pay freeze will actually make it harder to provide the smarter better public services that he wants because it will be harder to retain and recruit skilled staff in areas of essential need where there is international demand such as that for nurses and social workers? 
Hon BILL ENGLISH 
: The member is showing how completely out of touch the Labour Party is with the real world. The fact is that turnover rates in the public sector have dropped to historical lows and it is going to be necessary to ensure that any pay increases are met with productivity gains. Productivity in the public sector over the last 7 or 8 years has been appalling. That will have to change because if it does not change we will not be able to offer the range of services that the public deserve. 
Grant Robertson 
: Can the Minister confirm that he is signalling to primary and secondary teachers and to nurses that they can expect no pay increases when their collective contracts expire in 2010; if so what does he expect will be the result of that signal? 
Hon BILL ENGLISH 
: Nurses and teachers would be regarded by the public as having among the most secure jobs in the economy right now. We are signalling very clearly that there will be restrained funding and those professional groups whose dedication we admire and whose services we need have the opportunity to think about better ways of working. But the days of going to Ministers and getting large increases at the expense of the taxpayer without any productivity gains are over. 
Food Labelling—Country of Origin 
2.  
SUE KEDGLEY (Green) 
 to the  
Minister of Consumer Affairs 
: If country-of-origin labelling remains voluntary for single-ingredient foods—such as fruit vegetables meat and fish—then how will the Government guarantee that all such labels are fair and accurate? 
Hon HEATHER ROY (Minister of Consumer Affairs) 
: 
 The accuracy and fairness of country-of-origin labelling like the labelling of other goods is regulated by the Fair Trading Act. This requires that information about goods must not be misleading or deceptive. 
Sue Kedgley 
: Is it not the case that if labelling remains voluntary and there are no minimum mandatory standards that retailers are required to meet there will actually be no way of guaranteeing that unscrupulous retailers do not mislabel imported products as products of New Zealand and there will be no way of ensuring that the more than 1000 retailers of fresh food actually bother to label their fresh produce? 
Hon HEATHER ROY 
: We are a small reasonably well-educated economy. We are often able to achieve through voluntary means what other jurisdictions can achieve only through compulsion. The industry has shown as indicated a willingness to participate in a voluntary code; in fact some supermarkets have already started. Given that there is increasing demand from the public to know where their food comes from I put this issue on my work plan in January this year. Subsequently the Prime Minister asked me to progress work on voluntary country-of-origin labelling of wholefoods and I have set up a working group to explore the options around this issue. The working group is led by me. Its other members are the Minister for Food Safety the Minister of Agriculture and the Minister of Trade. Our respective officials have begun work and have been in discussions with retailers. 
Sue Kedgley 
: Why when country-of-origin labelling is mandatory for clothing footwear and wine should it be voluntary for food especially when other food labelling such as ingredients and nutrition labelling is mandatory and underpinned by a regulatory standard? 
Hon HEATHER ROY 
: My understanding is that the mandatory requirement for clothing and footwear to be labelled was an initiative that was put in by a previous Government quite some time ago in the early stages of a “made in New Zealand” campaign. Things have moved on significantly since that stage and as I indicated in my last answer due to an increasing demand from the public to know where their food comes from I have put the issue on my work plan. A working group is dealing with the issue now. 
Sue Kedgley 
: Why when she is Minister of a department whose main role is to encourage the provision of accurate information between suppliers and consumers would she not support consumers’ right to know where their food comes from and to be confident that labels are fair and accurate especially when point-of-sale labelling of fresh foods is very easy and cheap to implement? 
Hon HEATHER ROY 
: The reason I set up a working group is to explore the issues. We want to see consistent guidelines put in place so that it is easy for retailers to conform in a voluntary capacity. I have every confidence based on discussions that I have had to date with retailers that they are willing to put things in place. It is important in my position as Minister of Consumer Affairs to ensure that information is easy to access for consumers. I am confident that a voluntary regime—as supported by the Labour Party the National Party and the ACT Party—is enough to cover this issue. 
Sue Kedgley 
: I seek leave to table a document showing 47 countries that have mandatory labelling of fresh produce. 
Mr SPEAKER 
: And the source of the document? 
Sue Kedgley 
: The source of the document is a Horticulture New Zealand report. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Banking Sector—Minister’s Statement 
3.  
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: Does he stand by his statement that “taxpayers are supporting the banks and we want the banks to be able to demonstrate that they are going to support businesses and households through a tough time in the economy even if it affects their profits a bit”? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes. 
Hon David Cunliffe 
: Has the Minister in reaching his view that a select committee inquiry into banking is unnecessary taken into account the view of the 86 percent of respondents to a Manufacturers and Exporters Association survey who say they want a public inquiry to establish whether they are being overcharged interest on their business loans at a time when many can barely afford to make their next GST payment? 
Hon BILL ENGLISH 
: The matter of whether there was an inquiry was a matter for the committee. But as I understand it the committee was not going to be inquiring into the issues that the member raised. I tell him that if grandstanding and hand-wringing fixed problems then interest rates would not have reached record levels under Labour. 
Amy Adams 
: How do current home mortgage interest rates compare with those of the past 10 years? 
Hon BILL ENGLISH 
: Reserve Bank data shows that the average floating first mortgage housing rate for new customers in May this year was 6.41 percent. In May 2008 the average rate was 10.9 percent the highest interest rate in more than 10 years. Of course the people now saying you can fix interest rates with an inquiry did nothing about record rates then and those record rates had a big impact particularly on our export sector. 
Hon David Cunliffe 
: As the Minister seems willing to confuse the level of interest rates with interest rate margins has he taken into account the publicly expressed view of the Governor of the Reserve Bank that the proposed inquiry should proceed and that there has been an unexplained hike in the margin spread between the official cash rate and short-term interest rates up to 275 basis points? Has he also taken into account the views of the chief executives of the ANZ National Bank and the BNZ who have publicly supported the inquiry proposal? 
Hon BILL ENGLISH 
: The committee made its decision about the inquiry. I assure that member that actually people in the real world are worried about the absolute level of interest rates more than the margins. Of course the absolute level of those interest rates is much lower now than it was when he was in charge. If he could have lowered them with an inquiry why did he not do it then? 
Hon David Cunliffe 
: If the Minister believes that the committee has made up its own mind has he had any contact with the Finance and Expenditure Committee chair Craig Foss on the matter in recent weeks noting that Craig Foss has said there is “a lot more communication going on with senior banking industry figures”; if so has he received any new information from the banks their Australian parents or the Australian Government and did this information assist him to change his mind on an inquiry? 
Hon BILL ENGLISH 
: The inquiry was a matter for the committee. I have made it plain to anyone who will listen that our top priority is to ensure that banks keep lending because when they stop lending people lose jobs. There is some argument to be had about margins that apply to a very small amount of the lending they do but we want to maintain the advantage New Zealand has of a stable banking system which is rare in the world at the moment and can make sure the banks keep lending to businesses which can keep employing people. Grandstanding over an inquiry about a marginal issue is the proper role of the Opposition but it has no impact on economic policy. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. I expect you will know what the point of order is. The Minister has not attempted to address the process question that I just posed to him which was whether he had had any contact with the Finance and Expenditure Committee chairman with the banks with their parents or with the Australian Government. He did not attempt to address that question. 
Mr SPEAKER 
: I hear the point the honourable member is making. I could have assisted the honourable member far more if he had asked just that question. If the honourable member wanted that question answered he should have just asked whether the Minister had had any contact with the chair of the select committee. Then we could have had an answer. But no the member went on and added at least three other questions that I heard. There is no way I can assist him in getting an answer to whichever bit of the question he particularly wanted answered. I think that is an object lesson in how to keep his question to the point if he wants it answered. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. It may assist the House and the Minister if I were to reread a more truncated version of the same question. 
Mr SPEAKER 
: Forgive me but I cannot give the honourable member that benefit this time around; but does the member have a further supplementary question? 
Hon David Cunliffe 
: Has the Minister taken into account the views of the Productive Economy Council which points out the irony of the Government spending $9 million on a smacking referendum that it plans to ignore while deeming unnecessary a banking inquiry that affects many thousands of hard-working New Zealanders potentially paying too much for their mortgages and business loans? 
Hon BILL ENGLISH 
: I understand that the Productive Economy Council consists of one person. But nevertheless the overriding issue for all New Zealand businesses and households is that there is an adequate supply of credit and that the banks are able to keep lending. The select committee came to its own conclusion about an inquiry. The inquiry seemed to be focused on a very limited aspect of what is going on at the moment. I can assure anyone in the productive sector that this Government is working a lot harder than the previous Government to provide a better environment for them because we understand what they need whereas the previous Government did not. 
John Boscawen 
: What options if any does the Government have to tell the ANZ that it should not bully its elderly customers who wish to accept ING’s offer into waiving their legal rights to obtain proper redress through the Commerce Commission or does he think that this sort of behaviour is acceptable on the part of the ANZ? 
Mr SPEAKER 
: I will leave it up to the Minister to assess whether that question is consistent with the primary question. 
Hon BILL ENGLISH 
: As I think I said to the member yesterday we would certainly sympathise with older people who have lost their savings through bad advice bad choices or bad management of those savings. The Government does not have any legal means of determining the way the ANZ should behave in these circumstances. 
Hon David Cunliffe 
: Is the Minister of Finance therefore saying—when Government members of the Finance and Expenditure Committee initially proposed a narrow inquiry and the Opposition proposed broader terms of reference but later compromised and said it would accept either but Government members voted against both including their own—he would support broader terms of reference and reconsider the Government position on that basis? 
Hon BILL ENGLISH 
: No. 
Hon David Cunliffe 
: Does the Minister agree with Don Nicholson the President of Federated Farmers that “Small businesses … are paying a lot of money for their working capital funding so I’m not sure what took the steam out of the sails of the committee.” or with banking union FinSec: “What this shows is that the Government is either impotent or in the pocket of the Australian banks.”? 
Hon BILL ENGLISH 
: I almost always agree with Don Nicholson; he is a constituent of mine and a fine man. I have met with FinSec members a couple of times over different issues; I agree with some of what they say but not all of what they say. 
Auckland—Progress on Public Transport Projects 
4.  
NIKKI KAYE (National—Auckland Central) 
 to the  
Minister of Transport 
: What progress has been made on advancing public transport projects in Auckland? 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 I am pleased to report that the Auckland Regional Council and the New Zealand Transport Agency have reached agreement to advance a range of public transport projects in Auckland that were to have been funded by the Auckland regional fuel tax. New and improved rail stations including those planned at New Lynn Manukau Onehunga Grafton and Avondale will receive a subsidy of up to 60 percent from the New Zealand Transport Agency. In addition the New Zealand Transport Agency will pay for 60 percent of the outstanding work on the Newmarket station and make a $5 million contribution to work already done. The agency has also agreed to lend the Auckland Regional Council $33 million for the purchase of new diesel trains to cater for growing patronage until the electric trains arrive. I note that this has all happened without saddling the people of Auckland with an extra 9.5c per litre regional fuel tax. 
Nikki Kaye 
: How is the Government going to purchase electric commuter trains for Auckland now that the 9.5c per litre fuel tax has been cancelled? 
Hon STEVEN JOYCE 
: The Government is committed to the electrification project. The Ministry of Transport is currently investigating various options for the purchase of electric trains in Auckland. These include the Crown increasing investment in KiwiRail KiwiRail borrowing the money and the Crown providing an additional direct passenger subsidy until patronage increases or some form of public-private partnership most likely on an availability basis. We must ensure it goes ahead in a way that meets the needs of Aucklanders and ensures the most efficient use of taxpayers’ funds. 
Phil Twyford 
: When the Minister told the select committee this morning that funding for the purchase of Auckland’s trains was outstanding how much is the Government contributing and when will that money be provided? 
Hon STEVEN JOYCE 
: As I said in answer to the previous supplementary question we are currently working on a number of options and that decision is yet to be made. 
Phil Twyford 
: When the Minister cautioned the select committee this morning that integrated ticketing systems can end up in budget blowouts just how much of the estimated $100 million cost is he planning to contribute and what guarantees can he give this House that the information technology component will be kept under control? 
Hon STEVEN JOYCE 
: Personally none. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. This is a relatively simple point of order. That member is a new Minister but he cannot give personal answers in this House. He must answer as a Minister and not give his personal views. 
Mr SPEAKER 
: I hear what the honourable member is saying. I assume the Minister was speaking as Minister but he should correct that answer and make it clear what his answer meant. 
Hon STEVEN JOYCE 
: As a Minister I am also contributing nothing. If there are any funds to be contributed—and there will be—they will be contributed by the New Zealand Transport Agency. 
Nikki Kaye 
: What work is being done to introduce integrated ticketing to Auckland? 
Hon STEVEN JOYCE 
: Again I am pleased to report that the New Zealand Transport Agency and the Auckland Regional Transport Authority are working together on developing a sensible integrated ticketing system that balances the needs and conveniences of commuters with what is affordable. I commend their cautious approach and I note that the sums of money involved and the potential for cost escalation have been viewed nervously by all participants. The New Zealand Transport Agency will provide financial assistance at the same rate as for other public transport projects. 
Foreshore and Seabed Act Review—Maori Response 
5.  
TE URUROA FLAVELL (Maori Party—Waiariki) 
 to the  
Attorney-General 
: What response has he received from Maori to the report of the ministerial review panel on the Foreshore and Seabed Act 2004? 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 I have received a lot of feedback from Maori and non-Maori alike—too much to list here. I note the response of the Maori Party co-leader Tariana Turia who described it as a turning point from “the conflicts and divisions of the past five years”. I also note the comments made by the Leader of the Opposition who stated his party would act constructively over the review and I very much look forward to engaging with the Labour Party on this issue. I endorse the comments made by the Maori Party co-leader Pita Sharples yesterday that public access to the beach had never been an issue “as far as Maori were concerned”. But the fact that it has caused so much angst is why public access must be enshrined. 
Te Ururoa Flavell 
: How will the Government ensure that a conversation can be held between Maori and non-Maori on this issue so that the country can move forward together? 
Hon CHRISTOPHER FINLAYSON 
: I think it is important to emphasise that the report is just the latest stage in the ongoing conversation between Maori and non-Maori since 2003 but I think the panel’s report provides a real opportunity for Maori and non-Maori to continue that conversation. I very much appreciate the constructive way in which the Maori Party has raised the issue and I am confident that the Government with the Maori Party working alongside it will do all it can to ensure there is a just and durable resolution of this issue. 
Hon David Parker 
: Was the Labour Party’s submission to the ministerial review panel which advocated amending the legislation to restore the right of hapu and iwi to apply for customary title while preserving by statute public rights of access helpful in efforts to achieve a fair and durable solution? 
Hon CHRISTOPHER FINLAYSON 
: Yes I believe it was. The contribution of the Labour Party was valuable and I certainly think its ongoing contribution particularly through the member who asked the question will be very useful. 
Te Ururoa Flavell 
: Does the Minister have confidence in the robustness of the report and the panel members? 
Hon CHRISTOPHER FINLAYSON 
: I think the review panel did a very good job especially given the very tight time frame given by the Government. It has produced a robust report which gives the Government a very useful starting-point to enable all parties in this House and the wider public an opportunity to resolve this issue. 
Hon Nanaia Mahuta 
: Can the Minister confirm that the current legislation already guarantees public access to the foreshore and seabed; and will iwi who have substantial Treaty claim interests—including their harbours foreshore and seabed—such as Hauraki be able to negotiate a remedy under the Treaty settlement process or will they need to wait for the Government to respond to the report of the foreshore and seabed review panel? 
Hon CHRISTOPHER FINLAYSON 
: I certainly agree that the current legislation did address the issue of access and I would like to think that as a result of this report beyond peradventure the question of public access to the foreshore and seabed is no longer an issue that shall we say certain parties in this country will be able to raise in a mischievous way. 
Hon Nanaia Mahuta 
: Does the Minister intend to lift the cap on Treaty settlements in light of the foreshore and seabed review panel recommendation? 
Hon CHRISTOPHER FINLAYSON 
: The whole question of Treaty settlements which this Government is very committed to is one that I am addressing every day. In general terms I am not in a position to answer that question at this time. 
Adult and Community Education—Workforce Upskilling 
6.  
Hon MARYAN STREET (Labour) 
 to the  
Minister for Tertiary Education 
: What reports has she received on the need to upskill the workforce to assist in job placement? 
Hon ANNE TOLLEY (Minister for Tertiary Education) 
: 
 I have received a number of reports that recognise that upskilling the workforce is important in order to ensure we are in a position to take advantage of the economic upturn. That is why this Government increased the spending on tertiary education in Budget 2009 from $2.66 billion to $2.78 billion. 
Hon Maryan Street 
: What does the Minister say to Sandy Gibbs of Wellington who said on 18 June that adult and community education was a last chance for her to gain qualifications and a profession leading to the establishment of a graphic design business and that “I feel very strongly that these classes provide people with the means not only to gain confidence but to study and go on.”? 
Hon ANNE TOLLEY 
: I would say to Sandy that this Government remains committed to adult and community education and that is why we are spending $124 million over the next 4 years. That money will be spent on the priority areas of literacy language numeracy and foundation skills. 
Hon Maryan Street 
: When the Minister said yesterday at the Education and Science Committee that difficult economic times made her choose between funding adult and community education and getting a young person into a more vocational polytech course did she factor her refusal to extend the caps on student numbers at polytechs into that equation; if she did where does she expect the 6000 to 8000 students who are likely to be turned away from polytechs over the next year to go to for their upskilling opportunities? 
Hon ANNE TOLLEY 
: As I said to the member yesterday at the select committee she should not rely on projections that are based on April enrolments. They have proved to be unreliable in the past sometimes quite spectacularly so. As I said to the member yesterday this Government is watching the enrolments in tertiary institutions very carefully. I am reporting to Cabinet and the Prime Minister on a regular basis and I am in constant touch with the technology institutes and polytechnics sector in particular. 
Colin King 
: What areas has she targeted for additional spending in Budget 2009? 
Hon ANNE TOLLEY 
: The Government has put an additional $11 million into the Workplace Literacy Fund over the next 2 years. This will mean that for the next 2 years we will fund 4500 places through that fund. That compares with the previous Government which in good times could fund only 3000 places. Decisions like this show that we are committed to helping workers to gain the skills that they need in order to succeed and to produce the increases in productivity that the country needs. 
Hon Maryan Street 
: Does the Minister stand by her statement to the select committee yesterday that the chief executive officers of polytechs are inflating the number of students they expect to have enrolling at their institutions in the next 6 to 12 months; if so why does she think they are doing that? 
Hon ANNE TOLLEY 
: I do not accept that member’s assertion. That is not what I said to the select committee. What I said was that the projections that the chief executive officers were making were unreliable and that in the past they have proved to be so. The April enrolment figures cannot be taken as and have been shown in past years not to be a good indicator of the enrolments for the rest of the year. 
Defence Review—Public Consultation 
7.  
TODD McCLAY (National—Rotorua) 
 to the  
Minister of Defence 
: What steps is the Government taking to ensure that New Zealanders can have their say in the current defence review? 
Hon Dr WAYNE MAPP (Minister of Defence) 
: 
 Last Friday the Associate Minister and I launched the public consultation phase of the defence review. The public has until 24 August to make its views known. I should note that this is the first defence review for more than 10 years and it will in fact be the very first time that the public has had a direct say in a defence review. 
Todd McClay 
: How will this consultation be undertaken? 
Hon Dr WAYNE MAPP 
: At the launch last week the Associate Minister and I released a public consultation document for comment. This will be widely available in libraries and online at www.defence.govt.nz. There will also be eight to 12 public meetings so that the public can have its say directly. The Associate Minister will be leading that phase. For instance next Thursday the Centre for Strategic Studies at Victoria University is hosting a day-long seminar for defence experts to discuss the review. 
Todd McClay 
: What other measures is the Minister taking to get wide-ranging input into the defence review? 
Hon Dr WAYNE MAPP 
: The defence review includes an independent panel comprising Mr Simon Murdoch; Martyn Dunne the former major-general; and Mr Rob McLeod. They have been appointed and have already met with the review team and Ministers. Independent advice is also being sought on procurement given the Auditor-General’s report of last year. The outcome will be a thorough and comprehensive review and is intended to place defence on a sound footing for the next two decades. 
Pay Equity—Minister’s Statement 
8.  
SUE MORONEY (Labour) 
 to the  
Minister of Labour 
: Does she stand by her statement in the House on Tuesday when she said: “The law is clear: people cannot be discriminated against because of their gender. The standard is equal pay for equal work.”? 
Hon KATE WILKINSON (Minister of Labour) 
: 
 Yes. 
Sue Moroney 
: Will the Minister then advise the Minister of Education to implement the findings of the school support workers pay equity investigation which found that jobs in this female-dominated occupation paid $8 less per hour at the start rate than jobs in a male-dominated workforce with the same level of skills responsibilities demands and working conditions; in other words will she fix this unequal pay for equal work? 
Hon KATE WILKINSON 
: If there has been a breach of the Equal Pay Act remedies are available under the Act. The employee is entitled to make a complaint either under the Equal Pay Act or the Human Rights Act. 
Sue Moroney 
: If as the Minister herself said on Tuesday the standard is equal pay for equal work— 
Hon Dr Nick Smith 
: What’s the question? Start with a question word. 
Sue Moroney 
: —I said “if”—will she instruct the Minister of State Services to reinstate the pay equity investigation for social workers at Child Youth and Family where men are paid 9.5 percent more than their women colleagues or is she happy for her Government to be one of those unscrupulous employers she referred to in Parliament on Tuesday? 
Hon KATE WILKINSON 
: I refer to my previous answer. The same answer applies to that question. 
Sue Moroney 
: I raise a point of order Mr Speaker. I referred specifically to the Minister’s own statement in the House on Tuesday. She has failed to address the question of why if her assertion is that the standard is equal pay for equal work she will not instruct the Ministers. Why will she not address the question? 
Mr SPEAKER 
: I apologise to the honourable member for repeating this but if she reflects back on her supplementary question she will see that if she had asked the question in her point of order and only that question then it would be much easier for the Speaker to assist her. The dilemma was that the tail part of her question—if I remember correctly—put in a bit about whether it was part of the Government being irresponsible or something along those lines. When a member does that he or she cannot expect a question to be addressed absolutely because he or she has added political content to it and will get a political answer. If the member asked the simple question then I would assist her every time if I could but not when political content is added. That gives the Minister an out. 
Catherine Delahunty 
: Tena koutou. Does the Minister think it is appropriate for her department’s staff to be issued with a directive that participating in a lunchtime rally on pay equity for public servants “may therefore call into question our role as public servants” and can she comment on what kind of precedent that is in a democracy? 
Hon KATE WILKINSON 
: That is a matter for the chief executive. It is an operational matter. He is following State Services Commission guidelines which are there to safeguard the political neutrality of the Public Service. 
Grant Robertson 
: Did the Minister or her office have any contact with the chief executive of the Department of Labour about staff attending the pay equity rally on Tuesday? 
Hon KATE WILKINSON 
: As I said it was an operational matter. I made no directive. 
Hon Ruth Dyson 
: Yes or no? 
Hon KATE WILKINSON 
: No I did not have discussions with the chief executive about whether staff should attend the rally. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. It was a very tight question from Mr Robertson. It asked whether the Minister or her office were in contact. She said that she had had no contact but she did not refer to her office. I accept that we cannot have two legs but I do not think we could have a simpler question than that for a Minister to answer. But she avoided answering what is now becoming apparent. 
Mr SPEAKER 
: I have to say in fairness on this occasion that I thought the Minister gave a pretty reasonable answer. I accept the technical point the member has made but I thought the Minister was pretty upfront in answering the fundamental part of that question: whether she had any contact with the department over that matter. She answered that question very clearly to the House. In respect of the other part of the question I think had it been a primary question there would have been no problem but with a supplementary I think the Minister did answer the question within the Standing Orders. 
Sue Moroney 
: Why did the Minister say on Tuesday during oral questions: “If Labour members have evidence that women are being paid less only because they are women … they need to bring that evidence forward.” yet today she is shirking her responsibility to do anything about it? 
Hon KATE WILKINSON 
: As I said on Tuesday and as I have said today if there has been a breach of the Equal Pay Act there are remedies under that legislation. The employee is entitled to make a complaint under either that legislation or the human rights legislation. 
Hon Trevor Mallard 
: Did the Minister’s office have contact with anyone in the department about departmental officials attending the rally this week? 
Hon KATE WILKINSON 
: To the best of my knowledge no. 
Catherine Delahunty 
: I seek leave to table an email from the Deputy Secretary Corporate of the Department of Labour to all Department of Labour staff. 
Mr SPEAKER 
: Leave is sought to table an email from the Deputy Secretary of Labour to the staff. Is there any objection to that document being tabled? There is no objection. 
Document by leave laid on the Table of the House. 
Water Research Strategy—Role of DairyNZ 
9.  
JEANETTE FITZSIMONS (Green) 
 to the  
Minister of Research Science and Technology 
: What advice has he received on the potential conflict of interest of industry representative DairyNZ being contracted to produce the Government’s Water Research Strategy? 
Hon Dr WAYNE MAPP (Minister of Research Science and Technology) 
: 
 I have received advice from the Foundation for Research Science and Technology relating to the draft Water Research Strategy. The strategy is to assist the foundation in its investment in water research. As the member has already been advised the foundation contracted with DairyNZ to secure the services of Dr David Johns to act as a facilitator during the preparation of the draft Water Research Strategy. Prior to taking up his position with DairyNZ Dr Johns had been employed by the foundation for 5 years as its general manager of investment strategy. The conflict of interest potential has been carefully managed through consultation with major stakeholders before Dr Johns was engaged and through working the whole process through a governance steering committee to which Dr Johns reports. 
Jeanette Fitzsimons 
: Now that the Minister has confirmed that actions to manage the conflict of interest arising from the uncontested contract worth up to $100000 being given to DairyNZ include consulting stakeholders to ensure there are no objections which environmental and recreational non-governmental organisations were consulted about the suitability of DairyNZ preparing the Government’s Water Research Strategy? 
Hon Dr WAYNE MAPP 
: I am advised that the advisory group that drew up the draft strategy had 10 members including three eminent water scientists and representatives from other stakeholders including Government departments regional councils and users. The draft water research strategy has been open for public consultation and is currently being finalised for submission to the foundation’s board. I also note that it is the Ministry for the Environment not Dr Johns or DairyNZ that has provided administrative support for the development of the strategy. 
Jeanette Fitzsimons 
: Can the Minister confirm that DairyNZ included no environmental or recreational non-governmental organisations in its email of 27 April requesting comment on the 10-year strategy? 
Hon Dr WAYNE MAPP 
: I am not able to confirm that point but I do notice that the advisory group as I have already informed the member was quite broadly representative. In any event the strategy is open now for public consultation. It is actually to support a research application that has been finalised for submission to the board of the foundation. 
Jeanette Fitzsimons 
: I seek leave of the House to table three documents. The first one is an email dated 27 April this year from DairyNZ to about a hundred stakeholders that invites input but excludes any environmental or recreational non-governmental organisations. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is none. 
Document by leave laid on the Table of the House. 
Jeanette Fitzsimons 
: The second one is a file note from the foundation exploring the conflict of interest issues and indicating that consultation ought to take place. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection to that? There is none. 
Document by leave laid on the Table of the House. 
Jeanette Fitzsimons 
: The third one is the contract for services which is between the foundation and DairyNZ. It lists a bunch of stakeholders who are to be consulted but again the list does not include any environmental non-governmental organisations. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is none. 
Document by leave laid on the Table of the House. 
Drinking-water Standards—Delay in Implementation 
10.  
BRENDON BURNS (Labour—Christchurch Central) 
 to the  
Minister of Health 
: What assurances can he give smaller New Zealand communities on the safety of their drinking water given that he has announced a 3-year delay in implementing minimum water quality standards? 
Hon TONY RYALL (Minister of Health) 
: 
 The assurance I can give is that the local councils which represent their local communities and are responsible for water supplies are well aware of their responsibilities to both consumers and ratepayers under the drinking-water legislation. 
Brendon Burns 
: Does the Minister agree with the Prime Minister who only today told Federated Farmers’ national conference that “in many parts of the country water quality is poor or deteriorating”; if so when will he uphold his ministry’s commitment to make water safe to drink for the one in five New Zealanders who are currently at risk? 
Hon TONY RYALL 
: Of course I agree with what the Prime Minister said. Local government is concerned about the impact of compliance on people’s rates and water charges at a time of considerable financial pressure. The local councils have told us that the cost of compliance would significantly exceed the previous official estimates of between $50 million and $275 million. Local government has suggested that the burden could be around $800 million. 
Dr Paul Hutchison 
: What response has there been to the Government agreeing to local body requests for additional breathing space? 
Hon TONY RYALL 
: Although there has been a trickle of predictable criticism there has been a flood of support from local authorities and communities from one end of the nation to the other. The President of Local Government New Zealand Lawrence Yule welcomed the decision as did the Mayor of Hurunui District who wholeheartedly welcomed it. The Mayor of Marlborough District also welcomed it and further said that the previous Government had gone over the top on this matter. The list goes on. The member’s own mayor told me that this move would be welcomed. 
Brendon Burns 
: What does the Minister say to the many small communities such as Cheviot in the Hurunui District of North Canterbury—to which he has referred—which for 5 years has had people getting sick with the result that the Canterbury Medical Officer of Health threatened earlier this year to shut down the water supply as a medical emergency? 
Hon TONY RYALL 
: These communities are represented by their local councils and these local councils have requested this action. The councils are worried about the huge financial impact on ratepayers during the worst recession since the 1930s. There is nothing to stop the councils from taking action. 
Brendon Burns 
: Does the Minister agree with the Minister for Regulatory Reform who has variously described the minimum drinking-water standards as “ridiculous” and as “inefficient and superfluous” regulation that needs to be removed? 
Hon TONY RYALL 
: It is not for me to disagree with the Minister for Regulatory Reform. I think Mr Hide is exactly right when he says that everyone is in favour of pristine water quality but that is not the question here. This is a matter of balancing the benefits and the risks with a significant financial impact on ratepayers during the worst recession since the 1930s. This position is overwhelmingly supported by the elected representatives of communities around the country. 
Youth Initiatives—New Programmes 
11.  
TIM MACINDOE (National—Hamilton West) 
 to the  
Minister of Youth Affairs 
: What examples can she give of new youth-focused programmes? 
Hon PAULA BENNETT (Minister of Youth Affairs) 
: 
 On Tuesday I met with a group of young people from On the Edge Trust. Those young people drove the iCAN initiative which in just 1 month collected over 54000 cans of food from school students which were eventually donated to the Salvation Army and city missions. They also set a world record for the biggest canned-food structure. I commend those motivated young people who took the initiative and got it all off the ground with no Government funding but who received heaps of community support. 
Tim Macindoe 
: Can the Minister give more examples of communities getting behind programmes they value? 
Hon PAULA BENNETT 
: Yes. Today is a big day in Opotiki which is a place I call the youth mural capital of New Zealand. It is a big day because the mural museum exhibit is opening three new murals are being launched the mayor is handing out certificates for the young artists and a film is being made of the day’s events. A cake stall last week raised $1300 to pay for a book about the murals. Although I am pleased that this project got under way with Government funding I am even more delighted that the community says that the funding ending has inspired the whole town to get behind this very special project and to make it its own. 
Jacinda Ardern 
: What youth programmes will the Minister call for the introduction of to assist the 32000 unemployed young people in New Zealand; or does she agree that the stalled emissions trading scheme and the Resource Management Act are sufficient given that these were both used by the Prime Minister as examples of the Government’s action on youth unemployment? 
Hon PAULA BENNETT 
: I know that that member has already proven to the House that she likes to pluck numbers out of the air so I certainly dispute her figure of 32000 young people who are unemployed. We currently have over 15000 young people though on the unemployment benefit. Those are young people aged under 24 years. This Government is certainly committed to engaging them. We have already seen a number of initiatives and industry partnerships and they will continue. 
Jacinda Ardern 
: Does she agree with the Prime Minister who when asked for explicit examples of what the Government had done to address youth unemployment stated that one of the fastest ways to see youngsters get an opportunity was the introduction of the 90-day probationary employment period; if so by what percentage can we expect unemployment to decrease as a result of this initiative? 
Hon PAULA BENNETT 
: Yes I certainly agree with our outstanding Prime Minister. I say that we are in a global recession and unfortunately what happens at such times is that unemployment goes up. Let me say that I have no doubt at all that the 90-day probation period gives a number of young people an opportunity to get into employment that they would have not had otherwise. We would have more young people on the unemployment benefit if it was not for that fantastic initiative. 
Tim Macindoe 
: What other reports has the Minister seen about youth programmes? 
Hon PAULA BENNETT 
: The  
Sunday 
 programme recently highlighted the Otorohanga trades training programme that the mayor and the town passionately support. Despite the impression given in that item the trades training project has secure funding from this Government until December and they had already been told that they would be funded until June 2010. 
Schools Secondary—Student Achievement 
12.  
KELVIN DAVIS (Labour) 
 to the  
Minister of Maori Affairs 
: Does he stand by his statement in the House on 23 June in relation to student achievement in secondary schools “if secondary schools will not step up and deal with that problem then we go elsewhere such as universities to deal with it.”; if not why not? 
Hon GERRY BROWNLEE (Leader of the House) 
 on behalf of the  
Minister of Maori Affairs 
: The Minister has made a number of statements recently on the need to increase the number of Maori completing degree qualifications and he stands by all of them. He is also of the firm view that student achievement at secondary school is a responsibility of those schools. 
Kelvin Davis 
: Does the Minister understand that many secondary schools may perceive his comments as him saying he has given up on those secondary schools that have difficulty raising Maori achievement? 
Hon GERRY BROWNLEE 
: No that is not what was said. What was laid out was a challenge for secondary schools to do better by the Maori students they teach at the present time. Any glance at the statistics will show the member just how big that challenge is. 
Kelvin Davis 
: What are his solutions to raising Maori achievement at secondary schools? 
Hon GERRY BROWNLEE 
: Secondary schools are like all schools in New Zealand and need to be in tune with the needs of their students. The Minister simply lays down the challenge for them to recognise that they need to do more to lift achievement among this particular sector of their student body. 
Road User Charges Amendment Bill 
First Reading 
Debate resumed from 30 June. 
Mr SPEAKER 
: When the debate was interrupted the Hon Darren Hughes was speaking. However I have been advised that this call will be a split call and that the Hon Annette King will take the remaining 80—8 minutes and 40 seconds. 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 You are feeling very generous today Mr Speaker! Mr Hughes our spokesperson on transport made a start in this debate on Tuesday evening. In his few brief minutes of speaking he expressed the Opposition’s concern that the Minister is requiring such a very short report back— 
Hon Gerry Brownlee 
: I raise a point of order Mr Speaker. I may have missed something here. I apologise to the member if I have just interrupted for no good reason but am I to assume that Mrs King is now taking the balance of the speech for another member? 
Mr SPEAKER 
: That is my understanding of the situation. As I understand it she is entitled to do that. 
Hon Gerry Brownlee 
: So it is a split speech? 
Mr SPEAKER 
: Yes indeed. I am sorry; I thought I had announced it as a split call. 
Hon Gerry Brownlee 
: I genuinely apologise to that member for not hearing that. I certainly would be appreciative if her time starts again. 
Hon ANNETTE KING 
: Thank you Mr Speaker. I am so happy the House is feeling incredibly generous today. I think it must reflect the fact that our Speaker is getting married on Saturday and that we are all feeling very joyous for him—especially those of us who have happy marriages ourselves. We genuinely hope that he has a wonderful day and a long and happy marriage. 
As I was saying Mr Hughes our spokesperson made a start in the debate on this bill on Tuesday. He had only a few brief minutes to speak but he raised a concern that I would like to repeat now which concerns the Minister’s requirement that there be a report back of this bill by 21 July. Of course that is a mere 19 days away and in the middle of that time there is a 2-week adjournment so Labour is very concerned that there is a very short time frame in which to look at this bill. In fact the Minister has given no justification and no explanation as to why he needs such a short time frame to look at this bill and we would like to note our concern at the process. We are happy to accommodate the bill and if he wants to talk to us about it we would certainly be very happy to do that. But we would have liked to know the whys and wherefores of the need for this bill to be rushed through in a mere 19 days. 
This bill the Road User Charges Amendment Bill proposes to amend the Road User Charges Act 1997 and it has two outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges. The second is to provide a 42-day notice of increases to the road-user charges to all diesel motor vehicle owners and to— 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: If members want to have a discussion would they please move into the lobbies. There is a lot of noise around and it is disturbing the member speaking. 
Hon ANNETTE KING 
: Thank you Mr Assistant Speaker. The second part of this bill is to provide 42 days’ notice of increases in road-user charges to all diesel motor vehicle owners and to minimise the potential revenue loss caused by pre-purchasing of road-user charges by the trucking industry following notification of an increase. The bill provides that a heavy vehicle road-user charge licence will expire 1 month after the increase comes into effect. 
We support both of these measures. We strongly support the removal of road-user charges from electric vehicles; it is a great idea. It reinforces a lot of the work that we as a Government did towards the introduction of electric vehicles in New Zealand. In fact when we issued the transport strategy last year part of that strategy was the inclusion of a commitment to electric vehicles. I have to say that at the time there was a certain amount of tut-tutting and pooh-poohing by the National Party about the importance of electric vehicles in New Zealand and the part such vehicles would play. I did point out that we were at that time making our own electric buses in Ashburton for example and that when we looked internationally we could see that the need for electric vehicles was growing and the commitment to them was growing. So when a Government puts together a long-term strategy it should include electric vehicles in it; I say to Dr Smith that I am glad that the National Government has seen the light of day and that it supports Labour in the commitment to enhance the manufacture and use of electric vehicles in New Zealand. We will see greater use of electric vehicles over the years to come and taking off road-user charges from those vehicles—certainly in the early days—I think will help towards that. 
The second part is around the area of road-user charges. If anybody knows this issue it is certainly me. If anybody knows the heat of this issue it is certainly me who as the previous Minister of Transport faced the revolt of truckdrivers when I put up road-user charges last year with no notice. Of course at that time I increased road-user charges because it had been my experience the year before when we had increased them—along with increases other motor vehicle owners had—that I had given a certain amount of notice only to see a lot of forward purchasing of road-user charge certificates. In fact a large amount of revenue to the Crown was lost through that forward purchase. It was made clear in my meetings at that time with the head of the Road Transport Forum the Hon Tony Friedlander that the forum would want to work with the Government to put in place a regime that was fair to the Government but also fair to the forum—to increase road-user charges without a great loss of revenue to the Crown but also with sufficient notice in particular to truckies who were purchasing the road-user charge certificates. So this bill actually addresses what came out of the inquiry I set up and it was announced by the new Minister of Transport in May this year. 
The working party report that was done on road-user charges recommended that 6 weeks’ notice be given of any future increases in road-user charge rates; in fact this bill gives 42 days’ notice of such an increase. But what is just as important is the provision that those who purchase road-user charge certificates in that time will have only 1 month to use them. So the bill will close the loophole whereby people could go out and pre-purchase a lot of road-user charges at an old rate thereby saving themselves money and then use them indefinitely until they ran out. Under this proposal people will be able to use them for up to 1 month and then if there are any left over they will get a refund. I think the bill has come up with a good solution. 
However we have a couple of questions that we would like answered in the select committee. We would like to know—and perhaps it will not be possible at that time to tell us but I hope it will be—how the legislation will actually work in practice. I mean a lot of these things sound good but I know that the Hon Maurice Williamson who has had something to do with this in the past knows that often we can make these changes only to end up creating even bigger problems. So I think we would like to know how this requirement will work and what it will cost—how many more staff will need to be employed will the legislation mean additional resources in the ministry in order for it to be implemented and what avenues will exist to enable trucking firms in particular to rort the system? Everybody is saying that we need to be fair to everybody but we do not want to see rorts in the system. And what would be the total leakage of funds that would not be gathered from the Government? Does the Government have any idea? One of the issues in this whole scheme has been the leakage of funds. 
I am pleased that the review supported the continuation of the road-user charge system. I think that it is in the main a pretty fair system; this bill will certainly help its fairness even more. Labour will certainly support the bill but we will be looking in the very brief time we have for some of those questions to be answered. 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I am very enthusiastic about supporting the Road User Charges Amendment Bill which has been brought to Parliament by the Hon Steven Joyce. About this time last year New Zealand was in gridlock as a consequence of the mismanagement by the previous Government of the relationship with the road transport industry over the issue of road-user charges. New Zealanders and truckies were angry that the previous Government had gone back on its word to provide notice of increases in the road-user charges and it was an issue that caused New Zealand great grief. The member who triggered that protest needs to take some responsibility for the way in which she mismanaged that issue and the way in which the new Minister is now fixing it up. 
I speak with particular enthusiasm about the exemptions from road-user charges that are provided in this bill for electric cars as an incentive for that new technology to be taken up. The provision in this bill very much provides a contrast between the approach of this Government and that of its predecessor. Let us remind ourselves of what the previous Government did around electric car technologies: it came out with a strategy. You see in every area that the previous Government moved there was always a strategy. There were dozens of them—hundreds of them! It had a strategy that 40 percent of the car fleet by 2040 would be electric. The problem: was there any element of policy that would actually achieve that? The answer is: not a single iota. We searched under the desks. We looked under the chairs. We looked in the nooks and crannies right through the Government bureaucracy to try to find whether there was anything the previous Government had to be able to meet this big bold target of 40 percent of the New Zealand car fleet being electric by 2040. The answer was that it was a hollow empty strategy without anything to achieve it. The second feature is that in so many areas of the climate change debate the previous Government went for regulation. It went for the good old nanny State. It decided to tell New Zealanders how to live their lives in so many ways. This bill contrasts with that approach. This bill tells people to look at the new exciting technologies out there like electric cars which provide a way forward for a cleaner transport fleet. We are not going to compel people to buy them but we are going to provide an incentive. This bill in exempting those electric cars from road-user charges for a period of 4 years—it would then be reviewed—is a good way in which to give a kick-start to those new technologies. 
I will debate for the House a number of the reasons why I think electric car technology has great potential. The first is that the electric motor is an order of magnitude more efficient than the internal combustion engine. A revolution occurred 100 years ago from the old steam engine that had about 6 percent efficiency to the internal combustion engine that had about 20 percent efficiency. It is my personal view that this change to electric technology moves that efficiency from 20 percent to 75 percent. The truth is that the vast bulk of the energy in our cars is produced in heat not in motion. The first big gain from electric car technology is an order of magnitude more efficient in converting energy into motion for our traffic fleet. The second thing that is quite exciting about electric car technology is that normally when we put our foot on the brake all that energy is wasted in the brake pads. With electric car technology that energy is used to revert the electric motor into a generator to recharge the batteries. That adds another order of magnitude of efficiency to electric cars. The third gain that electric cars offer us is the issue around not carbon dioxide but particulate pollution. If we look at a city like Auckland one of the big contributors to air pollution particulate pollution is vehicles. Electric cars have absolutely zero contribution in terms of particulate pollution and that has a big flow-on benefit for people’s health and also in terms of the broader issue of New Zealand living up to its clean green reputation. 
The last point I want to make about electric cars is that they are beautifully quiet. I have one of the Hyundai Getz electric cars which was manufactured and altered in Australia by Blade Electric Vehicles. The greatest danger of this car is that it cannot be heard. It is as silent as a baby. One has to be quite careful when one is around pedestrians. It is so quiet and that is an added advantage. I also note that New Zealand is in a unique position to be able to advance electric car technology. The reason is that if someone has an electric car and the electricity that is used to charge its batteries is produced from burning coal we are going backwards. Sure we do not have the emissions going out the tailpipe of the car; we have it going out of the coal-fired power station. Where New Zealand is uniquely placed is that it has a higher proportion of its electricity produced from renewables than anywhere in the world. If there is any country that can get real climate change benefits and reductions in greenhouse gas emissions from the transport fleet in moving to electric cars it is New Zealand. That is why it makes good sense. I acknowledge some of the innovators around New Zealand whom I have met who have developed their own electric car technology. There are people like Rex Nowland in my own constituency who raised this issue with me. His frustration was that as the owner of a Volkswagen that has been converted to electrics the previous Government’s policy required him to have a sticker on his electric car saying “This is a diesel vehicle”. We can understand the frustration. Someone goes to all this effort to convert a car to electrics and such an identification has to be carried. 
The further point I wish to make is that this policy provides some equity with other technologies. This Government also has a policy of exempting ethanol that is produced sustainably from the equivalent of the petrol excise tax. The Minister of Energy and Resources Gerry Brownlee has brought in an initiative that will provide for a grant scheme for bio-diesel. Effectively this policy as provided for in this bill provides the same financial incentive for ethanol for bio-diesel and for electric cars. It provides a kick-start for those new sustainable transport technologies so that we might sensibly make the shift. I note that the benefit of this is probably about $400 or $500 per year for those electric car owners and that $400 or $500 a year over the life of a vehicle comes to quite a substantive amount. We are hopeful that it will see more New Zealanders able to purchase those vehicles and the likes of those companies such as Hyundai and Mitsubishi that have produced electric vehicles able to come up with an affordable technology that will be more sustainable. I note that 20 percent of New Zealand’s greenhouse gas emissions come from the transport sector. It has been increasing strongly. This initiative of exempting those electric cars from road-user charges is one of a package of complementary measures that the Government will be advancing as part of its broader climate change package. 
The last point I want to make is about the other part of this bill with regard to road-user charges. This bill enables the Government to give notice to road transport operators. What is unfair about the old law applied by the previous Government is that when charges are increased overnight it makes it very difficult for the pricing of those road transport operators in terms of the service charges they pass on. This bill is a sensible provision that provides for a period of notice for those— 
Hon Annette King 
: It was changed in 1999 actually. You don’t know that but you changed it. 
Hon Dr NICK SMITH 
: The previous Minister of Transport triggered the biggest protest by truckies that we have seen in decades and now we have the new Minister of Transport Steven Joyce sensibly fixing up the law to ensure that there is such notice given. I hope it will be a measure that all members of this House support. 
DARIEN FENTON (Labour) 
: 
 It is pleasing to take a call on the first reading of the Road User Charges Amendment Bill. I am really disappointed that on a day in the House when we have agreement on a bill like this one of the members opposite could not help himself. He does not have the generosity to put the past behind him and to work together with the Opposition on this bill. 
I also want to make it clear that the former Minister of Transport Annette King gave no guarantees to the industry either on increases or on notice. It is absolutely incorrect to allege that. I want to make sure that that is on the record. 
As I said Labour supports this bill’s referral to the select committee where we hoped it would be thoroughly considered but obviously that will not happen. We will have a very few number of days to consider the bill. I did hear the introductory comments made by my colleague Darren Hughes when he spoke briefly on the bill the other night. He observed that this is becoming a bit of habit of this National Government. We are very concerned about that. People need to have the right to comment on bills that are put before Parliament. They do that through the select committee process and it is called as my colleague said democracy. 
Labour thinks that supporting an uptake in the use of electric vehicles is a great idea and it adds to the good work that Labour did in promoting electric vehicles. Electric vehicles are the future and Labour already had plans in train for a nationwide set of recharging stations for plugging in electric cars when drivers are a long way from home. 
Labour instigated the review of road-user charges and it is interesting to note that the road-user charges system in New Zealand is unique in the world. We instigated a review because there had not been one in 18 years. During that period the ratio of trucks to cars had changed enormously as had the weights being carried by those trucks. That meant there was a great inequity between trucking firms and private motorists over who was paying for road maintenance. Motorists felt they were subsidising truckers and that heavy trucks causing substantial damage were not paying their share. 
Last year Annette King announced a working party that would look at the formula for road-user charges for heavy vehicles. She also announced that the Government intended to amend the Road User Charges Act 1977 for vehicles weighing more than 3.5 tonnes in order to restrict the period of time in which pre-purchased licences could continue to be used after a road-user charge increase. The purpose of the amendment was to allow the Government to give a reasonable period of notice of increases and I note that that is what this bill proposes to do. 
The bottom line for Labour in that review was that all road users must pay their fair share—it was all about being fair—towards maintaining our roads building new roads and improving passenger transport. We wanted to ensure that the formula for setting road-user charges delivered fairness for everyone. 
Well that was then and this is now. The working party reported back to Steven Joyce the new Minister of Transport. And guess what? A key recommendation was that the current road-user charges system be retained with some work around the margins which the Minister says he is looking at—and this I suppose is the first part of that. The report recommended that 6 weeks’ notice be given for any increases to the rates of road-user charges and the result is this bill which provides for 42 days’ notice but also provides a mechanism to minimise the impact of pre-purchasing. 
The bill proposes to amend the Road User Charges Act in order to achieve two outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges and the second is to provide 42 days’ notice of increases to road-user charges to all diesel motor vehicle owners. In order to minimise potential revenue loss caused by the pre-purchasing of road-user charges by the trucking industry following the 42 days’ notice the bill provides that heavy vehicle road-user charges licences will expire 1 month after an increase comes into effect. 
Part 1 provides for a road-user charge exemption for light electric motor vehicles. As I said we support that and I was looking forward to hearing from various parties at the select committee on the whole topic of electric motor vehicles and where we are heading with that. Labour supports the notion of new electric vehicle technology and the contribution that that makes for the efficiency of the motor vehicle fleet but currently availability is low purchase prices are at least double that of conventional vehicles and manufacturers do not rate New Zealand as a priority market. The Minister confirmed to the select committee this morning that the main reason for ownership rates being low is the cost of the vehicles. 
Although Labour supports incentives for moving the vehicle fleet beyond its current reliance on fossil fuels and encourages the reduction of greenhouse gases and harmful emissions this measure would appear to have a very minor influence on the decision of an individual or business to purchase an electric motor vehicle. But that does not mean we should not do it. Labour thinks we should be among the leading countries to widely deploy electric vehicles and plug-in hybrids for a new era of energy independence and low emissions in transport. We expect to see electric cars arrive and start to be used in New Zealand between 2010 and 2015. The numbers will grow slowly at the start but they will increase as supply increases and the costs go down. However this is a tiny gesture by a National Government and it does lack imagination. 
The recession calls for innovative thinking and searching out opportunities to create new jobs and be a leader in green technology. Denmark for example is investing in the development of the electric car industry and green transport. The UK Government is investing £250 million to promote low-carbon transport over the next 5 years. Motorists will be offered subsidies of up to £5000 to encourage them to buy electric or plug-in hybrid cars under plans announced by that Government. The US and China are in a race to produce electric cars and hybrid cars. As I said although Labour supports this measure by international standards it is pretty timid and the facts are that 5 years from now it is unlikely that we will have more than 500 electric motor vehicles on our roads. 
I have to note the apparent inconsistency in the National Government’s position. National has said that electric motor vehicles decrease reliance on fossil fuels but just before Christmas it rammed through under urgency a bill that repealed the obligation for oil companies to sell a proportion of the petrol and diesel blended with biofuels. A few hundred cars is progress I suppose but that pales in comparison to what could have been achieved had National not reversed the measures that Labour already had in place. 
I return now to the select committee process. I want to go over the questions that my colleague Annette King talked about. There are some real issues there and I hope that we will get time to get these questions answered in the very very rushed process we will have in the select committee. Those questions are how this will work in practice how much it will cost to implement this requirement and how many staff will be employed. What avenues would exist for trucking firms to rort the system? That is really important because we do not want to have a new measure and go through a process of rorting. Also what would be the total leakage of funds not gathered by the Government? 
Labour supports this bill. As I said I was looking forward to a very interesting debate at the Transport and Industrial Relations Committee. I guess I will not have much of an educational experience about electric cars but as I said it is a start and we support the bill. 
JEANETTE FITZSIMONS (Green) 
: 
 Light electric vehicles are capable of making some small contribution towards a more sustainable transport system in New Zealand. I say “small contribution” because they will be extremely expensive—roughly double the price of ordinary cars. Because most New Zealanders cannot afford to buy new cars they buy second-hand cars. But there will be no second-hand electric cars in New Zealand for a long time. Interesting data given to the Transport and Industrial Relations Committee just today in its review of the estimates showed that the Ministry of Transport expects the penetration rate of electric vehicles into the New Zealand fleet to reach 1 percent by 2020. That is way fewer than even the prediction that the Ministry of Economic Development made in 2007. 
Electric vehicles are being made at a very slow rate overseas. The reason is that their price is so high; a lot of that price is the battery technology. To be able to store enough energy to run a motor vehicle 100 or 200 kilometres on a charge takes an enormous amount of battery power—far more battery power than it takes to run our house. Running our house takes eight deep-cycle batteries the size of a truck battery. One cannot carry those around in an electric car so we have to devise a battery that is very low weight for high energy storage. That is very expensive. Electric cars will be a luxury for the very well-off for quite some time. 
The Government is asking that ordinary motorists—ordinary people on the minimum wage living on the edge of a city because they cannot afford the property prices closer to town—completely pay for the use of roads by people driving electric vehicles. Let us be quite clear that that is what we are doing: we are asking all road users—rich poor and unemployed—to pay the road-user charges for those who can afford to buy electric vehicles. We have to have a very good reason to do that. What might that reason be? Well we have an urgent need to move away from fossil fuels and the internal-combustion engine and in the view of the Green Party we should be making major efforts to improve public transport and rail freight in order to reduce the need for those fossil-fuelled energy sources and for individual vehicles where shared vehicles are perfectly adequate. 
There is no doubt that electric vehicles can make some contribution to that goal because there will still continue to be uses where one person in one vehicle is the only way of getting there. What bothers me is that the Government seems to see the one person in one vehicle approach where one cannot move anywhere as a human being without carting a ton of metal as the main solution. It sees things like travel demand management walking cycling and public transport as fringe activities that a few dopey people decide to engage in. We see it the other way round. 
So what is our position as Greens on the Road User Charges Amendment Bill? We want to encourage the new technology even though we know that like many new technologies it will be used by only those who are very well off like the Minister opposite. We therefore see it as appropriate for a short period to encourage those vehicles into the market by giving this incentive recognising that the vehicles are very expensive. We would be very concerned if the subsidy were to go longer than the 4 years that is proposed. We will be very firm about that at the select committee. We think that once those vehicles start to come into the country they will develop their own momentum. But to encourage the first movers—those who are prepared to bite the bullet and get into a new technology earlier—some subsidy is worthwhile. It will not be hugely expensive initially. The Ministry of Transport believes there may be 30 of those vehicles in New Zealand by 2010 and that it will take until 2020 before we have 30000. Well the subsidy will run out a long long time before that. 
We will support this legislation. The thing that concerns me most about it is the extremely short select committee period. I do not see how we can possibly give the legislation due consideration and hear from the public in such a short period. I urge the Government to consider taking this process a little slower. After all how many electric vehicle owners will be inconvenienced if we take an extra month at the select committee to consider this subsidy how long it should last and how it should be paid? We will not vote for that very early select committee report-back date but we will vote for the bill. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 There was a line in a song from a movie that used to represent the dizzy heights of aspiration we might reach in thinking about the latest trends in cars. The song went: 
Why this car is automatic 
it’s systematic 
it’s hydromatic 
Why it’s greased lightning 
With this bill today that song becomes so last century. 
Hon Maurice Williamson 
: Sing it. 
RAHUI KATENE 
: I do not need to; I have my backing group right here. Once this bill goes through the song we will be singing is: “This car is electric.” or to be more precise: “This car is a motor vehicle whose motor power is wholly or partly derived from an external source of electricity and whose gross laden weight is 3.5 tonnes or less.” 
It may not be a chart-topper but the electric car is destined to revolutionise many homes faster than even greased lightning. Although to be clear it is not as though these electric cars are breaking the sound barrier with the speeds they can muster. The 2008 model Subaru R1e electric car I understand has a range of 50 miles and a top speed of 62 miles per hour. What is revolutionary about these cars is that they can be charged overnight on an ordinary household current. One just plugs it in next to the toaster. 
The bill we are debating today will enable regulations to be made that effectively exempt light electric cars from road-user charges. The hope is that by amending the Road User Charges Act with this legislation New Zealanders will be rushing out to purchase such vehicles along with the Minister. 
The current road-user charges for a light electric car weighing 3.5 tonnes or less are $36.07 per 1000 kilometres. In sum this costs the owner of a light electric car approximately $432 per annum based on an average travelling distance of 12000 kilometres per year. So why would the masses rush out to join the Hon Nick Smith in hopping into one of these new electric cars? Top on the score card must be the impact electric cars have on preserving our clean green image in Aotearoa. In essence an electric car is an alternative fuel car that uses electric motors and motor controllers instead of an internal combustion engine. They are far more energy efficient in that they can recapture the energy of braking with the electric motor becoming a generator. Electric cars also create less pollution than gasoline-powered cars so they are an environmentally friendly alternative to gasoline-powered vehicles. Particulate or chemical pollution from exhausts will belong to the days of the past. 
Electric cars are also far quieter we have heard than conventional internal combustion engine vehicles with no exhaust no vibration and no noise. That becomes important in the context of carbon dioxide emissions. New Zealand’s total greenhouse gas emissions are the 12th highest per capita in the world. Within that transport emissions currently represent around half of the emissions from the energy sector and are growing at an unsustainable rate. Bold action is required. 
This is all well and good but the big question that has to be asked is how realistic is it that we will be seeing these flash electric cars cruising in Murupara or even in Ahipara some time soon. The  
New Zealand Transport Strategy 
 which was launched last August set the very broad target that New Zealand should become one of the first countries in the world to widely use electric vehicles. That is great but the strategy was a strategy without any actual dates and numbers of vehicles to be in the fleet. But most important of all it was a strategy with no funding attached. At the beginning of the year Mitsubishi and Hyundai unveiled their latest models promoting these new electric cars as costing about a third less than a petrol car to run. Indeed if we were to believe the promos Hyundai’s Blade Electron can travel 100 kilometres for just $1. That is pretty impressive. 
Hone Harawira 
: That’s awesome. 
RAHUI KATENE 
: Yes but so is the price tag at around $55000. The Ministry of Transport has confirmed as if we did not know that these vehicles will be expensive. Its 2007 paper  
Electric Vehicles and New Zealand—Identifying Potential Barriers and Future Considerations 
 put the aspect of cost into the wider context. It concluded that buying a new car is already financially beyond many New Zealanders and electric vehicles are not at the low end of the cost scale. Unless prices fall dramatically or second-hand Japanese imports start appearing the current generation of vehicles is simply too expensive to allow a widespread uptake. Maori are even more unlikely to be able to splash out on an electric car. Maori average hourly wages at $17.58 lag well behind the general economy at $21.41. In general the Maori working population is also younger and less qualified than other groups thereby increasing the risk of their vulnerability in the recession with the threat of job losses. 
We may be on the brink of an exciting energy revolution but it is revolution for the rich. And it is not looking like it will change quickly. Global production of light electric cars is very low and will remain so for the next 10 years. The current prediction is that by 2020 only 5 percent of new car sales will be for electric cars. Low-income earners and families will be the last to be able to afford to purchase electric cars and the last to benefit from the fact that once the initial purchase price has been met light electric cars are cheaper to run than conventional internal combustion engines. 
Until economies of scale start to reduce prohibitive battery costs early electric cars will have a price premium of roughly double to quadruple that of a conventional car. If that is not bad enough marginalised communities will become even more vulnerable to rising petrol costs as oil gets more expensive. However never let it be said that the Maori Party will not leap at the opportunity to take up an initiative if it is in the best interests of the people. 
There are many advantages to be said for the establishment of electric cars. We know that they will decrease the nation’s reliance on fossil fuels improve energy security and reduce vehicular emissions affecting air quality and greenhouse gas levels. With 40 percent of New Zealand’s carbon dioxide emissions coming from vehicles and with peak oil upon us there is an urgent need to reduce dependency on oil. 
Hone Harawira 
: It’s urgent urgent. 
RAHUI KATENE 
: It is very urgent. There is no question that these electric cars will make a difference—they will—and because of that we support the decision to exempt electric cars from road-user charges as one strategy that can help encourage New Zealanders to venture into such innovative frontier technology. But it must be a case of a vote that is “Yes but.” Yes we support it but until wider penetration happens transport spending needs to focus on sustainable and affordable alternatives particularly for low-income earners and families. Kia ora. 
CHRIS AUCHINVOLE (National—West Coast - Tasman) 
: 
 I am pleased to follow the erudite speaker who has just completed her speech Rahui Katene. I will be expressing the same sorts of sentiments as she did. I am pleased to have the opportunity to speak on the Road User Charges Amendment Bill sponsored by my esteemed colleague the Hon Steven Joyce who is having such an impact in his portfolio. 
The proposed exemption is transitional and limited in scope. It is not intended to set a precedent for road-user charge exemptions. This bill delivers on National’s election promise to exempt light electric motor vehicles from road-user charges and it is a pleasure to see evidence of the fact that this is a Government that delivers on its promises. The reason we want to exempt light motor vehicles from these costs—and indeed it is meritorious to do so—is that we want to encourage the uptake of light electric motor vehicles. 
We see private vehicles continuing to be the most significant mode of transportation for most New Zealanders. We have seen all sorts of attempts to change that situation over the last few years. I remember the subject coming through select committees where we encouraged Government departments to use car pooling systems where cars were provided. I was careful to ask at select committee meetings whether this was happening to any great extent. The systems seemed to be very hard to schedule and organise and frankly it did not happen. Whether or not we want to share even though there are lots of vehicles going in the same direction at the same time car pooling does not seem to be particularly catching on in New Zealand. In the more isolated parts of the country for instance down on the West Coast—which is an area that is very dear to my heart and I am sure to Assistant Speaker Rick Barker’s heart as well—if people driving through smaller communities see people hitchhiking it is common practice to stop and pick them up because there is no available public transport. Hitchhiking has developed into an art form in Takaka in Golden Bay where it is really part of the community structure that drivers automatically try to get more than one person in a car. 
But we see private vehicles continuing to be the most significant mode of transportation for New Zealand. It is therefore important that we use incentives to encourage the use of alternative fuel technologies as they are developed in order to help meet our environmental obligations over time. The wonderful thing about these light electric motor vehicles is that they improve the efficiency of the overall motor vehicle fleet. There are people with quite a lot of experience in assessing the age of a motor vehicle fleet and I think their view of New Zealand’s fleet is that it is not particularly flash in terms of emissions age and technology. If we can decrease the reliance on imported fossil fuel improve energy security and reduce vehicle emissions affecting air quality and greenhouse gas levels it must be a good thing. It is my belief that by combining highly effective electric motors with a competitive advantage in renewable electricity generation we can reduce the greenhouse gases produced by the transport sector. That sector is one of the largest producers of greenhouse gases as well as of the harmful emissions affecting air quality. 
As the debate on climate change continues it takes me back— 
Hon David Cunliffe 
: It’s Labour policy. 
CHRIS AUCHINVOLE 
: Well it has to be a shared policy really. It really does. I was very taken with some of the comments made that at last Labour is perhaps seeing the way to joining in discussions to see whether we can get things together. It is a little like— 
Hon Annette King 
: Chris you opposed it last year. 
CHRIS AUCHINVOLE 
: All I can say to the deputy leader of the Labour Party is that we do not look backwards; we look forwards. I am sure she will join us in that with this particular bill. We are indeed looking forward. 
It is true that electric cars are expensive vehicles. For example the light electric motor vehicle equivalent of a conventional car that cost 20000 bucks would cost in the region of $40000 to $80000. I think the Green Party member had more specific figures. But the global market for those vehicles is constrained with no immediate hope of an improvement no thanks to the low production volumes of first-generation vehicles. This is one of the traps of mass production that we live in. New Zealand is not at this stage seen as a priority market. There is not a light electric vehicle manufacturer in this country. We do not have them. However the Government plays an important role in the uptake of electric motor vehicle technology. After all my esteemed friend the Hon Dr Nick Smith has an electric vehicle I believe. It does happen; they are around. Part of the role of Government is to remove barriers that could prevent delay or dissuade people from engaging in the uptake of a market for light electric motor vehicles in New Zealand. One such barrier is road-user charges. The perception of that barrier is perhaps slightly disproportionate to the barrier of the large capital outlay for an electric vehicle but that is a consequence of the general negative perception about road-user charges. And there is a general negative perception. I think the National Government has gone a long way to enhancing the view of road-user charges by making sure that the money that comes off the road goes back on the road. 
Hon Annette King 
: That was our legislation last year Chris. 
CHRIS AUCHINVOLE 
: Indeed yes; with our encouragement. That just shows we do share things. 
Hon Ruth Dyson 
: You opposed it last year. 
CHRIS AUCHINVOLE 
: Well yes but then with a convincing argument and a little bit of modification it was worth doing. That is the benefit of give and take. 
Let us have a look at the consequence of changing this policy. The view was reinforced by the Energy Efficiency and Conservation Authority market research in 2008 in which 52 percent of 524 respondents stated that having to pay road-user charges would affect their decision to buy a light electric vehicle. It is easy to see why if we analyse how much it would cost in road-user charges for an electric car on an annual basis. Based on an electric vehicle weighing 2.5 tonnes or less and travelling the average distance of 12000 kilometres a year the cost would be $432 which is a significant amount of money. At the same time forgone revenue costs are small because there are very few electric vehicles in the fleet. The exemption will come into effect on 1 October this year if the legislation goes through all stages and will apply until 2013 when the initiatives will be reassessed. I think it is quite an important part of this legislation that the initiatives will be reassessed. So we are talking about $130000 for a year at the number of vehicles we have. 
Hon Maurice Williamson 
: Put a spark into it. 
CHRIS AUCHINVOLE 
: It is an electric car! I believe that the 42 days’ notice is a very good idea and will avoid the embarrassment that occurred last year through the unforeseen consideration of the sudden introduction of charge increases without notice. So the 42-day notification part of this bill will improve businesses’ ability to operate by providing them with time to pass on the costs of any road-user charge increases. 
In conclusion I tell the House that this Government believes in incentivising behaviour that has positive benefits and disincentivising behaviour that has negative consequences. The main thrust of the bill delivers the former. Road-user charges are a barrier to the uptake of light electric vehicles. We are removing this barrier to incentivise people to buy light electric vehicles because they are much better for the environment than the conventional car. They will improve the efficiency of the motor vehicle fleet decrease reliance on imported fossil fuels improve energy security and reduce vehicle emissions affecting air quality and greenhouse gas levels. The whole thing is extremely meritorious. Thank you. 
CAROL BEAUMONT (Labour) 
: 
 I rise to give Labour’s support to the Road User Charges Amendment Bill to go through to the select committee. The aim of the bill as others have mentioned is to amend the Road User Charges Act 1977 to enable regulations to be made to exempt light electric motor vehicles from road-user charges to provide 42 days’ notice of road-user charge increases and to provide for the expiration of heavy vehicle road-user charge licences 1 month after an increase comes into effect. 
The reason for those changes first of all is to encourage the uptake of light electric motor vehicles which are expected to improve the efficiency of the motor vehicle fleet decrease reliance on imported fossil fuels improve energy security and reduce vehicle emissions affecting air quality and greenhouse gas levels. Secondly the changes are to provide that heavy vehicle road-user charge licences will expire 1 month after an increase comes into effect in order to minimise potential loss of revenue caused by pre-purchasing of road-user charges by the heavy vehicle motor industry following the notification of a road-user charge increase. 
First of all in relation to electric cars it seems that we would all have to agree that this is a great idea. This is an important idea and one that reflects and reinforces the work that Labour did in promoting electric vehicles. Secondly this new electric vehicle technology can improve the efficiency of our vehicle fleet. Such vehicles are certainly very expensive but they are much cheaper to operate per kilometre than conventional motor vehicles. However because availability is currently low the purchase price is at least double that of a conventional vehicle and manufacturers do not rate New Zealand as a priority market the take-up rates are understandably low. It is the role of the Government to encourage the uptake of new technology by removing barriers as is the case with this bill. One barrier is the road-user charge. As Mr Auchinvole mentioned this view was reinforced by the Energy Efficiency and Conservation Authority’s market research in 2008. A majority of respondents stated that having to pay road-user charges would affect their decision to purchase a light electric motor vehicle. 
Road-user charges fund road use and they are required for all motor vehicles not eligible for an exemption. A light electric motor vehicle is not exempted under section 4 of the Act so would therefore be required to pay a road-user charge. For a light electric motor vehicle weighing 3.5 tonnes or less the road-user charge could cost $36.07 per 1000 kilometres. That would cost the owner of a light electric motor vehicle approximately $432 per annum based on an average travelling distance of 12000 per year. Of course the upfront capital cost of an early electric motor vehicle would be very significant. In comparison the road-user charge would appear to be quite a minor influence. None the less the negative perception about road-user charges particularly from owners of petrol motor vehicles who have not previously paid the charges would make it a barrier to the uptake of electric motor vehicle technology. So the preferred option being promoted by this bill is to exempt light electric motor vehicles from paying road-user charges until 2013. The exemption would last 4 years from 1 October this year to 1 July 2013; we would probably see about 300 light electric motor vehicles in the fleet by the end of that period. The expected loss of revenue from that exemption will be about $88000. 
I want to talk about the view of the Labour Party in relation to electric cars and other vehicles because our ambition which we stated very clearly in our manifesto was to be among the leading countries to widely deploy— 
Hon Dr Nick Smith 
: How? 
CAROL BEAUMONT 
: Yes “our”—the Labour Party manifesto. Our ambition was to be among the leading countries to widely deploy electric vehicles and plug-in hybrids to mark the beginning of a new era of energy independence and low emissions in transport. The preparation for a large-scale roll-out of electric vehicles included establishing a vehicle emissions reduction group focusing on electric vehicles. We expected to see—and I think this expectation is probably still right—vehicles starting to arrive and being used in New Zealand between 2010 and 2015. The numbers would grow slowly at the start but the volumes would increase as the supply increased and the cost decreased. 
Labour also in our manifesto talked about building clean green electricity generation to develop partnerships with electric vehicle manufacturers. There is certainly a role for the Government in establishing an environment that facilitates the uptake of electric motor vehicles. We had a plan for the introduction of nationwide infrastructure to recharge electric vehicles. Clearly there are a number of issues about the public infrastructure required for people to charge their vehicle during a journey. This sort of technology is likely to be expensive especially for the high voltage facilities that allow shorter charging times. Obviously work is going on in a number of other jurisdictions that are ahead of us on this and we could clearly learn from that work. 
As others have mentioned it is a shame that the process around this bill will mean that the select committee will not get an opportunity to really analyse some of these points in any sort of detail. From the speeches given in the House today I think that we can see there is a fair degree of interest in electric motor vehicles. 
I repeat my point by saying Labour is supporting this temporary exemption from road-user charges for light electric motor vehicles because we had initiated a whole raft of strategies to combat climate change and this is an area that could assist in that process. I also make the point that at that time National politicians such as Nick Smith were still in denial over climate change. A lot of groundwork was done by Labour to activate a strategy that would increase the size of the electric car fleet. I think it is quite interesting if the National Government thinks that it can claim any mana from any initiative to reduce carbon emissions given its response in that area. I ask members to look at things like the emissions trading scheme the future of which is still uncertain. The legislation is still before the special select committee the Emissions Trading Scheme Review Committee and there is no clear plan to outline how the emissions trading scheme legislation will be amended. Labour has offered to have some talks with the Government about a bipartisan approach in this area because it is very important. This is a matter for the survival of our planet. We will be approaching and have been approaching this task in good faith. We want to see a system that will be durable and in the best interests not only of New Zealand industry but also of our environment. 
It is important that we do not look at electric vehicles as the only solution. Electric vehicles might provide a nice photo opportunity but given the size of the fleet—and we have all talked about the fact that potentially we are looking at something like 500 electric motor vehicles on our roads in the next 5 years—this exemption by itself is not going to be the solution to climate change. I was recently in the UK as part of a Commonwealth Parliamentary Association trip and we were lucky enough to have a briefing while we were there by the Department of Energy and Climate Change. One of the important things was that the department has a comprehensive plan in place around climate change and ambitious goals. In fact the department is seeking to have an 80 percent cut in greenhouse gas emissions by 2050 and it has a comprehensive range of mechanisms on how it will do that. Clearly the situation for the UK is very different from ours. It is in a situation where methane is not particularly an issue but carbon dioxide is a much greater issue. But the country has a plan. We are well behind the eight ball on this. It made me feel particularly concerned to think that we had a number of initiatives in place but here we are with the emissions trading legislation still before a select committee and with no real plans in place while other countries are powering ahead. 
In conclusion I take this opportunity to say that this is a critically important matter for us. Thank you. 
NIKKI KAYE (National—Auckland Central) 
: 
 I support the Road User Charges Amendment Bill. First I acknowledge Rahui Katene in this House today. What a voice! I think that she did an incredible rendition of “Greased Lightnin’ ” and I do think that the atmosphere in the Chamber this afternoon is “electric”. I will also make a response to Carol Beaumont’ speech in terms of what she said regarding Labour’s manifesto and its strategy to deliver in this area. That is another example where Labour talked a lot but did not deliver so I am very proud that we are here delivering on a key election promise regarding electric cars. 
We are here today to enable regulations to be made that exempt light electric cars from road-user charges. In summary we want to get more people into electric cars. I know that the fact has been raised already today that electric cars can be seen as possibly unaffordable for some but the whole purpose of one of the parts of this bill is to try to make electric cars more affordable. The exemption of electric cars from road-user charges for 4 years will enable us to help to get more people into electric cars. We know that the exemption will come into force on 1 October this year and will apply until 2013 when the initiatives will be reassessed. 
People might ask how much the average person will save from using an electric vehicle. The calculation we have is that an electric vehicle weighing 3.5 tonnes or less costs about $37 per thousand kilometres to run so the owner of an electric car would be saved about $432 a year based on an average travelling distance of 12000 kilometres a year. That is a significant saving over 4 years. It is potentially over $1600. 
The other point I will make is that our Government is very focused on public transport. We heard the announcement today by the Minister of Transport Steven Joyce regarding the fact that the Auckland Regional Council and the New Zealand Transport Agency have reached an agreement to advance a range of public transport projects in Auckland that were to have been funded by the Auckland regional fuel tax. Some of those projects include new rail stations at New Lynn Manukau Onehunga Grafton and Avondale. They will receive a subsidy of up to 60 percent from the New Zealand Transport Agency. That is positive. But I also make the point that although we are all for public transport private vehicles will be a significant mode of transport in the future. We will see that moving forward which is why it is so important that we can encourage the use of alternative fuel technologies to help to meet our environmental obligations over time. The key thing about this bill is that technology can make a significant contribution to improving the efficiency of our vehicle fleet. 
That is where the other key benefit comes in regarding electric cars—the benefit for the environment. We all know that in New Zealand emissions have increased. I made that comment the other day and I know that Mr Hodgson was not happy with me but he acknowledged the fact that emissions had increased over the last period. They increased in 1990 and we acknowledge that as well. But a key source of those emissions is from transport. The figure I have here is that 40 percent of New Zealand’s carbon dioxide emissions comes from vehicles so there is real potential there for electric cars to make a huge difference given that we have an issue in terms of transport emissions and that we have a bill aimed at ensuring that we try to keep those transport emissions down in the future. I think we are really well-placed as a country to do that with this legislation. The real key benefit here is that it will help us to decrease our reliance on imported fossil fuels and improve our energy security. 
The other point I will make is that this legislation is not an isolated measure we are implementing to enable us to improve our energy security and to decrease our reliance on imported fossil fuels. If we combine the legislation with our competitive advantage in renewable electricity generation—which will help to reduce the greenhouse gases produced by the transport sector as well as the harmful emissions affecting our air quality—we see a real thrust from the Government aimed at aligning the treatment of electric vehicles with that of biofuels via the previous announcement we made in respect of bio-diesel and bio-ethanol. The key point is that not only is it a great incentive for New Zealanders who care about the environment to do their bit to reduce emissions but also it is aligned with the rest of our Government policy such as the previous announcement in respect of bio-diesel and bio-ethanol. 
I know that a number of people have made the point this afternoon that this may—in the short term at least—apply only to a small number of cars. But I do think that the principle is very important. We are moving forward to provide incentives in this area to enable good technology to be available in New Zealand that will enable us to help to reduce emissions. I note that in February of this year when the Minister for Climate Change Issues the Hon Dr Nick Smith welcomed the announcement that electric cars would be commercially available in New Zealand he said: “This is the beginning of an exciting energy revolution as significant as the economic transformation from the steam engine to the internal combustion engine more than a century ago.” So it is a bit of a watershed moment I feel. Even though it applies to what some people might not consider to be a large number of cars it is a significant moment. 
The Minister for the Environment has told me that he has an electric car and I know that he is doing his best to use it well. One thing people tell me when they say they worry about electric cars is that perhaps if they do not charge it—and they have issues around charging their phones—then they might suddenly run out of energy. The Minister has shared with me a little bit of a story that one day happened to him. I call him a bit of a trailblazer; not only is he out there charging up his electric car but he has told me he gets a bit of stick from his son Logan who has called it a bit of a nana car. I think that part of the movement moving forward is not only to have this great technology but also to enable young people out there to realise that electric cars are not nana cars; they are cool. I know that the Minister of Youth Affairs would agree with me that electric cars are not nana cars and I am sure that the Minister for the Environment will pass that comment on to his son. 
The other key aspect of this bill is that it gives 42 days’ notice of any increase in road-user charges to all diesel motor vehicle owners. Giving transport operators 42 days’ notice of a road-user charge increase provides them with time to pass on the cost of any road-user charge increases. This will give the Government the ability to minimise the potential revenue loss caused by the pre-purchasing of road-user charges by the heavy motor vehicle industry following notification of an increase. In respect of those road-user charge increases we know there was quite an uproar last year. We were all aware that the truckies were out there protesting when the road-user charge rates were increased without notice at a time that coincided with pretty high fuel prices. People were pretty upset at the time and transport operators were unable to pass the increases on to customers straight away. They publicly demonstrated in Auckland. A lot of people—and I remember this—were tooting at the time and they were pretty upset with the Labour Government. For heavy motor vehicle operators road-user charges represent a major cost of doing business. Changes in road-user charge rates that cannot be passed on to customers in a timely manner will significantly decrease marginal profitability. This 42-day notification will improve businesses’ ability to operate by providing them with time to pass on the cost of any road-user charge increases. I make the point that this is positive particularly as I am sure many truckies out there will see this as a very positive aspect in terms of this bill. 
In conclusion I tell the House that this bill is aligned with the rest of the National Government’s policy both in terms of public transport and of the environment. I am very proud to be here standing up for electric cars. They are cool cars not nana cars. I look forward hopefully to one day being able to afford to have an electric car. This is great legislation and I commend the Ministers involved in it. Thank you. 
SUE MORONEY (Labour) 
: 
 It is very interesting to listen to Government members filibustering on their own bill this afternoon. We certainly did not have the luxury of doing anything like that when Labour was in Government because we always had to take short and succinct calls to get through the business because we had so much on the Order Paper. We had so much business to get through that we were under the opposite instructions from those that the National Government backbenchers seem to be under. The National Government obviously has a light workload on the Order Paper. It is becoming very noticeable because we had to have Nikki Kaye talk for probably about 2 minutes of her 10-minute speech about nana cars and cool cars. Enlightening as it was that clearly was a filibuster and it tells us that the Government is in a bit of trouble with its programme of action. 
I will of course come to the first reading of the Road User Charges Amendment Bill. Labour is supporting the bill through to the select committee in its first reading. I will not be on the select committee to hear the submissions but I wish the select committee well in its deliberations. I know that at least one of the Ministers was a bit confused the other day as to whether I am a member of the Transport and Industrial Relations Committee. I am not and therefore Kate Wilkinson was quite wrong to draw to the attention of the House my supposed absence from that committee when I was not even a member of it. But here I am speaking in the House on a bill that is going to go before that very committee. 
It is a bill with regard to road-user charges and it has two particular outcomes. The first is to enable the exemption of light electric motor vehicles from the requirement to pay road-user charges. Labour supports this and of course Labour has been working along these lines for quite some time. But I note that the light electric motor vehicle seems to be the nemesis for everything that National does in transport. Although light electric motor vehicles will form a significant part of transport policy in years to come— 
Chris Auchinvole 
: Eventually! 
SUE MORONEY 
:—eventually they will—they are not the silver bullet for transport issues and I am pleased to see at least some of the National members acknowledging that. I have certainly had debates in my home patch of Hamilton with some of the National MPs there. I notice that when David Bennett was arguing against establishing a passenger train between Waikato and Auckland—that is right folks he was against something that would actually help his constituents—his reason for that was first of all that in the next 5 years everyone would be driving electric vehicles. I noticed that he has started to change that position now and he is saying it will be sometime in the next 20 years when everyone—apparently everyone—will be driving electric cars of some description and that the entire fleet in New Zealand is going to be electric cars in the next 20 years. I suppose we will just have to wait and see what happens on that front but I certainly do not believe that will happen in the course of the next 5 years. 
I wonder at times whether National members understand the economics of ordinary people who buy cars and how frequently they can afford to turn over those cars and how frequently families particularly in this economic climate will be able to afford to buy the newest car that—I acknowledge—one of the Ministers appears to have. But not every family will be in a situation where it will be able to afford the newest thing on the market—the electric motor vehicle. I do not know whether Dr Smith knows of many families in his electorate of Nelson who have stepped up to the electric motor vehicle. I ask Dr Smith how many he would see driving around Nelson these days. 
Hon Dr Nick Smith 
: Rex Nowland has been an innovator—converted his V-Dub! 
SUE MORONEY 
: That is one. So a man named Rex in Nelson can afford one of these but not many other families could. I would strongly suggest that those thousands of New Zealanders who are losing their jobs every week sadly in the current economic situation are not going to be looking to replace any motor vehicle in their family for quite some time to come. That is going to put back significantly the planned approach. It seems to be the silver bullet approach that National has: that everyone is going to be driving an electric vehicle sooner or later. 
I think there are just a few small things in the way at the moment but nonetheless this is a good approach: to enable the exemption of electric motor vehicles from the requirement to pay road-user charges. I also wonder whether the National Government might take the opportunity when it is listening to submissions on this particular bill to think about diversifying even further in its transport portfolio. Could it consider using our rail network as part of the transport policy rather than seeing it as a competitor with roads and therefore something that cannot possibly be used? One of the arguments I have heard against having a passenger train service between Auckland and Hamilton is that National will not have that because it might compete with the concept of its precious Waikato Expressway. Another way of getting from Hamilton to Auckland might put the Waikato Expressway at risk. How ridiculous is that! 
Clearly people have different transport needs. Certainly I am a strong proponent of establishing that passenger train between Hamilton and Auckland because it is going to be a much safer way and a much more energy-efficient way for hundreds of people who commute daily between Hamilton and Auckland—that is between the largest city in our country and the fourth-largest city in our country. They are only 120 kilometres apart. We have a train track and the Government owns the trains now so I am not quite sure what the big objection is from National members for establishing a passenger train service between Hamilton and Auckland. Does the Government think that somehow it will undermine the use of roads? Does it think that is somehow going to get in the way of this bill? I certainly cannot see what the issue is but David Bennett is extremely opposed to establishing that passenger train service. 
The second objective of the bill before us is to provide 40 days’ notice of increases to the road-user charges to all diesel motor vehicle owners and to minimise potential revenue loss caused by pre-purchasing of the road-user charges by the trucking industry following notification of an increase. The bill provides that heavy vehicle road-user charges licences will expire 1 month after an increase comes in effect. I think this is a very sensible way through a very tricky issue. We all like to know in advance when our costs are going to increase to our businesses. We all want to have this knowledge so that we can take it into account when we are doing our forward planning with our finances. Removing the road-user charges for electric cars is a great idea and it reinforces all the work that Labour did in promoting electric vehicles. 
We know that electric cars are the beginning of a new era of energy independence and low emission transport but I hope that National is in no doubt whatsoever that it cannot claim any mana from any initiative to reduce carbon emissions by putting more electric cars on the roads when it continues to dither and dilly-dally over what it will do about the emissions trading scheme. I think until National actually gets its act together around that issue anything that it does in regard to this particular bill will absolutely look like tinkering around the edges. I hope that in the submissions coming forward people will support this bill. I think it has much to recommend it but I also hope that submitters will take the opportunity to talk about the broader issues concerned with emissions from vehicles. I hope they will take the opportunity to put forward pressure on this Government to look at the whole ambit to do something and to take leadership over the emissions trading scheme issue. In conclusion I recommend the first reading of the Road User Charges Amendment Bill to the House. I look forward to hearing the report back from the select committee on the submissions that it hears. 
Hon NATHAN GUY (Associate Minister of Transport) 
: 
 For those who were listening I say that the previous speaker was Sue Moroney. She spent most of her time speaking about what is obviously a pet project of hers: a railway line between Hamilton and Auckland. Listeners need to know that Sue Moroney is indeed a list MP and is not representing the people of that area. No one in that area is listening to Labour right now apart from the local MPs who are doing a fantastic job. The 
Road User Charges Amendment Bill is vitally important. I am sure the bill will pass its first reading today judging by the speakers that have already spoken about it in the House this afternoon and last week. It is a very very important bill and it is important that we crack on with it. That is why it has been given a report-back date of 27 July—the end of this month. 
I want to make some introductory remarks and talk a little about electric cars and the road-user charges that are proposed in this bill. I think the important thing is to realise that this bill is very forward-thinking about electric cars and it might be a while until—I think it is 2011—we get up to a predicted 500 electric vehicles in this country. But we need to ensure that we are ready for that and that we are encouraging it. Indeed the first reading of this bill today shows that this Government is very much prepared to listen and think ahead to the future. The important thing is that we need economies of scale to kick in to bring the charge of these vehicles down because right now they are very expensive. There is the battery cost and there is a premium to purchase one of these vehicles on the market. That vehicle premium might be in the vicinity of 50 percent or maybe 70 percent more than what one would endeavour to purchase a new vehicle from a motor vehicle dealer for. Across the world New Zealand may not initially be a priority market for manufacturers focused on large subsidised markets that can absorb the technology premium. Although New Zealand is not a light electric motor vehicle manufacturer the Government plays a very very important part in endeavouring that we are getting on with this technology. Part of that role is to remove the barriers that could prevent or delay the uptake of the market of light electric motor vehicles in New Zealand. 
The other important comment I want to make is on road-user charges and yes a review was done last year when the previous Labour Government was in office. Of course many in this House will remember the gridlock that was created by the previous Minister of Transport the Hon Annette King when she came out and said that road-user charges would increase. Truckies across New Zealand were up in arms about it and there was gridlock across Auckland City Wellington City and most of our cities throughout New Zealand. Trucks came in protest from my electorate from Kapiti and Horowhenua down State Highway 1. So it is important that we get this process right. This 42-day notice of any increase in road-user charges to all diesel motor vehicle owners does that. It gives forward notice. Giving transport operators 42 days’ notice on road-user charge increases provides them with time to pass on those costs to any of their consumers if they wish to which most probably they would choose to do. To minimise the potential revenue loss caused by pre-purchasing of road-user charges by the heavy motor vehicle industry following a notification of an increase the original road-user charges will expire 1 month after an increase comes into effect. 
This is a very important bill. It is very forward-thinking. We need to be aware that there will be zero pollution with electric vehicles. Right now across the country—and indeed across most of the world—we are having the climate change debate. More electric cars will mean that there is less pollution. Of course we need to be mindful of the fact that those vehicles are a lot quieter which is interesting. When I was walking in Wellington recently a Segway went racing past me and nearly knocked me over because I had not heard it coming. Mr Assistant Speaker I am not sure whether you have any down in Invercargill. One stands on them and they are driven by electricity. They are very very quiet and they transport people around communities; they are seen mainly in cities. These Segways are about 11 times more efficient than the average-sized American car. They cost about $15000 Mr Assistant Speaker; they would be very good down in Invercargill for you to get around and see your constituents. The point I am making to the House is that electric cars are the way of the future but I guess there will be a road safety component—particularly for pedestrians. They might be used to hearing a vehicle and it may indeed be a diesel vehicle which history shows tends to be a bit noisier than petrol vehicles. But these electric vehicles will be a lot quieter. As I said I nearly got caught out by a young gentleman motoring past me on a Segway the other day. I make that contribution in this debate. 
I also wish the Speaker of the House the Hon Dr Lockwood Smith all the very very best for his wedding in the weekend. Indeed in the House this afternoon we have the Minister for the Environment the Hon Dr Nick Smith who has an electric car. I wonder whether he has offered his car to the Speaker of the House the Hon Dr Lockwood Smith as an opportunity for him to transport himself to his wedding with his soon-to-be bride. That is an opportunity that the Minister for the Environment may have already offered to the Speaker of the House. We know that the Speaker has a tendency towards larger-engined vehicles so that opportunity may be turned down. I know that the Minister for the Environment had his electric car at his recent wedding. On that very light note I wish this bill all the best for its passage through the Transport and Industrial Relations Committee with a report back towards the end of the month on 27 July. I commend this bill to the House. 
Bill read a first time. 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 I move  
That the Transport and Industrial Relations Committee consider the Road User Charges Amendment Bill 
 that the committee report finally to the House on or before 27 July 2009 and that the committee have authority to meet at any time while the House is sitting (except during oral questions) and during any evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House and outside the Wellington area during a sitting of the House despite Standing Orders 187 189(a) and 190(1)(b) and (c) 
. 
A party vote  was called for on the question  
That the motion be agreed to. 
Ayes 107 
New Zealand National 58; New Zealand Labour 42; ACT New Zealand 5; Progressive 1; United Future 1. 
Noes 14 
Green Party 9; Maori Party 5. 
Motion agreed to. 
Voting 
Correction—Misuse of Drugs (Medicinal Cannabis) Amendment Bill 
Hon STEVE CHADWICK (Junior Whip—Labour) 
: 
 I seek leave to correct the result of a vote in the first reading of the Misuse of Drugs (Medicinal Cannabis) Amendment Bill. Proxy votes were incorrectly cast for the Noes on behalf of two members who actually cast their own votes for the Ayes. I seek leave to have the vote corrected. 
The ASSISTANT SPEAKER (Eric Roy) 
: Leave is sought for that purpose. Is there anyone opposed to that course of action? There appears to be not. Leave is granted and the record will be amended. 
Tariff (AANZFTA) Amendment Bill 
Customs and Excise (AANZFTA) Amendment Bill 
Third Readings 
Hon CHRISTOPHER FINLAYSON (Acting Minister of Trade) 
: 
 I move  
That the Tariff (AANZFTA) Amendment Bill and the Customs and Excise (AANZFTA) Amendment Bill be now read a third time 
. The ASEAN-Australia-New Zealand Free Trade Area Bill was referred to the Foreign Affairs Defence and Trade Committee on 28 April. The committee recommended in its 15 May report to the House that the bill be passed with no amendments. Since then the bill has had its second reading on 24 June and went through the Committee stage on 25 June. The legislation was then split into its two present parts after the debate in the Committee of the whole House. The two parts should be read together today. 
This legislation amends New Zealand’s domestic legislation so that New Zealand can be ready to enter into force the ASEAN-Australia-New Zealand Free Trade Area agreement by the target date of 1 July 2009. The agreement is a significant achievement for New Zealand because we are so dependent on trade for our economic well-being and prosperity. The current global economic crisis and the protectionist sentiment it has fed has made gaining and maintaining access to valuable and dynamic export markets such as ASEAN more critical to New Zealand firms than ever before. Improving market access for New Zealand firms through trade agreements such as this agreement ensures we can continue to stimulate economic growth and help safeguard the jobs of the many thousands of New Zealanders who work in or who support export-oriented industries. There is a growing body of evidence that backs this up. Recent OECD data suggests that a 10 percent increase in trade is associated with as much as a 4 percent rise in per capita income. 
This agreement like all of our trade agreements is about facilitating trade by negotiating an environment that makes it easier more profitable and more predictable for New Zealand businesses to enter markets and then do business in those markets. As a market of more than 566 million people ASEAN is an increasingly important destination for New Zealand goods service suppliers and outward investment. The immediate trade benefits of the agreement are clear for all to see. ASEAN has now become New Zealand’s third-largest export market for merchandised goods and those were worth NZ$4.6 billion in the year to June 2008. Our trade has grown at a staggering 24 percent per year over the last 3 years with seven of the ASEAN member countries now featuring in New Zealand’s list of top 30 bilateral trading partners. 
The agreement also represents the first time ASEAN has negotiated a comprehensive free-trade agreement as part of a single undertaking. That means it includes trade in goods and trade in services and investment as well as the other subjects that are covered in a modern free-trade agreement such as protection of intellectual property and competition policy. In the area of goods exports the outcome that the Government has secured is a very good one indeed. Within 12 years 99 percent of New Zealand’s current trade with Indonesia Malaysia the Philippines and Viet Nam will be duty-free. For New Zealand businesses operating in those markets this is a major advancement in terms of their market access into those major and growing markets. 
But the agreement does more than simply address tariff lines for merchandised trade. For New Zealand exporters in the services sector the agreement also represents real gains in New Zealand’s priority service sectors including education services. New Zealand investors and their investments will benefit from the new and additional protections for their investments into the region including through the potential for recourse to binding investor State arbitration procedures. The agreement includes a disputes settlement framework to resolve any trade-related disputes that may arise between New Zealand and its ASEAN partners. 
In addition to this agreement New Zealand has also concluded legally binding agreements on trade and labour and trade and environment with the Philippines. Those outcomes build on existing instruments on these issues with other ASEAN partners Thailand Brunei and Singapore and ongoing work with Indonesia and Malaysia. 
The difficulty of successfully negotiating a free-trade agreement simultaneously with 10 very diverse members of ASEAN should not be underestimated so I acknowledge the efforts of officials previous Ministers of Trade and all of the stakeholders who have contributed to this very good outcome. I acknowledge and thank members of the Foreign Affairs Defence and Trade Committee for their consideration of the legislation and I thank those who submitted to the committee. 
The legislation we are voting on today is relatively straightforward. It mirrors both in structure and content what was done for previous free-trade agreement legislation. It amends two Acts: the Tariff Act 1988 and the Customs and Excise Act 1996. The amendments to the Tariff Act allow for the application of the preferential tariff rates made under the ASEAN-Australia-New Zealand Free Trade Agreement to other parties of the agreement. Amendments to that Act also allow for New Zealand to apply transitional safeguard measures in certain circumstances on imports from the free-trade agreement party countries. Amendments to the Customs and Excise Act are required to provide for a system to enable issuing bodies to issue the necessary certificates of origin. These certificates will be required by exporters to establish that they are eligible to receive the preferential tariff rate in the free-trade agreement importing country. Subsequent to the passage of this legislation implementing regulations will be required to implement the preferential rates of duty and the rules of origin. 
The ASEAN-Australia-New Zealand Free Trade Area is a significant economic and strategic investment for New Zealand in line with this country’s fundamental trade priorities. Our priority as a nation depends on our ability to trade and invest in the world market. We also depend on rules to govern trade and remove barriers so that our traders can fairly compete. These are among the goals of the agreement which will benefit New Zealanders. I understand that the legislation is supported by a majority of the members of the House. I commend this legislation to the House. 
Hon MARYAN STREET (Labour) 
: 
 It is with great pleasure that I rise to speak again in the debate on the ASEAN-Australian-New Zealand Free-Trade Agreement—this time for its third reading. This is an important moment. In the third reading I will simply recap four essential points that I and my colleagues have already traversed in the course of the first and second readings of the ASEAN-Australia-New Zealand Free Trade Area Bill which has been divided into the Tariff (AANZFTA) Amendment Bill and the Customs and Excise (AANZFTA) Amendment Bill. 
First I reiterate the opportunities that this free-trade agreement confers on and provides for the New Zealand economy. As was noted already the ASEAN free-trade area includes markets of some 566 million people. It is a 12-country agreement. If we take out our chief trading partner Australia and concentrate on the 10 ASEAN nations we see that we have an extraordinarily large market for which we can produce goods. 
It is important to note in this third reading that sometimes there have been difficulties presented with free-trade agreements and I will traverse two of those difficulties very shortly. I just say that the pedigree of this agreement reaches back to the time of Jim Sutton and to him all credit is due. It proceeded from him into the care of Phil Goff and to him all credit is due. It was finally signed and delivered into this House by the Hon Tim Groser and to him all credit is due. This free-trade agreement has been a long time in the making and it has been worth waiting for. It allows our export producers in New Zealand access on favourable terms to markets of enormous size. Even when the global economy is faring badly there is still room in these ASEAN markets for growth in New Zealand’s exports. Even a small percentage increase in growth for New Zealand exporters can be relatively easily achieved over time through this agreement. 
The second point I make is that some of the obvious benefits of this agreement come from its scope. It covers goods services and investment and on that basis it provides enormous scope for exporters and not just commodity exporters but service providers and exporters as well. As far as goods are concerned clearly New Zealand will benefit from the elimination of tariffs—within 12 years—on 99 percent of New Zealand’s current exports to the four largest markets in the ASEAN grouping. Those markets are Indonesia Malaysia the Philippines and Viet Nam. On full implementation this agreement will equate to a saving for our exporters of some $50 million even if exports to those markets were to remain static—in other words on current export numbers. A saving of $50 million is something that our exporters particularly our food production exporters but others besides are looking forward to. For example by 2010—and that is very quick in the process—tariffs will be eliminated on dairy products exported to the Philippines. As far as meat and wool are concerned tariffs on New Zealand’s key beef exports to the Philippines will be eliminated by 2012 and to Indonesia by 2020. Over the 12-year period that sees those tariff eliminations rolled out—country by country and year by year—exporters will see improved savings for their industries and their operations. That is very significant. 
The effect of the agreement on services will also provide some critical outcomes for New Zealand. The number of services that are included in this free-trade agreement is quite remarkable: not only do we have business services the usual things that one might expect such as legal services accounting services and so on but also we have communication services construction and related engineering services educational services environmental services health-related and social services tourism and travel-related services and so on—there are more besides. That list although not exhaustive indicates the breadth of this piece of trade architecture. 
The third thing that is important in the scope of this agreement is the investment outcome for New Zealand investors. Essentially this free-trade agreement provides additional protections for New Zealand investors in the ASEAN countries. Those protections include protections from arbitrary expropriation and compensation for losses owing to armed conflict civil strife and so on. Those protections are of comfort to New Zealand investors. 
There are two other points that I want to make. My first point went to the opportunities that this free-trade agreement provides. My second point went to the scope of this agreement. My third point relates to something that I talked about in some detail in the second reading and that was that some concern has been expressed by critics of free-trade agreements about arrangements with Burma. I reiterate that the level of trade that New Zealand has currently with Burma is minimal and none of it is in any way an obstruction to the registering of our profound concern about and condemnation of the regime in that country. We are obliged by other regulations to recognise Burma as one of the world’s least-developed countries. It has that status and therefore automatic access in some respects particularly with regard to quota protection to New Zealand. However that relationship remains fraught for us and our ability to be critical of that regime is not interfered with by this free-trade agreement. 
My final point—and it is one that I think one of my colleagues will pick up on later as well—is the preparedness of New Zealand Trade and Enterprise to invest in ASEAN markets to facilitate the reach of New Zealand export companies and export industries into those markets in order to maximise the opportunities that this free-trade agreement provides. We heard this morning at the Commerce Committee the Minister responsible for Vote New Zealand Trade and Enterprise say that there was not any reduction in the offshore capability of New Zealand Trade and Enterprise. The point remains however that if we are to maximise the possibilities New Zealand Trade and Enterprise needs to have a plan for increasing its capability in the ASEAN markets. 
JOHN HAYES (National—Wairarapa) 
: 
 The Tariff (AANZFTA) Amendment Bill and the Customs and Excise (AANZFTA) Amendment Bill were created from the ASEAN-Australia-New Zealand Free Trade Area Bill by the Committee of the whole House. The legislation went through the Committee of the whole House with only minor procedural changes. 
As I have sat here this afternoon listening to the erudite speeches from my colleagues on both sides of the House I reflected on what if I was a constituent in say the Wairarapa electorate this would do for me. I say to the sheep farmers to the east of Pahiatua to the dairy farmers in the south of the Wairarapa and north into the west of Dannevirke that they will all be better off because of this legislation. I say to the grape-growers and the kiwifruit-growers that they will all be better off because of this legislation. I say to the companies near Dannevirke like Metalcraft Industries and to the companies in Masterton that are actively engaged in producing for example things like axe heads or monitoring the weather situation in vineyards in New Zealand and many parts of the globe that they will all be better off because of this agreement. 
This legislation will amend our domestic laws so that New Zealand can enter the ASEAN-Australia-New Zealand Free Trade Area on 1 July 2009. The legislation amends the Tariff Act 1988 and the Customs and Excise Act 1996. I regret to say to the winegrowers in Martinborough that no it will not reduce their excise tax obligations! We are doing this so that New Zealand can comply with its obligations under the agreement that has been as colleagues have pointed out under negotiation across three Ministers and for a good 9 or 10 years. The agreement requires New Zealand Australia and four ASEAN countries to tell each other that they have completed the domestic procedures for the agreement to come into force—yesterday. As has been pointed out the agreement was signed in Thailand in February. It came through our Foreign Affairs Defence and Trade Committee—and I thank my colleagues for their constructive contributions there—and I also say to the House that all the submissions we received were positive and supportive particularly from organisations like Fonterra and other companies that are actively engaged in export. 
Hon Pete Hodgson 
: What about Jane Kelsey John? 
Hon Maryan Street 
: Did you read Jane Kelsey? 
JOHN HAYES 
: Jane Kelsey had a different view but that was quite predictable and it has been known to this House over many many years. In a democracy people are allowed to have alternative points of view. But then Jane Kelsey is not actively engaged in exporting so I will leave that there. 
The agreement is important because the ASEAN countries are close to New Zealand. As has been pointed out there are just under 600 million people—566 million people—in the ASEAN region and it is an important existing trade partner. What is really important is our ability to increase our trade to those countries and if we are going to lift ourselves up the OECD ladder we really have to do that. We have to increase our trade and Fonterra is reporting to us that despite the difficulties over melamine in China our exports to that country are strongly growing. China is not a member of this agreement but it is in the general region and what is going on in China is reflected elsewhere in the region which is why the Government has run a trade surplus of $860 million in the last month. When we think about countries like Burma I think New Zealand can also assist those countries to move forward because of their closer economic relationship with ourselves. I think there have been significant trade increases between New Zealand and the ASEAN countries as a result of developing strong relationships and also removing barriers to trade. A colleague just asked me whether this would impact on our beef exports to Indonesia because of the halal slaughter requirements. That issue is not caught up in this framework except that the framework provides a mechanism for New Zealand to sit down with the other countries that are signatories to this agreement and engage in a dialogue to resolve potential difficulties between us. Doing that enables a much greater certainty in our trade relationships and it gives a degree of confidence to our businesses by minimising the risk they face in engaging in trade with other countries. 
The agreement will also enable us to jointly develop opportunities in trade development and service delivery where working together would reduce costs increase speed and efficiency and help develop knowledge skills and resources across a range of countries. All this becomes much more important in an environment where we are facing a significant economic downturn and recession because although some companies including in my own town Bouzaid and Ballaben have run into difficulties by signing this agreement we are opening up new opportunities for a whole lot of new companies. One thing for sure is that jobs are lost but jobs are created as an economy moves forward. This agreement will also open doors for investment and the provision of services where New Zealand is currently unable to meet demand. 
As other colleagues have pointed out the agreement with the Philippines on trade and labour and trade and the environment provides certainty that human rights and environmental standards that we value are maintained by our close trade partner. It is also very important in my electorate that we have this arrangement for engaging in labour because Filipino people are playing a very strong role in our dairy sector—particularly so in my electorate. 
The agreement will move us forward and open the door for future developments as we look ahead. It means that New Zealand will be well placed in the centre of these developments. As I said in our select committee it is very clear that this agreement has huge support from our business community. As I said some time ago in this House Asia had an annual growth rate of around 6 percent in 2008. But from 1980 to 2008 Asian GDP multiplied by four times China’s GDP multiplied by three times and India’s GDP multiplied by three times. In the same period Europe’s GDP multiplied only twice. Asia’s share of world trade has climbed from 16 to 28 percent in that period. Over the same time period America managed only a 21 percent market share and Europe’s market share of world trade declined from 28 to 20 percent. What we are doing with this agreement is locking ourselves into a part of the world that has the potential to grow very quickly. That has to be a reason for improving the prosperity of every entrepreneur in this country every business in this country and every employee in this country. With those words I thoroughly commend the bill to the House. Thank you. 
Hon PETE HODGSON (Labour—Dunedin North) 
: 
 It is my pleasure to take part in the third reading debate on this legislation and Labour members warmly support it. I will begin by doing what is now almost cultural in this Parliament which is to acknowledge the work of previous and present Ministers of Trade in getting quite a complicated agreement done and dusted. I will also depart a little from the culture of this country by saying that we really need to acknowledge the work of officials. They are the guys who do the hard yards in terms of the negotiation. They are pretty clever people—some of them are very clever—and we would be a poorer nation without them. Let us get that on record. I am sure there is wide agreement on it. 
A very small note of discord that I mention in passing is that the current Prime Minister of the land has said sort of negative things about the previous Minister of Trade the Hon Phil Goff. The Hon Phil Goff has thick enough skin to manage that; there is no problem at all about that. But it shows that sometimes—if we are not careful—we can be a little graceless. 
The breadth of the agreement has been outlined by previous speakers—particularly my colleague the Hon Maryan Street—so I do not want to go back over it. But I will say that in the recent burst of free-trade agreements China and ASEAN rise as very big changes on our exporting landscape. I want to contrast our approach to each of them. It is not a fair comparison in one sense because the ASEAN agreement involves many nations and China is one huge nation. But the difference between the way that we have approached the aftermath of the free-trade agreements is worth reflecting on. 
In the case of China we did pretty much all that one could or might expect to do. There was a lot of ceremony about the agreement. There were a lot of trade missions around the ceremony about the agreement. There was a great deal of media coverage of the agreement. There was a retooling of New Zealand Trade and Enterprise’s presence in various parts of China as it sought to extend its focus into that country in light of the free-trade agreement. A Beachheads was set up in China. There is ongoing research and development collaboration with China. And on and on it goes. 
But none of that has happened and I expect none of it will happen in respect of the ASEAN countries. That is a shame. Of course it need not happen with all of those countries; some of them have smaller economies than others. With some of them we already have a free-trade agreement; the job is done. But for many of the countries—particularly Indonesia Malaysia the Philippines and Viet Nam—we have an opportunity that we have not seized. 
The reason we have not seized it came out in this debate when the person who began the debate the Hon Christopher Finlayson reminded us of how Fonterra will make progress because of the free-trade agreements and of how the meat industry will make progress because of the free-trade agreements. The chair of the Foreign Affairs Defence and Trade Committee John Hayes made similar comments. Although John Hayes managed to mention axe heads weather sensors and other businesses in the electorate of Wairarapa which he has the current privilege to represent the fact of the matter is that National assumes that business will follow function that business will follow the signing of the free-trade agreements and even measures how much it expects. What is apparent from those comments is that no further central effort is likely which is a shame. 
We heard from the Hon Maryan Street that under interrogation in the select committee the Minister responsible for the New Zealand Trade and Enterprise budget said there would be no cuts. Well whether or not that is true it ain’t good enough. It ain’t good enough. A recession is going on and it is really important that we do not let a good recession go to waste. Probably an emerging difference across the House is that people on this side of the House would be much more inclined in a recession to put emphasis on and investment into skills to put emphasis on and investment into what might be called innovation and to put emphasis on and investment into trade. 
I acknowledge the significant increase of investment in the Export Credit Office. I freely acknowledge that and congratulate the Government on that move. It is a good move. The Export Credit Office was opposed by everyone when it was set up. It was opposed by National as well as by Treasury and God knows who else. But that is in the nature of things. It is now part of our fabric and National has backed it with some cash. That needs to be acknowledged. But that is where it stopped which is unfortunate. It is really unfortunate. 
I think there is a case for trade missions I think there is a case for a programme of development and I think there is a case for increasing New Zealand Trade and Enterprise’s presence in those areas. I think there is even a case for extending beachheads beyond Singapore. There is certainly a case for saying that we need to pay attention to the countries where we think the increase from the free-trade agreement in trade is likely to be the greatest and that we should not take the position that it is OK now to sign an agreement to ring up Fonterra and to tell it to make the best of it. You see this country cannot be an economy built on dairying and tourism alone. That will not work. Just as we need a broad range of markets which is why this free-trade agreement is so important we need a broad range of exports. And we do not have that. ASEAN is an opportunity for us to improve a little on that. 
Our exporters are a pretty gallant lot. They choose to spend a lot of time on aircraft a lot of time away from their businesses and from their homes. Very few of them are exporting large quantities. There are very few large exporters in this country. It is important that we give small and medium-sized exporters the opportunity to grow. Not all of them will want to take part in any trade mission will want to use the services of New Zealand Trade and Enterprise or will want to use the services of a Beachheads to be established in Jakarta for example. Not all of them will but some of them will. We in Government should be there to offer support to those businesses that want to access them but we are not doing so. 
I am sorry that this is a negative contribution to a free-trade debate but I think that we are wasting some opportunity here and that the Government ought to think carefully about whether that is a smart thing to do. Free-trade agreements of this ilk come along but once. They come along but once. There is an opportunity that goes by once but I think we are letting that opportunity pass us by. We are not seizing the totality of it by any means. So I am asking the Government—and the next National speaker may wish to respond—whether it thinks that it has maximised the opportunities of this free-trade agreement because I certainly do not. 
Dr KENNEDY GRAHAM (Green) 
: 
 I rise to convey the views of the Green Party in the third readings of the Tariff (AANZFTA) Amendment Bill and the Customs and Excise (AANZFTA) Amendment Bill. My mind goes back in the first instance to the first reading of the original ASEAN-Australia-New Zealand Free Trade Area Bill in which I participated. I was disappointed to miss the second reading but I have since been through the records of the second reading and the Committee of the whole House quite carefully. 
I wish to engage the two main parties National and Labour which I have to say should be regarded in this debate and on this issue—and not for the first or only time—as a conjoint political establishment best regarded as “NatLab”. Their views can be seen in contradistinction to those of the Green Party. 
In the first reading Pete Hodgson sought to engage the Green Party in a debate on this matter and that was something I appreciated. I responded by identifying four concerns that we held and subsequently we developed a fifth concern in the course of the select committee which was also conveyed in our minority report. Those concerns were genuinely addressed in response by National members and Labour members and we appreciate that. In fact a debate was joined and I see it as ongoing. I also see these particular third readings as simply one further step in a broader debate that is to be had and that will not terminate immediately on the issue of free trade more generally. I appreciate the comments made in the first reading by National members Dr Hutchison Mr Macindoe and Mr Finlayson in particular and from the other side by Mr Hodgson Maryan Street and Mr Robertson. 
The House is on notice that the Green Party has expressed these concerns but at the same time we did say that we are not anti - free trade per se; it is just that we require that free trade meets certain fairly stringent standards that we appear to put at a higher threshold than the other two major parties do. I ask myself whether there is anything on which National Labour and Green can unite and I think the answer is well yes. In terms of a very broad and idealistic vision of a future world we no doubt can unite. I think all three parties can unite in a vision of a global economy that meets three standards: firstly that global economy has to be based on green trade pertaining to both the production and the freight of goods and services that are completely sustainable; secondly there needs to be completely open trade—total free trade—and thirdly that trade needs to be fair not only in respect of domestic producers and finding a natural balance of their activities in every country in that regard but also in terms of political harmony around the world in our trading relationships with other parties. So we are united on three broad criteria for a future ideal global economy. We could call it green open and fair or by way of acronym “GOF”. It would be the “GOF” vision but let us recognise that there is only one “F”. If we had another “F” it could become futile so we will keep it at “GOF” with one “F” if members do not mind! All parties can unite on that vision but having identified that somewhat artificial vision we then realise that the reality is way short of it because international trade at the moment is not green it is not totally open and it is certainly not free. 
In the first reading I lamented the excessive obsession with economic growth. Dr Hutchison replied that the Greens missed the point because the issue was much broader than economic growth; it had to do with cultural and political links and so on. My reply to him is that we do not deny that fact and we welcome the broader political and cultural ties with ASEAN but by way of responding in logic we say that those ties do not and should not force us in any way towards a free-trade agreement if that particular agreement does not meet the criteria and standards we have identified. 
Let me proceed in an analytical manner with our five concerns and see to what extent the responses from National and Labour have allayed our concerns. Firstly there was the issue of green trade. We asked why the national interest analysis did not include an estimate of the increased trade volume and the increased greenhouse gas emissions that would ensue from free trade. Unless I missed it I heard no answer from National on this point but I heard an answer from Labour. Mr Hodgson said that “if one is to approach climate change one cannot approach it through trade; one has to approach it through the economy and society as a whole.” He also said that “one cannot do it in such an itsy-bitsy way.” We simply disagree. Trade whether it is airfreight or sea freight is a critically important part of the global economy representing somewhere around 2 percent of carbon dioxide emissions. Trade is likely to become a part of future Intergovernmental Panel on Climate Change negotiations so in response I put it to our Labour colleagues that we cannot responsibly exclude trade from our climate change obligations. Therefore we conclude that there is no change on our position on this in light of the response to our concern in the first reading. 
Secondly we had a concern about the manufacturing equilibrium. We were concerned that further phasing out of protections could lead to further factory closures. Mr Finlayson assured us that “The agreement is expected to have a positive effect on exports gross domestic product and employment in New Zealand including in the manufacturing sector.” I think this is simply a case of differing expectations. We do not know what will happen in the future. Future events by definition cannot be proven in advance; only time will tell. We acknowledge the possibility of a positive effect but we deny the certainty of its occurrence. There is no compelling evidence to surrender our objection. Let us look forward to empirical case studies to settle this matter in the future. 
Thirdly pertaining to the financial sector we expressed our concern that the agreement locked in light-handed regulation of finances in capital markets. Mr Finlayson responded: “Under the agreement the existing regulatory and policy settings for … investment would be protected.” He went on to say that the financial services annex of the agreement would preserve New Zealand’s ability to regulate. I interpret this statement to be an assurance that ASEAN companies can operate in New Zealand only in strict conformity with our tight regulatory measures. On that basis the Green Party would be prepared to withdraw its concern subject of course to future verification. 
The fourth issue pertained to democratic protection. We expressed our concern over a lack of targeted sanctions against Myanmar’s leaders. In response Maryan Street advised us that the least developed countries had automatic access and no quota barriers to the OECD under the existing free-trade agreement and that the free-trade agreement did not preclude New Zealand protection. But that was beside the point. Our point was that it precluded targeted sanctions against Myanmar’s leaders. 
The final point pertained to tobacco exemption. We expressed our concern that we would surrender the right to ban tobacco in future legislation on health grounds should we wish to do so. We have been advised that the agreement does not in any way change New Zealand’s current approach to tobacco regulations and nothing in it would contravene New Zealand’s obligations under the framework convention. Those were carefully crafted statements by Mr Finlayson but they equally slid past the point that we wished to be able to ban tobacco in future legislation if the country so decided. So we retain that concern as well. 
It is with a sober realisation of the limitations of the free-trade agreement that we will therefore maintain our opposition. Thank you. 
Dr PAUL HUTCHISON (National—Hunua) 
: 
 It is a pleasure to follow Dr Kennedy Graham who undoubtedly is a true gentleman and gracious parliamentarian. I acknowledge the huge experience that member has had in this area over many years. I think that his idea of a triad—as he called it a “NatLab-Green” triad—is somewhat visionary. One of these days maybe there will be areas of consensus. Certainly this is an area where the National Party and the Labour Party quite rightly agree; that is that vital trade is fundamentally important to our economy. 
I also acknowledge the fact that Dr Graham lamented excessive obsession with economic growth but then went on to say that he acknowledges that a huge richness has developed over the last 30 40 50 years in New Zealand that is continuing to expand. In an earlier debate I said how my wife who runs a ballet school now goes throughout Asia— 
Hon Pete Hodgson 
: Ballet school? 
Dr PAUL HUTCHISON 
: —I mentioned that—examining for the Royal Academy of Dance. The point I am making is that that sort of interchange would hardly be thought of 20 years ago yet now it is becoming commonplace. When I go back to my electorate in Hunua and Pukekohe where there is a very very diverse community I think of the huge interchanges that we have achieved both economically and culturally. They are now so important to a totally different way of life than what New Zealand had 40 to 50 years ago. 
Like the Hon Pete Hodgson I want to acknowledge the genesis of this bill and those who were associated with it. I note that ASEAN was founded way back in 1967. I was not too far wrong when I mentioned the Hon Lockwood Smith as one of those responsible for the start of the good work that was later followed by such others as Phil Goff and the most excellent Tim Groser who is out there today working hard for New Zealand. We became an ASEAN dialogue partner in 1974 and in 1995 the ASEAN and CER trade and economic Ministers agreed to establish a dialogue to facilitate trade and investment linkages between the two regions. It has grown considerably since that time. The ASEAN-Australia-New Zealand Free Trade Area Bill has been divided into two bills. I acknowledge the fact that the legislation has been hardly changed which is of great tribute to the parliamentary counsel and like Pete Hodgson I acknowledge the officials who have worked very hard in this area. 
I want to go back to a couple of the submissions that we had and that I was particularly struck with. One submission came from the Seafood Industry Council. 
Grant Robertson 
: It was very good. 
Dr PAUL HUTCHISON 
: Yes it was very good. The point they made was that New Zealand was being if anything under-ambitious in the area of seafood trade. That points to the fact that here we are in a country that has a huge economic zone that has huge opportunity to increase our trade in seafood yet we account for only 0.4 percent of global production from wild capture fisheries as well as from aquaculture. In comparison the ASEAN nations have about 8 percent of global seafood exports. Indeed there is a huge opportunity for us to expand in that area and into that enormous market. 
The other point that Dr Kennedy Graham made was about the green trade issue. He feels that it is very important that we acknowledge air freight and sea freight because they represent 2 percent of global emissions. One hopeful thing is the fact that we read recently in  
The Economist 
 that there is likely to be a solar-powered flight right around the globe in the next year or two. That is the sort of technology that the world will be embracing and hopefully New Zealand will also be embracing it in terms of our research and development. It may be embraced at a much more modest level to start with but after all we had the boat that travelled around the globe using biofuels call in the other day. That boat will be going down to the South Seas to chase the Japanese fleet and their whaling activity. That is the sort of thing that I am sure we will be embracing in years to come. 
There is no doubt that this agreement is a very significant one and that it is very beneficial to New Zealand. It involves 12 countries 566 million people and the whole area has a GDP of something like $700 billion. I understand it will come into force at the moment this legislation is enacted today. I believe it will benefit New Zealand and our area for decades ahead. Thank you very much. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 I also want to join in the congratulations that other speakers have given to the trade Ministers responsible for pushing this agreement along. People have referred to Lockwood Smith Jim Sutton and Phil Goff and to the current Minister of Trade the Hon Tim Groser. It is an enormous effort to get an agreement like this negotiated. It requires a range of diplomatic skills and technical knowledge. I know that all the Ministers have worked hard to get their heads around that portfolio. 
I will also briefly note the role of the officials who have negotiated this because if Ministers need to get their heads around technical details and the scope of these agreements then it is the officials who do the grunt work behind that. I particularly acknowledge Martin Harvey and Vangelis Vitalis from the Ministry of Foreign Affairs and Trade. They are both excellent public servants. I am sure that my colleagues opposite would not be at all surprised if I took this opportunity to note that they represent backroom—as the National Government would have it—public servants; the very same ones who apparently are not doing anything useful. Bill English said yesterday that they were not doing real jobs. 
Phil Twyford 
: They’re gone. 
GRANT ROBERTSON 
: They are gone; they are being capped or cut and everything apparently is about the front line. But in the end the value that Mr Hayes and others have talked about tonight—the dollar value in terms of exports and the jobs that could potentially be created out of this—owes an awful lot to those so-called backroom officials. I think everybody in this House should join in congratulating them and thanking them for their excellent work. 
I think that today is a cause for celebration. We are putting in place legislation that will give New Zealand and New Zealanders greater access to a market of 566 million people as has been said. It is a market place where $1.4 trillion in global trade takes place annually. That is a huge figure and it is something that we can now be a part of. For New Zealand it is a growing market. Over the last 3 years we have had a 24 percent per year increase in trade. But restrictions that are still in place until we pass this legislation today mean that $50 million in tariffs is being paid by New Zealand companies in this region. We can now work through and remove those. 
In time 99 percent of tariffs on exports to Indonesia Malaysia the Philippines and Viet Nam will be removed and that is an excellent outcome. Even on day one of this agreement coming into force 70 percent of exports to those countries will be duty-free and that is a fantastic beginning and a fantastic opening for a range of New Zealand companies. 
We know that 25 percent of Fonterra’s exports go to the ASEAN region. Fonterra is our largest company and 25 percent of its exports—about $2.2 billion worth of exports—go to that region annually. That region is an incredibly rich market that we can tap into further and I know that Fonterra and others are waiting anxiously for this legislation to be passed and put into action. I do believe that that is a cause for celebration. 
I also want to mention why this agreement is unique. When negotiations on this agreement began I am not sure that many people even those in trade circles thought we would be able to pull it off. I do not think that many people thought New Zealand and Australia could be part of a large regional body like this and negotiate with it. It is an important innovation. 
I think that our No. 1 goal—and this cuts to some of the questions raised by Dr Kennedy Graham—still has to remain a global deal and it needs to be a global deal that fulfils some of the “GOF” principles that Dr Kennedy Graham outlined in particular the open and the fair principles and also the green principles which I will return to in a few minutes. A rules-based trading scheme that is fair at a global level is I think the aim of both National and Labour and it must be something that we continue to pursue with vigour because it is only then that we will begin to fulfil the open and fair aspects of Dr Kennedy Graham’s vision. 
In the absence of a global deal high-quality regional agreements like this one are the next best thing. Bilateral agreements are important for sure and we continue to work on those and negotiate with a range of countries but a regional agreement can start to knit together the key building blocks of that global deal and this agreement is a high-quality one in that regard. 
New Zealand was able to enter into this agreement with ASEAN—and with Australia as well—in a way that had not been seen before and it made sure that we intensify those relationships in the growing markets of Asia. Other speakers have already talked today about the fact that in terms of our region in terms of the livelihoods of New Zealanders Asia is the place where we must continue to pursue and develop markets. This agreement will enable us to do that. 
I want to touch on three other areas in this contribution. One of them is to note as I did in an earlier speech on this legislation the side agreements on trade and labour and trade and environment that have been brought into force with the Philippines. These go along with agreements that we already have with Thailand Brunei and Singapore on trade and labour and trade and environment. 
I think it is very important that those agreements are worked on and developed as they acknowledge that trade does not happen in isolation. Trade happens as part of our overall relationships with these countries and indeed with how these countries develop. I know that in other agreements we have signed around trade and environment particularly there have been spin-offs for our companies. In the Trans-Pacific Strategic Economic Partnership Agreement with Chile there has been a large amount of interaction discussion and development of ideas in the area of environmental and eco-tourism and in the use of environmental services. 
From the point of view of future trade negotiations we must keep up the momentum to have these side agreements—hopefully—incorporated closely and more often with the main trade agreement. They provide a whole other area of development a whole other area where we can increase our relationship with these countries. I congratulate the Government on the fact that it has gone through with the trade and labour and trade and environment agreements with the Philippines. National has not always been keen on these side agreements but it has gone ahead with this one and I encourage and urge it to continue to include considerations of trade and labour and trade and environment in future agreements. 
Other speakers have already referred to the issue of Burma. I know there will be a number of members in the House who will find it troublesome that Burma is part of this agreement. But I know for sure that by our engagement with the ASEAN region we will be able to ensure that we have more contact and more dialogue with countries around the importance for New Zealand of issues of human rights. 
I think it is important that we continue to build that dialogue and build those relationships because I know as I said that many members in this House myself included have some discomfort about what is occurring in Burma and some discomfort about whether we can continue to work with Burma as a country in a way that we would like to. But I feel that the engagement that we get with the wider ASEAN region through this legislation will enable us to do far more in that regard. 
I also want to briefly refer to a question that was raised in the select committee process around this legislation and that is about how we keep open dialogue and discussion with Parliament during free-trade agreement negotiations. A very brief time line comes into play once an agreement has been signed and then needs to be brought through a legislative process like this one The select committee is given a brief time to look at the legislation look at the agreement and then go forward and bring it back to the House. In a sense it is almost as if we parachute into a negotiation and a discussion. 
I know from my previous work at the Ministry of Foreign Affairs and Trade that there has been a dialogue over many years with both business and unions about free-trade negotiations. People are kept up to date. They are kept informed about those negotiations in a way that in fact Parliament is not. I think there is some cause for Parliament to be updated as to the process of a negotiation so that we are not simply parachuting in on it at the end of the negotiation when there may be issues and core concerns that we need to resolve. 
This is an issue that the select committee has been discussing and will continue to discuss and I hope that over time we can include more people in knowing about what is happening in negotiations and in ensuring that we build a wider and broader range of support. 
I commend this bill to the House. I look forward to seeing the benefits in terms of exports and in terms of the jobs that will flow on from it. I hope that in the future we can continue to build strong regional trade agreements and work towards the global deal with fair rules-based trade that we all know this globe needs. Thank you. 
Debate interrupted. 
Maiden Statements 
Dr CAM CALDER (National) 
: 
 E nga mana e nga reo e nga rangatira tena koutou tena koutou katoa. Good afternoon satsriakal ni hao talofa salaam alaikum ahn nyung ha se yo. I stand before the House today full of gratitude to the hundreds of passionate volunteers who worked so hard for National in the last election and of course those voters the length and breadth of New Zealand who gave the National Party such an overwhelming mandate and allowed me to enter Parliament from the party list. Thank you. 
Since putting my toe in the political waters many have offered me advice encouragement and support. In particular I wish to acknowledge Mel McDonald Simon O’Connor Greg Mulholland Kit Parkinson Chris Mullane Mike Gudsell and members of the “Pride of the Union” who were there when most needed. 
Politics plays havoc with family life. I wish to thank my family and especially my wife Jenny and daughters Leisha and Carla for their love understanding and support in the face of the inevitable disruption my involvement has brought. 
On my lapel I wear the silver fern. Every day it reminds me of our country and the privilege and responsibilities I have in serving as a member of Parliament. I came to politics relatively recently in 2003 because I was concerned at the state of the New Zealand my children would inherit. I want New Zealand to be able to offer my children as much opportunity as it has offered me. I am a proud New Zealander ambitious for our country and wish to contribute to a National-led Government that will allow New Zealand to achieve its full potential and offer a future to my children and indeed all New Zealanders a Government of a country where our young people are inspired share a sense of purpose and a feeling of belonging and are drenched with exhilaration at the possibilities and opportunities open to them with hard work and commitment. 
New Zealand is facing economic challenges on the world stage of unparalleled complexity and fluidity. As well as a fiscal crisis we have a crisis of confidence. Globally no one knows how deep the hole is. I feel privileged to serve in John Key’s National-led Government a Government that is principled pragmatic and inclusive and that is seeking to cushion New Zealand from the worst effects of the financial turmoil; a Government that is a champion of individual freedom and choice that celebrates excellence and that rewards achievement; and a Government that recognising that our society is judged by how we treat our most vulnerable is working with local government and the third sector such as non-governmental organisations and voluntary and charitable organisations seeking to strengthen families and communities. I am exhilarated to rejoin the team and to work towards these ends. I hope my sojourn this time lasts a little longer than my first one. 
My forebears left Scotland and arrived in Dunedin in 1849. I grew up in New Plymouth. By inclination and personal experience I am a compassionate conservative. My father Gordon died when I was 6 years old. I was brought up by my mother Dorothy. She received a widow’s benefit. In my mind’s eye I can still see her working at her old treadle sewing machine making me pairs of shorts to wear to school. Many of my other clothes were those other kids in the neighbourhood had grown out of. My mother’s example taught me the value of hard work and personal responsibility. She encouraged me to dream my dreams and to reach for the stars. Dorothy emphasised that with determination whatever goal one sets one’s heart on can within reason be achieved. Above all however she always encouraged me to do my best and if at first I did not succeed to try try again—advice that has come in handy many times since. Although it was a struggle financially I never felt hard done by or disadvantaged—though I drew the line at eating tripe a second time. I never felt hard done by because I always felt loved by my mother; my brothers Rob and Don; and my sister Julie. 
My experience means I can empathise with the many in single-parent families in New Zealand today. The majority of single mums and dads do a wonderful job raising their children but a disturbingly large number of children are raised not in a loving home but in a love-free zone. Please let me share a story with you. Whilst campaigning in Manurewa during the 2008 election I gave a lift to a hitchhiker a large heavily tattooed Maori gentleman—a local resident and as it later transpired an ex-member of a well-known nationwide gang. Arriving at our destination I asked him for his thoughts on how New Zealand might reduce the growing numbers of the unloved. He talked about his community and about his experiences growing up: the death of his father an alcoholic mother a succession of stepdads alcoholism violence meted out and received gang membership crime prison and now battling with this legacy attempting to remain outside the boob. He had no answers. By the end of his story he was in tears and I was close to it myself. His story is tragic. However the real tragedy is that it is a tale all too common to thousands of young and not-so-young New Zealanders. 
Our people are our greatest resource. Our society is judged by how we treat our most vulnerable. A Government cannot legislate aroha; a Government cannot legislate love. One of our greatest challenges this term—and there are many—is to address the problem of protecting the vulnerable without encouraging the dependent behaviour that has been shown to have such harmful effects on our youth and New Zealand society. I believe in a compassionate welfare system—a safety net however not a drift net. There are no simple easy answers and one has to avoid silo thinking but there is no doubt that with the involvement of national government local government the third sector and crucially the political will the mesh can be reshaped and gains can be made. 
As I mentioned earlier I have fond memories of my childhood growing up in Taranaki. The education I received at Westown School and New Plymouth Boys’ High School gave me a solid grounding and allowed me to proceed to further study at Otago University. After post-graduate study in Australia I set off from Melbourne with a pack on my back. I took a boat from Perth to Singapore and travelled overland from Singapore to London meeting folk of startlingly diverse backgrounds along the way. Despite their differences it was apparent even to a callow Kiwi boy how many needs and aspirations were shared by and common to the disparate groups and ethnicities. After a 6-month journey and down to my last US$20 I made it to England. 
Eventually I bought a dental practice and whilst running the practice took a degree in medicine from Cambridge University—motto: “Hinc lucem et pocula sacra”; the literal translation: “From here light and sacred draughts”. During my student days at Cambridge the preferred sacred draught consumed at times in alarming quantities was Greene King India Pale Ale. However the non-literal translation of the Cambridge motto is apposite and in an ideal world it would be true of any educational establishment: “From this place we gain enlightenment and precious knowledge”. 
A world-class education system is fundamental to New Zealand nurturing our people and arresting our currently declining standard of living and place in the OECD. National is spending nearly $1.7 billion on education including new spending on early childhood education and helping students meet national standards in literacy and numeracy. We have much to do. 
During the last 6 years I was privileged to be chosen as National’s candidate in Manurewa. I spent 6 months walking the streets of the electorate. My trusty RMs took a pounding and I had to get them resoled. I relished the campaign and the opportunity to listen to the members of the colourful vibrant diverse Manurewa community—a microcosm of wider New Zealand society. I listened to the community gatekeepers—the mayor the church leaders the sports clubs hundreds of small-business owners and thousands of residents. I listened to Pat who was concerned about graffiti on her fence; Warren 14 who wanted a panel-beating apprenticeship; Sanjay a small-business owner who was concerned about tax cuts and cutting red tape; Elsie 80 years old who was concerned about her personal safety; and Gary a lifelong union activist who was alarmed by what he saw as the decline of standards in New Zealand and the lack of accessibility to world-class health care for all. These concerns were remarkably similar to those voiced by folk who live in Epsom on the North Shore in Thorndon in Wellington Fendalton in Christchurch or Maori Hill in Dunedin. 
As I said during the campaign National is not perfect. We do not have a magic wand and we cannot change things overnight but John Key’s National-led Government working with our support parties is listening to the voice of New Zealand and is working to address these crucial areas of education health and personal security as well as the many other challenges the current global situation has thrown up. The straitened financial times we are living in means another huge priority is addressing the concerns of small businesses and aiding their ability to grow the economic cake—the cake that ultimately underpins our nation’s well-being and ability to recover from the current recession. 
If I may plant a few seeds with this speech from my background in medicine I believe that it is essential that New Zealanders are given the tools to take responsibility for their own health. As Professor Beaglehole observed recently the key to prevention is to make healthy choices the default option. It is gratifying to learn that smoking is no longer seen as cool among many young people but the ravages of smoking and alcohol abuse cost thousands of New Zealanders their lives each year. There is room for simple low-cost light-touch interventions here. More of us exercising more often and eating more wisely will improve our nation’s health markedly. An education programme similar to the one in France which nudges people in a healthy direction whilst eschewing the wagging finger of a nanny State could be instituted at minimal cost. 
The Kiwi male is renowned for considering himself indestructible—he is not. I have a couple of friends who are alive today because a simple blood test the prostate-specific antigen or PSA alerted them to the possibility that further investigation of their prostate may be indicated. I wonder how many men would like to know year after year with a simple test that everything is normal that their prostate is within the normal range rather than to find out in a one-off test too late that it was three to four times the norm. Let us promote the “man-o-gram” for blokes. 
I am a keen fisherman. I would like my children’s children to be able to take home a feed as easily as I can today—if not more easily. I have discussed the concept of a series of marine reserves with the Minister of Conservation and caucus colleagues and have been gratified with their response. Finally we all recognise that quality of life is not just a matter of economic success though economic success is fundamental to our well-being. As well as measuring our GDP therefore let us make New Zealand the first country in the world to measure our quality of life with a GPI a genuine progress indicator—that is a comprehensive assessment of the total well-being of a community including social cultural and environmental aspects and the economy. 
Last year Nicolas Sarkozy issued the rallying cry: “Ensemble tout devient possible.”—“Together all becomes possible.” He won the presidency of France. Since the last election in New Zealand it has not been politics as usual. Some were surprised when John Key reached out across the political spectrum to the Maori Party to ACT to United Future and to the Greens. I was not surprised because that is how our leader and this party have been thinking. We are all in this together. The best politics is good government. John Key’s National-led Government has bid adieu to the politics of bitterness and divisiveness and has invited our support parties from elsewhere in the House to help paddle New Zealand’s waka. Though the waters are turbulent the waka is on course and is moving steadily in the right direction. Together all becomes possible. Mr Speaker I am honoured to serve all New Zealanders in this the forty-ninth Parliament of New Zealand and thank you for the opportunity to deliver my maiden speech. Kia kaha. Cruachan. Thank you. 
Sittings of the House 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 The House is just a few minutes away from what would be the normal rising time. We have made good progress with business today. Accordingly I seek leave for the House to rise at this earlier moment. 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 I raise a point of order Mr Speaker. I just want to check with our whips that there has been proper consultation on that. There has not. I think we should move an adjournment motion and we should have a debate. 
Mr SPEAKER 
: Leave has been sought. 
Hon Trevor Mallard 
: I have now been assured that it has been agreed— 
Mr SPEAKER 
: I am on my feet. I do not mind other members standing as they congratulate Mr Calder. Leave has been sought for the House to stand adjourned. Is there any objection to that course of action? There is none. 
The House adjourned at 5.53 p.m.