Hague Kevin: Regulatory Improvement Bill — Second Reading In Committee 
Text is incorporated into the Bound Volume 
Hague Kevin: Regulatory Improvement Bill — Second Reading In Committee 
[Sitting date: 30 March 2010. Volume:661;Page:10187. Text is incorporated into the Bound Volume.] 
KEVIN HAGUE (Green) 
: 
 I want to pick up not exactly where I left off but where the Minister in the chair the Hon Rodney Hide left off in his discussion of the proposed changes to the Conservation Act. He referred not so much to the specific objectives of the Regulatory Improvement Bill in terms of removing gaps duplications errors and inconsistencies but rather to the broader purpose for which those were to be removed—in other words to improve the environment for business. He used two words in respect of the proposed increase in the maximum length of concessions from 5 to 10 years. He said it would make the process more efficient and more contestable. 
Well it has been a while since I studied economics but it seems to the Green Party that the effect of increasing the term of concessions is not so much to improve contestability for example but to reduce contestability. The effect of a concessionaire having his or her concession extended for a further 5 years—again I emphasis for the House that there is not necessarily any public input at all—is to make it very much more difficult for competitors and those who might wish to test the concession to have a viable go the next time. I am mindful of the work of the Commerce Commission in respect of laboratory services for the Otago and Southland district health boards. The Commerce Commission had the very strong view that in that case the sole contract that was proposed for an extended period would have a chilling effect on competition and on contestability by shutting out competitors; that when it came to the end of that contract it would be difficult for other potential competitors to be in a position to make viable bids. 
So what this bill proposes is anti-competitive. It seems unusual for the Green Party to be making that point in a House where normally either National or Labour is making that point but it seems that we need to because no one else is doing it. I think we would call the bill monopolistic. 
I want to talk in the time I have remaining about several of the other downsides. Sure there is an upside; there is a small increase in efficiency for the business that happens to be successful in getting the concession. It is a small upside. On the other side for the department there is a reduced cost in administering it. On the downside we have the monopolistic effect of a chilling of competition. We have the fact that there will be increased pressure from other businesses that have been shut out of that process wanting to apply for concessions in other parts of the conservation estate. In terms of determining appropriate conditions we have the difficulty of predicting at the beginning of a 10-year period what all of the effects may be over that 10-year period. There is a mid-term review but my submission is that it is inadequate. 
I am particularly concerned about the fact that the public are shut out of the process. In response to the Hon Dr Wayne Mapp’s contribution earlier on can I say I am very much aware that the bill provides for concessions in excess of—exceeding—10 years on which yes the public will have the right to have a say but anything up to 10 years is solely at the discretion of the Minister. I believe that that is inappropriate and inadequate. 
I say that in the broader context of the pressures on the department around concessions that I referred to earlier. We are already seeing decisions being made by the department for commercial reasons. It is a small point but the Cathedral Cove concession stand earlier this year was a concession that served no conservation purpose at all. It was a concession that was given purely for revenue. If we are starting to see conservation values such as the untouched nature of that place being comprised for revenue in a small case like that what will we see in more important places with more important conservation values? We have seen the department allow commercial eeling of threatened long-finned tuna in national parks. What was the reason for that? Again it was revenue. 
We are in an environment where the Government has starved the Department of Conservation of cash—a $52 million reduction in funding over a 4-year period—at a time when the threats to our biodiversity the threats to our natural values and the threats to our public conservation estate are greater and greater. That leaves the department in a totally invidious position because it has increasing demands on its budget on the one hand and decreased revenue on the other. That means that in its new business development strategy it is looking for ways of developing new revenue streams. This bill which extends the time of concessions to 10 years without necessarily any public say at all provides an avenue for the department to pursue. The temptation will be great to grant concessions under this new provision in order to obtain revenue. Longer periods will be more lucrative; there is more in it for businesses from longer periods. The risk is that the objective of the Conservation Act of preserving those fantastic treasured places for all New Zealanders living now and for all of those to come for their inherent biodiversity and conservation values but also for their recreational access will be compromised by that process. 
In summary this bill in respect of the changes to the Conservation Act and to the reserves legislation is bad law. They do not fit the objectives of this kind of bill but also they set a set of objectives for the department that are at odds with the purpose of the Act and with the purpose of that public conservation estate and they should not proceed.