Volume 618 Week 62 - Tuesday 27 July 2004 
Volume 618 Week 62 - Tuesday 27 July 2004 
[Volume:618;Page:14293] 
Tuesday 27 July 2004 
Mr Speaker 
 took the Chair at 2.15 p.m. 
Prayers 
. 
Visitors 
Socialist Republic of Vietnam—President of the National Assembly 
Mr SPEAKER 
: Honourable members first I have much pleasure in informing you that His Excellency Mr Nguyen Van An President of the National Assembly of the Socialist Republic of Vietnam is within the precincts of the Chamber. I am sure that members would wish he be welcomed and accorded a seat on the left of the Chair and that the House would also welcome the members of the delegation in the gallery. 
His Excellency Mr Nguyen Van An accompanied by the Minister of Foreign Affairs and Trade entered the Chamber and took a seat on the left of the Chair. 
United Kingdom—Parliamentary Delegation Commonwealth Parliamentary Association 
Mr SPEAKER 
: I also have much pleasure in informing members that a parliamentary delegation from the United Kingdom branch of the Commonwealth Parliamentary Association is present in the gallery. I am sure members would wish that those visitors be welcomed too. 
By-Election 
Te Tai Hauauru 
Mr SPEAKER 
: I have been advised by the Chief Electoral Officer pursuant to section 185 of the Electoral Act 1993 that the name of the member elected to the House of Representatives for the Te Tai Hauauru electoral district is Tariana Turia. I understand that Tariana Turia is present and wishes to affirm. Would she please come forward to the chair on my right. 
Members Sworn 
Tariana Turia was presented to the Speaker made the affirmation required by law and took her seat in the House. 
Voting 
Correction 
Mr SPEAKER 
: When the House was in Committee on the Parole (Extended Supervision) and Sentencing Amendment Bill the result of the vote on Marc Alexander’s proposed amendment to clause 10 to omit and substitute proposed section 107A(b) was incorrectly announced. The correct result is Ayes 35 Noes 84. 
Motions 
Floods—Eastern Bay of Plenty 
Hon TONY RYALL (National—Bay Of Plenty) 
: 
 I move  
That the House note the recent severe flooding in the Eastern Bay of Plenty with consequent damage to homes farms roads and stopbanks; express its sympathy to the family of the late Mrs Beverley Freeman and further commend the tireless efforts of the emergency services and the many hundreds of volunteers assisting families and farmers in the huge recovery ahead. 
JANET MACKEY (Labour—East Coast) 
: 
 I concur with the sentiments expressed by the Hon Tony Ryall. Having visited the region yesterday I can testify to the strength and dedication of that community in repairing the damage and in moving on with their lives. I also want to draw special attention to those agencies both governmental and non-governmental that have moved right outside their comfort zones and core business to take their skills—skills that are not normally needed in that community but that are in demand now—and use them to help the people of the community rebuild their homes and their lives. I am sure that members of the Labour Party agree with the sentiments expressed by Mr Ryall and we wish the people of the community all the best for their redevelopment. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 On behalf of my colleagues in New Zealand First I endorse the sentiments expressed in the Hon Tony Ryall’s motion and echoed by Janet Mackey. It is a dreadful disaster and it is absolutely beyond belief in many respects. It says much for the people of that area that they are showing such effort and determination to right things. On behalf of New Zealand First Party members and our members of Parliament I wish them all the very best in their endeavours. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 On behalf of the Green Party I add our sympathies and very good wishes to the people affected by these terrible floods. It was a great shock for me to recognise on the front page of the  
New Zealand Herald  
a house that was teetering on the brink. I had stayed there not so long ago. It is occupied by a couple of prominent members of the Greens and we have been in email communication with them. Certainly the situation has been very very difficult for people there. I think the time has come when we need to work with local government to put in place preventative measures against this kind of climatic event which is going to become more frequent. 
JUDY TURNER (United Future) 
: 
 On behalf of United Future I extend our sympathies also to the people of Whakatane Edgecumbe affected areas of Opotiki and the Matata straight. I make the personal statement that I am extremely proud of my community for the way that people have pulled together and worked together through an extremely difficult time. I am very proud to be part of that community. 
Motion agreed to. 
Points of Order 
Parliamentary Membership—ACT New Zealand 
RODNEY HIDE (Leader—ACT) 
: 
 I raise a point of order Mr Speaker. I raise what I think is a serious point for the ACT party and indeed for this House. We would like you to give it your due consideration perhaps consult with the Business Committee and report back to us. 
You will be aware that the Court of Appeal has recently put down a judgment which found that the ACT party was wrong to have the belief that: “Our proportionality has been distorted.” But what we find is that you have made a decision that we no longer have nine MPs as we were elected with; we have eight MPs. So accordingly our seating has been adjusted for eight members our parliamentary resourcing has been adjusted for eight members the number of calls we get in any speaking slot on any bill or at question time is as if we have eight members and our representation on select committees is as if we have eight members. 
We are considering what our response should be in light of this judgment. Although I do not ask for your consideration now I ask you to consider whether you are correct in assigning us as having only eight MPs in this House and allocating the proportion accordingly. 
Mr SPEAKER 
: I thank the member and I thank the other member of his party who raised this issue for the advice that I received from him. I will give this matter serious consideration and report back as the member has requested. 
Questions to Ministers 
Economy—Reports 
1. CLAYTON COSGROVE (Labour—Waimakariri) 
 to the  
Minister of Finance 
: What recent reports has he received on the state of the New Zealand economy? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 The latest international  
Economic Freedom Report  
ranked New Zealand the third-freest economy in the world equal with Switzerland Britain and the United States and behind only Hong Kong and Singapore. The ACT party recently described New Zealand’s economic performance as “truly outstanding” which I think is a fair reflection of how things are going. 
Clayton Cosgrove 
: What risks if any are there to New Zealand’s growth prospects? 
Hon Dr MICHAEL CULLEN 
: The biggest economic risks in the short term are continuing volatility around oil prices and the stronger than expected slow-down in migration. The biggest risk in the medium term is the possibility of an irresponsible fiscal stance being adopted by any future Government and I note that certainly some people are promising simultaneously to cut taxes and substantially increase spending on defence and law and order. I am sure a previous Reserve Bank governor would have condemned such approaches by a major party. 
Dr Don Brash 
: Did the Minister get any reports at all from his official economic advisers in Treasury that the Holidays Act or the Employment Relations Law Reform Bill would improve the outlook for the economy or did they like the recent OECD report on the New Zealand economy warn of the dangers of reregulating the labour market? 
Hon Dr MICHAEL CULLEN 
: There have been some complaints around the Employment Relations Law Reform Bill. They come from the very same people who told us that the Employment Relations Act would lead to not a single new job being created in New Zealand. Unemployment is now down to just over 4 percent—not counting of course those on the Opposition benches who are underemployed. 
Dr Don Brash 
: I raise a point of order Mr Speaker. The Minister did not answer the question I asked at all. 
Mr SPEAKER 
: While a point of order is being heard I will hear it in silence. That is the only warning today. Please restate the point of order. 
Dr Don Brash 
: I asked whether the Minister had had any reports from his own economic advisers that those two pieces of legislation would improve the outlook for the New Zealand economy or whether they instead warned like the OECD report on the New Zealand economy that that legislation would damage the outlook for the New Zealand economy. 
Mr SPEAKER 
: The member should expand a little. 
Hon Dr MICHAEL CULLEN 
: As I recollect the official advice it was not likely to make very much difference to the economy at all. Given the fact that nearly all Treasury staff are on 4 weeks’ holiday already I am sure that is true. 
Rt Hon Winston Peters 
: Is it correct that for example Ireland which has a similar population to New Zealand exports five times more than New Zealand or that Singapore exports more than six times per capita than our population; is that not profound evidence of a significant failure in the economic direction this country has taken in the last 20 years? 
Hon Dr MICHAEL CULLEN 
: It is also true that Ireland imports nearly five times as much as New Zealand. That is the nature of the Irish economy. The United States exports significantly less than New Zealand as a proportion of gross domestic product (GDP). I would be very happy if our GDP per capita figures were the same as theirs. 
Rt Hon Winston Peters 
: Will the Minister give us details of the comparative spending power of for example every Singaporean and Irish person as opposed—[ 
Interruption 
] 
Mr SPEAKER 
: There will be no comments from anyone other than a member of Parliament or that person will be removed. I ask the member to restate his question. 
Rt Hon Winston Peters 
: I ask the Minister to give us the comparative figures in terms of spending power of every Singaporean and every Irish person as opposed to every New Zealander; again is that comparison not compelling evidence of our economic failure? 
Hon Dr MICHAEL CULLEN 
: The GDP per capita in both Ireland and Singapore is now above New Zealand’s. This can scarcely be pointed to as a success for a pure free-market approach. Singapore has only recently taken its first tentative steps to deregulating the importation of chewing gum for example. 
Sickness Benefit—Invalids Benefit 
2.  
KATHERINE RICH (National) 
 to the  
Minister for Social Development and Employment 
: As of today how many New Zealanders are receiving the sickness and invalids benefits and what percentage change does that represent from the numbers receiving the same benefits in 1999? 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 Consistent with the long-term rising trend in the number of sickness and invalids beneficiaries as at the end of June 2004 44128 New Zealanders were receiving the sickness benefit—an increase of 34 percent on the 33022 receiving that benefit at the end of June 1999. The comparable figures for the invalids benefit are 72342 41 percent and 51173. This increase compares with increases of 69 percent in the number of sickness beneficiaries and 84 percent in the number of invalids beneficiaries between 1990 and 1999. 
Katherine Rich 
: Can the Minister tell the House how his Government’s policy changes have contributed to a 34 percent increase in sickness benefit numbers since December 1999 when in the 2 years prior to his Government coming to office the numbers were steadily in decline? 
Hon STEVE MAHAREY 
: As the member knows the underlying reasons for the rise in numbers of sickness and invalids beneficiaries are no different in this country from others—for example the ageing population. But this Government in April this year against the backdrop of the lowest unemployment rate for 20 years launched a sickness and invalids benefits strategy which will assist more people off those benefits and back into paid employment. 
Moana Mackey 
: What is the Government doing to support sick and disabled people working to the extent that they are able? 
Hon STEVE MAHAREY 
: As I said in April this year the Government launched its sickness and invalids benefits strategy to step up assistance to people who are sick or have a disability. It includes a pilot programme paying for health treatment where it will assist the return to work; enhanced case management by lowering the number of active cases for each case manager; specialist work brokers to support clients and employers; and allowing invalids beneficiaries to trial working 15 hours or more without losing their benefit. The Government wants to ensure that it harnesses the skills of these people because we have the lowest unemployment rate in around 20 years and they are needed in the workforce if they are able to be there. 
Sue Bradford 
: To what extent does the Government believe that people being forced off accident compensation and into the benefit system is adding to the numbers of people on the sickness and invalids benefits? 
Hon STEVE MAHAREY 
: I think from memory about 17000 over the last 5 years. 
Dr Muriel Newman 
: In light of the increase in sickness benefit numbers by over a third since he has been the Minister at an annual cost of almost $500 million a year can he explain why the proposal to address this surge in numbers that was prepared by his Ministry of Social Development has been withdrawn until 2006 in spite of strong advice from Treasury stating: “Due to the large fiscal growth in this area there is a pressing need for reform options before 2006.”? 
Hon STEVE MAHAREY 
: We agree with Treasury. That is why in April this year we launched a major new strategy that means we will do everything we possibly can to remove barriers between a person being on a benefit and going back to work. For example we are willing to go as far as buying an operation for a person if it will return that person to work. 
Judy Turner 
: Does the Minister stand by his claim on National Radio this morning that the increase in the number of sickness beneficiaries is a result of an ageing population when the number of people under 20 years on the sickness and invalids benefits has also jumped by a third since the year 2000? 
Hon STEVE MAHAREY 
: Yes of course I stand by that; it is one of the reasons that drive these benefits worldwide. But the member has raised another reason why we are seeing an increase in this area. There are a number of reasons why we are seeing more people on a sickness benefit or an invalids benefit. There are many reasons and they are complex. 
Katherine Rich 
: Why does the Minister continue to use an ageing population as an excuse for rising sickness benefit and invalids benefit numbers when a report from his own ministry in 2003 states: “Ageing populations played little role in benefit growth over the last 30 years.”? 
Hon STEVE MAHAREY 
: Perhaps it is because I am getting older myself—I do not know. But I would say that my department has consistently reported the ageing population in New Zealand—particularly amongst people of European origin—as one of the reasons that we are seeing more people on these benefits and that is for the very logical reason that age often goes with a condition that may mean that a person cannot go to work. 
Judy Turner 
: Can the Minister confirm that of the 60000 people who have transferred from the dole to the sickness benefit since 1999 stress and depression have been the second and third most popular reasons for transferring with both doubling in number in that time; and what possible explanation does he have for that pattern of behaviour? 
Hon STEVE MAHAREY 
: It is one of the features of systems around the world that we are seeing psychological conditions such as stress and depression being the reason for people seeking income support because they are unable to go to work. It is one of the reasons why that is a key feature of the sickness and invalids benefits strategy that I have been speaking about today. I will just correct the member: since 1999 to now about 73000 people have moved from the unemployment benefit to the sickness benefit and 42000 have moved from the sickness benefit back to the unemployment benefit. Therefore a net number of about 31000 people remain on the sickness benefit. 
Katherine Rich 
: When a 2003 report from his own ministry on the subject of the rising number of sickness benefits and invalids benefits confirms that by international standards the New Zealand sickness and invalids benefit systems are “passive” and that once beneficiaries are in the system “little is done to attempt to rehabilitate them into employment” why should the House believe that the Minister is on top of the problem of the rising number of invalids benefits and sickness benefits? 
Hon STEVE MAHAREY 
: Because of that report in April this year—and I stress that to the member—we launched the sickness and invalids benefits strategy which is a very active approach to ensuring that people are able to go to work against a backdrop of the lowest unemployment rate in 20 years and the fourth-lowest rate in the OECD. 
Judy Turner 
: Can the Minister confirm that sickness beneficiaries and invalids beneficiaries are not required to undertake treatment programmes as a requirement of their benefit; if so can he tell us why that should be the case? 
Hon STEVE MAHAREY 
: Of course a case manager is not a person with a medical qualification. For sickness and invalids beneficiaries we rely on the opinion of a qualified designated doctor a specialist or a general practitioner who will thereby prescribe treatment. 
Katherine Rich 
: As between 1993 and 1999 about 50 additional people joined the sickness benefit queue per month can the Minister explain why under Labour more than 250 extra people per month have joined the sickness benefit queue when variables other than Government policy have remained largely unchanged? 
Hon STEVE MAHAREY 
: As the member knows from the figures I read out before during the 1990s we saw an increase in the numbers of both those benefits of between 60 and 80-plus percent. The member therefore knows that the reasons that lie behind those benefit increases are consistent and she therefore should applaud the fact that finally a Government has decided that it will do something about this matter against a backdrop ofvery low unemployment. 
Dr Muriel Newman 
: I seek leave to table an official information briefing paper that states that the major reform proposal by the Ministry of Social Development has been withdrawn. 
Document by leave laid on the Table of the House. 
Sickness Benefit—Unemployment Benefit 
3.  
Rt Hon WINSTON PETERS (Leader—NZ First) 
 to the  
Minister for Social Development and Employment 
: Does he still dismiss suggestions that Work and Income had a policy of transferring hard-to-employ people from unemployment to sickness benefits; if so why? 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 Yes because there is and has been no such policy. 
Rt Hon Winston Peters 
: How can the Minister blatantly dismiss any such suggestion when we have had a circumstance as proven by a written question to his colleague Mr Barker last year on 31 October that revealed that over 36.1 percent of those on sickness benefits were in receipt of the unemployment benefit immediately prior to being placed on a sickness benefit and how does he answer those sorts of facts? 
Hon STEVE MAHAREY 
: The original question from the member concerned a policy that might see the transfer of hard-to-employ people from the unemployment benefit to a sickness benefit. I am giving him an unequivocal guarantee that there is no such policy and that this Government is committed to ensuring that people who are on those benefits are put in a position whereby they can undertake work where that is possible. We are very actively following that policy. 
Georgina Beyer 
: How does the number of people transferring from the unemployment benefit to a sickness benefit compare to the total number of people leaving the unemployment benefit? 
Hon STEVE MAHAREY 
: Over the last 6 years a total of 1.1 million people have left the unemployment benefit. To assist the member’s understanding of that I will explain it means that the same person can go back and forwards off the benefit either through cancellation of a benefit or transfer to another benefit. Of those people 73000 or less than 7 percent have transferred to the sickness benefit. Over the same period 52000 people have transferred from the sickness benefit to the unemployment benefit meaning a net transfer of 21000 from the sickness benefit to the unemployment benefit. 
Rt Hon Winston Peters 
: Does the Minister seriously expect any sort of integrity to attract to his name when he tries to explain away the fact that over 36 percent of the people on the unemployment benefit fell sick and then went on to a sickness benefit; what fools does he think the people of New Zealand are? 
Hon STEVE MAHAREY 
: I think the people of New Zealand are extraordinarily wise. I guess that is why we are the Government. I do not have that figure in front of me and all I can say to the member is that the figures I have just read out show that over the period of this Government 73000 people have moved from the unemployment benefit to a sickness benefit and 52000 people have gone the other way. 
Rt Hon Winston Peters 
: I seek leave to table an answer given by Rick Barker in October of last year that sets out that over 36 percent of the people on the unemployment benefit fell sick and another answer from the same Minister that details the sickness benefit application numbers. 
Documents by leave laid on the Table of the House. 
Foreshore and Seabed—Veto Powers 
4.  
GERRY BROWNLEE (Deputy Leader—National) 
 to the  
Deputy Prime Minister 
: Does he stand by his response on the  
Agenda 
 programme of 24 April 2004 when asked if an effect of the Foreshore and Seabed Bill will be to create veto powers effectively allowing Maori to refuse consent unless they are reimbursed thereby creating a charging regime that “If we’re talking about a customary usage right that could be the case”; if so why? 
Hon Dr MICHAEL CULLEN (Deputy Prime Minister) 
: 
 Yes the Government has always said that customary rights are property rights and as such will have legal protection under the law. The power to prevent a development will arise only when the relevant regional council has ruled that such a development would have a severe adverse impact on the ability to exercise the recognised customary right. 
Gerry Brownlee 
: How does the Seabed and Foreshore Bill’s legitimising of the koha-for-consent practice sit with this Government’s claims to want to reduce the cost and time of Resource Management Act consents? 
Hon Dr MICHAEL CULLEN 
: As I said where a customary right exists and a regional council rules it would have a severe adverse impact for a development to occur then a property right is being adversely affected. The fact that that property right is held by Maori should not mean it is treated any differently from the property rights held by Pakeha. 
Russell Fairbrother 
: What test does the Foreshore and Seabed Bill apply to customary rights? 
Hon Dr MICHAEL CULLEN 
: The test is a high one. They must be applied for through either the Maori Land Court in the case of Maori or the High Court in the case of non-Maori. Applicant groups must be able to demonstrate that the use or activity is integral to their culture and has been practised substantially uninterrupted since 1840. It is expected therefore that those rights when they are established will be specific in nature and discrete. 
Dail Jones 
: Is the koha-for-consent process referred to in the supplementary question asked by the deputy leader of the National Party something that came into being as a result of the Resource Management Act passed by National when it was in office? 
Hon Dr MICHAEL CULLEN 
: The so-called koha-for-consent process is certainly a result of the Resource Management Act passed under the previous National Government. But of course similar payments are made to Pakeha; they are just not called koha in that case. 
Hon Ken Shirley 
: In developing the foreshore and seabed legislation did the Minister and his Cabinet colleagues give consideration to including a clause to limit the potential for stand-over fees and charges for approving consents to be included; if not why not? 
Hon Dr MICHAEL CULLEN 
: That issue should arise in the context of a general review of the Resource Management Act. But a party that stands by property rights as being the basis on which the entire civilisation rests as does the ACT party I think will be very careful about interfering with the capacity to be compensated for the loss of the use of those property rights. 
Hon Peter Dunne 
: With regard to the interface between the foreshore and seabed legislation and other enactments such as the Resource Management Act in respect of the issue of customary rights is the Deputy Prime Minister satisfied at the level of public understanding of the concept in terms of what is being proposed in the foreshore and seabed legislation; if he is not satisfied what steps will the Government take between now and the implementation of that legislation to ensure that those concepts are widely understood so that there can be no potential confusion or feeling after the event that what people got was not what they expected? 
Hon Dr MICHAEL CULLEN 
: No I am certainly not satisfied and I think that the nature of much of the public debate on this issue demonstrates the reason for that lack of satisfaction. But I am sure that if the Government was to engage in a major campaign of education on this matter we would have screaming headlines with various Opposition members’ names attached to them. I am confident that when the Act is in place people will notice remarkably small change in what they are doing now legitimately and that will probably be the best proof of the Act’s operation. 
 Tariana Turia 
: Whom do customary rights flow from and what assurances can the Government give that the foreshore and seabed will not be sold by Governments of the future? 
Hon Dr MICHAEL CULLEN 
: Customary rights flow from the exercise of common law rights which predate therefore the signing of the Treaty of Waitangi; indeed the English version of the treaty states in article 2 the current then understanding of what customary rights were at the transfer of sovereignty. I am sorry but the second part of the question was— 
Hon Member 
: What security? 
Hon Dr MICHAEL CULLEN 
: Parliament is sovereign. The best security therefore is not to elect Governments that believe in selling State assets whatever they are. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. That answer is totally unsatisfactory. It clearly did not address the question. To go off and say that the safe way to protect the foreshore and seabed is to elect a Government that would not sell State assets hardly addresses the issue that was raised by the member asking the question. 
Mr SPEAKER 
: I thought it did. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. With the jeering and catcalling from the Government benches I missed the answer. I thought I heard Mr Cullen decrying those who would sell State assets but I might have got him wrong. Can you confirm that he said that? 
Mr SPEAKER 
: That was the impression that I gained too as Speaker when I was listening to the answer. 
Gerry Brownlee 
: Did the Government consider any advice in preparing the Foreshore and Seabed Bill that raised the issue that the selling of consents into areas of customary use could lead to future treaty grievance and a liability on the wider New Zealand community? 
Hon Dr MICHAEL CULLEN 
: Actions undertaken by Maori on a willing buyer willing seller basis have never been the grounds for successful treaty grievances. Treaty grievances related often in the past to an unwilling seller basis. 
Food Safety—Contaminated Cornflour 
5.  
SUE KEDGLEY (Green) 
 to the  
Minister for Food Safety 
: Why has she not used her powers under section 40 of the Food Act 1981 to issue a mandatory recall of all food products that contained cornflour that was contaminated with lead 100 times above the maximum level accepted under New Zealand standards? 
Hon DAMIEN O'CONNOR (Acting Minister for Food Safety) 
: There is no need. The New Zealand Food Safety Authority has worked closely with the companies involved and where it has been necessary product recalls have been effected. There has been complete cooperation from the companies. 
Sue Kedgley 
: Is the Minister aware of recent research such as the 2003 definitive study in the  
New England Journal of Medicine  
that concludes that any lead exposure whatsoever may lead to irreversible intellectual impairment in children and why therefore is the so-called Food Safety Authority falsely telling New Zealanders that there are no short or long term effects from consuming cornflour contaminated with lead? 
Hon DAMIEN O'CONNOR 
: The Food Safety Authority is not misleading New Zealanders in any way at all. It is undertaking tests of a number of food products—approximately 30—to identify whether there are any excessive levels of lead contaminant. Where there are identified levels above that accepted in New Zealand or in Australia those products are being recalled. 
Steve Chadwick 
: Would country-of-origin labelling have helped this situation? 
Hon DAMIEN O'CONNOR 
: No. This cornflour was a product made in New Zealand; the cornflour being generally milled from New Zealand corn and imported corn being used only when New Zealand corn was not available. Country-of-origin labelling for every ingredient particularly minor ones is impractical and costly and that cost would eventually be passed on to the consumer. 
Sue Kedgley 
: Does the Minister dispute the statement made by Hutt Valley medical health officer Stephen Palmer that: “Lead is a really hazardous substance especially for small children. Relatively low doses can in very young children affect the neurological system and slow development. It shouldn’t be in food.”; if not why did the Minister of Health claim in a statement made today that for any lasting damage people would need to have an ongoing intake of high levels of lead? 
Hon DAMIEN O'CONNOR 
: In response to the second part of the question because that is the truth. We do realise the potential danger from excessive and prolonged exposure to lead. I am very pleased to say though that between 1982 and 1998 dietary lead exposure decreased by over 95 percent in the diet of the average New Zealander. We are very aware of the potential danger. That is why the Food Safety Authority is moving quickly on this issue. 
Sue Kedgley 
: What advice does the Minister have for the father who phoned me last night worried sick because his daughter has glycogen storage disease which requires her to eat corn maize every 2 hours and for other parents who are desperately worried because their children had consumed large amounts of this recalled product—Robinson’s Step Up Egg Custard—over the last 6 months? 
Hon DAMIEN O'CONNOR 
: While it is very hard not being an expert to give specific advice on that issue I suggest that every parent in the country should give their children a balanced diet and consuming a large number of packets of egg custard is probably not healthy in any way for any child. 
Sue Kedgley 
: What confidence can the public have in the Food Safety Authority when it found this significant contamination only by accident and then set about downplaying the dangers to the public in spite of scientific evidence to the contrary? 
Hon DAMIEN O'CONNOR 
: The Food Safety Authority has not downplayed the danger. It has acted swiftly on this issue. It has exposed through normal monitoring through the Total Diet Survey in this country something that this country does at world’s best practice—that is assessing the intake of the average New Zealander’s diet. We have done this well. We have exposed a problem and we are moving on it quickly. 
Rod Donald 
: Does the minister agree with the statement made by the Food Safety Authority’s director of domestic and imported food Tim Knox in today’s Christchurch  
Press 
: “The rapid growth in food imports since 1996 exposed the country to new risks.”; if so why does his Government continue to oppose country-of-origin labelling of food and why does he continue to deny New Zealand consumers the right to know where their food comes from so they can decide for themselves what level of risk they are willing to bear when they buy overseas-produced food? 
Hon DAMIEN O'CONNOR 
: As I pointed out in answer to the first supplementary question country-of-origin labelling would not necessarily ensure that we knew where every product came from if some of that food was manufactured in this country. That is accepted as international practice around country-of-origin labelling. The most important thing is that the Food Safety Authority has a robust system of ensuring that every New Zealander has access to safe food and that wherever we expose some problems we act on that promptly. We are doing so now. 
Sue Kedgley 
: I seek leave to table from the  
New England Journal of Medicine 
 a recent definitive study showing that intellectual impairment of children can occur even with extremely infinitesimal amounts of lead. 
Document by leave laid on the Table of the House. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. This is naturally a topic that I take a great deal of interest in. I am wondering whether the member will give us some assurance that the member for New Lynn is not currently demonstrating with his hair colour an excessive consumption of lead. 
Mr SPEAKER 
: This is one of those rare occasions when I am completely lost for words. 
Tertiary Education Commission—Growth and Innovation 
6.  
LYNNE PILLAY (Labour—Waitakere) 
 to the  
Associate Minister of Education (Tertiary Education) 
: How is the Tertiary Education Commission assisting the tertiary education sector to support growth and innovation? 
Hon STEVE MAHAREY (Associate Minister of Education (Tertiary Education)) 
: 
 Consistent with the more strategic approach to investing in tertiary education the Tertiary Education Commission recently provided funding of nearly $1 million for projects to foster entrepreneurial relationships between Auckland University and industry; a consortium to establish post-graduate qualifications of advanced engineering technical and business skills; development of in-work training within the biotechnology sector; and $1.8 million for information and communications technology at Canterbury University to fund a project to identify and meet current and future skill demands in that region. We will announce more of these innovations in the near future. 
Lynne Pillay 
: How were these wonderful initiatives funded? 
Hon STEVE MAHAREY 
: These wonderful initiatives have been funded through money from the Tertiary Education Commission’s contestable strategic fund in particular the growth pilot initiative. The Government provided the Tertiary Education Commission with money for this as part of its response to the growth and innovation industry task forces. This shows the importance of a more strategic approach to tertiary education implemented by an arms-length body that can make independent funding decisions of benefit to the country and tertiary education. 
Hon Bill English 
: Has the Minister seen a letter from the New Zealand Vice-Chancellors Committee that states: “What is the point of laboriously putting in place charters and profiles and a raft of other accountability measures when the system is haemorrhaging dollars right before your very eyes?” and that: “The end result of this neglect and mismanagement of obvious problems is that the mainstream needs of tertiary education institutions will be postponed.”; and what comment does he have to make on this? 
Hon STEVE MAHAREY 
: No I have not read the letter. But if I had I would probably say to the vice-chancellors that the funding situation in the 1990s when it was being cut year on year by the National Government has been massively improved by this Government and that they know they are the beneficiaries for example of the grants that I read out today which would have been simply impossible under the National Government. 
Question No. 7 to Minister 
BRIAN CONNELL (National—Rakaia) 
: 
 I raise a point of order Mr Speaker. I notice that the Minister of Police is not in the House. I believe that only he would have the information to answer the questions that I would pose. I seek the leave of the House to have my questions carried over until the Minister of Police is in the House to answer my questions. 
Mr SPEAKER 
: The first comment is irrelevant because it is not a point of order. Leave is sought to postpone this question. Is there any objection? There is. Please ask the question. 
Police—Staffing 
7.  
BRIAN CONNELL (National—Rakaia) 
 to the  
Minister of Police 
: Does he stand by his responses to the House to question for oral answer No. 3 on 23 June 2004; if so why? 
Hon PAUL SWAIN (Minister of Labour) 
 on behalf of the 
 Minister of Police 
: Yes because they were accurate. 
Brian Connell 
: Could the Minister please explain why he asserted that 90 percent of priority one events are dispatched within 2 minutes; when an internal memo dated 15 June from the manager of the Southern Communications Centre states that on Tuesday Wednesday Thursday and Friday of the previous week this requirement was not reached—in fact on the Tuesday only 73 percent of calls were dispatched within 2 minutes? 
Hon PAUL SWAIN 
: As Kath and Kim say it is quite “ironical” that the member asks that question because he also asked questions at the time his question was raised on the issue of the Southern Communications Centre. What the member needs to know is that the 90 percent figure was accurate and even more importantly now the number of staff in the communications centre will be increased by 18 with five in the Southern Communications Centre. The situation is getting better. 
Brian Connell 
: I raise a point of order Mr Speaker. I would ask you to reflect on that answer from the Minister. He did not attempt to answer my question at all. I asked him how he could assert that the information was correct when clearly there is information to hand that demonstrates that the answer cannot in fact be right. 
Mr SPEAKER 
: I listened to the member’s answer and the last few words very definitely addressed the question. 
Darren Hughes 
: In terms of meeting the response times that the Minister has outlined how do police staffing levels and resources compare between December 1999 when this Government took office and now? 
Hon PAUL SWAIN 
: Extraordinarily well. In December 1999 there were 8767 police staff; now there are 9827. The budget at that time was $840 million. Under this Minister it is now over $1 billion. This is a fabulous Minister of Police in a fabulous Labour-led Government. 
Brian Connell 
: When the Minister answered my question on 23 June did he have in his possession the memorandum from KierenKortegast the manager of the Southern Communications Centre that warned that priority one levels were not being dispatched to the performance targets of 90 percent but were in fact as low as 73 percent on some occasions; if not why not as I had that information? 
Hon PAUL SWAIN 
: I am not sure whether the Minister had the information at that time but I am aware that there were some issues there. That is why the Minister has worked extraordinarily hard to make sure that the numbers have improved down there—going up by five. 
Brian Connell 
: I raise a point of order Mr Speaker. We are getting ourselves into a muddle. I specifically asked the Minister whether he had that memorandum in his possession when he answered that question on 23 June. 
Mr SPEAKER 
: The Minister addressed the question. He may not have satisfied the member— 
Brian Connell 
: I raise a point of order Mr Speaker— 
Mr SPEAKER 
: Please be seated. I have not finished. I am getting tired of the member. That is twice he has raised points of order that are not points of order. The member did address the question. I heard the member. 
Brian Connell 
: Let us get the  
Hansard 
 shall we? 
Mr SPEAKER 
: Order! That is the last warning. The member will leave if he interjects while I am on my feet. I say to the member that I heard the Minister Paul Swain say that he did not have the particular information there but he then added an answer at the end that said that the Minister was aware of the situation and had added five more people to that area. That certainly addressed that question. I am not here to judge the quality of the answer. I am here to see whether the Minister addressed the question. He did. 
Rt Hon Winston Peters 
: I raise a point of order Mr Speaker. I do not wish to contest your ruling but there is a serious issue here which is that there is a huge discrepancy between what the Minister told the House and emerging figures available to the Minister at that time that later on became available to members of Parliament. The Minister was asked how he could explain that. That part he has not explained and he needs to. 
Mr SPEAKER 
: I heard the Minister address the question. I will have a look at the transcript and I will see whether there is anything that I need to rule on further. 
Brian Connell 
: Does the Minister stand by his statement that sick leave has halved since February; if so why does information I have received show that 24 days’ sick leave was taken in the week ending 13 June a significant increase from the weeks ending 31 May and 24 May? 
Hon PAUL SWAIN 
: Yes I do stand by that because that is the information that has been provided to me by the police. 
Timberlands Forests—Management of Conservation Land 
8.  
DAVID PARKER (Labour—Otago) 
 to the  
Minister of Conservation 
: Has he received any reports on the current management of the former Timberlands forests that are now protected as conservation land? 
Hon CHRIS CARTER (Minister of Conservation) 
: 
 Yes. My department has reported to me that under Department of Conservation management the level of pest control in those forests has increased at least fivefold. Three important cave sites in the Charleston Forest have been ranked as internationally significant threatened species are being actively protected at several sites weed surveys have been undertaken and public recreational use of the forest is growing. 
David Parker 
: Has the Minister seen any reports on proposals for the future management of those protected rainforests? 
Hon CHRIS CARTER 
: Yes. I have seen a report that Dr Don Brash would like to see those forests and other conservation areas on the West Coast available for logging. He wants to take New Zealand back to the turmoil of the 1990s when chainsaws were ripping into our unique publicly owned rainforests and the country was in an uproar. 
Question No. 7 to Minister 
BRIAN CONNELL (National—Rakaia) 
: 
 I apologise to the House—I realise I should have raised this at the time—but I seek leave to table a document from KierenKortegast written on 15 June which points out that those targets were in fact not achieved. 
Mr SPEAKER 
: I will allow the member to seek leave. Is there any objection? There is. 
Sentencing—Reparation 
9.  
RON MARK (NZ First) 
 to the  
Minister of Justice 
: Will he be reviewing the sentencing laws to ensure that provision for reparation to victims does not buy lighter sentences; if not why not? 
Hon PHIL GOFF (Minister of Justice) 
: 
 Section 12 of the Sentencing Act provides that a judge must order reparation to the victim in every case unless there are strong reasons not to do so. In relevant cases this sentence is in addition to and not in place of any other sentence that may be appropriate such as imprisonment. Separate to this under section 10 of the Act voluntary offers of amends can be taken into account by the court in sentencing but only to the extent that the victim accepts the offer and that it is genuine and is capable of fulfilment. There is no current intention to change those provisions. 
Ron Mark 
: Has the Minister received any feedback from the public surrounding the sentence handed down to Qi Sun a repeat-offending Chinese national on a work permit for his part in an illegal casino where bets of over $1000 could be made who was discharged without conviction after paying a paltry $150 donation to the Salvation Army; if so did the feedback indicate that the public were satisfied with this form of chequebook justice? 
Hon PHIL GOFF 
: No to the best of my knowledge I have not received any submissions on that case—leastwise they have not come across my desk if they were received. What I can tell the member is that the judge has a discretion to take into account what he accepts as an offer of amends and he can impose what he believes to be the appropriate level of reparation. In another case—the Cromie case in the member’s own region—$380000 was paid by way of amends but that did not stop the offender getting 2½ years’ imprisonment because that was appropriate given the nature of her offending. 
Tim Barnett 
: What rights are accorded to the victim with regard to whether any amends offered by the offender will be regarded as a mitigating factor by the judge at sentencing? 
Hon PHIL GOFF 
: Section 10 states that the court must take into account an offer of amends but only to the extent that it is genuine that it is capable of fulfilment and that it is accepted by the victim as expiating or mitigating the wrong. This then will be one mitigating factor that is judged against other factors including aggravating factors and it does not reduce the need for the court to sentence in relation to the sentencing purposes of the Act which are protection of the public denunciation and deterrence of offending. 
Richard Worth 
: In the light of the widespread public perception that those with money may by making reparation payments secure a lesser sentence why will the Minister not review the Sentencing Act so that rich and poor people are punished equally and the rich do not secure an advantage? 
Hon PHIL GOFF 
: Some would say that that is a bit rich. It is important—[ 
Interruption 
] 
Mr SPEAKER 
: I must say that that was a little bit of an overreaction. I heard the Minister make a comment that was out of order and I was about to chide him for it. He will please answer the question. 
Hon PHIL GOFF 
: It is a fundamental principle in our system of justice that people are treated the same regardless of their income or status in life and it is important to uphold that. That is why when the Act said that amends could be taken into account it did not state the level of amends and a judge will obviously take into account what is offered in relation to what the person’s means are. The Act also takes into account that there are a variety of other ways in which a person can help to restore the situation he or she has caused for the victim. The member is a lawyer. He should not talk about perceptions; he should talk about realities. As an officer of the court he knows that the court does not believe in chequebook justice. 
Nandor Tanczos 
: Does the Minister agree that reparations can be an important part of or an alternative to sentencing where agreed between a victim and an offender and in particular that in general reparations are preferable to the use of fines—as the money actually goes to the victim rather than to the State? 
Hon PHIL GOFF 
: I do agree with what the member has said. In the last year alone over $14 million was paid by offenders to victims to help set right the losses suffered by those victims. Anybody in the House who would be opposed to that happening needs his or her head read. 
Ron Mark 
: Is the Minister satisfied that his Sentencing Act has been applied by the judiciary as it was intended; if so was it his intention that foreign criminals be able to claim over $40000 in legal aid from the taxpayer and then have the appellants pay $64000 worth of blood money in exchange for a 3½ year reduction in a sentence? 
Hon PHIL GOFF 
: The member is absolutely factually incorrect in the last statement he made. If he took the time to read the judgment instead of making things up he would see precisely why the judge on appeal decided to reduce that sentence. The question of amends not accepted by one half of the family but ultimately accepted by the other half of the family was only third in line of what the judge said was important in the reduction of the sentence. 
Ron Mark 
: Then what is the Minister’s response to calls from the public indicating a widespread feeling that chequebook justice is alive and well under his Sentencing Act especially following a recent case where an unlicensed foreign driver killed a 4-year-old girl through his dangerous driving and had his sentence halved on appeal due to $40000 worth of blood money being offered to and declined by the victim’s family and the victim’s kindergarten? 
Hon PHIL GOFF 
: Repeating something as a fact and which is factually incorrect does not make it a fact. The member has his facts wrong on a number of fronts. There is nowhere in the judge’s sentencing notes—and I hope the member has read them— 
Ron Mark 
: Come on. 
Hon PHIL GOFF 
: He has read them? Well he would know better. I bet he has not read them. The judge made it quite explicit that this was not about chequebook justice at all. He deplored the accusation of chequebook justice. The reason the sentence was reduced was to bring it into line with other sentences for like offences. It had nothing to do with what the member claims at all. 
Rt Hon Winston Peters 
: In the interests of disclosing what the law is in respect of the rich I seek leave to table a book called  
The Paradise Conspiracy 
 which shows that crooks rather than getting punished got knighthoods. 
Document not tabled. 
Chief Justice—Comments 
10.  
RODNEY HIDE (Leader—ACT) 
 to the  
Prime Minister 
: Following her advice to judges that they should “stick to the bench” how does she believe that Chief Justice Sian Elias should pursue her concerns about the “institutional independence of the judiciary as a whole from the Executive.” given the Chief Justice’s view quoted in the  
New Zealand Herald 
 that the judges are “very vulnerable on this question of independence”? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 The constitutional convention is that the Chief Justice conveys any concerns about the relationship between the judiciary and the executive to the Attorney-General. 
Rodney Hide 
: Does the Prime Minister agree with the Chief Justice who said before the British Parliament: “I think in a way the executive has beaten up the anti-democratic unelected angle—in other words inflamed legislative suspicions of judicial over-aggrandisement.”; if she does not agree with that does she have full confidence in the top judge of our top court? 
Rt Hon HELEN CLARK 
: I would find it hard to think how the statement the member has quoted would be substantiated but if the Chief Judge wishes to come to the Attorney-General and attempt to substantiate it we would be all ears. 
Richard Worth 
: Would a wise Prime Minister dismiss the views of a concerned and committed Chief Justice as minor when the issues involve the relevance significance and sufficient resourcing of our new and highest court? 
Rt Hon HELEN CLARK 
: Try as I can and having read what was said to the select committee in the United Kingdom I cannot add up issues around the employment of staff library facilities information technology and the security of officers of the court and make those into a statement about an intolerable pressure on the independence of the judiciary. 
Hon Dr Michael Cullen 
: Could I ask the Prime Minister to confirm that the information technology available to the new Supreme Court judges is significantly superior to that available to either the executive or other members of Parliament? 
Rt Hon HELEN CLARK 
: I do not have precise information on that but I am very happy to take the Minister of Finance’s advice on it as he almost certainly is the one who is paying for it. 
Dail Jones 
: What responsibility will the Prime Minister accept for this unique debate between a Prime Minister and a Chief Justice and will she acknowledge it is symptomatic of the lack of consultation that surrounded the abolition of appeals to the Privy Council and the establishment of an under-resourced Supreme Court? 
Rt Hon HELEN CLARK 
: I cannot take responsibility for the Chief Justice initiating a debate with comments before a British select committee. What I have observed is that when a Chief Justice or anybody else from the judiciary makes such comments it starts a political debate that the judge cannot then continue to pursue—as her own press statement yesterday made clear. I also note that in the evidence to the select committee in the United Kingdom Justice Gault specifically stated: “At the same time I do not criticise the administrative support the court so far has had and it has had a great deal because it is the new game on the block and it is getting a lot of attention.” 
Nandor Tanczos 
: Is the Prime Minister of the view that New Zealand’s historical dependence on the Privy Council as our superior court has meant that in the past our judiciary has not been able adequately to maintain its role in the balance of powers and does she think that the various constitutional debates now being entered into by the Chief Justice indicate a welcome robustness in the relationship and raise important questions? 
Rt Hon HELEN CLARK 
: I am sure the fact that the top court of appeal for New Zealand has resided 12000 miles away has had an impact on the development of the judiciary in this country. But as I said in response to an earlier question I do find it hard to add up the series of comments around employment of staff library facilities information technology and security of officers to make an intolerable threat to the independence of the judiciary. 
Stephen Franks 
: Following on from the Prime Minister’s answer to the question about what the judges should now do where the Prime Minister referred them to a discussion with the Attorney-General does she consider that that is entirely fair given that when the Chief Justice was asked before the British select committee whether the Attorney-General was independent she confined herself to saying “Yes although …”? 
Rt Hon HELEN CLARK 
: The simple advice I have is that the constitutional convention is that the Chief Justice would raise such concerns with the Attorney-General. Of course if the Chief Justice felt that she needed to take the matter further there is always the possibility of appearing before a select committee. One might also expect that given that the Chief Justice has a warrant from the Governor-General approaching her might be a course to follow. But I am not convinced that the avenues for discussion of these issues were exhausted. Indeed those comments were made in May; I understand that further progress on a number of these issues has been made since that time. 
Stephen Franks 
: Does the Prime Minister understand the confusion left after her Deputy Prime Minister castigated activist judges who “express views on what the law should be” when her Attorney-General had promoted a new Supreme Court expressly so that the judges could “develop an indigenous law for New Zealand”; and in view of her advice to the judges to in effect butt out what is the difference between activism usurping Parliament and judges “developing an indigenous law”? 
Rt Hon HELEN CLARK 
: The Deputy Prime Minister’s comments on judicial activism have had enthusiastic support in a number of parts of the Chamber—not least from the member who has just asked the question who has been heard to opine on that matter in the past. As I infer the Attorney-General’s comments were directed entirely to the top level of appeal for the judicial system being located here in New Zealand; that therefore makes the decisions those entirely of the indigenous law of New Zealand. 
Rodney Hide 
: Is the Prime Minister concerned that our top judges felt the need to fly 12000 miles—all the way to London—to say things to the British Parliament that they were clearly not prepared to share with our Parliament; and what will she do as Prime Minister to ensure that our judges can raise serious concerns here in New Zealand without any fear of executive intimidation or retaliation? 
Rt Hon HELEN CLARK 
: My understanding is that the reason for the Chief Justice and two others going all the way to the United Kingdom at that time was to attend at least one formal ceremony around the end of New Zealand appeals to the Privy Council; it was thought it was an important symbolic occasion and there should be high-level representation which also included the Attorney-General. In addition the Chief Justice and the two others were asked to appear before a British select committee because Britain is also considering a major change in its top court levels; it was in that context that they gave evidence presumably under oath to a select committee. I am sure that if the New Zealand select committee that is relevant to the judiciary would like to invite the judges in they would similarly answer such questions. 
Stephen Franks 
: Will the Prime Minister in future try to make it easier for the judges to follow her advice and “stay out of the political arena” by ridding the Government’s legislation of deliberately undefined politically loaded terms like “principles of the Treaty” “kaitiakitanga” “accountability” “spiritual and intrinsic values” “tikanga Maori” and so many other terms that force the courts into the political arena? 
Rt Hon HELEN CLARK 
: I am astonished that the member thinks the word “accountability” has no place in the law but then I am also astonished that he would think it possible for the law in New Zealand not to have regard to concepts such as the ones he mentioned. 
Family Support Services—Development 
11.  
JUDY TURNER (United Future) 
 to the  
Minister for Social Development and Employment 
: Does he stand by his statement with regard to the development of family support services that “I am confident that MSD’s collaboration with NGOs and other relevant agencies to achieve a more effective and responsive family service sector will not only relieve pressure on CYF but also result in greater practical help for New Zealand families in their communities”; if not why not? 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 Yes I do. 
Judy Turner 
: What practical help for New Zealand families has emerged from the family services initiative given that documents obtained under the Official Information Act reveal that all that has happened since the baseline review last year is the creation of 23 new management positions at a national and regional level a list of non-governmental organisations and a website? 
Hon STEVE MAHAREY 
: I take it that the member is referring to the new section of the Ministry of Social Development that deals with family and community issues. The member will know that perhaps one of the most significant developments in relation to the questions she is raising is the partnership that has been formed between the non-governmental organisation sector that deals with family and community services and that part of the Ministry of Social Development. She will also know if she has talked to the non-governmental organisation sector that it has been extraordinarily positive about that relationship and regards it as one of the most important developments that has taken place in a very long time. 
H V Ross Robertson 
: Can the Minister tell the House what the Government has put in place to take forward its approach to supporting families? 
Hon STEVE MAHAREY 
: The Government of course over the last 5 years has made children and families one of the major features of its policies. That is why we now have a family and community services group as part of the Ministry of Social Development and it is why we have a partnership with the non-governmental organisation sector to strengthen family support. We have been doing a large number of practical things to support families and I point in particular to the Working for Families package which will benefit nearly 300000 low to middle income families with children by investing over $1 billion a year once it is fully in place. That represents the biggest offensive against child poverty in this country in decades. 
Katherine Rich 
: When the Minister talks about creating “a more effective and responsive family service sector” how effective and responsive is the Department of Child Youth and Family Services call centre when in the last 6 months nearly 11000 New Zealanders ringing the department hung up because they did not get any answer? 
Hon STEVE MAHAREY 
: As the member well knows the Department of Child Youth and Family Services reports to the Associate Minister Ruth Dyson. But I have sat and listened to questions from that member to Ruth Dyson and the Minister has outlined her concerns about the call centre and exactly what she has done to improve the centre. 
Judy Turner 
: Is the Minister confident in the ability of family services to complete the mapping of local community needs across 20 sites given that documents obtained under the Official Information Act reveal that after a 2-year trial the Department of Child Youth and Family Services mapping of services at six sites was incomplete and had barely started at one site; does he concede that the major problem with the process is that there is a vague idea only of what the outcome should be as opposed to the kind of dual-track model for family support services proposed by United Future? 
Hon STEVE MAHAREY 
: The local services mapping concept is a very sound one and I do not think anyone in the House would dispute the bringing together of all family and community services in a local area so that they work together as having anything other than merit. The taking up of that approach by the new family and community services part of the Ministry of Social Development will guarantee that it will move faster. The ministry has vastly more resources available to it for this purpose than the Department of Child Youth and Family Services did. That is why non-governmental organisations have greeted the new part of the Ministry of Social Development with open arms and why they see it as making more progress. 
Judy Turner 
: Does the Minister agree that given that the Department of Child Youth and Family Services reported a 30 percent increase in notifications over the last year—most of which the department’s staff themselves admit involve basic family support needs—what our families really need is quality early intervention services and a referral system to community agencies that are already trying to do that work such as the model proposed by United Future earlier this year; if not why not? 
Hon STEVE MAHAREY 
: I can only continue to applaud the commitment that that member and her party have to children and families in this country and say that we always take their extraordinarily insightful ideas very seriously and study them very closely. That is partly because they are so close to the ideas of the Government itself. 
Rt Hon Winston Peters 
: Speaking about insightful ideas how can the situation possibly improve when the Families Commission legislation was so loose as to its description of “family” that it would include Black Power the Mongrel Mob the Nomads the Headhunters the Hells Angels Highway 61 and the Filthy Few? 
Hon STEVE MAHAREY 
: I thought the Filthy Few had closed down to be truthful. I point out to the member that that issue was raised during the passage of the bill and as he will remember it was dealt with so that those kinds of groups would not qualify as families. 
Canterbury District Health Board—Elective Surgery 
12.  
Dr PAUL HUTCHISON (National—Port Waikato) 
 to the  
Minister of Health 
: Does she believe the amount of elective surgery currently being performed by the Canterbury District Health Board is meeting the needs of Canterbury residents; if so why? 
Hon DAMIEN O'CONNOR (Acting Minister of Health) 
: 
 As the Canterbury District Health Board said last week the amount of elective surgery at Christchurch Hospital has gone up this year not down. The hospital has met its targets and increased the amount of elective surgery it has delivered in the financial year ending 30 June. 
Dr Paul Hutchison 
: Given that the Minister said in 1999 that Labour was committed to implementing a timely elective surgery system does she accept that a 15-month delay for elderly cataract sufferers in Canterbury is neither timely nor meets their needs? 
Hon DAMIEN O'CONNOR 
: In response to the new Opposition spokesperson on health I am happy to say that we do not like having anyone wait for surgery. However it is a reality of any health system and with regard to cataract operations the Minister of Health has committed to a cataract project to investigate the delays in this area of surgery. 
Lianne Dalziel 
: Can the Minister advise whether Canterbury residents will benefit at all from the extra funding in Vote Health for major orthopaedics operations which amounts to $30 million for this year and rises to $70 million a year in 4 years’ time; if so how? 
Hon DAMIEN O'CONNOR 
: In response to a member who really cares about Canterbury yes Canterbury will be funded for an extra 250 major hip and knee operations this year at a cost of an extra $3.79 million. By year 4 of the project it will receive an extra $7.6 million a year in sustainable funding for extra hip and knee operations. By then the rates of intervention in Canterbury will be among the best in the world dramatically improving the quality of life for thousands of Canterbury people. 
Barbara Stewart 
: Can the Minister explain why many people under the Canterbury District Health Board have to wait longer than 6 months for their first consultation with a specialist? 
Hon DAMIEN O'CONNOR 
: As we work through the number of people who are looking to improve their quality of life through elective surgery there will always be pressure points but I am pleased to say that we have had an increase of 122 in general elective surgery operations 48 in dental and 81 in neurology. We are spending billions of dollars more in health and access to health care for every New Zealander is improving. 
Dr Paul Hutchison 
: Does she accept that patients in Canterbury with cataracts feel there is nothing timely about their waiting lists or in meeting their needs given that the number of operations performed has halved from 1200 in 1999-2000 under National to only 600 in 2002-03? 
Hon DAMIEN O'CONNOR 
: While I do not have the figures in front of me I do accept there has been a reduction in the cataract area of ophthalmology. The Minister has committed to investigate this very area to make sure that people have better access. 
Dr Paul Hutchison 
: I seek leave to table a copy of an article from the  
Press 
 of 21 July 2004 titled “Elective Surgery Rates Plummet” which shows that there were 1200 cataract operations in 2000 and only 600 in 2002. 
Document by leave laid on the Table of the House. 
Hon DAMIEN O'CONNOR 
: I seek leave to table the response put out the day after by the Canterbury District Health Board that refutes the claims made in that article. 
Document by leave laid on the Table of the House. 
Ron Mark 
: I seek the leave of the House to table written questions that I have put to the Minister of Health on this issue that she simply fobbed off telling me that this is the district health board’s responsibility. 
Mr SPEAKER 
: Leave is sought to table those written questions. Is there any objection? There is. 
Urgent Debates Declined 
Lead Contamination in Corn—Government's Response 
Mr SPEAKER 
: I have received a letter from Sue Kedgley seeking to debate under Standing Order 373 the Government’s response to lead contamination in corn imported into New Zealand. The actual importation of the corn is of course not a matter for which there is ministerial responsibility. The Government’s response to it does involve ministerial responsibility but I cannot accept that its response to one reported incident requires that an urgent debate be held especially as the House is about to embark on an estimates debate that will enable the matters of concern to the member to be raised. I therefore decline the application. 
Estimates Debate 
In Committee 
The CHAIRPERSON (Ann Hartley) 
: The new Standing Orders provide for 8 hours of debate on the estimates. Each member may have no more than two speeches of 5 minutes on each vote. The estimates debate should be relevant to the Government’s current spending plans as contained in the Estimates of Appropriations. As each vote is reached a question will be put that that vote stand part of the schedules. If it is the wish of the Committee I will put the question on groups of votes by Minister until a vote is reached that members seek to debate. A separate question on this vote will then be proposed from the Chair. Should it be the wish of the Committee a question may be proposed on two or more related votes for the purpose of debating them together. 
At the conclusion of the 8-hour debate any remaining votes and the remaining provisions of the bill will be put as one question. The Government indicates which votes are available for debate. I understand that all votes are available in order of seniority of Ministers commencing with the Speaker’s votes. A list setting out the order is on the Table. 
LINDSAY TISCH (Junior Whip—National) 
: 
 I raise a point of order Madam Chairperson. I just want clarification of the number of speaking spots for each speaker. I understand that normally we would be able to have more than two. You indicated that each member could make a maximum of only two speeches. I seek clarification on that point. 
The CHAIRPERSON (Ann Hartley) 
: It is two speeches on each vote. However the member could seek leave to have more if that was where he— 
LINDSAY TISCH 
: When we look at the categories of votes we see that there are a number of separate votes under each of them. In the first group of votes—those under Mr Speaker—there are five votes. We could have our speakers speak 10 times? 
The CHAIRPERSON (Ann Hartley) 
: Yes that is right—twice on each vote. 
Vote Office of the Clerk agreed to.  
Vote Parliamentary Service agreed to.  
Vote Audit agreed to.  
Vote Ombudsmen agreed to.  
Vote Parliamentary Commissioner for the Environment agreed to.  
Vote Arts Culture and Heritage 
STEPHEN FRANKS (ACT) 
: 
 I rise on behalf of my colleague Deborah Coddington who has raised for the people of New Zealand the Prime Minister’s contribution to pride in New Zealand in the sending of a dunny that brays like a donkey to Venice. It is very easy for people in the arts world to despise and reject any notion that the hoi polloi those of us who are not the insiders should have a view on what the Government should pay for by way of art. Of course we are all expected and encouraged to have a view on high art architecture major public buildings and the beautification of roads and other things that are useful and we all welcome the extent of the improvement to our environment that the arts and the artists can create. But this Government turns artists into beneficiaries. It encourages them to feel that New Zealand is a poor country. 
Of course it may be relevant that the average wealth of New Zealanders—the average savings of New Zealanders—is a quarter of that of even the Australians who are not rich and it may be that in an impoverished country there is no one else to sponsor art other than the Government. But it is extremely precious for the people whom the Prime Minister has set out to sponsor and to turn into political clients to complain when New Zealanders have a view on what they are paying for. It is more than precious for them to object that we should simply accept the judgment of the experts. The Prime Minister in her role as patron of the arts should accept that she must be judged on the art they create and on the people whom she puts into power to spend the taxes of ordinary people on these artists. 
We are told by Creative New Zealand that in recent years the members of et al have produced “rich and poetic installations that combine sound text and found objects”—whatever those are—and that the results are “profound and disturbing”. We are all proud to know that New Zealand is going to offer in Venice—“layered and immersive installations which explore the link between science technology and areas of behaviour reformation involving political ideologies and fringe religious practices are particularly pertinent at this time.” 
Hon Ken Shirley 
: What a load of crap. 
STEPHEN FRANKS 
: What a load of crap. What a load of drivel and we are paying for it. Let me go on further. It states that the project for Venice this year “builds on the success of recent projects. Et al’s sculptural installations create highly charged environments packed with outdated and junked computer hardware and scrawled messages on instruction cards and wall charts. Rows of chairs examination tables computer stations and flickering screens in grey rooms activated with electronic noise suggest a kind of pseudo science as well as a disturbing view of religious fanaticism.” It will “exploit an alluring quality” in the collective’s own work. What is this alluring quality? It is “the absence of the artist”. It is rich enough on its own; it does not need more. 
Then we get an explanation in the footnote of who the artists are that the Government is sponsoring to Venice: “p.mule blanche ready-made trust bud shoop cj (Arthur) craig and sons constance strange L budd Lillian budd lionel b marlenecubewell minervabetts merit groting mythic investments”—I like that; that could be a new summary for the Prime Minister’s entire investment in the arts—“and popular productions.” I think that one was misnamed. 
I ask the Prime Minister what we are about with $500000 of taxpayers’ hard-earned money—from taxpayers who actually do try to beautify New Zealand and the world; taxpayers who build gardens who buy things that they like who buy CDs and who pay to sponsor the music they prefer. What are we doing when this Government sponsors such tripe? 
Rt Hon HELEN CLARK (Minister for Arts Culture and Heritage) 
: 
 I want to respond to the member because there are a number of fundamental untruths in what he said. I also want to make some other points about the matter. Firstly to suggest that I as Prime Minister had any role in choosing this work— 
Stephen Franks 
: I raise a point of order Madam Chairperson. It is unparliamentary to suggest that there are fundamental untruths in what I said. Maybe she could allege that I was mistaken. However the word “untruths” implies that I have consciously said something false. 
The CHAIRPERSON (Ann Hartley) 
: I will ask the Prime Minister to reword that. 
Rt Hon HELEN CLARK 
: They are fundamental errors but then the member should be in a position to know why he is wrong. The member would be well aware that the Minister for Arts Culture and Heritage does not select the work that represents New Zealand at an exhibition off shore; absolutely not. To suggest as the member did that the Minister for Arts Culture and Heritage must be judged on the art created by New Zealanders is to suggest a sort of Nazi or Stalinistic view of the world that I personally could not buy into. 
The second error is that if the member had bothered to research his comments he would have been aware that the previous “piece of art” by that artist of the donkey etc. is not what is being submitted to the Venice Biennale. What happens is that a piece of art is created for the area that New Zealand is allocated at the Biennale. It is submitted as a concept at this stage and on the basis of a range of concept proposals the selection committee has chosen. The position is that Creative New Zealand is of course funded by the New Zealand taxpayer. It is accountable through the normal mechanisms including through a select committee process and members should take the opportunity during the estimates to call in Creative New Zealand and hold it accountable for its processes. 
The Creative New Zealand organisation then delegated the work of selecting an artist and curator team to a selection committee. In my view it is there that the process has gone awry. I will not make comments about the quality of the artist or the quality of the artist’s work. That is for others. I do think it is perfectly legitimate for the public to debate the nature of the art. But as Minister for Arts Culture and Heritage I will not go around demeaning individual artists. But what is a matter of considerable concern to me is that firstly this presence at the Biennale came about because there was an invitation from the Italian Government to the New Zealand Government for there to be New Zealand representation. The New Zealand Government takes the view that those who represent New Zealand at the Biennale should be capable of representing it. Indeed the criteria set out in the selection committee’s brief states: “The key personnel have a proven track record of undertaking the ambassadorial and publicity responsibilities required in a major international exhibition project 
Clearly that criteria has not been met. Key personnel must include the artist. The artist must therefore be able to be named and be able to give interviews and perform other ambassadorial functions. Obviously there has been interaction with me the Associate Minister for Arts Culture and Heritage and Creative New Zealand as we have expressed our concern about what appears to be a breach of the selection criteria. As a result I am now advised that the artist will engage extensively with international arts professionals at the event she will conduct selected interviews with international arts media and she will provide responses in writing to questions. That still leaves me with some concerns because the artist does not wish to disclose her identity. 
I think this is a salutary lesson for Creative New Zealand that if it delegates to a selection committee the least it can do is ensure that it follows its own criteria. I can assure the member that that will have a bearing on my thinking about resourcing levels for Creative New Zealand in the future. 
Vote agreed to. 
Vote Communications Security and Intelligence 
Vote Ministerial Services 
Vote Prime Minister and Cabinet 
NANDOR TANCZOS (Green) 
: 
 I seek leave to have Vote Communications Security and Intelligence treated separately in order for the Green Party to cast its vote on that. 
The CHAIRPERSON (Ann Hartley) 
: I will put that now as a question. The question is that Vote Communications Security and Intelligence stand part of the schedules. All those in favour please say Aye to the contrary— 
NANDOR TANCZOS (Green) 
: 
 No. 
The CHAIRPERSON (Ann Hartley) 
: The Ayes have it. 
NANDOR TANCZOS (Green) 
: 
 A party vote is called for. 
The CHAIRPERSON (Ann Hartley) 
: The clerk will conduct a party vote. 
Jill Pettis 
: What are we voting on? 
The CHAIRPERSON (Ann Hartley) 
: We are voting on Communications Security and Intelligence. 
LINDSAY TISCH (Junior Whip—National) 
: 
 I raise a point of order Madam Chairperson. I just want clarification. When the Prime Minister left the chair I understood that we would be looking at those votes individually. She has left the chair and we have moved on to Dr Cullen. That is fine. However now we are going back and I thought we would have to seek the leave of the Committee to look at those votes individually. That is what I am asking. We have come back to Vote Communications Security and Intelligence which is the Prime Minister’s responsibility. 
The CHAIRPERSON (Ann Hartley) 
: No I said in opening that I would put the votes as a block unless there was any objection. Then they would be put one at a time. 
LINDSAY TISCH 
: Madam Chairperson you have actually put the votes. We have now moved on. It was only after that that Mr Tanczos asked for his vote to be recorded separately. So he should seek leave to do that. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 I raise a point of order Madam Chairperson. The problem with your ruling is this. You put the votes and only one voice vote was heard in this Chamber. That was the Green member saying no. On that basis they must win that vote. 
Dail Jones 
: That is correct. 
Rt Hon WINSTON PETERS 
: That is what happened here. If no one said yes and one member said no then that vote being only one voice must surely win here. 
The CHAIRPERSON (Ann Hartley) 
: As the member knows it is not a matter of decibels of sound. It is a matter of me calling the vote as I heard it. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 Madam Chairperson you called the vote. You are required to determine where lies the majority. If only one person in a House with 120 members raises his or her voice that person is the majority. The rest are taken to be in agreement or to have abstained. 
Hon Ken Shirley 
: Silence is compliance. 
Rt Hon WINSTON PETERS 
: Yes come on. 
The CHAIRPERSON (Ann Hartley) 
: I thank the member. No the result is not declared on the voices. It is up to me to declare the result. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 I raise a point of order Madam Chairperson. It is not up to you to determine that at all. That is why we have had a procedure for hundreds of years whereby members vote by a series of mechanisms but they must do something to have their vote recorded. They cannot do nothing and be assumed to be on either side of the debate or the argument. With respect it is up to you regardless of the voices to determine where the majority lies. With the greatest respect you are assuming a dictatorial role that is not allowed for by the rules that guide your office and how you should behave. I am saying to you that if only one person intimated his or her vote therein lies the majority and it is not up to you to decide otherwise. 
Hon BRIAN DONNELLY (NZ First) 
: 
 I raise a point of order Madam Chairperson. I refer you to the situation that occurred in 1999 when National had two members in the House and I think Rodney Hide was representing ACT. He left the House and the question was put. John Carter who was the National whip chased after him in the House and no one made any call at that particular time. In fact the Speaker was recalled on this particular issue. It was a confidence matter. The Opposition at that time claimed that because no one had called on that particular vote then the vote had to go the way that the Opposition had called. As it was the Chair at the time was Geoff Braybrooke and he put the vote a second time. David Carter who was the Minister in the chair made a call. It was on the basis of David Carter’s call that the Chair then allowed a party vote to be called for. But had that not been the case it was quite clear at that time that it would have gone in this particular favour. That particular vote was a matter of confidence. I refer back to that incident. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 When the Chair or the Speaker is declaring a vote I am sure he or she is judging where the majority lies in terms of the votes cast. The fact that one member of the Committee even called for a vote to be taken on the matter separately— 
Rt Hon Winston Peters 
: No he called on the vote. 
Hon Dr MICHAEL CULLEN 
: Let me finish my sentence or two. He called for a vote to be taken separately on the issue. [ 
Interruption 
] Yes the member did. He actually rose on a point of order and sought to take that vote separately from the other votes in this section and then voted against. The Chair was perfectly in order to assume that the other parties present were voting in favour and called the vote in favour of the affirmative particularly on an estimates position where clearly the two Government parties automatically can be assumed to be voting in favour of the motion. 
I have been in this House on a number of occasions when people have not voted on their voice—even in the days when there were divisions. It was not necessarily assumed that they were not voting at that point. But if the member wants to take up the estimates time which is a time-limited debate with points of order of this sort then that can certainly happen but I would have thought the Opposition’s time was better spent on debate. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 In respect of what Dr Cullen has said the Green member called for a party vote in addition to his having voiced his opposition. That is the sequence of events on the chronology. Surely there is no way we can have people saying: “Well actually I’ve been here a long time and you can assume what people are going to do next.” That is an amazing statement that Dr Cullen made. You called for the vote Madam Chair because it means something. You called for the vote because it is the only way you can measure where the vote might lie and anything short of that is expeditious nonsense. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 Confusion now seems to be developing. It is perfectly appropriate for the member to call for a vote because the Chair had ruled in favour of the affirmative. As the member had voice voted in favour of the negative he was perfectly entitled to call for an actual party vote in that case. It would have been inappropriate for a member who had voted with the affirmative to have called for a party vote because only people who voted against the declaration of what was the majority can call for a party vote following the voice votes. 
Rt Hon Winston Peters 
: There was no voice; that’s the point! 
Hon Dr MICHAEL CULLEN 
: I again point out to the member that people frequently vote on the voices in this House but the Speaker and the Chair are able to make their own judgments about where the majority lies. The very purpose of calling for such a vote is not just for the fun of having another vote; it is because people are actually questioning whether the Speaker’s judgment was correct in their call. The decisions of the Speaker and the Chair are not final on the basis of the voice vote. If that were so we would have no procedure for anything before the voice vote and indeed Governments would feel very comfortable in many instances. It would not matter what the numbers were in the House they would somehow have the numbers on the basis of the voting because all they would have to do is to get a declaration in their favour on the voice vote. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 The reality is that there was no voice vote in favour of the Ayes and there was an Opposition vote in respect of the Noes. That member then asked—and Dr Cullen has got himself into a real fix now—for a party vote and he was denied it. The only thing that possibly can stand now is the “No” vote from the Greens. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 The member has not been denied a party vote. We were just in the process of proceeding to a party vote when points of order were raised about the calling of the voice vote. 
Hon BRIAN DONNELLY (NZ First) 
: 
 I do not have a history of purely and simply playing games but this case does disturb me. Why do we take the voice vote in the first place? The reason why we have a party vote is that purely and simply on the voice at times it is impossible for the Chair to decide the numbers one way or the other but in this case it was quite clear that there was no vote in favour of the Ayes and there was one vote in favour of the Noes. If for example there was a mumbling along the lines that some parties were in favour of the Ayes I would be quite happy to accept that that would then logically lead to the opportunity for a party vote. However regardless of the sophistry of Dr Cullen there was no Ayes vote and that really is the decision that we have to make. We are not doing it for triviality; we are doing it for the precedent it will set for this House. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 There are many occasions in this House where four or five parties vote in one direction and a couple of parties vote in the other direction but the couple of parties are noisier than the four or five parties voting in favour. The numbers are overwhelming when it comes to the party vote but on the voices if one was to go by sheer noise—in this case one versus nil—it would have been called in favour of the minority. That is not the basis on which the Chair makes the judgment on a voice vote. 
NANDOR TANCZOS (Green) 
: 
 While I am obviously sympathetic to the view being put forward by Mr Peters I am looking at Standing Order 141 which states: “The Speaker asks members to answer ‘Aye’ or ‘No’ to the question and states the result of the voice vote. Any member present may then call for a further vote to be held.” However Standing Order 142 states: “Where a further vote is called for a party vote is held unless the subject of the vote is to be treated as a conscience issue.” If I had held my mouth perhaps the point would be correct but unfortunately I actually called for a party vote and it appears to me that under the Standing Orders a party vote is then required to be held. 
The CHAIRPERSON (Ann Hartley) 
: The point is that the Chair declares the results on the basis of where the Chair considers the majority lies. That is exactly what I did. I declared the result and a party vote was called for. We are in the process of calling a party vote. 
Rt Hon Winston Peters 
: I raise a point of order— 
The CHAIRPERSON (Ann Hartley) 
: I have ruled on the point of order. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 I know that you have attempted to but I want to get some clarification. You let Dr Cullen speak after you had said he would the last person to speak. The fact here is that there is no requirement for a party vote if the Chair properly reads the vote that has already been recorded. No one from the Labour Party called for a party vote nor did anyone else for that matter but it is because you said that the sole voice vote was lost that he then called for a party vote. He would not have done so if you had said yes. It is axiomatic for goodness sake. I want to ask you a very simple question: unless you are a soothsayer or a clairvoyant how did you work out the result of that vote given that only one person said no and no one said yes? 
The CHAIRPERSON (Ann Hartley) 
: As was said in the discussion it is up to the Chair to call the vote. As often happens in this House the people who call for the Ayes can often be louder than or not as loud as the people who call for the Noes. 
Rt Hon Winston Peters 
: No one called for the Ayes; that’s the point. 
The CHAIRPERSON (Ann Hartley) 
: I say to Mr Peters that I have given a fair bit of latitude in this discussion. I am saying very clearly that it is up to the Chair to declare the result. I am now proceeding with the party vote. 
LINDSAY TISCH (Junior Whip—National) 
: 
 My point goes back to the first point that I made right at the beginning of this debate when we were considering the five votes. You put the motion then— 
Hon Dr Michael Cullen 
: No. 
LINDSAY TISCH 
: The Minister shakes his head but it was my understanding that we voted at that time. Following that however Mr Tanczos said that he wanted to treat Communications Security and Intelligence as a separate vote. Now  
Hansard  
will record this and I am sure I am right because that is the point that I brought up originally. It is fine for him then to ask for a separate vote but in my view he should have sought leave to have the vote taken separately because you had already put the vote on all five. Then Mr Tanczos came forward and wanted that vote treated separately. I am sure that  
Hansard  
will support the proposition I have put. 
Now I am not saying that that is wrong. I am just saying that that was my understanding and is the reason why I brought that proposition to your attention at the beginning of this debate. National is quite happy for another vote to be taken if the member wishes to seek leave to do so. 
Hon Dr MICHAEL CULLEN (Leader of the House) 
: 
 The point is to get exactly right what you did because what you did was exactly what you are supposed to do as the Chair. That is you called certain votes one after the other. You explained at the start you would call votes down to the point where a party seeks to speak on that particular vote and then up to that point any previous votes are actually put. You had not actually reached the point where any votes had been put but you proceeded to the second or third on the list and Mr Tanczos quite properly asked for the vote on Communications Security and Intelligence to be put separately which in my view he is entitled to do. It may have been a fraction late but he sought support for that to happen. It was granted. The vote was put. You declared the voice vote. He has now called for a party vote and that is the point we are at. 
The CHAIRPERSON (Ann Hartley) 
: I tell Mr Tisch that that is absolutely correct. I said in the beginning that I would call the votes slowly. If any member wants them put in any other way than the way in which I am calling them it is up to the member to say so which is exactly what Mr Tanczos did. I will now put the party vote on Vote Communications Security and Intelligence. 
A party vote was called for on the question  
That Vote Communications Security and Intelligence be agreed to. 
Ayes 86 
New Zealand Labour 51; New Zealand National 25; United Future 8; Progressive 2. 
Noes 22 
New Zealand First 13; Green Party 9. 
Vote Communications Security and Intelligence agreed to.Vote Ministerial Services agreed to.Vote Prime Minister and Cabinet agreed to. 
Vote Security Intelligence agreed to. 
Vote Finance 
JOHN KEY (National—Helensville) 
: 
 Everybody knows that this is a tax spend and wasteful Government and we need no more evidence of that than to look at Vote Finance—a $57 million expenditure item in Budget 2004. Where has the wasted money gone? There has been $2.8 million for taxation advice. I have some advice for the Minister of Finance: one does not need to spend $2.8 million to know that raising the top rate of personal taxation is causing havoc amongst the business community of New Zealand and that by raising the top rate of taxation every small business in New Zealand has to pay more in compliance costs. One does not need to spend $2.8 million to know that this was simply an ”envy tax” and that it puts the wrong incentives into the economy. This is a tax waste and spend Government; everybody knows that and one does not need to read Vote Finance to know that. 
I do want to point in particular to $3.29 million of expenditure by the Government in Vote Finance in relation to purchasing advice on the ownership and performance of Crown companies and Government institutions. That $3.29 million was and is proposed to be spent by the Government on advice on the purchase and performance of Crown companies. What a waste of money that is because when I looked at the heads of agreements for TrackCo announced on the Government website or on the Treasury website just a few days ago what did I see? The first thing I saw was that despite the Government spending $3.29 million in this area no due diligence was undertaken by this Government when it bought TrackCo—no due diligence whatsoever. Why was that the case? Well Treasury was kind enough to outline its reasons why no due diligence was taken and there are some real beauties. 
The first example of those reasons wasthat TrackCo was costing only $1—the Government did not need to do due diligence on it because it was costing only $1. Well hello has anybody in the Government worked out that we are buying hundreds of millions of dollars worth of a liability? The fact that it cost $1 I am sure meant it did not come into part of the $3.29 million the Government is to spend on advice. The second little beauty contained in the heads of agreement in relation to due diligence was this one: the Government was going to buy TrackCo anyway so it would not bother having due diligence done on TrackCo. Well putting to one side what an arrogant statement that is for any Government about any purchase one of the reasons why the Government owning a multitude of businesses can very often be the wrong thing is that “we are going to do it anyway” is no reason to fail to carry out due diligence. But maybe the best reason came last and it was simply in the statementthat the best information was held within Toll Holdings and therefore that information would come to the Government when it purchased TrackCo anyway. The best information held by the existing owner Toll Holdings would come to the Government anyway. Well has anybody in the Government worked out that it could well be in the interests of Toll Holdings—the existing owner—to have that number as high as possible? After all those who have looked at the deal for just a cursory moment will have seen that anything under $200 million is picked up by the taxpayer of New Zealand so it could be well within Toll Holdings’ interest to keep the number high. 
Secondly if all this failure to do due diligence on a large liability that was being purchased by the Crown was not bad enough what did we see on Friday? We saw the reason why no due diligence was necessary despite the fact that Dr Cullen has tried to tell the public of New Zealand on nationwide television that everything spent above $200 million on the track would be recouped through the access charge. Even he the Minister of Finance who has a keen sense of humour could not keep from breaking in to a smile when he made that comment on nationwide television. But what did we see on Friday? We saw the absolute classic about the board of TrackCo the company that the Government did not do the due diligence on because it is paying only $1 for it and because it is going to buy it anyway. We saw three additions to the TrackCo board—jobs for the boys with famous sort of Labour Party people like the President of the Labour Party Mike Williams being famously appointed to TrackCo. That is why the Government did not need to do due diligence. That is why $3.29 million has been wasted if this Government is telling the people of New Zealand that it is spending that money on getting advice because the Government does not need to get advice when it does not do due diligence and when it stacks the board with its mates it can get through whatever pork-barrel politics it likes. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
:  
I am pleased to take the first call in this debate and to respond to one or two of the slightly hysterical comments made by Mr Key. He is still learning the role of course. Can I take him first of all through his first little topic which was why do we have a 39c in the dollar top taxation rate? The obvious question in reply to that is why is National not promising to abolish it as its top priority? That was National’s policy up to only a few months ago and then Dr Brash looked at the numbers and dithering said: “Ah! This doesn’t look too good. This isn’t what the public wants. We’ll start talking about tax cuts for low and middle income earners instead.” —even though he said last year that one would have to cut the top taxation rate to get the economy moving. Despite the fact that we did not cut the top taxation rate the economy is moving so strongly now that a northern market commentator is expecting interest rate rises—on which I cannot comment being the only person in the country who cannot comment on interest rate rises—by the Reserve Bank within the near future. What we see is that the economy is growing extraordinarily strongly despite the fact that various rather large pips keep squeaking occasionally because there is a very small squeeze on them. That comes of course from a party that once had a 66c in the dollar top taxation rate on people earning certainly less than $60000 a year. Taxation cuts was the first winner today from Mr Key; he is going to run on the policy that the top taxation rate should be lowered. That would not affect the great majority of New Zealanders most of whom would be delighted if they earned $60000 a year. Most of them do not earn as much money as that and do not expect to do so at any stage during their working lives. 
But let me turn to Mr Key’s second little topic about the railways. He said the National Party’s policy was that the Government should not have bought the railway track back. Well that is a really popular policy as well! I think that something like 80 percent of New Zealanders think this Government should have bought the railway track back. Why did we buy it back? We bought it back because a previous National Government sold the railway track—against Treasury advice. The sale of that asset is the only one I know of when Treasury’s advice should have been taken. When National sold the railways Treasury said the track should not be sold because the track was the infrastructure and the Government needed to make sure it was maintained and kept in place. But what happened? The track was run down over the next years to a parlous state. Now Mr Key says: “Oh my goodness! It’s going to cost some money to fix up the railway track”—which National sold off. 
But then Mr Key says the railways board we appointed is stacked with well-known left-leaning socialists—Labour Party supporters. 
John Key 
: Hacks. 
Hon Dr MICHAEL CULLEN 
: “Hacks” is the word National members used. I am sure that Cameron Moore former president of the Canterbury Manufacturers Association—a person I suspect of somewhat conservative political leanings; he certainly was like that when he was head prefect of Christ’s College some 40-odd years ago—will be somewhat offended to be described as a Labour Party hack. Now who was National’s No. 2 exhibit as a Labour Party hack? It was Dr Clive Matthewson. Well apart from the fact that he is the uncle of Katherine Rich—we will not dwell upon that for too long; we would not want to suggest by any chance I had been sort of suborned by the delights of Mrs Rich on this matter—what we can say about Dr Matthewson is that the last time he was in Parliament let us remind ourselves he voted for a National Government on confidence and supply. Such a generous Minister or so non-hacked off am I—or so happy is he—in terms of somebody who had been a good friend but who left the Labour Party crossed the floor and voted with National that I have appointed him to the board of TrackCo. Why? Because Dr Matthewson happens to be an able person. He happens to be a civil engineer and he brings crucial skills to the job. 
Mr Key has suddenly gone very quiet. Let me point out that in 1996 Mr Key was still overseas practising dodgy things on the international finance market—manipulating paper money all over the place. He was not aware that in 1996 there was a party then called the United party which Dr Matthewson was the leader of and which entered into in effect a coalition agreement with the then National Government and saved National’s bacon—kept it in power. I appointed Dr Matthewson and Cam Moore to the board and appointed other people to the board who are able people. 
John Key 
: Mates. 
Hon Dr MICHAEL CULLEN 
: It is probably that I have lots of mates and Mr Key does not have any. It is very hard for me to appoint people who are not mates of mine to the board of anything. I apologise for that fact. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 There is nothing so embarrassing as watching two guilty parties pointing the finger at each other. I recall very well 20 July 1993 when the then National Government with a foolish Minister of Finance called Richardson sold New Zealand Rail for $328 million. That was a massive underpricing of the company and within 3 months as the international market heard about it—and Mr Key as well—the share price for Wisconsin central railroad and Fay Richwhite went up by a massive $182 million every dollar of which was lost to the New Zealand taxpayer. Those are the facts. Back then of course on 20 July 1993 the Labour Party said that it supported the sale. 
Hon Member 
: Can’t believe that. 
Rt Hon WINSTON PETERS 
: Yes it did. If one looks at the press statements one sees Labour supported the sale back in 1993. So here we have those two parties both as guilty as sin when it comes to selling the taxpayer’s hard-earned constructed assets and one of them is trying to make out that it is innocent. They are both as guilty as sin. Do members know what National said back in 1993? It said it thought it would cost $200 million to do some upgrading and it could not afford it. New Zealand Rail back then of course was making a significant profit. It is a lie to say it was making a loss; it was making a significant profit. 
But what happened? Here are the facts. The financier of National’s 1984 1987 and 1990 campaigns—Fay Richwhite—in October 1992 got itself made the financial adviser to New Zealand Rail. In April 1993 barely 6 months later it jumped the table and said hello boys it was the buyer. The National Party—Mr Key’s party which he thinks should be in Government—was so naive and stupid it did not put New Zealand Rail to the market. It gave those insiders the full run and sold New Zealand Rail at a bargain-basement price. Did the new owners construct $200 million of reconstruction repairs and maintenance? No they did not. They then recapitalised New Zealand Rail drained and sucked everything out of it and shot through. They are the same people whom Don Brash met when he was last in Europe. They are all the same old players looking for the same old favours smack in behind this National Party Opposition. That is why National cannot be trusted anywhere on the Treasury benches without being totally controlled and on a very hard leash. 
Mr Key is right about due diligence because this is a case of history sadly repeating itself. There was no due diligence back then and there is none now. Why on earth would Toll want this track? All over the Hawke’s Bay and all over this country there are significant costs awaiting the New Zealand railways when it comes to our track. Bridges need repair and construction and the new genius running the finance portfolio Dr Cullen says he will get taxpayers to pay for that. He says Toll can run the railways and make all the profit and we will pay Toll to have the very machinery and mechanism by which it may ply its service. How stupid can one be? I have to tell New Zealand taxpayers they are tigers for punishment. They have to be if they fall for this one. Mr Key is right—except that he is the last person in the whole wide world to make out that argument because he comes not with the clean hands of equity or truth but with his hands totally soiled with the DNA and blood all over them. 
There is only one party that can be trusted on these matters and that party is New Zealand First. We do not sell State assets and particularly ones that are making a profit. But here is the extraordinary thing. I ask Dr Cullen what costs are contemplated by the taxpayer now in respect of our railways our tracks our bridges and every other facility. What is the taxpayer in for now? I then ask him to tell me that what this Government has done is smart. We got the railway back; we actually were the owners of it just a little while ago. This Labour Government claims to be different from Labour in 1984 and 1990 and it has sold the railway. 
PAUL ADAMS (United Future) 
: 
 I would like to speak on finance. I want to focus particularly on one area of taxation—GST. We collected close to $10 billion in GST last year. If there is any evidence that shows United Future is a party that is truly in the centre it is our campaign to fight against the tax on a tax that is the GST on rates. Some great billboards have gone up around the country—and members may have noticed them—stating that there should be no tax on a tax. 
This is a serious issue. I will take a moment to consider that the Government loves to collect taxes. There is no doubt about that. A Government needs taxes. But the people of New Zealand the ones that members and I know do not like paying taxes and they definitely do not like paying a tax on a tax such as GST on rates. One can only imagine the human outcry if we decided to put 12.5 percent GST on the PAYE that we collect from workers. Yet this tax is a tax on the workers in this country. 
Businesses can claim back the GST that they pay on their rates but can the elderly claim back the GST they pay on their rates? No they cannot. I believe that the elderly in Australia do not have to pay GST on their rates. In New Zealand it is the workers as they earn their money who have to pay GST on these rates. 
I believe in GST. I think it is a very good and fair tax system. I believe it is a tax system that collects tax for running the country from everybody who passes through this country. But once it becomes a tax on a tax we will stand against it. It will be interesting to see what happens when it comes to the vote on my fellow member Gordon Copeland’s member’s bill because this is a very unfair tax system. I have heard from many people as we have spoken around the country against GST on rates and they have supported us. Tax collected on false pretences— 
Rt Hon Winston Peters 
: Why are you voting for it? 
PAUL ADAMS 
: —is something that Mr Peters would disagree with. Yet I believe we started with a tax on a tax and now we move into other things like the development contributions that we have in my own home town of Albany. I read in the paper that the costs of a home and land in the Auckland area are getting out of hand. It states on the North Shore City Council’s website that before one even starts to build a minor dwelling in the little area of Albany one will be paying around $60000 by the time one cuts off the little piece of land and pays the reserve contribution permit costs and development costs. 
This cost of $60000 is nothing short of a tax under another name. This has happened under a Government that said it would not increase taxes yet we have seen these types of stealth taxes beginning to increase over every little area—here a little there a little. But United Future will fight for this one. We are pleased that our member’s bill has come out of the draw and that we can put it to this House so we can flush out the true colours of some of these parties as we debate these taxes upon taxes. It will be very interesting to sit and observe. The elderly people in this country will be extremely interested to see who supports Gordon Copeland’s bill to see that GST on rates is removed because we believe— 
Craig McNair 
: Talk about the Budget. 
PAUL ADAMS 
: This is about revenue. This is a tax on a tax and as I said the Government has collected just under $10 billion in GST over this last 12-month period. I believe that that is an incredible amount of money. I agree that we need to see how the expenditure on a lot of these departments is going. We should give the poor taxpayers in this country a break and reduce some of these overheads not keep increasing them. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 I seek leave for an extension of time for the United Future party to now tell us why they are voting for this Budget which has that very tax in it. 
The CHAIRPERSON (H V Ross Robertson) 
: Under Speaker’s rulings 1/5 and 1/6 a member cannot seek leave for someone else. 
Rt Hon WINSTON PETERS 
: I am moving an extension of time. 
The CHAIRPERSON (H V Ross Robertson) 
: The House is the master of its own destiny. Is there any objection? There is. 
CLAYTON COSGROVE (Labour—Waimakariri) 
: 
 The speech preceding my United Future colleague’s speech was very interesting because Mr Peters demonstrated that amnesia is here to stay in respect of the New Zealand First Party. If we look at the unemployment figures during the time that Mr Peters was Treasurer and compare them with what we have now we see a huge gap. So let us bring this debate on finance and revenue estimates and the progress of the economy back to some bedrock facts. We have Huey Dewey and Louie over there in New Zealand First. I say to Mr Mark—[ 
Interruption 
] 
The CHAIRPERSON (H V Ross Robertson) 
: I am sorry to interrupt the member. I know it is the first day back but can I ask members to please look at Speaker’s ruling 56/1. Interjections are to be rare reasonable relevant restrained and as a former colleague—the honourable member Geoff Braybrooke—said if at all possible witty. 
Ron Mark 
: I raise a point of order Mr Chairman. In keeping entirely within the Standing Orders could you remind members that they are to refer to other members in the House by their honourable names not nicknames such as “Huey Dewey and Louie”. To do such a thing would result in me calling that member “Punch and Grow” or something like that. We could not have that could we? 
The CHAIRPERSON (H V Ross Robertson) 
: The member is right—Speaker’s rulings 26/7 and 26/8. 
CLAYTON COSGROVE 
: Mr Speaker I thank you for your indulgence. I would tell Mr Mark to stick to ski trips that never existed. He needs to get his facts straight. 
I will now concentrate on this finance and revenue debate and look at some hard facts which of course the Opposition will not like. From 1990 to 1999 the economic growth figures under the National Government averaged 2.6 percent. Now New Zealand is enjoying the most sustained period of economic growth in three decades. Suddenly the silence from Mr Key is deafening. The figures show that our annual growth rate was 3.4 percent on average in the past 3 years—well above the OECD average of 1 percent. 
If we are to have a debate about the finance and revenue estimates we should deal with the facts. I will look at tax which we have heard a lot about today. The latest statement on the National Party’s tax policy—when it finally sorts it out because we know that Dr Brash is a bit agnostic and uncomfortable or whatever—along with its ACT partners would give Dr Brash and Mr Hide and others in this place an extra $600 a week. Somebody below $39000 would get zip and that is the difference. 
What have we done in these estimates? We have put a package together that targets middle and low income hard-working New Zealanders. I would have thought that that mob on the other side of the House would actually be in favour of giving the workers—whom the Opposition says from time to time that it represents as long as they are on six-figure salaries—a little bit back. Under this Budget low and middle income workers if they are on $39000 with kids get $150 a week extra. If they are on $55000 with kids they get up to around $200 a week extra. I think it is good to go to hard-working families and say that if they work look after their kids and do the right things the Government will stand beside them and assist. But the only people the Opposition will stand beside are those who drip in Christian Dior earrings and jewellery and have elegant diamond pens. The National and Act parties will stand beside those people who have like Mr Key as he told the Finance and Expenditure Committee the black American Express card. I must confess that I had never heard of a black American Express card. I think I had a gold one but I never heard of a black one. I am told one has to do a number of things in the private sector for American Express to show that amount of faith and trust to get a black American Express card. 
Let us look at it. The Opposition has called for company taxes to be lowered. They have always said how badly New Zealand does and how over-regulated we are compared with Australia in respect of tax. Here is what the Chief Executive Officer of Fletcher Building Ralph Waters had to say: “If I didn’t choose New Zealand’s 33 percent regime against Australia’s lower rate but with payroll and capital gains taxes as well as stamp duty added on then I shouldn’t be doing the job I am.” 
If we look at Australia’s top two rates of personal tax they are ahead of our top rate. Australia’s company tax rate on the face of it is lower than ours but if we add in their equivalent of accident compensation—I think their equivalent of accident compensation is about double ours—Medicare and payroll then their rates are far and away higher than ours. But that is the sort of dynamic place that the National Party wants to take us. 
Let us look at these finance and revenue estimates and what will be achieved this year and what previous estimates under Dr Cullen have achieved. If we look at unemployment the number of Kiwis in work has grown by 193000 in 4 years under Labour. In 1999 when Labour came in the unemployment rate was 6.3 percent. Where are we now? We are just tilting over 4 percent or just tilting under depending on what one reads. I challenge Mr Key to match those facts. 
JOHN KEY (National—Helensville) 
: 
 What an illuminating debate this has been. There was Clayton Cosgrove the head of the Finance and Expenditure Committee who one would think would know better because one would think he had been reading the reports that come from Treasury produced out of the $3.29 million worth of policy advice given to the Minister of Finance. One would think he would read those reports. Those reports indicate quite clearly that Treasury has significant concerns about the growth rate. Treasury does not apportion any of the growth rate to the current policies of this Government; it apportions them to the reforms of the 1980s. So do members of the OECD and any other external commentators who have taken a moment just to have a look at our things. 
When we look at the policy advice provided to the Minister of Finance pre the Budget Treasury was quite clear in the things it wanted the Minister to do. One of them was to address the top rate of personal taxation and I think the second one off the top of my head—I read the report only three or four times clearly more times than the Minister of Finance read it—was to cut the company rate of taxation. 
Treasury does not believe in the Clayton Cosgrove - Michael Cullen definition of forming tax policies for companies. It does not believe that we have to take the best of our system—let us say no payroll tax and no capital gains tax—and then take the best of the Australian system a lower nominal rate. Treasury is a lateral thinker in the world of finance. It knows—OK I am extending things slightly—that one can design tax policy that indeed has the best of the New Zealand system:no capital gains tax and no payroll tax; and the best of the Australian system: a lower company rate of taxation. 
The next point I want to address just for a moment is that the Minister of Finance stated that he believed I said that the Government should not have bought the railway tracks. That was not the statement I made at all. The Minister should go and reflect on that. The statement I made was that the taxpayers of New Zealand have a right to know that due diligence was done when the Crown on behalf of the people of New Zealand assumed a huge liability. 
Darren Hughes 
: What wishy-washy stuff is this? 
JOHN KEY 
: I say to Mr Hughes that if we had done some due diligence we could understand. It may be a great shock to Mr Hughes but my 20 years in the finance industry were not spent telling companies to go out and buy whatever they felt like willy-nilly without doing any due diligence because they were buying a huge black hole at $1 and should ignore the liabilities because they were going to do it anyway or because the best information was held by the seller. 
It is quite standard practice to do due diligence. It is not an unusual sort of thing. In fact given the amount of time that Chris McKenzie and the group had up in Auckland I would have thought that they must have been doing something. They were obviously enjoying the Auckland lifestyle and having a few laughs. Clearly they were not doing due diligence work and I say to Mr Hughes that they told us that. That is just a very interesting point to note. 
Can I also reflect on the comment made by the member for United Future about abolishing GST on rates. What a misguided policy that is—putting to one side of course the $230-odd million that they would be expected to find somewhere else. One of the great principles of the New Zealand GST system is that GST is on everything. We do not have it not on uncooked chickens and on cooked chickens; we do not have it on this and on that. We have it on everything. It is a fair system and we understand the rules. I might add that just last week I saw employees of the local authority in the area I live in out chopping trees. 
Darren Hughes 
: Which one’s that? 
JOHN KEY 
: In a number of places. They were chopping trees and if I had undertaken that myself I would have had to pay GST. It is a fundamentally flawed policy. 
I want to talk just for a moment in Vote Finance about the build-up of the State sector. There was a very interesting answer to a parliamentary question I asked just a few weeks ago. The information that came back stated that in 2000 the Government had at its disposal about 1700 policy analysts. Now we find that at the end of 2003—and this number will already be considerably larger now because we are 7 months into the year; and I might add that it is 2 years to the day since the election of 2002 but that is an aside—there are now 650 more policy analysts than that. 
PANSY WONG (National) 
: 
 I would like to continue the theme of the articulate National finance spokesperson John Key who is very well respected in the business and economic sectors. He raised a very good point about whether the Labour Government understands business and whether the New Zealand public can trust the Labour Government to manage New Zealand’s economic direction. I want to use a very tidy example one of the Labour Government’s economic initiatives to demonstrate what typifies Labour’s approach to business activities. Firstly Labour is ignorant of what makes business tick; secondly it believes in throwing money away just to make itself feel good; and thirdly it has very little respect for how it uses taxpayers’ money. 
I want to use the example of the Export Credit Office which was opened with fanfare and was trumpeted by the then Associate Minister of Foreign Affairs and Trade Pete Hodgson. He said in 2001 that the export credit scheme was part of the Government’s drive to improve export growth. The Government reckoned that the scheme started with good research and consultation and that it was the solution for New Zealand’s small exporters. He predicted that as soon as the office opened up for business small exporters would be queuing to take up this credit insurance. The Government was so confident about it that Cabinet was told that the Export Credit Office would recover its costs and would not cost taxpayers a cent that it would not compete with commercial providers—that was written into its contract—and that the scheme would operate for New Zealand’s small and medium-sized enterprises. 
After the scheme had operated for 12 months research was conducted to find out why none of the small exporters had taken up the offer from the Export Credit Office. The report told us that in hindsight when the Export Credit Office was set up the extent and significance of the gaps why small exporters were not able to export to foreign markets had not been quantified. So the Labour Government as usual had charged into unknown territory and claimed it had a solution. Over $1 million was used to set up the office and almost $1 million was spent every successive year to prop up that office without in effect any understanding of the problems facing small exporters in increasing their business. 
So in the review of the finance estimates that was conducted recently I once again raised this issue with the Minister of Finance and asked how many export contracts that office—$3 million and 3 years later—had actually signed. 
John Key 
: How many? 
PANSY WONG 
: The answer was zilch—none. Then the Minister—and I think this is a very worrying thing which I want to share with the public—said that although the office had not signed up any contracts he reckoned that $3 million was a small price to pay in order to have the Export Credit Office which provides some underpinning of confidence for small exporters. So the Labour Government was very generous with the taxpayers’ money spending $1 million a year to give exporters some confidence. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 In reply I thank members for their sometimes lucid participation in the debate—at least from Mr Clayton Cosgrove. 
Mr Peters asked a number of questions about the TrackCo issue and why the Government is putting money into the track. It is because firstly the track needs it; secondly the public interest is in keeping expanding traffic on the rail; and thirdly if the Government does not do it the cost will fall back on the public anyway through increased costs of roading. Unfortunately there is no no-cost option for the Government in this particular area. 
The TrackCo deal is a very simple one. Basically we have agreed to put $200 million of capital upfront into upgrading of the track and delayed maintenance. Toll as a consequence is committed to a level of upgrading of its own capital equipment and the Government will recover by way of charging any expenditure above the $200 million. In terms of due diligence firstly I think it is fair to say that the Government knew more about the nature of the track than Toll did when it bought Tranz Rail. We could not actually warn it about it because of the nature of legislation around companies etc. Secondly as I said we will recover expenditure above $200 million in terms of the charging regime. 
With regard to Mr Adams and the issue of GST on rates I say that in my view it will stay in force. We certainly oppose it. I remind the member that it passed the Labour caucus in 1984 by one vote which was that of Mr Dunne. He actually voted for imposing GST on rates. I can say that I voted against it at that point. Had Mr Dunne voted against it in 1984 GST would not have been imposed upon rates; it would have lost in the Labour caucus by one vote. But since that time firstly we have learnt that we were right in terms of the majority position—that is that keeping the GST system simple and as broadly based as possible is actually central. It is one of the reasons we have the best value-added tax in the world. It is a much better value-added tax than the Australian goods and services tax. Secondly in fact rates have increasingly become a fee for service of one sort or another and are less and less related to ability to pay or variable. The more rates are a fee for service the more the case is absolutely clear that GST should be applied. Finally I point out that even if GST on rates is seen as a tax upon a tax it is not the only case; GST is applied on top of excise duties on petrol tobacco and alcohol products but that does not seem to arouse the same concern. 
Mr Key came back to the good old issue of the top rate of income tax. If that is the National Party’s obsession and clearly it is the thing that sends its members to sleep at night—thinking about reducing that top income tax rate—why is it not National’s “Key” policy so to speak? It does not seem to be its “Key” policy; it is not even its “Brash” policy now. It used to be. It has kind of dropped down in relevance in terms of the National Party’s approach. 
As for the company tax rate I say that the only beneficiaries from lowering the company tax rate are foreign investors in New Zealand. For New Zealand investors it is an imputation credit. If it were a classical tax regime then the argument might be different but there is an imputation tax regime in New Zealand on company tax and therefore it is only a timing issue. As long as New Zealand public companies pay out just about all of their profits by way of dividends their argument is extremely weak because it is clear they are not ploughing their profits back into growth. And that is another issue the Government is looking at. 
Of course the National Party cannot get its position right on this issue or its position right on the track. Mr Key could not tell us what the National Party’s position on buying back the track was. He was asked during his speech but he would not give it. The problem is of course those members have to wait for the signals from “Foggy Bottom” before they know what their position should be on any particular issue before the New Zealand public whereas we in the Labour Government make our own decisions. 
Finally I will address the issues raised by Pansy Wong who has this obsession with the Export Credit Office. What has happened is that a lot of deals have gone though as a result of the Export Credit Office being in place. There are now exporters who can indicate their ability to finance for greater than 1 year. I have a whole series of examples here of exporters who have been able to proceed because of the existence of the Export Credit Office. It has been successful in that respect. I have examples of a Canterbury exporter an Auckland exporter able to offer finance a marine exporter offering finance terms and a communications company offering finance terms. They were able to proceed to make those offers because the Export Credit Office was standing in the background. The fact that in the end they did not need to use it is actually—if Mrs Wong cares to think about it—a positive because therefore no Government money was actually put at risk in any of those deals. But the fact that the Government backing was there enabled those exports to occur. If Mrs Wong is telling us that National would remove the Export Credit Office I say to her: “Make our day.” 
A party vote was called for on the question  
That Vote Finance be agreed to. 
Ayes 61 
New Zealand Labour 51; United Future 8; Progressive 2. 
Noes 55 
New Zealand National 25; New Zealand First 13; Green Party 9; ACT New Zealand 8. 
Vote Finance agreed to. 
Vote Revenue 
JOHN KEY (National—Helensville) 
: 
 I want to turn my attention in Vote Revenue to the $1.316 billion that is paid to administer and pay amongst other things the family support tax credit the family tax credit the child tax credit and the parental tax credit. Before I do so I will reflect for just a moment on the concerns we had with the Working for Families package and the interaction of those particular payments that are to be made. During the Budget debate we highlighted—and members will recall this—the rather disastrous situation we believe where potentially a great many New Zealanders could be put into a situation whereby they face very high effective marginal rates of taxation. Someone with two children living in say Wellington or Auckland and earning $38000 could indeed receive an after-tax income in excess of that gross income of about $43000. When compared with someone earning $60000 with two children—maybe a next-door neighbour—we find that person’s after-tax income would be only about $2000 more than that of the person earning $38000 gross. People on $60000 face an effective marginal taxation rate of around 90c in the dollar. 
When we highlighted that after a little bit of digging the Minister for Social Development and Employment Steve Maharey responded with one of those classic lines: so what? Well here is the beef if the Minister missed it. The beef is that people will not necessarily want to get up on Saturday mornings to do a bit of extra overtime when they receive only 10c in the dollar. Here is the beef if the Minister does not necessarily get it: people who go out and educate themselves further often incur costs in doing that—it is called a student loan—or they go and borrow some money or take out some form of debt on their credit cards or whatever. 
Judith Collins 
: Why bother? 
JOHN KEY 
: Why bother? Exactly—that is the point. If someone will receive only 10c in the dollar why will that person bother to do so? Clearly in case the Minister for Social Development and Employment missed it in relation to his comment of “So what?” here is the beef. Quite often when one is earning $38000 in a job vis-à-vis earning $60000 or $70000 it could well be that the job paying $60000 or $70000 has a considerable amount of additional responsibility. Therefore one may have to consider whether to change jobs and be prepared to take that extra responsibility in order to earn 10c in the dollar—I think not. That is the answer to Mr Maharey’s “So what?”. All the international evidence—which I am sure the Minister was aware of but conveniently forgot especially when he was interviewed on Radio New Zealand—proves that this measure does exactly what the National Party has been saying in terms of deterring that kind of behaviour. 
I want to take a moment if I may in talking about child tax credits and accommodation supplements to reflect on whether this Budget has a little more spin in it than maybe first meets the eye. I say that because while many others in the Committee may have gone to sleep after a Budget that was one of Labour’s biggest giveaways yet could not get Labour a kick up in the polls at all—and that is pretty disappointing—Michael Cullen was sitting there and expecting and promising the ninth floor that he would deliver a few more points in the polls to stave off what will be the inevitable collapse when the Maori Party takes all Labour’s Maori seats in a year’s time. He promised the Prime Minister that and he failed. He has failed dismally and he has tied himself up and has no room to move. An interesting spin came out on the Budget. Members heard it from Clayton Cosgrove earlier when he talked about the good the Government would do for hard-working families. Well interestingly enough I asked a parliamentary question about the accommodation supplement and was told that 266000 New Zealanders will receive the accommodation supplement in 2007 on Treasury’s predictions. But I was very surprised to learn that of those 266000 New Zealanders Treasury predicts that 260000 will earn $25000 or less. In fact the vast majority would be classified as welfare beneficiaries. I am not knocking that; I am simply pointing out that the statements being made by the Government to the people of New Zealand—in relation to the accommodation supplement anyway—are simply not correct. 
That led me to wonder whether Michael Cullen and Labour’s finance team had possibly been trying to mislead the people of New Zealand with their statements—and members saw that before with regard to Mr Cosgrove’s comments. So I picked up fact sheet 7 of the Working for Families package and I found to my surprise that example 1 was a very interesting example. Rod and Barbara sound like a lovely couple; they have two children and they live on the North Shore. Rod works 40 hours a week and earns $52000 gross per year. [ 
Interruption 
] I am sure he probably does vote for National. Rod and Barbara pay $385 a week in mortgage costs. Their total income from work and the accommodation supplement is $766.55 in the hand. Lo and behold in example No. 1 on fact sheet 7—a prime example and up in lights—thanks to the generosity of a Minister once described as Scrooge McDuck by all the cartoonists around the country that couple gets $170 per week by 1 April 2007. Fantastic! Rod and Barbara are absolutely high five-ing themselves over on the North Shore which is a seat held by National MP Wayne Mapp—and may I take a moment to say what a wonderful job Wayne Mapp does for the people of North Shore. Anyway there are Rod and Barbara over on the North Shore having a really good time. Fact sheet 7 of Working for Families was distributed widely to the people of New Zealand and talked about by the Minister of Finance by Clayton Cosgrove by the Minister for Social Development and Employment on Radio New Zealand and by Mr Darren Hughes the translucent member for Otaki who is out there pumping out all the spin that the Government has. 
Why was that couple scenario No. 1 on fact sheet 7 of Working for Families? Because it was the proudest moment for Labour. Not only did the Government manage to infiltrate middle New Zealand—Rod and Barbara a lovely couple with two kids who live on the North Shore and earn $52000; members know the drill—with welfare dependency which is not necessarily something the majority of New Zealanders is necessarily proud of but lo and behold the subliminal message was that middle New Zealand should not worry because it was getting something out of the Budget. Okey-dokey! So away I went and did a little research. Members will be surprised to know as I was—and I was absolutely shocked at this—that Rod and Barbara are one of six couples who earn between $50000 and $55000. I have more fingers than there are couples in New Zealand in that situation! Michael Cullen can name them individually; he has had a cup of tea with every couple earning between $50000 and $55000 that is getting something out of this Budget. It is a hoax! Government members look confused—and they should be confused because those are the facts from Treasury. Unbelievably the situation of Rod and Barbara even though they earn $52000 and are a nice couple who live on the North Shore with two kids is constructed from a very unusual set of circumstances. 
If any members are interested I could give quite a long dissertation on why that couple is one of six couples on that income—and in fact one of only 104 out of 266000 couples earning anywhere near that amount of money—who will get an accommodation supplement and so will get something from the Budget. So when Clayton Cosgrove the Minister of Finance the Minister for Social Development and Employment the translucent member for Otaki and anybody else want to get on their feet in this Committee and tell the people of New Zealand what a wonderful job this Government is doing for middle New Zealand I have only one comment: it is baloney. What a load of baloney it is! Rod and Barbara happen to be in a very unusual set of circumstances. I want to congratulate Treasury and probably the Inland Revenue Department because they must have spent months finding Rod and Barbara. It must have been very difficult to find that couple. They must have absolutely trolled through the phone books to find the one in six couples that earns between $50000 and $55000 and will get anything out of Working for Families. 
That is why the public of New Zealand resoundingly voted against this Budget and is why three-quarters of the people who voted on the  
Holmes 
 poll did not want it. It is why Labour has had no kick out of it and why Michael Cullen completely failed the Prime Minister when he told her not to worry because the Government would have a big spend-up and fend off the Maori Party that is going to take the seven Maori seats. It has failed it is a hoax and it is a load of baloney. No one will believe Working for Families is a good package for middle New Zealand. 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I think Mr Key’s problem is that he is not yet fully National Party potty-trained. He has not yet learnt the mocking insincerity that drips off Tony Ryall and Roger Sowry at a moment’s notice. Mr Key is sometimes an intelligent person. He started off by telling us that there were thousands and thousands of middle-income families that will have over 90 percent marginal taxation rates. Now one gets to that only if one also gets the accommodation supplement abatement. Mr Key told us that there were not actually thousands and thousands of those families getting the accommodation supplement but that there were only six families on incomes of above $50000 receiving it. So all that heavy breathing from the National Party in opposing the Working for Families package was trying to find people whom I have had a cup of tea with but who would not go anywhere near the National Party with a cup of free water because they would not trust it in that respect. 
Again what Mr Key did not tell us was the answer to one simple question: if in some sort of fit of idiocy the public votes for the National Party at the next election would a National Government remove the Working for Families package? [ 
Interruption 
] That is right he should. That has got that on the record; I have been waiting for that for some time. I hope Rod and Barbara are listening out there. Mr Key has just announced that they will lose their $170 a week under National but the really good news is that although they may be something like $150 a week worse off as a consequence—because the tax changes will not give them much—their effective marginal taxation rate may be a bit lower. I hope as they try to pay for the kids’ shoes the school fees the mortgage the rates and all of that they will be able to say to themselves that if only someone popped in tomorrow and offered them a job as a brain surgeon their effective marginal taxation rate would be lower than it would be under Labour. That would probably not be a great solace to Rod and Barbara. 
The National Party has to explain what its policy is to deliver gains of that order of size—an average of $100 a week for all families with kids where those families earn between $25000 and $45000 a year. What is the National Party’s alternative? Its alternative as it said itself at the time is that those families are not seen as hard-working New Zealanders. That is the National Party’s view. One is not a hard-working New Zealander in the National Party’s view until one gets to about the $100000 a year range. The vast bulk of Kiwis in the National Party’s view of life are not hard-working people. The National Party sees them as “welfare bludgers” and if they are Maori welfare bludgers well it is even better from the National Party’s perspective on those matters. The National Party does love to make that connection whenever it can—in front of the right sort of audience of course. When its members get in front of a different audience it is a somewhat different story. 
So what is the National Party’s position on those changes? It is that we should not have any of them. Instead we should just knock a cent or two off the taxation rate in the middle range which would give the people on $38000 or $40000 next to nothing in the hand—a couple of peanuts and the chance to work harder as a monkey is what the National Party’s approach would be. It would knock off those people’s fourth week’s holiday make their working conditions worse sell out the country to nuclear ships and flog off the schools and the hospitals. That is the National Party’s entire agenda because it has not yet come up with a single idea that it did not put into place in the 1990s. Each of the four policies announced by the National Party is what it did last time around and lost on. Those policies now have sort of “Brash knobs” on them making them even worse. 
I say that we are proud of the Working for Families package. We will be happy to go to the election saying to people that under Labour they will keep their fourth week’s holiday the Working for Families package and those increases in income. If Mr Key stabs Mr Power in the back and gets on the front bench in Government then people will lose the Working for Families package the fourth week’s holiday their country’s independence the decile funding and all those things. I do not reckon that National will be in power after that. 
Vote Revenue agreed to. 
Vote Economic Industry and Regional Development agreed to.  
Vote Community and Voluntary Sector 
The CHAIRPERSON (H V Ross Robertson) 
: I call the honourable member Katherine Rich. Is the member speaking on Vote Social Development? 
KATHERINE RICH (National) 
: 
 Yes and on Vote Community and Voluntary Sector. 
LINDSAY TISCH (Junior Whip—National) 
: 
 I raise a point of order Mr Chairperson. I would like to clarify that. On the schedule we have the first vote under the Hon Steve Maharey as Vote Community and Voluntary Sector and Katherine Rich will take a call on that. We will have other speakers later on taking calls on the fourth vote under that Minister Vote Social Development. I understand that the first vote under that Minister on the schedule as presented to us and tabled is Vote Community and Voluntary Sector. 
The CHAIRPERSON (H V Ross Robertson) 
: I have it down here that there is a separate vote for Vote Social Development but I do have Vote Community and Voluntary Sector Vote Employment and Vote Housing being taken together. Can we get this cleared up? 
LINDSAY TISCH 
: We do not mind the Chairperson calling Vote Social Development first but on the schedule presented to us that is the fourth vote under the Hon Steve Maharey. If the Chairperson wants to take Vote Social Development before the other three we will not object to it. 
The CHAIRPERSON (H V Ross Robertson) 
: We will proceed with Vote Community and Voluntary Sector. 
KATHERINE RICH (National) 
: 
 What a mess this portfolio is—what an absolute shambles. We have seen some major community programmes—some organisations that did good community work throughout New Zealand—reduced to an absolute shambles. I am referring to the Community Employment Group and the various programmes and activities that that organisation carries out within New Zealand. New Zealanders were pretty proud of that group in 1999. At that time it was run by a future Labour Cabinet Minister Parekura Horomia and undertook a wide range of community projects up and down the country that were good basic common-sense projects. But Labour came in and wanted to put in place its far-flung bizarre programmes and partnerships and about eight different programmes later we now have just a remnant of what was a very well-run section of Government. 
We have seen in the estimates process that there will be no change in the way community employment is delivered. We have seen vague objectives loose applications of guidelines—that is if the guidelines for grant applications have been followed at all—and some results that cannot be described in any better terms than “dubious” and “waste of money”. 
I am referring to projects like the now infamous hip hop tour. As my colleagues on this side of the Chamber know given the $26000 that was spent on that tour our concern is not about the music. Members on this side have nothing against hip hop as a musical genre but some community members are asking whether taxpayers should be asked to spend good money on researching how hip hop came to New Zealand—somehow we are supposed to think via Paris Samoa and Hawaii. That is where the applicants said they chilled out and had a very relaxing time. Most people concluded that it was not a good way to spend taxpayers’ money except for the Minister and the then general manager who went on National Radio and said he thought that it was a pretty good way. We on this side of the Chamber totally disagree. 
Some of the reports that have been released lately look at the way guidelines have not been applied when it comes to grant applications and the way some groups barely look at the guidelines at all before they are handed taxpayers’ money. We think the Community Employment Group needs to get back to basics—the good common-sense approach to community development—and to take out what is fast becoming a lot of rhetoric and garbage spoken about that area. 
A lot of the Minister’s speeches go something like: “Blah blah social capability; blah blah social capacity building; blah blah whole of Government; blah blah joined-up Government; blah blah interconnectedness.” I can basically rewrite some of his speeches myself. I thought: “Gee this social capability term is very interesting. I’ll look it up.” Treasury was very helpful so here is the definition: the term “social capability” is defined as “society’s capacity for collective action in a variety of spheres including non-market and market involving voluntary interactions as well as the coercive powers of the state.” 
 Well that clears things up. I feel a lot happier. If one feels like Manuel of  
Fawlty 
 Towers 
 in saying: “¿Qué?” one is not alone. And that is where a lot of New Zealanders are at the moment—putting their heads to one side and asking what this is all about. I do not think New Zealanders want to talk about such vague academic concepts. They do not want issues like community development to be an academic subject. I think they do want to get back to some basics and do want this particular organisation to fund programmes that are actually going to make a difference. 
We are not talking about researching hip hop tours. We are not talking about sending people off shore who did not know how to research and freely admitted they knew nothing about hip hop before they went. We are not talking about craft trips to Melbourne. New Zealanders do not fairly expect that we will use taxpayers’ funding to fund projects of a dubious quality particularly when one looks up and down the country and sees hard-working community organisations that find it really difficult to raise funds and provide some of the basic services that New Zealanders hold dear like Plunket or the Women’s Refuge. There are many organisations that were absolutely gobsmacked when they saw the long list of projects and programmes that had been funded through that particular organisation. 
We want more than a shake-up and we were not made to feel confident in dealing with this particular part of the Budget when various officials came before the select committee. We felt very concerned that not only had we seen $21 million go into a black hole last year but we had the concern that it would happen again because the guidelines have not changed. We are still seeing a very loose application of guidelines. 
A lot of money is being spent in areas where most Kiwis would really question the reason for some of that expenditure. So we have to get out of some of those kinds of strange projects that make New Zealanders just shake their heads. We have to ensure that if taxpayers’ money is going to be spent it is going to be spent well and spent on things that actually make a difference. 
One of my favourite Community Employment Group projects in relation to which I have just received an answer to a parliamentary question today will interest people. I asked about a project that received funding to look at the best way for the people of a particular marae to communicate with one another. The answer came back that almost $2000 had been spent on the development of a website. I said that was great and asked where the website was. I asked them to give me the proof that there was a website. The Community Employment Group came back and said that it was all right and I was not to worry about it because the field worker had sighted the website so it was in existence. But I said no. Being a trusty Opposition member I wanted to see the proof. Here it is. This is a printout of a website—one page—and the information on it states: “NgatiKere site coming soon.” That is the website; that is what we got for $2000. 
When it comes to serious investment in Maori leadership Maori land partnerships or the various programmes that that Minister has imposed on the Community Employment Group—as a result of ideology as opposed to the desire to allow the organisation to continue its work—I think if that group could get back to some of the basics over the coming year then we would see some improvement. This is not about throwing the baby out with the bath water. It is about tightening some of the guidelines so that some of the taxpayers’ money being spent in this area is first going into projects that do make a difference; second going into projects without such bizarre and vague objectives that nobody can really understand what they are anyway; and third going into projects that are described in terms that actually mean something. 
I think we need to move away from making this community and voluntary sector an academic subject and move back into something that communities can understand and implement. This vote is not supposed to be a slush fund for all and sundry. It is supposed to fund a programme that can assist communities to develop locally. By that I mean various projects that have worked in the past. One could look at going to Ranfurly to see the work that has been done there on its art deco project or look at the Otago rail trail project. They are good solid thoughtful community development projects not hip hop tours to Hawaii whereby someone gets $26000 to go and “chill out” at the taxpayers’ expense. 
When the Minister takes a call he might like to tell us whether those applicants from the Social Entrepreneur Fund will pay back their grant. We have also seen that particular fund go by the way thankfully. Although the Minister says fund applicants are all community champions and examples of human innovation a lot of other members on the Government side of the Chamber obviously agreed with members on this side which is why we have seen that entire project canned as a result of concerns raised by the Opposition. We need to get better accountability and we need to ensure that money is spent wisely and in areas that will really make a difference to local communities. 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 I rise to say that I agree with almost everything that the member who has just sat down said. In fact I cannot think of anything she has said today that I did not agree with. 
Katherine Rich 
: The Social Entrepreneur Fund is crap? 
Hon STEVE MAHAREY 
: No I think the Social Entrepreneur Fund is a very sound idea and I will come back to that. The member did not actually use the bovine excreta phrase when she was on her feet but we will come back to that in a moment. 
I should say that the member is attracting a great deal of interest from me. I have a vast collection of music and I am very impressed with the fact that the member has just purchased the Guns N’ Roses compilation and has identified “Sweet Child O’ Mine” as her favourite song. I think that is a real sign that she is a little bit more colourful than we had thought up until now. It was interesting to hear. “Welcome to the Jungle” happens to be my favourite Guns N’ Roses song and I welcome the member to this particular jungle. 
I go back to my earlier point that I agree with what the member has said. The community and voluntary sector is an area of Government spending that I know the member has a strong personal interest in. She has been able through very close connections to people close to her to follow its development over the last decade and a half. As a result she is well aware that the Community Employment Group has done a great number of things that members right around this Chamber would applaud. They have things going on in their electorates right now that they want to hang on to. They have mayors who are very keen for this kind of funding to carry on and people throughout the networks in their communities who want to see that work carry on. In the region I come from and the region of Horowhenua which the excellent member for Otaki comes from there has been Community Employment Group work around floods for example over the last little while. So this is a group that has its finger on the pulse of the community. For a long time it has been close to the community and has done a lot of things that we want to see it do. 
However the member raised a very important point—that groups like this of course are born out of very high levels of unemployment. They deal with people who are individually disadvantaged in communities that are disadvantaged. They have been working to try to ensure that they provide a platform for those individuals and communities to expand their possibilities in enterprise so that they can create more opportunities for employment. We happen to be in an environment as the member intimated that is very different from the way it was when this group began. In other words we have an unemployment rate of 4.3 percent. It is the fourth lowest in the OECD. We have more people employed than ever before in the history of this country. We have rising wages. I recently drove through the community of the excellent member for Wairarapa Ms Beyer who has led development in the Wairarapa over the last little while. I looked at one small town after the other where there were local coffee bars and other small businesses starting up. It was very colourful. There were flowers along the street in places like Carterton making the place look extremely attractive. It has been very much the vision of Georgina Beyer over the years to have a thriving community building on its wood tourism trying to get small businesses together and all those kinds of things. There is also the wine industry and horticulture. She has been tireless in promoting that kind of vision and we can see it happening. 
As a result of this outstanding change in fortune we are looking at the Community Employment Group through a different lens. We are asking what the role is of a group dealing with disadvantaged communities and individuals in the 21st century against this very optimistic backdrop brought about by the Labour-led Government and its outstanding MPs. I know that the member opposite was reflecting on that. As an Opposition member she is well aware that she is looking at a Government that is doing incredibly well. The country is on a roll and she is reflecting to herself on whether this organisation which has been very successful in the past should carry on in its present form. 
In my view the answer is probably not which is why last year in November I asked it to look at its grant system why I asked it to review itself and why in the near future we will be talking about the future of the Community Employment Group. We need to be talking about what it does as a core function being perhaps done in a different kind of form. That is where I think we are going. 
In raising those points today the member demonstrates as usual the fact that she is a very able Opposition member and that she has been doing some very good work in thinking about something that her and her family have been close to for some time. She is affirming the group’s core function of working with disadvantaged communities. She is acknowledging that under Labour there are fewer of them because we are doing so well. She is acknowledging that individuals who might be served by the Community Employment Group are fewer in number because they are now gainfully employed and living exciting lives throughout the country. She is saying that given the success of the Government we are now in a situation where we need to rethink the form of that organisation. I am saying I agree with her. I think we are as one on this and can work together to have the function provided in a way that does serve New Zealanders in the 21st century rather than have the group carry on exactly as it is. I agree with her entirely and we will do that. 
Vote agreed to. 
Vote Employment 
JUDITH COLLINS (National—Clevedon) 
: 
 It has been very interesting listening to the speeches this afternoon in this estimates debate. I welcome back the Hon Steve Maharey the Minister in the chair. I hope everything is fine. We have missed him. Certainly we have missed his sense of humour which I think was so aptly displayed in that last speech. What a comedian! It is certainly good to have him back again for the time that he will be a Minister which will not be long. 
Today I shall talk about employment. I certainly noted that the Minister referred several times to employment rates in New Zealand. He forgot to mention all the people who shift off the employment benefit and go on to the sickness benefit or the invalids benefit. At the end of last week and just this week doctors have been saying that they are sick of Work and Income people sending unemployment beneficiaries to them having told them to tell the doctors to give them a sickness form. I note that the Minister has previously been quoted as saying that sometimes unemployed people get sick. Well we know that. Lots of people get sick. That does not mean to say that they end up on a sickness benefit. Many of us would know of people who we would think could be on a sickness benefit but they are not. Many of us know people who are on an invalids benefit yet can commit criminal activities can have children can do things like pick kiwifruit and all sorts of jobs that they get paid for under the table. Many of us know of such people in our electorates and just generally. 
Not too many people are fooled by the contention of the Minister that the number of people on the sickness benefit is suddenly increasing—35 percent under Labour in the last 4 years—because we have an ageing population. Does the Minister think we all came down in the last rain shower? When people are past the age of 65 they get superannuation. That is what we call being aged. Being aged is not being 50 55 or 60; being those ages does not necessarily mean that suddenly all those people cannot work. We know that it is a “have” the doctors know that it is a “have” and the people of New Zealand know that it is a “have” and they have had enough of it. They are saying constantly in the polls that they have had enough. They have had enough of that politically correct rubbish. They have had enough of burglars and sexual predators who happen to have been on a sickness benefit an invalids benefit or an unemployment benefit because they are supposedly too sick or too ill to work or are unable to get work. 
Many of us see in our electorates and around the country that a number of people in small businesses are really really hurting under this Government. Small businesses are finding it difficult to find staff who are stable to compete with bigger firms to pay all the extra holiday pay and to do everything else that this Government is imposing on them. That will have a detrimental effect on employment. 
I know that the previous Minister in the chair talked a lot about how the Budget is helping families and all of that. Has he taken a couple of kids to the movies lately? Does he actually realise what the cost of living is under this Government and that there have been substantial increases in the cost of living? The more that we tell people that it is OK to be on a benefit and that they can survive on it and earn some money under the table the worse it gets. In fact the cost of taking kids to the movies now is pretty horrendous. Just the other day I took a couple of kids to the movies and at the end of the day after I had got all the things they thought were a requirement in going to the movies there was not an awful lot of change out of about $70 or $80—after parking and everything else. Many many families in this country could not afford to do that. Certainly I felt it was not something I would do again in a hurry. 
Costs are constantly being imposed. They do not just go on to businesses; they go straight back through the system to the very people who can least afford it. We are talking here about the families. They are the ones who can least afford it. Our just doling out a few dollars here and a few dollars there does not help them. Those people want some relief. They want some relief in taxes and they want it now. 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 I was just waiting to see whether any other member wanted to speak on employment. I really do appreciate members giving the Government an opportunity to speak on this topic. 
I remember when I first came into Parliament which was some time ago back in the 1990s. Soon after that we were entertained—or whatever the National Government thought it was doing at the time; it treated it almost like entertainment—by cuts in the benefits of people throughout this country by up to— 
Judith Collins 
: Did you put them back? 
Hon STEVE MAHAREY 
: Yes we have actually. Incomes of people were cut by up to 30 percent. 
I tell people who are new in the House and maybe were not around politics at that time that that is where the food bank industry came from. It came from those cuts. I can remember the Christmas after the cuts had taken place. I had asked Mrs Shipley in the House what the impact would be of those cuts in people’s incomes—whether we would see poverty and what kinds of problems might emerge. She had said that she did not know and that the Government would wait and see. About 12 months later we saw that households no longer could put food on the table. I remember ringing Peter Gresham who was the Minister of Social Welfare at that time and a member for an area not far away from my Palmerston North constituency and saying to him that I had queues outside every church in my city that people were queuing all over the place because in the post-Christmas period they simply could not feed their kids. I remember he came home from his holiday and introduced changes to the benefit system because people simply could not live on the benefits that had been cut by the Shipley-led National Government at that time. 
One other thing that happened in 1992 was that unemployment hit 11.9 percent under a National Government. That meant that there were unemployment rates of 30 percent amongst Pacific Island people and we had unemployment rates of plus 30 percent amongst Maori people. We had entire communities of people around this country where no one had paid employment under the National Government. So when we look at employment and unemployment today I want to say thank you to the National Opposition for giving this Government’s members an opportunity to say that we are very pleased that in 1999 the people of this country put us into Government; that we now have the fourth-lowest rate of unemployment in the developed world at 4.3 percent; and that more people are gainfully employed in this country as we sit here today than ever in the history of this country. More people are going out every day earning an income and taking it home and being able to put food on the table. They have a future for themselves because we now have more people in gainful employment than ever in the history of this country. 
 National members say we need to do something about the number of sickness and invalids benefits and I know that they want us to do that because they could not do anything. There was an 84 percent increase in the number of invalids benefits during the 1990s—84 percent—and from memory an around 65 percent increase in the number of sickness benefits during that time. But they point to the one little window when there was a change. That one little window was when Mr Sowry and Mr McCardle decided they would abolish the sickness benefit—there was to be no sickness any more; people could not get sick under the National Government—and put all those people on the community wage. In other words they blurred the figures for those 2 years because they amalgamated a range of benefits under the umbrella of the community wage. 
National members now come into the Chamber and say: “Let’s compare the period when we abolished the sickness benefit with the sickness benefit situation now.” Nobody except Dr Newman would accept that kind of shell game because good public policy is about comparing an apple with an apple so that one can make the difference and say one is improving things. The National Government abolished the sickness benefit for a couple of years before we changed it back to being a sickness benefit because we do acknowledge that people get conditions or diseases that mean they cannot go to work that mean they are out of work for a short period of time. That is what a sickness benefit is for so we have put it back in place. But to compare the period now with the period when there was no sickness benefit is an extraordinary piece of charlatanism in terms of trying to say: “Well we did one thing and you’re doing another.” Let us compare apples with apples. 
Under that Government the number of sickness and invalids benefits went through the roof and it had not one single policy that would change it. Do we? Yes we do. We have a change that means that in April this year against the backdrop of a very positive employment and unemployment situation we introduced radical new policies around the sickness benefit and the invalids benefit. They are the kinds of policies that people right throughout the OECD are following closely because we do better than they do. We have better policies than they do so they are following us. New Zealand is once again getting back into a position thankfully of being a leader in social policy rather than having no social policy which is what we had under the National Government. Once again we are leaders in this policy and we will try to address these problems. 
The last point I want to make is this. If people around this country are listening to this debate—and I am sure there are many thousands riveted to what we have been saying here this afternoon—they can compare these two policies. We are interested in ensuring that people are treated fairly when they are sick or have a disability. We will treat them fairly. We will ensure that where it is possible they will get an operation they will get treatment for their condition we will train them we will support them in the workplace we will fund the transition to work and we will be extraordinarily positive in opening security and opportunity for those people. That is what we will do. What would a National Government do? It might abolish the sickness benefit again it might introduce time-limited benefits and it might tell people that it will introduce work-capacity testing again of the kind that was a disaster for people with mental health problems in the late 1990s. We have not heard one single idea from these people that they had not already tried in the 1990s and those ideas caused them to lose heavily the election in 1999. People were sick of the mean-spirited hopeless misguided policies that the National Government introduced in the 1990s. People are now looking at more people being employed than ever the lowest unemployment rate we have had in 20 years optimistic communities all over the country looking for more and a fair and just Government that is now beginning to do things about the sickness benefit and the invalids benefit. 
I have one last point to make. Dr Newman said on the radio today that she would provide me with individual cases of doctors who have been browbeaten by a Work and Income person. I have the senior people from Work and Income and the Ministry of Social Development sitting behind me now and they are anxious to hear about such a case. We have not heard of one single case yet. Dr Newman promised me today on National Radio on  
Morning Report 
 to provide individual cases. We are eager to hear of those cases. I say to Katherine Rich and Mrs Collins over there that we are eager to hear from them too. If we have individual cases of doctors who are being browbeaten to the extent that they break their ethical position and give medical judgments that do not have a sound basis because they feel threatened by one of our clients at their clinics—if that sort of scenario is playing out if there are individual cases of doctors around this country having to do unethical things or to make judgments that are not soundly medically based because they feel threatened—we want to know about them. 
I make this invitation now and I extend it to tomorrow. If we can hear of those cases we will support those doctors to make ethically and medically sound judgments on the people who are in front of them because what do we want in terms of Work and Income? We want one thing. We want those doctors to tell us whether that person is sick within the terms of that benefit disabled within the terms of that benefit or fit to be a job seeker under the terms of the unemployment benefit. That is what we want. We have no policy for anything else other than that. If there are individual circumstances that Ms Rich or Dr Newman knows about we are eager and waiting to hear of them. We want to support those doctors to be able to do the right thing. We look forward to hearing of those cases because we have not heard of them yet. 
Vote agreed to. 
Vote Housing agreed to.  
Vote Social Development 
KATHERINE RICH (National) 
: 
 It is very interesting to hear the comments made by the Minister for Social Development and Employment when he reflects on the past few years. We have just had the best economic conditions in a generation and certainly in my lifetime but very little of that—none of it in fact—has anything to do with what the Government has done in the social development area. It is also interesting to see the absolute amnesia that some Labour Party members have about the reforms in the 1980s and the 1990s. Although they carry on and complain about the changes that were made to the benefit system very few changes were made by this Government when it came into Government. It did not put the benefit levels back up again. It whinged on about it and talked about it but it did not put the benefit levels up again and it has not really undone any of the major reforms of the 1980s and the 1990s under the two successive Labour and National Governments. 
Despite having had those excellent economic conditions we now have more people dependent on welfare than ever. We have more people who are dependent on the State for their income than ever. When we look at the estimates and the Budget we see predictions that the numbers of people on all the major benefits will go up over the next few years. This is a time when we should see serious chunks taken out of the welfare system yet we have seen a huge increase in the numbers on the invalids benefit and a 35 percent increase in the numbers on the sickness benefit. 
I do not know where the Minister gets his figure of an 84 percent increase during National’s time because if we look at the period 1993 to 1999 we see that the increase was about 14 percent and that was an expected increase if we consider population growth and the expected rates of disability and illness. In the last 2 years before National left Government the numbers on those benefits were going down. The number on the sickness benefit was in decline yet if we compare that with the position during the first 2 years under Labour we see that the number went up by 21 percent. 
There was a reason for that. Most of the variables within the community remained constant but we saw a huge change in Government policy that was ideologically driven. We now have over 330000 New Zealanders of working age on a benefit and in those households live 250000 kids. That is a huge proportion of our community who are on welfare and living a subsistence life in many cases; it is basically the population of Christchurch Dunedin and Invercargill put together. We should have bigger aspirations for our communities. 
If we look at what was presented by this Government we realise that we did not see any vision or a grand plan. We saw a lot of spending which was supposed to bring in the votes but I think New Zealanders saw through that. They looked at the Working for Families package and they realised that the Government was embarking on a huge vote-buying exercise that was not designed to make a skerrick of difference to most New Zealanders’ lives. Why should they champion making more New Zealand families dependent on welfare? 
On this side we do not think that is something to crow about. We do not think it is a good thing to make more New Zealanders dependent on a State handout in order to live their daily lives. If we look at some of the respected members of our communities such as teachers policemen nurses and the Waihi family for example we find people who would be described as professionals saying they cannot get by in this country any more on basic salaries. We have to come to the realisation that this country is not a wealthy nation and that we have to make some big changes if we are to become anything other than the retirement village of the South Pacific. We have to try to keep our best and our brightest on these shores and not have them go off shore—[ 
Interruption 
]—as I am sure many of the member for Otaki’s friends and university colleagues have done. We need to look at a better way of providing welfare so that we can ensure that those who are in need get it but we do not create an ongoing trap. 
We on this side have bigger aspirations. We do not believe that people who go on to welfare have to stay there. We believe that most people are capable of doing something and that staring at a wall is not a great way to leave many New Zealanders. No wonder we see many New Zealanders go from the unemployment benefit to the sickness benefit! A lot of that increase comes from depression. Well if there is anything to make anybody depressed it is being inactive and sitting at home it is losing self-esteem and it is having decreasing morale. That is why we are seeing some major changes. 
Dr MURIEL NEWMAN (Deputy Leader—ACT) 
: 
 I want to address the explosion in sickness benefit numbers and the failure of this Government to stem the surge. To begin with I ask the Minister whether he has contacted Dr Andrew Causer and Dr Rod Hickey whose comments appeared in the lead story in the  
New Zealand Herald 
 yesterday. Those doctors were expressing concern that Work and Income case managers are advising people to go on to a sickness benefit even though the doctors believe that most of them are not sick. The Minister made an outrageous statement earlier in the House saying that we were not providing him with information but yesterday New Zealand’s largest national newspaper named two doctors one of whom has been in contact with me. The Minister also has a Medical Council—an independent practitioners association—that has expressed huge concern about this issue. 
I ask the Minister to take a call and tell us whether he and his department have been in touch with those brave medical practitioners. I say “brave” advisedly because anybody who stands up to this Government is a brave person. I would like the Minister to tell us right now exactly what he has done about the concerns that those two doctors raised in New Zealand’s largest daily newspaper. 
I received this correspondence from one of those doctors: “I am a GP. Many WINZ clients are sent to our clinic for sickness benefit forms to be completed. Most are unhappy with life rather than having true depression and yet WINZ pushes them all on to a sickness benefit. I believe WINZ is being directed to push people on to the sickness benefit to make their job easier because it means they no longer have to try to find work for these people and also it makes the unemployment statistics look artificially good.” 
The  
New Zealand Herald  
editorial also talked about this issue stating: “But if the doctors’ allegations are correct it suggests subterfuge and a dereliction of departmental responsibility. Should it be established that a deliberate policy is being orchestrated resignations should follow. Trickery of such nature would demand nothing less.” I suggest the Minister has failed New Zealand if in fact he has failed to follow up on the allegations made in the  
New Zealand Herald  
yesterday. The information I have claims that some 95 percent of many of the people who are currently going on to the sickness benefit are fit to work. If that is the case I suggest that this Government is actually condoning benefit fraud on a massive scale. 
The sickness benefit costs around $500 million a year. If we add the $1 billion a year that it costs New Zealanders to fund the invalids benefit that is a massive amount of money. The  
New Zealand Herald  
actually makes the very interesting statement that most of the savings made in respect of the dole—savings this Government has crowed about over the last 18 months—are being swallowed up by greater spending on the sickness benefit and invalids benefit. 
The sickness benefit was established in the way that we know it in the late 1930s. In 40 years only 7500 New Zealanders were on a sickness benefit but in just 4 years of this Labour Government the number has gone up by 11000. Under its jurisdiction the number has gone up more than 1½ times what it took 40 years to reach. The only time that relentless rise in numbers actually halted was when the sickness benefit was put into a work-capacity testing regime. In other words where case managers asked people: “What can we do to help you to get well enough to go back to work?”. That was all it was. It was done in the spirit that people were on a temporary sickness benefit because they were not able to work right there and then but that they would get well enough to go back to work. That is the key issue this Government is failing to address. 
 JUDITH COLLINS (National—Clevedon) 
: 
 That was a great contribution from Dr Muriel Newman. When the Minister stood up before and made some very interesting comments he talked about food banks. Well I would like to ask him: “Where are the food banks today?”. The food banks are there they are growing and organisers are constantly saying the banks are under stress. Those people are constantly saying that things are getting worse not better under this Labour Government. After 5 years of a Labour Government the food banks are still there and growing. 
I have been looking at some of the initiatives under the social development portfolio and some of the best things in that particular portfolio were put in place under a National Government: Family Start Strengthening Families and Social Workers in Schools were all initiatives under a National Government. They are all still there but unfortunately because they are not initiatives of this Government nothing much is happening with them. No improvements are being made no increases are being made and no expansion of Family Start is being made past the 16 areas it already works in. 
Today I have been reading  
Making New Zealand Fit for Children: 
 
a booklet from Unicef New Zealand. There are 40-odd pages about making New Zealand fit for children and lots of things in relation to social welfare policy or—what do we call it now—social development. I cannot find one thing in the booklet that says children need fathers. I look in there and cannot find one thing that says children need parents. There is nothing about that in there and of course that is exactly in line with this Government’s and this Minister’s views that it does not really matter about fathers. It does not really matter about what structure a family is but as long as it is a group of individuals who all feel like having the occasional group hug then that will be a family. 
Well that is not a family—not by a long shot. It does not matter how many programmes this Government brings in to operate in that area—and there will not be that many—because until we get some absolute basics right and a Minister in the chair who understands that families need to function before they can do their job we will not get any improvement. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
JUDITH COLLINS 
: Before the dinner break we were talking about things like food banks and the fact that they are still here and growing. There was a certain amount of cackling coming over from the Government side at those comments so fortuitously I just happen to have a report from today’s New Zealand Press Association that states: “Hard-up Northland families are resorting to living in cars during winter say emergency housing providers.” The date of the article is not 27 July 2000; it is 27 July 2004. It is today’s report and continues: “Whangarei services say they are fully booked as families flock to them after relationship break-ups or to escape over-crowding or abuse. Some of their worst cases include: A woman living in a van with her two daughters aged 7 and 14 for nearly four months.” What does the Minister say about that? The cases also include: “A woman and her two sons aged 4 and 11 sleeping in a car for a week.” and “A man in his 20s sleeping in a car with his 15-year-old brother for three days.” Whangarei services say that people are being forced out by expensive rents. They say it is the wet and cold weather that bring more people in—and the number is growing. They are saying that normally they get two or three calls a week and now they are getting 25 or more. 
That is what is happening under this Labour Government. So despite all the rhetoric and all the talk about how the Government is throwing money away—giving money here there and everywhere—the money is not getting where it needs to be. 
That brings me to the issue of young Maori. I am really pleased to see Tariana Turia back in the Chamber today and I am really pleased to see that even if I do not agree with everything she says she is a woman of principle. That is something this Labour Government is very very slack about. That woman actually does stand up for people and she does stand up for her own people even if her views are somewhat misguided sometimes. But we should give her her due. She has acknowledged that the party that has done the most for Maori New Zealand is the National Party. We should remember that today. 
Hon STEVE MAHAREY (Minister for Social Development and Employment) 
: 
 I thank the members of the Opposition for the opportunity to talk about social development. It has been a debate shall we say and speakers have canvassed a number of issues. I want quickly to answer some of them. 
We began with Katherine Rich acknowledging that we find ourselves as she said in excellent economic conditions. I thank the Opposition for that acknowledgment—that the stewardship of this Government does indeed go alongside some quite extraordinary economic conditions as the Minister of Finance pointed out earlier today. I think one of the things that Katherine Rich often brings with the leadership of Dr Brash is a kind of honesty to these kinds of debates and it was refreshing today to have an Opposition spokesperson so openly acknowledge that we are working in good economic conditions—indeed in her own words “excellent economic conditions”. They are of course attributable to the leadership that has been provided by this Government for over 5 years now. Many people of course on the Opposition did predict— 
Dr Muriel Newman 
: Absolute luck. 
Hon STEVE MAHAREY 
:—that a change of Government to a Labour-led Government would lead to things like falling levels of employment higher levels of unemployment and an underperforming economy. I know they began by saying we had had luck for a year then they said we had had luck for 2 years then it was luck for 3 years then it was luck for 4 years and now even they are beginning to say I think that after 5 years maybe we are doing some things right. 
Katherine Rich today had that kind of open honesty that is coming through from the National Party lately as they acknowledge just how well things are doing. But I must say that from there she went downhill. She then began saying that the number of people on welfare had gone up. Ms Rich knows that that is not true. She knows that. We in fact are looking at a much lower number of people on benefits now than when we became the Government in 1999. Indeed in just crude terms we are talking about a good 100000 fewer people. 
That is why for example when we look at the estimates we see we are returning so much money all the time to Treasury from the welfare budget because we are coming under the forecasts all the time. So we are able to say: “We don’t need to pull that money down that you budgeted for us to get because we’re seeing so many fewer people on a benefit and they’re passing through so much more quickly.” That is something I think that Katherine Rich needs to go back to and she needs to spend a bit of time getting in touch with those figures. I know that sometimes in politics it is a good idea to be unaware shall we say of the reality of the figures so one can make one’s argument but really after 5 years of watching the progress of this Government we do think it is probably time for her to have a look at them. She will understand that the numbers of beneficiaries across the whole board have dramatically declined in the last 5 years and that we are doing extraordinarily well. 
She called for vision from the Government and of course all one has to do is visit the website to find lots of papers on strategies and so on. But we are still waiting for one new idea from Katherine Rich. We have heard about times on benefits for people who do not work for the dole and we have heard about work-capacity testing—all the failed ideas of the 1990s have been brought out again. Sometimes I wonder whether what the National Party is doing—because it knows it does not really have any ideas—is kind of pushing these ideas out so that people have something to talk about while it hides the fact that it does not have a new idea about welfare at all. So we would invite National Party members to give us a bit of vision as Katherine Rich has asked for because it would be very interesting to debate with them. 
Then we went on to Judith Collins who talked about the issue of people going across from the sickness benefit to the unemployment benefit. I just want to reiterate to people in the Chamber that Work and Income does not have a policy to encourage people off the unemployment benefit on to the sickness benefit. In fact the Committee might like to share in some of the stats of the last little while—that is over the past 6 years. From 1999 to now we have seen 1.1 million placements so to speak off the unemployment benefit—people moving off to go to something else. Only 73000 of those went from the unemployment benefit to the sickness benefit during all of that time. Only 73000 of that 1.1 million migrated and 52000 went the other way—that is they went from the sickness benefit to the unemployment benefit. Because we want them to get a job of course. They get well as people who are on the sickness benefit do then they go back on to the unemployment benefit and go off hopefully into some kind of job. We have a good story to tell here and I do thank Opposition members for giving us an opportunity to tell them about the April strategy and how that is unrolling now and helping people who are on sickness or invalids benefits to begin looking at opportunities to get a job. 
We then went on to Mrs Newman who talked about the fact that I had asked her for cases that would tell us that doctors had been bullied into giving people forms that said they were sick. She went away this afternoon when I asked her after the Committee rose and she has given me a case. I will not read out the name because she told me she wants me to treat it with respect but I just want to point out how this debate is based on such difficult information. This email says: “I believe Work and Income New Zealand”—it is not ‘Work and Income New Zealand’ at all these days; it is just ‘Work and Income’; the words ‘New Zealand’ have been gone for a long time—“is being directed to push people on to the sickness benefit to make their job easier because it means they no longer have to try to find work for these people and also make the unemployment statistics look artificially good.” If we had a chance to talk to this doctor—because all I have here is “Hi I’m a GP”—I would say that it is not called Work and Income New Zealand; it is called Work and Income. There is no policy to push people from the sickness benefit— 
Hon Bill English 
: There is. 
Hon STEVE MAHAREY 
: No I tell Mr English that there is not. People who have a history in the organisation—and Mr English has because he was in Treasury—will know that one of the things that often triggers this debate is the reminder of what the criteria are for the sickness and invalids benefits. When doctors get that reminder they often reply and talk about it. They recently got a reminder and that is what probably triggered this person. 
I say to this person that going on to the sickness benefit does not get someone out of looking for a job. Throughout they will be work tested but I say to members on the other side that we will not work test the sickness benefit. Those people are sick. It might be the policy of ACT to do so but we are not going to do it. Unlike the National Party we have lower caseloads we have introduced enhanced case management we have provided more money we have provided more tools and we will even get operations for these people so they can return to work. In other words it would not serve case managers at all to be saying: “I would like you on a sickness benefit.” because then they would find themselves with an enhanced case-management process dealing with exactly the same people and trying to move them into part-time work. 
So this doctor simply needs to pick up the phone ring Work and Income and ask: “Do you have a policy?”. We will say “No.” “What’s your name?” We could tell the doctor it is Work and Income and not Work and Income New Zealand. We could also explain that it would do people no good at all to be back on the sickness benefit in terms of a job because those people would find themselves very actively managed there as well—since April—to try to get them into part-time work. Now I would say to Dr Newman that that is the problem with this debate. I do not have a doctor here or a person I can go and see. This doctor is clearly wrong and if we could get in touch with him we would tell him so. 
I say also to the member that on Thursday the national commissioner will be with the Medical Association. Its members have been invited because they asked to meet today. The association has been asked to bring together all the information from actual doctors with actual cases to give to us and we will deal with them. We do not want supposition misunderstanding rumour or unsubstantiated things from the newspaper; we want real stories from the Medical Association. If any doctor in this country feels that he or she is being browbeaten into giving people sickness benefit forms to say they are sick when they are not we want to get alongside that doctor and assist him or her to give good sound medical judgments so that we get the right information. 
The frontline of Work and Income is not staffed by general practitioners. We have to rely on what doctors say—and we will. We want to work with the Medical Association. Can we be more transparent or open than that? Can we try any harder than that? I will personally visit doctors if they want me to to tell them how they can work with us so they are not browbeaten by our clients or anybody else. How can we get more transparent and open than that? We cannot. That is the offer we are making that is the offer Work and Income is making; and we will deal with that issue. 
I thank members for the debate. It would have been good if it had been based on facts but I enjoyed it anyway. 
Vote agreed to. 
Vote Foreign Affairs and Trade 
ROD DONALD (Co-Leader—Green) 
: 
 I will focus my 5-minute speech on the trade negotiations budget and ask whether New Zealand gets value for money for all of Mr Sutton’s overseas trips. The irony of this Budget process is that Mr Goff is accountable for how the money is spent while Mr Sutton is overseas spending it. I would like Mr Goff to explain exactly what benefit New Zealand has gained from the $4.6 million increase in spending on World Trade Organization negotiations bilateral so-called closer economic partnerships and free-trade agreements during the last 5 years. While he is about it he could tell the Committee what the opportunity cost has been of not spending that money on more productive ways to make our economy self-reliant. 
The evidence strongly suggests that the more money the Labour Government spends on imposing its free-trade agenda on New Zealand the worse our trading position gets. Statistics New Zealand’s trade figures released today reinforce this point. Two years ago New Zealand had a trade surplus of $521 million for the year to June and our exports stood at $32.3 billion for that year. Today because the Government pursues disadvantageous trade deals such as the New Zealand - Singapore Closer Economic Partnership our exports have dropped to under $30 billion and the modest trade surplus has turned into a massive trade deficit—over $3.5 billion for the year to June. I am sure Mr Goff will offer all sorts of excuses for the deterioration in New Zealand’s international trading position. Some excuses have a ring of truth such as the impact of New Zealand’s higher dollar and the increasing cost of fuel imports. 
But hang on a second why did our dollar go so high in the first place? In part that is because of the Government’s foreign investment policy which pushes up the value of the New Zealand dollar—all part of the free-trade and investment agenda. Fuel spending has gone up in part because we waste fuel unnecessarily transporting identical goods back and forth within New Zealand between Australia and New Zealand and between New Zealand and other countries. Again it is all in pursuit of free trade rather than in pursuit of sustainability. 
New Zealand certainly has not got value for money from the trade negotiations budget for the Singapore free-trade deal. Before that deal took effect New Zealand’s trade deficit was a mere $24 million with that country. Now it has blown out to $323 million. Yes some of that is because of petroleum imports but the Government cannot hide from the fact that New Zealand’s exports to Singapore have actually declined by $180 million in the last 3 years. There has been a 37 percent decline since the closer economic partnership took effect. 
If that is not bad enough Mr Sutton and his officials did not even seem to know this basic information. When Jim Sutton described the New Zealand - Singapore Closer Economic Partnership as a “stunning success” a couple of weeks ago he had absolutely no evidence to back up his claim. The Singapore Trade Minister tried to come to his rescue but was not convincing. Belatedly Mr Sutton’s office tried to explain away the decline in exports by claiming that a lot of goods had been diverted to Malaysia in the last 3 years. So I ask the Minister why our exports to Malaysia have gone down by $50 million in that time. 
The meeting with the Singapore Trade Minister was meant to be a review of the closer economic relations deal—it was not. There was no report published on the deal no analysis of why the deal has been a one-way street in Singapore’s favour and no thorough scrutiny of the fact that 46 percent of the shipments from Singapore that were tested for rules-of-origin compliance failed the test. Why was there a complete lack of scrutiny by the Minister and his officials? Perhaps they were too busy trying to do new deals with Thailand and China than look into what has gone wrong with our deal with Singapore. 
Why does the Labour Government want to sign a free-trade agreement with the corrupt Thai Government and another deal with the cruel Chinese Government? These proposed deals make a mockery of the Speech from the Throne in 1999 when Labour made commitments to incorporate labour and environmental standards in free-trade agreements. How can the Labour Government even begin to negotiate a free-trade agreement with countries that refuse to ratify core ILO conventions let alone ensure that the ones they have signed are complied with? 
How can it in all conscience consign Thai workers including half a million children to lives of poverty by giving tariff-free access to goods made in sweatshops where pay rates are only 77c an hour? How can it welcome the Thai Prime Minister Mr ThaksinShinawatra to New Zealand when it is becoming increasingly obvious that he is corrupt and runs a corrupt regime? Members need not take my word for it. They need only read an article such as the one in the  
Melbourne Age 
. 
Hon PHIL GOFF (Minister of Foreign Affairs and Trade) 
: 
 Sometimes the people of this country must wonder when they listen to speeches on trade by the Green Party. That party seems to fail completely to understand that New Zealand is a trading country and that for both its survival and its prosperity it needs to have access to markets around the world. If the Green Party had its way somehow right around the world there would be free-trade agreements none of which encompassed New Zealand. There New Zealand would be relying on a world market to sell its very largely commodity-based exports locked out of all of those markets and refusing on principle to trade with our fourth-biggest market China because we did not agree with its politics. Maybe we should refuse to trade with our second-biggest market the United States because we do not agree with everything it says. That is a view of the world that is remarkably simplistic and naive and that sort of attitude really raises questions about the Greens’ readiness to participate in a Government. 
I have to say that the Uruguay round for the General Agreement on Tariffs and Trade has resulted in the advantaging of this country to the tune of billions of dollars a year yet Rod Donald was against that. We would benefit from more billions of dollars each year if we could get the Doha development agenda through but Rod Donald is against that. What I do not understand about what Rod Donald is saying is that he seems not to have picked up a very basic point which is that in order for Third World developing countries to thrive in the world today they need access to markets in the developed world and they need the developed world to cease spending—as OECD countries do—$361 billion a year in export subsidies. That is nearly a billion dollars a day. 
The only way we can stop that is by getting the Doha development agenda through with the critical clause that Jim Sutton is fighting for right now on behalf of New Zealand and the developing world to ensure that the United States and the European Union step back from the position they have held for many years of subsidising their exports and therefore stopping the Third World from using its comparable advantages to get into their markets. Worse still that position is stopping the Third World from exporting anywhere else because the developed world is subsidising its products in a way that puts the developing world out of business. There is only one way to deal with that situation. It is through the Doha development agenda and that is what Jim Sutton is fighting for right now. I would have expected that member to support him in that instead of making that dreary liturgy of doomsday and negativism. 
I put this to the member: New Zealand’s longest standing free-trade agreement is Closer Economic Relations with Australia. It was 20 years old last year. What has that done for New Zealand? At the time Mr Donald and his colleagues said that Closer Economic Relations would destroy New Zealand that we would be overrun by the larger country Australia that we could not possibly do it and that it would damage us hugely. Has it damaged us hugely? No. In that 20 years New Zealand exports have doubled in real terms with Australia. We now send across the Tasman one-fifth of what we export; before Closer Economic Relations it was about one-tenth. That has been a remarkable success story which has led to New Zealand being able to develop the level of prosperity we have today. Closer Economic Relations is a success story for New Zealand exporters and a success story for the Australians. The two countries together have a combined market of $24 million giving our manufacturers—because Australia is our biggest market for manufacturing—a domestic market that enables them to survive and to compete with the world. And Mr Donald said that that was a bad thing. 
Is Uruguay a bad thing? It makes us billions of dollars per year. Is Closer Economic Relations a bad thing? Our economy survives on it. What is more the free-trade agreements that will be negotiated with Thailand and China hopefully with Singapore and Chile in the Pacific Three Closer Economic Partnership and hopefully also with the whole of the ASEAN block will deliver huge benefits to New Zealand. Although we do not have blockages of trade to this country those countries have huge blockages—huge tariffs and non-tariff barriers—stopping our entry. 
This is win-win for New Zealand. It is time that Rod Donald woke up to that fact and supported the efforts that have been given bipartisan support across the House for years to ensure that New Zealand can go ahead to thrive and prosper in the world instead of being locked out of international markets and having a crumbling economy. That is what the Green policy stands for in this area and it really is not good enough. Mr Donald needs to do some work to understand why it is vital that we continue to fight in the world for access for New Zealand exporters into those markets. 
Vote agreed to. 
Vote Justice 
NANDOR TANCZOS (Green) 
: 
 My co-leader and I will be doing the good cop bad cop routine with Mr Goff. 
Hon Phil Goff 
: I am likely to agree with you Nandor. 
NANDOR TANCZOS 
: I quite agree with my co-leader in terms of trade issues. The Minister has to walk a tightrope when it comes to matters of justice because there is always the need to head off the more extreme policies and promises of parties that are desperate to get into Government and the need to do what the Minister knows the evidence shows actually works to reduce crime and lower the crime rate. 
That tightrope just became looser because we are coming up to an election year and the “rash Brash” promises of abolishing parole for most offenders lowering the age of criminal culpability and ignoring a number of other international conventions about protecting the rights of prisoners will all go out the window. There is an agenda around the world right now among right-wing Governments to do away with international conventions to protect the rights of prisoners so it is no surprise that Mr Brash is following his American idol in that regard. But the reality is that there are no simple solutions to reducing crime and politicians who offer silver bullets are simply misleading the public. That is not to say there is nothing we can do about crime but the answers are much more complex. 
There is a desire for tougher sentences—that is understandable—but it leads us down a dead-end road of building more and more prisons to lock up more and more people for inevitably increasing amounts of crime. The fact is that prisons do not reduce the rate of reoffending to any significant degree and longer sentences are no better than shorter sentences at reducing reoffending. The real danger is that that focus diverts resources into building prisons and away from more effective initiatives. It is sad that the Minister constantly boasts that we have a rising prison population. That fact is an indictment on our country whereas we should be looking at how we keep people out of prisons. 
Let us look at the things that are being promised at the moment such as truth in sentencing and no parole. There are problems with parole there is no doubt about that—we see that in the newspapers—but the problems are particularly around monitoring. The answer is not to abolish parole; the answer is to make sure that parole is properly resourced so that there is proper monitoring and so that we know what is going on. Resourcing is a significant part of that. This is not an argument to end parole because the reality is that parole does work. We have just to look at the recidivism index which shows that in the 24 months after release by the Parole Board 15.6 percent of those released on discretionary parole were reconvicted of an offence compared with 28.7 percent of those released on automatic release. We can assume that the same would go for people who are kept to the end of their sentence and then released without parole. There is ample evidence from overseas as well that shows that parole and reintegrative programmes result in greatly decreased recidivism rates. 
That is really where we have to start looking. We have to start looking at a real package of what we are going to do to reduce crime. Everyone in this Chamber knows that the real answer is around crime prevention and early intervention and to Mr Goff’s credit he has put resources into those issues. He has come before the Justice and Electoral Committee numerous times and laid out some of the different pilot schemes that have been put into place around early intervention and crime prevention. 
I visited a scheme in the Hawke’s Bay where there were incredible successes in working with young people who were serious offenders at a young age—people who have been convicted of 16 to 20 offences of burglary and the like. They have very close monitoring and hands-on mentoring by extremely dedicated staff with amazing results. I visited a young man who had never been employed in his life and now he is attending school and doing well in his exams. He has been doing part-time work at a local business and is turning his life around. This also indicates that it is not just about Government intervention but that the community has to get on board. The community has to support rehabilitation. The community has to be prepared to give people a chance and give them another go to turn their lives around. If people come out of prison or wherever and have no chance of work or of getting any kind of decent income it is inevitable that many of them will go back to crime. So I acknowledge the work that Mr Goff has done on that. 
It needs to go further. We have pilot schemes but we need to expand them out. We need to look at a whole range of strategies aimed at the community and the family not just at individuals. We need to look at how we can strengthen families parenting skills and the like. 
Hon PHIL GOFF (Minister of Justice) 
: 
 Having disagreed somewhat strongly in the last debate with Nandor Tanczos’s colleague I take the opportunity to acknowledge the rational stand that Nandor Tanczos has taken in the House on law and order. It is an election year next year when everything winds up and everybody wants to be the hanging judge and the toughest on law and order. I have been around in politics for about 24 or 25 years and I have heard at every election from parties in Opposition— 
Hon Bill English 
: It used to be you Phil. 
Hon PHIL GOFF 
: I have heard mostly from Bill English’s party. He will remember that Jim Bolger was promising capital punishment and we remember that in 1990 there was all this talk about the National Government getting tougher. National is the classic “lion in Opposition lamb in Government”. Let us face it: it did nothing in Government. In 9 years National did not change the sentencing legislation or the parole legislation. 
 The one thing I disagree with Mr Tanczos about was his statement that I boast about our rising prison population. I do not boast about it; I regret it. I would rather it not be rising but the truth is that by the time people have developed the entrenched recidivism of many in our community by the time they have reached that stage there are very few ways that we can protect the community other than to take them out of circulation. We have the second-highest rate of imprisonment in the Western World but it is well behind that of the United States which is 700 per 100000. The United States has 2 million people in prison. One in three of its black population at some time will be in the justice system. That is not a model we want to emulate. We already take a tougher line on imprisonment than any other Western country we would like to compare ourselves with—the Australians the Canadians the English or the Scots. I do not welcome that and that is why we have put the emphasis that Nandor Tanczos mentioned; that is why we not only are being tough on those people whom we have to be tough on but are trying to deal with the causes of crime and trying to put fences at the top of the cliff. 
The best way of doing that is through early intervention at ages 0 to 5 when we have some chance of turning a kid’s life round. There are kids growing up in an unstable insecure environment marked by abuse and lacking in love and security. We know that those sorts of environments produce criminals. Criminals are less likely to be born than to be created and we have to do more in the early intervention area. This year we have foreshadowed that Budget 2005 will have a particular emphasis on early intervention. That is not to say we are not doing it now. What are we dealing with in Project Early? We are dealing with kiddies between the ages of 3 and 8 who are playing up in school and have behavioural problems that are obvious. We are intervening at that point and in 80 percent of the cases of those under the age of 7 we are able permanently to remedy the factors behind their behavioural problems. How much better to resolve the problem there than to have the human wastage and taxpayer’s expenditure caused by our letting that problem get worse and worse until we are forced to put people into jail! So we have to deal with the problem at both ends. We need to deal with the concept of restorative justice and I know that the member has provided good support for that. 
But we will hear because it is an election year that suddenly things are in crisis. Well it is some crisis! The crime rate in New Zealand according to police statistics—I never produce these statistics; these are police statistics—is 13.8 percent lower than it was at its peak in 1996. Am I satisfied? No of course I am not satisfied. There is more that we must and need to do—and we are doing that. 
Jill Pettis 
: They’ve gone very quiet. 
Hon PHIL GOFF 
: They have gone very quiet. We have put record expenditure into policing and we now spend more than a billion dollars on it. We have 400 more police officers and they are doing the job we expect them to do. We have a record number of sworn police. We have tougher sentences and I pay tribute again to Nandor Tanczos. The Green Party members supported the Sentencing Act and the Parole Act. That was not the “first best” solution but they acknowledged that those changes needed to be done so that somebody like William Bell who clearly poses a threat to the community and who cannot be given a second chance is locked away for life. It will be 30 years before he can be considered for parole. That is tragic for that individual but it is necessary for society. That person under the National Party Government in earlier times would have done 7 years in prison for murder. Now he is doing 30 and he will probably spend a lifetime in prison. 
Where we have needed to we have toughened the laws. We have toughened the DNA laws. Don Brash talks about DNA testing of everybody who is arrested. That is 110000 people a year at $200 a pop. So we would have DNA sampling of somebody who has been arrested for being drunk and disorderly? Well that will make the world a safer place! We have already dealt with that. The National Party was on the committee when we dealt with it. Mr Tanczos was on the committee. Anybody who commits a serious crime including burglary which has been redefined as a serious crime will be liable for DNA testing and everyone who is convicted and imprisoned will have DNA taken. We have done what we needed to do there. 
The public opinion polls on the parole issue actually showed that the public thought Don Brash had gone too far. Yes there are mistakes in the parole laws. We are constantly trying to improve them and make sure that the Parole Board gets it right. We have required the Parole Board to have as its paramount consideration the safety of the community and not to release anyone who poses an undue risk. That is set out in legislation as clearly as it can be set out. 
We are making the changes crime is going down and the laws have got tougher where they needed to be tougher and they will continue to be tougher. We will move on the matter of the proceeds of crime to get the proceeds off the gang bosses. By setting a civil rather than a criminal standard of proof we can get our hands on the money that motorbike gang bosses and presidents can actually keep at the moment because the laws are not adequate. Those changes are being made. I am proud of what we have achieved in this country. It is not perfect but we do a lot better than others. We have a far lower rate of serious crime in this country than the English the Canadians the Scots and the Australians have. We do better and we are already tougher in those areas. It would be a terrible shame if this National Party decided it would as it has already shown abandon any pretence of principle and go for the lowest common denominator—whether it be race or crime. Most of the population knows that it will not come to anything anyway because when National had 9 years to do something about this it did absolutely nothing. 
MURRAY SMITH (United Future) 
: 
 There is evidence that the wheels are falling off our justice system. If Mr Goff wants a crisis then he needs to see it in his own portfolio. The merger of the Department for Courts with the Ministry of Justice has demonstrated that and as the ministry takes and assumes the primary responsibility for that sector it is absolutely important that some major changes take place rapidly. 
In the estimates report of the Justice and Electoral Committee it said with regard to Vote Justice that the ministry had acknowledged it had “inherited a range of complex capability issues and risks” as a result of the merger. If we look beyond that to see exactly what it means we find that the ministry informed the select committee that there was a culture clash between the Ministry of Justice and the courts sector and that morale was particularly poor among the courts staff. So we find that problems are arising in the courts and justice ministry that have yet to be resolved and that are hugely problematic. 
The latest example of course has been the row around the Supreme Court and this Government. It is clear that on the issue of the Supreme Court the relationship between judges and the Government is fraught with tension. That should not surprise anybody given the way that the Supreme Court was created. It was created against the tide of public opinion and against the strong opposition of the business legal and Maori sectors. It was created with judges feeling that the politicisation of their positions had reached an intolerable state and now we find the Chief Justice complaining about a lack of operational resources. That tells us less about the operational resources and more about the deteriorating relationship between the judiciary and the executive. The public arm-wrestling between the executive and judiciary for supremacy does neither any credit. When we see reports in the newspapers saying that Margaret Wilson has “snapped back at criticisms of her Supreme Court by the Chief Justice Dame Sian Elias as tensions between the government and the judiciary reach breaking point.” people will inevitably have a lack of confidence in our systems. The Attorney-General is meant to be the independent arbiter between the two; however on one day she supports the Chief Justice’s right to comment in the face of the Prime Minister’s criticism and on the next day she rails against the Chief Justice as again demonstrated in the  
Sunday Star-Times 
 in its report on the issues. It is clear that this Government needs to sort this matter out and it is clear also that at the moment there is nobody attempting to do that. 
Of course the primary issue that surrounds this matter is the court’s right to create law and how far that right extends. I suggest that the move from the select committee to try to put into the Supreme Court Bill some outline of the role that the Supreme Court should have—which the Government squashed—is now something the Government thinks might have been a better idea. 
But the court’s right to create law and the matter of whether the courts should take the social and political consequences of their decisions into account are key issues. They have been issues since particularly 1980 and the Lesa decision—the decision regarding Samoan rights to New Zealand citizenship. The Court of Appeal actually stated that the decision was influenced by political considerations. On the other hand there is the decision in the foreshore and seabed case where the court refused to intrude into the social and political consequences of its decision and left it to Parliament to make a decision. The irony of that is that the Government has taken a contradictory approach. It is smarting over the foreshore and seabed decision where the Government did not look at the political consequences but is also sending warning shots across the bow of Supreme Court judges in particular not to engage in judicial activism. Once again the  
Sunday Star-Times 
 reported: “The set-to comes hard on the heels of Deputy Prime Minister Michael Cullen’s attack on activist judges a thinly veiled reference to government unhappiness at the foreshore and seabed decision.” It is time that the Government took some action in order to do that but the Attorney-General whose unique role is to ensure it happens gives us little confidence so far that she can be a peacemaker in this situation. 
The second issue is resourcing. The Government is struggling in order to resource the justice sector properly. The Chief Justice I must say needs to advocate for all courts not just the ones she sits on. 
Vote agreed to. 
Vote Official Development Assistance agreed to.  
Vote Pacific Island Affairs agreed to.  
Vote Food Safety 
SUE KEDGLEY (Green) 
: 
 The ongoing crisis of the lead contamination of cornflour in our food supply has demonstrated just how inadequate poorly resourced and ill-equipped our food safety agency is to protect the safety of our food supply. Lead contamination up to 100 times our legal limit in a staple product like cornflour is an extremely serious breach of our regulations but the response of the Food Safety Authority to this food safety crisis has so far been woefully inadequate. Indeed consumers’ confidence in the safety of our food and the ability of the agency to protect our food supply has been rocked by this incident. I have had furious consumers emailing and phoning me all day asking how a poisonous hazardous substance like lead could find its way into our food supply and remain there for 6 months undetected and why when finally this contamination was found by accident in a 5-yearly survey of our food it took 10 days for the Food Safety Authority to tell New Zealanders it had discovered significant contamination of cornflour in our food supply. 
The Acting Minister said in the Chamber today that the Government had “acted swiftly” on the issue had “exposed a problem” and was “moving on it quickly” and I wondered whether he meant that as some sort of joke. Does he consider that taking 6 months to track down a significant contamination is “acting swiftly” and that taking 11 days before bothering to tell New Zealanders or issuing any press release about a significant contamination of our food supply is a swift and adequate response? What a joke! 
Why does the Minister for Food Safety not use her powers under section 40 of the Food Act to recall all products that have been found to contain cornflour contaminated with lead up to 100 times more than is permissible by law? Let us remember that only a number of months ago the Minister for Food Safety mandatorily recalled 700 dietary supplements even though there was no demonstrable risk from those products and indeed no investigation has shown that that mandatory recall of 700 products was essential. But here is a known contamination by a poisonous hazardous substance and the Minister is refusing to issue a mandatory recall. Why has the Government once again put the interests of food manufacturers ahead of consumers and refused to release even a list of the foods known to have been contaminated with lead? Surely we consumers have a right to be told the truth of the situation and to know what products are contaminated so that we can make up our minds whether we want to eat them. We do not want to have some arrogant food safety agency saying: “I’m not going to tell you because we’ve decided that this level of contamination is safe.” I have called and I will be repeating my call not just for the products to be identified and for that information to be released publicly but also for the test results of all the foods that have been contaminated to be released. 
Why is the Food Safety Authority running around telling New Zealanders that there are no short-term or long-term risks from consuming cornflour contaminated with lead up to 100 times the legal limit? Is it unaware of international research showing that there is no safe level of lead and that even in low concentrations it can impair children’s intellectual ability? Had it talked to the Ministry of Health before it issued this falsely reassuring and indeed inaccurate and dishonest advice? Consumers just want to be told the truth. They want the Food Safety Authority to be honest and to give impartial fair and balanced advice but what they seem to be getting is propaganda. 
The other issue that consumers need reassuring on is whether the contaminated cornflour that we have been told about is simply the tip of the iceberg or whether the contamination is far more widespread than we might know. Originally we were told that only 45 tonnes of cornflour were contaminated with lead but now it turns out that two more batches of 45 tonnes were contaminated with lead. 
Hon DAMIEN O'CONNOR (Associate Minister of Health) 
: 
 I was not going to take a call but I cannot sit here and see the Food Safety Authority accused of being dishonest. That is absolutely outrageous and the sooner that member is more honest in her criticism—and she is entitled to criticise the operations of the Food Safety Authority—the sooner New Zealanders will know what is going on. The authority was established in 2002 and has been in place since then. It has been formulating policies and systems to ensure that the food that we consume and process in this country and the food we export as well is safe. 
I would like to tell the member that lead is a naturally occurring substance and that there are probably minute trace elements and particles of lead in most of the things that we consume. The issue here is the level. Clearly the level found in the cornflour was above—in fact in some of the samples it was estimated to be 100 times above—what we consider to be a safe human consumption level. Indications at this point are that the contamination has occurred not from the corn itself but from some process of transportation whether it be from the ship a truck or whatever. But somehow there has been contamination. The fact that we identified that and were able to move on it quickly says that the systems put in place by an organisation that has only been up and running since 2002 are very very good. The authority has moved to eliminate any risk to the New Zealand public and consumers because the systems have identified and told us the product lines that we have to test and those that should be withdrawn. That has occurred and I would like to congratulate the staff of the authority—not sit back and allow them to be accused time and time again by the Green Party and Sue Kedgley who misleads or attempts to mislead the New Zealand public into believing that the Food Safety Authority is working against them. That is not true. It is there to protect the consumers of this country. It is also there to ensure that we as an economy are able to export quality safe food around the world. 
I just ask the Green Party once again to be more honest in its criticism and assessment of what is happening with regard to the Food Safety Authority. 
A party vote was called for on the question  
That Vote Food Safety be agreed to. 
Ayes 61 
New Zealand Labour 51; United Future 8; Progressive 2. 
Noes 55 
New Zealand National 25; New Zealand First 13; Green Party 9; ACT New Zealand 8. 
Vote Food Safety agreed to. 
Vote Health 
BARBARA STEWART (NZ First) 
: 
 On behalf of New Zealand First I rise to speak in the estimates debate. It was pleasing to see there is an increase in the health budget of 3.5 percent. The increase can be considered to be an attempt to regain our First World health system. The Minister of Health in her Budget debate speech stated that our rate of intervention lagged well behind that of the international average of countries like Australia Canada and Britain that we often compare ourselves with and we hope that this Budget increase will make a difference to those statistics. On a positive note we are pleased too that the Government is taking some constructive steps in addressing meningococcal disease. While that is a little late in coming we support its efforts on that front. They are definitely needed. Many parents particularly in south Auckland have welcomed the initiative and we know that there are many other parents right throughout New Zealand who are anxiously waiting for the treatment regime to come to their area. 
Although the Government has made some improvements with the cancer control strategy we in New Zealand First still find it very disturbing that we require our cancer patients to travel to Australia for treatment. If we want to have a First World health service we need to be able to treat those patients at home. It was very disturbing to read the article titled “The big C” in this week’s edition of the  
Listener 
 which stated: “When it comes to surviving cancer you’re better off living in Australia or just about any developed country than here.” 
That is quite disturbing. The article lists many shortcomings that we are all aware of: issues like waiting times for radiotherapy and surgery workforce shortages flagging research and lack of funding for drugs that are available in Australia. We all know that delays in treatment here cost lives. We need really good coordinated care allowing patients to be investigated and diagnosed quickly and to have the proper access to treatment right here in New Zealand. We presently have piecemeal services and fragmented information about those patients. It is to be hoped that the implementation plan for the New Zealand cancer control strategy will be completed on time at the end of July and that the strategy and the increase in the health budget may hopefully address many of the shortages that were listed in the article. 
One of the areas too that is of prime concern to New Zealand First is that of dental care for adolescents. We know that area is in a state of crisis with very few dentists offering a free service for high school children because it is not worth their while to provide it. We believe that urgent action is required because lack of oral health-care results in other problems that are far more expensive to treat. It is rapidly getting to a situation in which free dental care for adolescents is difficult to access which is leading to a situation in which those who can afford to pay for the dental service do so and those who cannot pay go without. So it is really time for the Minister to become proactive in that area. I know she has said she has some good ideas that she will work through so that adolescents receive dental care in a timely manner. 
Free health-care for under-6s must really mean free health-care not health care with additional fees. We are now reaping the results of several years of successive Governments not providing a subsidy to doctors that is adequate to ensure that all under-6s get free doctors’ visits. We are seeing rampant glue ear and asthma rates in low socio-economic areas and that is all preventable with the right care. We hope that some of the additional money put aside in the Budget will actually be used for that purpose. 
One other area of concern for New Zealand First is the need for nurses to be paid adequately in order to ensure that we stem the flow of qualified nurses and doctors to Australia and elsewhere. We know that nurses are the basis of our health-care system and they are now leaving New Zealand in greater numbers than ever before. 
SUE KEDGLEY (Green) 
: 
 I would like to focus initially on one particular aspect of the health budget which is the implementation of the Government’s recently released Healthy Eating - Healthy Action plan to reduce obesity in New Zealand. The Ministry of Health recently put out a report that acknowledged 8000 to 9000 New Zealanders die from what it called dietary-related risk factors a year. That is so astonishing that it is almost hard to believe but it is true and it therefore suggests that much of our focus in health should be on improving the diet of New Zealanders. Twice as many people are estimated to die from dietary-related factors than from smoking but whereas the Government has put a tremendous across-the-board effort and resources into a major effort to reduce the health risks of smoking when it comes to the healthy eating plan and the tackling of obesity it has unfortunately—and to our great astonishment— provided no new resources. We looked in vain through the Estimates for such resources. Essentially the Government is full of wonderful recommendations and good ideas but there are no resources and no national leadership and there is a laissez-faire approach that basically relies on voluntary action by the food industry. It treats the whole issue of obesity as if it could be solved by personal responsibility. Unfortunately that wonderful plan with all its wonderful ideas has about as much chance in my view of curbing obesity in New Zealand as I have of flying to the moon. 
What is needed if we are to turn around and improve the diet of New Zealanders and in particular our children is leadership resources and for the Government to be prepared to tackle the hard issues. There is nothing here in the Estimates calling for any restrictions on the advertising of energy-dense low-nutrient foods for children which the World Health Organization states is one of the major underlying issues that contribute to obesity and nothing about removing the selling of high-sugar soft drinks from schools and hospitals or even a requirement for comprehensive nutrition education in all schools and preschools—or indeed for the teaching of cooking skills in our schools. 
 When the Minister came before the select committee she said the Government was not going to take a bossy nanny State approach and the food industry had shown great willingness to work on this issue. 
We are delighted if the food industry is prepared to collaborate with the Government but we ask whether the food industry’s collaboration is part of a public relations initiative to try to stave off the necessity for regulation. I suspect it is the latter and frankly it is naive to expect the industry to curb its highly profitable promotion of fatty sugary foods to children. We have had the experience of the marketing undertaken by the tobacco and the baby milk industries which has shown that voluntary approaches are ineffective. They are great for public relations but they do not actually bring about the changes that are needed if we are to seriously reduce the number of New Zealanders who die of dietary-related factors from the present level of 8000 to 9000 a year. The World Health Organization points out that for every dollar that it spends on trying to improve the nutrition of the world’s population $5 is spent by the food industry on promoting unhealthy processed food. 
The truth is there is so much pressure on children to eat unhealthy food that it is becoming more and more difficult for parents to get children to eat ordinary nutritional food—to eat a healthy balanced diet. We have children who are becoming addicted to bad eating habits and to unhealthy food at a very young age and that can of course condemn them literally to a lifetime of ill health. So there is little point in fiddling around the edges and trying to say all sorts of wonderful platitudes about our concern about obesity in New Zealand if we are going to allow the children of our nation to be bombarded with unhealthy food. 
HEATHER ROY (ACT) 
: 
 I rise on behalf of ACT New Zealand to speak to the 2004-05 Vote Health estimates. I recently asked a question of the Minister of Health about the funding for Plunket Line for the forthcoming year 2004-05 and the Minister was not able to answer my question. She was not able to tell me at the time anyway that the Plunket Line funding was actually going to be very dependent on the funding for Healthline because Plunket Line was about to be incorporated into the American-based system of Healthline. In fact it has been contracted to an Australian branch of the 16th biggest company in America. So Plunket Line which like Plunket itself has become a New Zealand icon since its inception in 1994 is really now on its last legs. 
Plunket Line has helped hundreds of thousands of New Zealand families over the last 10 years. At the same time that Plunket services have been progressively withdrawn and made less available to New Zealand families Plunket Line has taken up the slack and has been available in a very timely fashion to young parents and caregivers who are experiencing difficulties with their young families and young children. It was with great sadness yesterday—for the ACT party and for those of us on this side of the House—that we saw a 4-page press release from the Minister of Health telling us of Plunket Line’s demise and trying to put in very positive terms the fact that Healthline would be taking it over. 
We should look back to the 1999 election. Just before the general election the then Leader of the Opposition Helen Clark and the health spokesperson for the Opposition Annette King both lent their support to Plunket Line. Not only did they lend their support to it they backed it to the hilt. They launched a petition gathering 60000 signatures and promised—and many New Zealanders remember this—that under a Labour Government Plunket Line would not close due to a lack of funding. It was one of the credit card pledges—squashed on to that tiny little credit card—and was one of the most important planks for the Labour Government. What do we see today? Five years later we are seeing the demise of Plunket Line and it being absorbed into Healthline. 
 My parliamentary questions have shown that the 0800 number for Plunket Line—the thing that has helped Plunket Line retain its unique identity—is also to go. Members should not listen to the talk about the 0800 number being retained because I have a reply to a parliamentary question that states that as Healthline is rolled out the 0800 number will remain until it is replaced by a single number where callers can choose to receive well-child and parenting advice. 
When people ring Plunket Line they have already chosen whom they want to speak to. They do not want to speak to somebody reading off a computer screen; they want to speak to a Plunket nurse. 
Jill Pettis 
: I managed to bring up my son without ringing anybody except my mother. 
HEATHER ROY 
: Perhaps the member would like to take a call. 
An announcement was made yesterday but it would appear that things are not as rosy as the Minister of Health Annette King tried to make out in her 4-page press release. We know that this would have been a big news item last night had not the Minister of Health refused to speak to Television New Zealand. The reason she refused to be interviewed by Television New Zealand is that the Prime Minister was caught off guard. When she was asked about Plunket Line she did not know what was happening despite the fact that she had made such a song and dance in 1999. The item that was screened about 2 weeks ago is now the subject of an ongoing complaint. So the Minister of Health will not speak to Television New Zealand about Plunket Line because she is very unhappy with the decision to roll it into Healthline. 
Sir Truby King who was responsible almost 100 years ago for the establishment of Plunket to help families would turn in his grave if he knew what had happened—under a Labour Government—to the state of Plunket in this country and now to Plunket Line. Plunket Line is about to be disestablished. 
Hon DAMIEN O'CONNOR (Acting Minister of Health) 
: 
 It is very frustrating to sit here and listen to the garbage coming from the ACT member who is intent on unnecessarily stirring up and putting fear into the minds of parents up and down this country. 
Hon Bill English 
: Plunket Line is gone. 
Hon DAMIEN O'CONNOR 
: Plunket Line has not gone. Under the tenure of the Hon Bill English Plunket almost went down the drain. We stepped in and secured its future. All one has to do is ask the chief executive of Plunket himself Mr Paul Baigent who says that the move is an exciting one for Plunket Line because it secures its future. It will provide a 24-hour nationwide service. The problem with the Opposition speakers in the debate and with Mr English as well is that they will not listen and they do not want to hear the truth. 
The fact is that Healthline has been piloted in my region along with the regions of Northland the East Coast Gisborne and Canterbury very very successfully providing a service for people who have neither the transport nor the ability to get directly to a general practitioner a nurse or an emergency department and the assessment of Healthline has been very very positive. In fact 97 percent of people calling had a higher satisfaction rate than was expected and 85 percent of calls were answered within 20 seconds. I doubt whether there is another health service in the world that could match that sort of service delivery. 
The fact is that Plunket Line which was an invaluable service for parents up and down this country has been under constant threat. Plunket admitted that it has struggled to get funding for that ongoing service. The Government has secured Plunket Line along with Healthline and committed to roll out that service to the entire country. We ran the four pilots on Healthline proved its success and then moved to secure Plunket Line services for parents throughout this country. That is a good-news story. No matter what Heather Roy does to try to twist that around that is one of the success stories of this Government along with the billions of dollars of funding. 
Hon Bill English 
: Why didn’t the Minister go on television? 
Hon DAMIEN O'CONNOR 
: I cannot speak for the Minister. I am not concerned and I am not sure whether the Minister is concerned about going on television. Mr Bill English is suffering from withdrawal symptoms. He finds it hard to get on television now. The Minister does not have to go on television to roll out what is one of the most crucial vital and appreciated services in this country in order to secure its future. 
The Plunket Line is being wrapped in with the Healthline and it will now be extended across the whole country. This is another of the remarkable success stories that we have rolled out across this country under a Labour-led Government in the area of health care. 
A party vote was called for on the question  
That Vote Health be agreed to. 
Ayes 60 
New Zealand Labour 51; United Future 7; Progressive 2. 
Noes 47 
New Zealand National 25; New Zealand First 13; ACT New Zealand 8; Independent: Awatere Huata. 
Abstentions 9 
Green Party 9. 
Vote agreed to. 
Vote Agriculture and Forestry 
R DOUG WOOLERTON (NZ First) 
: 
 It hurts me as a non-member of the Government to say that New Zealand First supports the changes that have been made in Vote Agriculture and Forestry because for too long this extremely important ministry the Ministry of Agriculture and Forestry has languished. It has been the victim of change after change and of far too much fragmentation. It has long been a concern of the Primary Production Committee that the ministry could not respond in time—and it has proved to be so—to incursions of pests from overseas and to problems within this country because of relying on outside contractors for in our view far too much of its service. We support the moves that have been made because that issue is now being addressed. We are seeing the Ministry of Agriculture and Forestry taking a lead role amongst the other areas of ministry it is responsible for such as biosecurity and it is advising on trade and research for and on behalf of the Government. We are very pleased to see that happening because it is bringing a focus back into this most important ministry. 
One cannot explain more clearly the importance of this ministry without mentioning one part of it—the dairy industry—that provides give or take 25 percent of New Zealand’s exports. This industry went through massive change in the restructuring of its boards. I was a member of the committee that looked at the restructuring of the producer boards. I am pleased and proud to say that I was a strong advocate of the cooperative model that has been adopted by Fonterra and I reaffirm tonight my belief in the cooperative model. I believe that Fonterra is producing the results we expected of it. I am proud to say that I was one of the few who predicted a great future for Fonterra and the move has been seen to be the right one. 
I was also delighted—and I did not expect this to happen—to see Vote Food Safety included under the Ministry of Agriculture and Forestry rather than the Ministry of Health. I know that not all of my colleagues would have been as pleased as I was to see that happen but I think that is where it should be. The food process starts at the farm. Recently we saw on television a much publicised event where mice were found in vegetables from Australia under the McCain brand. I suppose I did not need to mention the brand but it was the McCain brand. That happened in agriculture—out in the paddocks and the cornfields—but ultimately the food ends up on people’s plates sustaining the population. It is the checks the food security and the food safety that make sure that mice rats tails or other gremlins do not end up on one’s plate. I would like to think that what happened to that food in Australia could not or would not happen in New Zealand—and I hope I am not proved wrong by the next television programme I see when I get home. 
I am very pleased to see Vote Food Safety under the Ministry of Agriculture and Forestry. That is where it should be. We can go from the pasture to the plate or from the cornfield to the cornflakes—one or the other—but I think that if it were under Vote Health the focus would be different. 
Vote agreed to. 
Vote Biosecurity—Agriculture and Forestry agreed to.  
Vote Biosecurity—Conservation agreed to.  
Vote Biosecurity—Fisheries agreed to.  
Vote Biosecurity—Health agreed to.  
Vote Education 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 First we have the extraordinary spectacle of a Minister of Education sitting in the Chamber who will not even take the chair. That tells us about his lack of confidence in the administration of his own portfolio. 
Well might he lack confidence because the Associate Minister of Education (Tertiary Education) is a failed tertiary education Minister. His policy has no credibility in the tertiary sector and I shall tell members why. He may be the most plausible Minister but he does not create policy; he creates a kind of fog. People can never quite get hold of it. It looks like it will stop us but when we get in there it does not stop us. We can never describe it properly and we come out afterwards with a cold clammy feeling. 
This is what this Minister has been doing. Here is Steve Maharey’s strategy. These are the tertiary reforms. I will quote from a Ministry of Education document: “The reforms are fundamentally about shifts in ways in thinking and relating”—that is what it is about—“achieved through dialogue around aims and objectives and steering through a clear set of strategies and the integrated funding framework.” 
Simon Power 
: What’s that? 
Hon BILL ENGLISH 
: It sounds so good; it just rolls off the tongue—“shifts in ways in thinking and relating”. [ 
Interruption 
] No I will not tell members who else would say that. So that is the“Mahareyism”. 
Hon Steve Maharey 
: Does the member want an extension? 
Hon BILL ENGLISH 
: Does the Minister want more of it? The interesting thing about this is the Ministry of Education itself has no faith in the strategy. I have looked through its document that talks about the Tertiary Education Commission’s latest expulsion or product or whatever one calls it—the differentiation document—and the Ministry of Education has almost nothing to say about it. It regards the document as incoherent as repetitive and as having no sense of priority. In fact there is one interesting bit in here where it states that what the document states is at odds with all the other decisions that have been made. The Department of Labour and Treasury essentially say: “Don’t do it. Don’t put out the document about the tertiary landscape and differentiation because it will put things backwards not forwards.” 
After 4½ years of “Mahareyisms” about “shifts in ways in thinking and doing” here is the verdict of the people who supported him. From 1999 he was a very popular Minister. He had widespread support in the tertiary sector. Well here is what the tertiary sector thinks about the strategy. This is the vice-chancellors’ comments: “What is the point of laboriously putting in place charters and profiles and a raft of other accountability measures when the system is haemorrhaging dollars right before your very eyes?”. That of course is a reference to the runaway expenditure on community education funding but also the vast increase in low-level courses such as life skills that this Minister has funded. He has created this whole mechanism this whole big room of ropes and pulleys to see whether he can get the mouse to eat the cheese. That is what it is all about—a whole big room of ropes and pulleys to see whether he can get the mouse to eat the cheese. What happened? The mouse just went off somewhere else. 
I have found that no one is taking any notice. I go round the tertiary sector saying: “Why don’t you oppose this? Why don’t you get worked up about it when you know that it can’t work?”. They just say: “We’re not worried about it because it doesn’t make any difference to us.” That would not matter except that this financial year the Government will spend $45 million on the Tertiary Education Commission and no one is taking any notice of it because it does not do anything. It is a “Mahareyism”. It is a “shift in ways of thinking” full stop. It does not do anything. It is not a shift in the system and it is not a shift in strategy or activity or what students are doing; it is just a “shift in ways of thinking”—a $45 million shift. 
This Minister has lost his credibility and that is why he will get reshuffled by Ms Clark out of this portfolio towards the end of the year. Having talked and talked and talked then when they finished talking reported and reported and reported nothing has happened. 
Hon BRIAN DONNELLY (NZ First) 
: 
 The point that Bill English made about the Tertiary Education Advisory Commission total vote was interesting. One would have thought that with the charters and profiles having got through there would be a reduction in the vote requirement for the commission. In fact it is to be increased from $25 million to $45.617 million. One has to ask some very serious questions as to why there was almost a doubling of the requirement for the Tertiary Education Advisory Commission. 
However I want to refer to a contribution made a little earlier today by Paul Adams of United Future. He gave quite a powerful contribution with regard to GST on rates. What came through was that GST on rates is an evil thing. By the time he had finished I believed that if this House continued to have GST on rates hellfire and brimstone would be borne down upon us. However I point out to Mr Adams and to United Future that this is an appropriations bill. In those appropriations which only this Parliament can make there is GST on rates. When United Future votes for this particular Budget it will be voting for GST on rates as it did last year with last year’s appropriations bill so I really would like some explanation. Could United Future please ensure that hellfire and brimstone will not rain down upon this House as a result of its vote. 
I come back to Vote Education. There are just a couple of things that I would like to focus on one of which is tertiary student allowances. Everybody knows that members on both sides of the House are concerned about student debt. However people do not seem to realise that the majority of student debt is not made up of loans for fees but loans for living allowances. Loans for living allowances are not universal as New Zealand First would like and that we negotiated with National in 1996 to have. It did not come to fruition because the coalition broke down. 
Darren Hughes 
: Never trust any of them again! 
Hon BRIAN DONNELLY 
: That was Jenny Shipley and she was the great betrayer. Nevertheless there is a problem and to an extent this Budget recognises it because it shifts up slightly—only very slightly—the actual thresholds at which the rebate first comes in from $28000 to $33700 and it shifts up the threshold where it completely goes away from $50752 to $62000. So the Government and this Budget recognise there is a problem but it has made only a very very minor change. We believe that the Government needs to go a whole lot further if it is to overcome some of the inherent injustices that exist within the system as it stands when the student allowance is assessed on parental income. That is what it is based upon—parental income. 
I know of a student who told me her father had left when she was 3 years of age and had never contributed a cent to her upbringing. Yet when it came to assessment for a student allowance he was living overseas his income was assessed there and she did not get any student allowance. There is the rub! It is unfair. 
However this Government has also made three other changes to student allowances. The first one is that people who were married and under the age of 25 were not assessed on their parents’ incomes but were assessed on their own and their spouse’s incomes. The Government has changed that. So to any parent who has marched his or her daughter up the aisle and thought that now his or her daughter is financially independent of himself or herself at the age of 19 or 20 I say sorry but this Government believes that those parents should be financially liable until their daughter turns 25. This is the same Government that believes that 12 and 13-year-olds can be given the morning-after pill without their parents having any knowledge of it or being provided with help through State-funded agencies yet at the same time it is saying that even if the person is married the parents are financially liable. 
The other issue is about people who have gone to work. They could have left school taken a low-paid job reached the age of 23 or 24 and then decided it was time to get an education so they could get a better job. In the past they were not considered to be financially dependent upon their parents. Under this Budget they will now become classed in that way. We believe this is totally unfair. The Government says that the reason it has had to do this is very simple. The current policies are in breach of the Human Rights Act. 
BERNIE OGILVY (United Future) 
: 
 I want to say a few things about the export education funding in the appropriations. Forty million dollars has been set aside for the next 4 years. Yet we know in this Committee that there is over $2 billion coming back for this nation through export education. This is a huge business and I do not believe anyone is unaware of that by this date. It is such a good business that it earns for our nation by way of GST and income taxes probably $500 million. It is a huge business it makes huge dollars it is increasing and growing each year and I say that this is very good for our nation. 
I think the $40 million that has been set aside in this appropriation is great but it does not completely say what we should deal with with a business of this size. One of the things I was appalled by in the select committee when I asked some questions about who runs this business in the New Zealand Qualifications Authority was that 106 staff run the entire thing. I asked very specifically who ran it and was told that everybody ran it. I want to ask the Government: if one were running a $2 billion business surely one would want somebody like a Ralph Norris at least at the head of the show because he knows how to run that level of business. It is a great shame I believe when 106 people running a huge business are in their own words non-business types. 
I believe this is a business that could grow to $20 billion and move forward. I believe the Government ought to be really really stressing how to invest in the best people to make this business work. I am very very pleased by the way that it is making huge profits. I am troubled that many people around this country are perplexed that they have to pay an export levy each year—which adds up I am told to about $3.5 million or maybe a bit more—which is collected by fees from all those who have language schools in New Zealand and run those programmes. A lot of angst was suffered to get that $3.5 million. Considering the half a billion-dollar surplus at least that comes back to the Government by way of profits through tax I ask why the Government wants $3.5 million from providers around the country when in point of fact the business is making such an enormous profit. This policy has put a whole lot of people’s backs up—everybody from universities polytechnics and private training providers—the whole lot were opposed to the export levy from day one. 
So the only advice I have to the Government at this point is that it is great to see the expenditure but why cause so much anguish in and among the industry of education? I am very very sad that basically—as someone told me over the weekend—the Labour Government is really becoming a closet capitalist party and making money and profits; yet denying this. 
SIMON POWER (National—Rangitikei) 
: 
 It is always tricky following a United Future member because one is always of the view that he or she could sit down at any stage regardless of whether the bell has gone and without too much notice one finds oneself taking the call at that point. 
I want to follow on from my colleague the Hon Bill English who talked about the mist of language that Steve Maharey uses to describe what is going on in the tertiary sector. I say to my colleague the Hon Bill English that there is one thing in tertiary education that is emerging from the mist and that is a huge bureaucracy. It is worth raising this issue for the Minister and I hope he does take a call to respond to some of the issues that have been raised by the Hon Bill English and myself because during the second reading of the Tertiary Education Reform Bill on 30 May 2002 the Minister had this to say: “This is a significant change but I do not want it to be a bureaucratic change. I want it to be a smart change—” 
Hon Bill English 
: He did not say that! 
SIMON POWER 
: He did say that. “I want it to be a smart change—not heavy intervention but one that will ensure that in the end most providers are able to do this for themselves”—and this is the clincher—“rather than through some gigantic bureaucracy.” 
I tell the Minister that it is worth raising this. On its establishment in 2003 the Tertiary Education Commission inherited 235 staff. Rather than slimming it down to be a light-handed guiding strategic device by January 2004 the commission was employing 324 staff. At that point in 2003 it had already spent $7.8 million on contractors and the outsourcing of work. And that raises the question: what were the 324 people doing? What were they actually doing that $7.8 million had to be spent on consultants and contractors? A parliamentary question showed us that $1 million alone went to BurleighEvatt to create the charters and profiles system. Well call me provincial but is that not what the Tertiary Education Commission is for? Is it not the commission’s job to create the charters and profiles system? What on earth was going on when 12 of these employees are being paid more than $100000 a year? 
So what did the Tertiary Education Commission do? It decided it would restructure the second and third tier management to reflect the streamlined approach that the Minister wanted. Some of those job advertisements I have to tell the Committee make some of the best reading one will ever see: Manager of Instrument Steering; Management of Sector Engagement—the most bizarre things that members will ever have heard. What happened at the end of the big restructuring of the Tertiary Education Commission? The Minister knows the answer. After restructuring the second and third tier management four jobs changed. 
Hon Bill English 
: Surely it was 400? 
SIMON POWER 
: No I tell Mr English that it was four jobs. So there are still 320 people working at the Tertiary Education Commission with $8 million being spent on contractors and consultants. How did they go? What happened? Well the release of the inaugural Performance-based Research Fund report resulted in a court case so that went well. The Tertiary Education Commission failed to prevent a $105 million blowout in the spending of low-value non-assessed non - New Zealand Qualifications Authority approved community education courses. It delayed the funding category review for another year and of course the late landscape document was widely criticised by the Ministry of Education Treasury Te PuniKokiri and the Department of Labour. 
So what is going on in the mist? Well if one believes that which is all true— 
Hon Bill English 
: A shift in thinking! 
SIMON POWER 
: Bill English says it is a shift in thinking. It is actually a whole lot of people running around trying to find consultants to do their jobs. That basically seems to me to be what is happening. 
Referring to the New Zealand Vice-Chancellor’s letter that the Hon Bill English referred to earlier it is worth noting this comment that was made on the community education situation: “There are a number of aspects of this situation which quite frankly we find unbelievable given the plethora of steering instruments reporting requirements and accountabilities to which all tertiary institutions are subject.” My colleague Maurice Williamson who held this portfolio before I did said to me early on: “This is a difficult piece of legislation to oppose if you believe it’s going to be a light-handed steering instrument.” 
Hon Maurice Williamson 
: I did say that. 
SIMON POWER 
: That is exactly what he said. It is not and the Minister has some serious questions to answer. 
DONNA AWATERE HUATA (Independent) 
: 
 I would like to raise the issue of the $198 million that the Government intends to cut from community education 5.1 funding over the next 4 years. I am not so much criticising the cut in the community education 5.1 funding as such because we know that it has blown out over the past few years to unacceptable levels but I do take issue with the Government over the way that it is intending to impose those cuts. 
We know that the Christchurch Polytechnic received $15 million for its Cool IT programme and the question that I raise is what level of accountability was raised with Christchurch Polytechnic. What I want to know from the Associate Minister is how did it ever get to that pass—that $15 million could be paid out for a programme where there was no accountability or that a polytechnic could act completely against the objective and the intention of that programme. I want to know how many people who went on the Cool IT programme finished the course how many of those who received the disk actually put it in their computer and what the outcome of that course was. We do not know. As a result of the actions of a few irresponsible members of the polytech sector everyone is to be penalised. The Eastern Institute of Technology received I think it was $18 million for its te reo Maori course through the radio; I am asking the Minister why it ever got that money and why an investigation was not carried out a lot sooner. I want to know why everyone in that sector is to be penalised because of the foolish and irresponsible actions of a few. 
I have to raise with the Minister this issue: if these providers had been Maori providers we can only posit or speculate about what the outcome might have been. 
Hon Bill English 
: They would have been slammed. 
DONNA AWATERE HUATA 
: They would have been slammed from one end of the country to the other. If it had been a Wananga this would never have happened. If it had been let us face it even the Pipi Foundation which at least with all its faults did deliver what it was contracted to deliver this would never have happened. But for Christchurch Polytechnic to get away with $15 million and the Eastern Institute of Technology with $18 million and to have nothing done brings to mind there is one rule for Maori providers and another for Pakeha providers. 
Another example was the Modern Age Institute of Learning. Millions of dollars went missing from the student account. That money should have been there for those students. What happened to it? It just disappeared. The New Zealand Qualifications Authority put all the documents into the hands of the Serious Fraud Office but the office decided to do nothing—absolutely nothing. Oh how wonderful it is to be Pakeha in this country! Similarly there was the case of the Paramount Institute. What happened to the money that was supposed to be there for students? Nothing! It went into a black hole. When complaints were laid with the Serious Fraud Office the office decided to do nothing—absolutely nothing. Oh how wonderful it is to be white in this country! We need only think back a few years to Aotearoa Television. Complaints were laid about that organisation. What did the Serious Fraud Office find when it finally got to have a look at it? It found that no money had gone missing and that the organisation had delivered on all its objectives. Oh how wonderful it is to be Pakeha in this country at times! 
I am concerned that this particular kind of funding is of most benefit to Maori communities—especially to marae courses. In relation to Te Whare Wananga o Awanuiarangi courses that have been run on marae I was told that a number of those who had been through those courses have gone on to do certificate courses and are now doing degree courses. There even are records of masters students having gone through those community education courses. So those courses are one way in which the Maori community is able to reactivate and they have been true to the spirit of the funding. People have learnt to learn again. For the whole sector to be slammed because of the actions of a few—let us face it—Pakeha polytechs just beggars belief. I just find it breathtakingly stupid that the Tertiary Education Commission the New Zealand Qualifications Authority and the Minister would respond in this way. 
I turn to the $36 million that is to be spent on international education which is another example of breathtaking stupidity. If the New Zealand Qualifications Authority had done its job and stopped the Modern Age Institute of Learning and the Paramount Institute from falling over then New Zealand might not have the miserable reputation we now have in places like China Korea and other parts of the world. For a few million dollars we could have stopped that. Then there was Carich which had several thousand overseas students. If the Tertiary Education Commission could have pulled its finger out of its sensitive places and acted more quickly so that Carich did not go to the wall then maybe we would not have such a lousy reputation. I say to the Minister: “Give us a break!”. 
Hon STEVE MAHAREY (Associate Minister of Education (Tertiary Education)) 
: 
 I want just to reflect for a moment. I am not sure whether the debate has finished because I see that Mr English is still a little edgy in his chair. We may hear some more from him so I may have to come back to answer his questions. I want to reflect just a little on what I often call the “Maharey-Williamson changes” and the reason I call them that is I think the one person in the National Party who has the wisdom to understand what is happening in tertiary education is Maurice Williamson. 
The reason he understands it is he knows that the market model requires a body to run it. Members will remember the changes that took place in Maurice Williamson’s head when he went to Scandinavia and it was explained to him that if we wanted a strategic approach to our investment at a tertiary level we had to have a body that would make the investment—that there had to be a more organised approach to it; it could not be run just by student demand. He understood that but he could not get it across to the members currently on the National front bench. They slagged him off basically by disagreeing with his model and he ended up at No. 29. But I am very pleased to see that he is working his way back through the ranks slowly but surely on the basis of his understanding because then at least he will probably reintroduce to his caucus the notion that this approach requires a body like the Tertiary Education Commission. There may be an argument over how it works how many staff it has how much money it spends etc. but if we are going to have a strategic model then somebody has to do it. That is what we are building here. 
I thought it was ironic to use the word used by my junior whip colleague that on a day when we were talking in the House at question time about the Innovation and Development Fund which is money that goes directly into the sector—$1.8 million to go off and do specific innovations that will help connections between universities and business; money for biotechnology skills; and so on—when we were talking about a range of money that it would not have been possible to provide to the tertiary sector under the National Government and that was received as manna from heaven by the university vice-chancellors who could not get any of this money under a National Government Bill English should rise and say we do not want this kind of approach. I could go through all the achievements of the Tertiary Education Commission over the last little while but let me just take one—the Performance-based Research Fund. We asked the commission to put that policy in place. We thought that the money for research should be taken out of the equivalent full-time student funding because it was being spread too thinly we did not know whether any accountability was taking place we did not know who was spending it there were people who were not research active but were still getting money and astoundingly there were many people—in fact a worrying number of people—at the post-graduate level teaching post-graduate courses who did not do any research yet we were paying them for it. 
So we have said: “Don’t do that.” and I think on reflection that the Performance-based Research Fund policy development is probably one of the best pieces of policy ever seen in this country frankly. It was done by the sector. It worked in a very very cooperative way. It now has a stand-up model which most people around the world are looking at and saying is better than the British one better than the Florida one better than the Canadian one. I think we have a model that will have to be tweaked and developed but if Mr English wants one piece of evidence that the Tertiary Education Commission can do and has done something to transform—the word used by a number of my old colleagues and probably some of his too—the tertiary sector it is that policy. It has transformed the sector because if we talk to any of— 
Hon Bill English 
: It has not transformed it. 
Hon STEVE MAHAREY 
: Mr English as usual misses the point because he is a rather stupid man when it comes to tertiary education. So let me just say that academics like Paul Callaghan the members of the Royal Society in this country and the Royal Society in the UK would say that if there is one thing that has transformed the universities of this country and anybody who is involved in academic research it is the Performance-based Research Fund. I know that Mr English is now going to say he would repeal the research fund. I know that because he is sitting over there saying it is no good. So the National Party is committed to repealing the fund. We are not. It has transformed the way that academics do research in this country. It is the way that we will change their behaviour. The only person over there once again who is silent is Mr Williamson because he understands exactly that it has transformed that culture. It has been a fantastic success. Unfortunately for Mr English who does not do any kinds of brave changes—I cannot remember a single thing he achieved when he was a Minister and when he was leader he did not achieve anything which is why he is not leader any more—we have changed that culture through these kinds of developments. I know that when we are on the election platform next year and I am saying we will have a Performance-based Research Fund and the National Party is saying it would not I know who the academics are going to vote for. They are going to vote for us. 
Mr English’s contribution really on the whole is ironic and one that does not acknowledge that major changes like the Performance-based Research Fund have been very significant. The single biggest change I can think of in academic life in my lifetime is that Performance-based Research Fund. That is how big it is. It has made that kind of change. Unfortunately for Mr English I was the academic and not him so I probably know. 
The second point is about Bernie Ogilvy. I thought the United Future contribution as always was a very good one. He gave a contribution tonight that unlike the ones by Mr English actually did make a contribution in terms of something that has got to happen with export education. It is a very large $2 billion business. It is something that now is a significant player in our economy and we have to make sure that we organise that industry and do not have it run by every disparate player in the country individually. I think that is a very important point he made. I hope that is what is happening under Trevor Mallard’s leadership as we are moving towards that kind of very significant industry being more integrated and being led properly in the way that it should be.  
 Brian Donnelly as usual made a very good speech as well particularly about student allowances and debt. Yes we have made changes this year. Yes they have made a difference. I personally think that we as people who represent taxpayers will have to do more in this area. I think we have a very significant issue around student debt. We have tried as a Government to turn it back with interest-free loans by trying to keep fees low by ensuring that allowances are extended and by doing a range of smaller things particularly in terms of work for students. But frankly I think the people who sit in here—with the exception of people like Simon Power who is a little younger than people like me who went through tertiary education without this debt burden—are still struggling with making sure that we do something significant about reducing that debt. But this Government has tried to put its money where its mouth is and move it forward. 
I think Simon Power and I are proud to be provincial—that is what I would say. He said “call me provincial” as if that was bad; it is not and we would both fit into that category. I think he raised some interesting points about the Tertiary Education Commission. I think we have to ensure that we end up with a Tertiary Education Commission that does not see itself as the centre of the system. It is supposed to be there as a funding body and to assist the institutions themselves to develop good relationships with people who are trying to use their university polytechnic or whatever—the student the business community the iwi. That is the relationship that should be strong. But let me remind Simon Power that if we want a more strategic focused approach which is making decisions about where money is invested there needs to be some kind of central body to do it and I am glad he agrees with that. 
Donna Awatere Huata ironically I think raised the issue of accountability. I understand that she takes it very seriously. Let me say that the 5.1 funding which is a policy put in place by—and Bill English was not the Minister then—the National Government last year blew out in a way which was unacceptable. Because we do have funding mechanisms in place where we can deal with that we have. We are trying to get ourselves a system where yes there is community education and yes people are accountable. I say to Donna Awatere Huata that she is wrong that we will hold people accountable for this expenditure. In the case of Christchurch Polytechnic we have an audit going on now. If that audit comes back and we find that that money has not been accounted for properly we will act on that institution in the same way as we would with anybody else. It will have to front up with the money account for it and do the same thing as any other organisation would be required to do. I will not be panicked into doing things before we have proper information before we have the proper dialogue that should go on but we will always make sure that taxpayers’ money is accounted for properly. If Christchurch Polytechnic cannot do it then it will unfortunately have to account for the money that is there because that is the requirement of this Government—that people do front up. 
Those seem to be the major points. I think Mr English wants to speak again so I will sit down. If when he is finished there are points I need to account for I will rise and do that. 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 The Minister is about $100 million late. He could have easily fixed 5.1 by firing the so-called professionals who are running three or four of our polytechnics and who simply broke the rules in a very unethical and unprofessional manner. If he fired the councils that he appoints because they would not fire the chief executives everyone would get the message. Instead what he has done is cut millions from the funding of every regional polytechnic including most of the ones that behaved themselves admirably and did not take the opportunity. 
The other question I have for the Minister is this: where are his officials? Clearly Ministers are not taking the estimates seriously. There are no officials present so if one asks a question such as I will be asking there is no one to tell me the answer. Here is the question. The Government has funded a pretty extensive assessment project through Auckland University. The product asTTle is now out in the schools. I have been debating with the Ministry of Education and the Minister about access to the asTTle data because it now has 100000 students on it and the data has been calibrated to produce finely judged testing. That system is working in our schools right now. I asked for that data under the Official Information Act and I received a scrambled reply from the ministry that said I am allowed a briefing on it. But even though the ministry has total ownership of intellectual property in that data the letter does not say it will not release it it just does not address the issue. 
So I ask the Minister tonight whether he will give me the performance data from asTTle. I know it is there. It is called trial data but it does not matter what it is called; the ministry owns it. It is all packaged up and accessible. It is not in raw read-only form like the data from the ministry that the Minister gives to me when he is using smart-alec tactics. It is all there ready to go. One can press the button and look at it and Professor John Hattie will show it to anyone who goes to his office. So if I can see it in his office why will the Minister not give me that data under the Official Information Act? It is owned by the taxpayer paid for by the taxpayer and readily available. I am allowed a verbal briefing on it apparently and I presume some presentations on a screen but I am not allowed the trial data. I want to know from the Minister why? 
I also want him to explain why he does not have officials here to answer our questions because that is what has always happened in the 13 years almost 14 years that I have been in this Parliament. At estimates time Ministers sit in the chair with the officials nearby and answer questions. Where are they? I want to know where they are and why this Government is so arrogant that it thinks it does not have to bring officials here to answer questions about why publicly funded data is not being given to this Parliament even though the Ombudsman intervened to make sure I got some versions of it. Why is that the case? 
Where are the officials who can answer questions about the $80 million blowout and the deep-seated conflicts of interest at Christchurch Polytechnic? They are being protected because they have done their job as badly as this Minister has. There are a whole lot of questions about education spending and they just cannot answer with any integrity. There is an $80 million blowout. What could our schools have done if they had that amount to spend on information technology or their operations grant? What could have been done with $80 million to appease the Minister’s crocodile tears about student debt? He will go around half-crying to student audiences for the next 15 months about how he wished he could do something. Well he blew the money! For all his steering control and strategy he blew huge amounts of money—millions of dollars—on the least strategic least important and lowest value waste of education that could be found in any tertiary system. He blew it. So where are the officials and why are they not here to answer our questions? What is so special about the Minister and his officials that they do not have to front up? I also ask the Minister to tell me about asTTle. It is publicly funded data. I have asked for it and I am allowed a briefing. Where is the data? 
Hon STEVE MAHAREY (Associate Minister of Education (Tertiary Education)) 
: 
 I will answer those “quiet” questions from Mr English. He needs to watch that blood pressure—that is all I will say. He has had his answer as far as I understand about the asTTle data: he is allowed a briefing. 
Hon Bill English 
: No no. Why can’t I have the data? 
Hon STEVE MAHAREY 
: I am telling the member that he should go ahead and take that briefing. 
Hon Bill English 
: Why can’t I have the data? 
Hon STEVE MAHAREY 
: I heard the question in the first instance and I have just given the answer. I will explain for people at home. The way it works in here is that we have a turn each. Mr English has just had his turn but he is continuing it from his chair. The answer to the question is that he has been offered a briefing on the asTTle data and I would take it if I were him. I cannot think of any other question he asked about that point. 
Hon Bill English 
: I raise a point of order Madam Chairperson. Have officials been prevented from coming into the Chamber? Are they being kept outside by order of the Chair or by some other request from an MP? Clearly the Minister is not going to answer the question as to why he thinks they are not in here to answer those sorts of technical questions we cannot expect the Minister to know the answer to. I want to be clear with you Madam Chairperson about whether officials have been prevented from coming into the Chamber. 
The CHAIRPERSON (Ann Hartley) 
: No. It is entirely up to the Minister. 
Vote agreed to. 
Vote Education Review Office 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 I hope the Minister will condescend to answer some questions I have about the Education Review Office and the role it fills in supervising the National Certificate of Educational Achievement (NCEA). Members will remember that some months ago there was publicity around Cambridge High School and the Government moved very quickly to tell the public that it was sending the New Zealand Qualifications Authority and the Education Review Office into that school to investigate allegations that pupils were essentially being given credits under the NCEA—credits for which other New Zealand students have to work very hard. 
I predicted at the time that the New Zealand Qualifications Authority and the Education Review Office would not find anything wrong because the NCEA system is something to which those offices are ideologically committed—quite irrationally committed because they will not contemplate any criticism. They were essentially going in therefore to examine their own role. They were going in as auditors when they had already been there. The New Zealand Qualifications Authority had certified the standards and the Education Review Office had been in the school but the Minister was sending them back—the burglars were going back to see whether they had committed a crime. I think that is a shame for the students of Cambridge High School and for the credibility of the NCEA a qualification that I had hoped would succeed. 
I ask these questions because I have been given material in the last few days that compounds my concerns about exactly the issues that have been raised about Cambridge High School. I want to give the Minister the benefit of this description of activity related to Student A at an unnamed high school. He received his work book for a particular unit standard on 31 February 2004. That was the date on it. In case anyone is unclear there are not 31 days in February; there were only 29 this year. The booklet was completed and three credits were awarded on 2 March. Let us put aside the 31 February date; let us say that the student received the book on Friday 27 February. By 2 March which I think was Tuesday the student had been awarded three credits and an entire unit standard. 
Simon Power 
: Bright boy. 
Hon BILL ENGLISH 
: Bright boy. The student thinks that he may have had a 1-hour lesson on 27 February the day he received the book and maybe a 1-hour lesson on 1 March. I have to check whether those are days of the week on which the school could have been open because it looks to me that they could have been on a weekend. So this looks to be a student in one of our schools—and I have the booklet—who received three credits at NCEA level one in 3 days and who maybe had had some lessons. I will set out to verify that. 
That booklet is one of a collection of booklets that include other rather startling items of information like unit standards that were sat in 2003—at least unit standards whose work was carried out by the pupil in 2003—and that were all signed off on the same day as the 2004 ones some 12 months after the student had allegedly sat the standards. Now those standards are not insignificant. A fifth-former or sixth-former—a year 11 or 12 student—can tell us that for some three-credit standards weeks of work are involved in order to get them. But it happens that there are some three-credit standards one can get in 3 days with about an hour’s lesson. There is other material in those booklets whereby credits have been awarded and no teacher has signed the book. There are some booklets whereby students appear to have signed off each other’s work because if we go down the roll we find that the signature is not actually the name of a teacher but is the name of another student on the roll. 
Simon Power 
: Peer review. 
Hon BILL ENGLISH 
: Peer review; student-driven learning. I want the Minister to tell us: firstly why we should have any faith in the Education Review Office’s examination of Cambridge High School; and secondly is there anyone credible to whom I can give this information so that we can clean up the nasty tail end of the NCEA. 
Hon STEVE MAHAREY (Associate Minister of Education (Tertiary Education)) 
: 
 On the second issue I simply invite the member to make that information available to the Minister of Education because he would be very interested in the kinds of facts that the member is exploring. I can tell from Mr English’s speech that he wants to verify some of the things that are in the booklets himself. Obviously he should do that and then pass on the information to the Minister’s office. 
In relation to the Education Review Office review of Cambridge High School and whether the Education Review Office can be relied upon I draw the member’s attention to the notes that have come from the Education and Science Committee where the issue was discussed in relation to Education Review Office reviews and where questions were definitely raised. Issues were also raised about the Education Review Office being connected to other agencies so that it can have better access to data. The committee arrived at the conclusion that the new agreements that are being made around the Education Review Office the New Zealand Qualifications Authority and so on give more faith that the Education Review Office reviews can be relied on in relation to Cambridge High School. So yes the issue is a live one and it has been discussed and dealt with in the notes from the Education and Science Committee. 
Once again on the second issue the member should verify the data as he wants to do and then I think the place that the information should go to is the Minister’s office. 
Vote agreed to. 
Vote Sport and Recreation agreed to.  
Vote State Services agreed to.  
Vote Climate Change and Energy Efficiency agreed to.  
Vote Crown Research Institutes agreed to.  
Vote Energy 
PETER BROWN (Deputy Leader—NZ First) 
: 
 I would like to put two questions to the Minister. First of all is he happy with the state of affairs with regard to energy in this country right now and secondly does he believe that that state of affairs has become worse better or remained the same since the Labour Government came to power? If he thinks it has become worse perhaps he could kindly tell us why because there are people hurting out there and hurting badly. They are facing price rise after price rise; they do not know when it will come or how it will come and furthermore they do not believe they can take it any more. 
Energy—electricity—is essential and at one time this country had an abundance of it but now it has slipped away and we are barely keeping pace with what we need. The whole portfolio needs a ray of fresh thinking. Specifically there are three aims. We must guarantee security of supply—that is essential. We have had two dry years and business and individuals have suffered. We must make electricity available at a reasonable price to all New Zealanders and available at the flick of a switch and we must have increasing capacity. We must have more investment in the industry so that we can increase capacity. They are the three principle aims of the electricity industry. Our fourth aim would be to educate and encourage people and dare I say it give some incentive for people to conserve energy. I have been told that in Australia for example the Government is offering financial incentives for people to install solar heating in their homes and wherever. It would make a huge difference here if many homes adopted solar heating for their water heating. 
 The Government recently announced that in October it will make it compulsory for retailers to offer the 30c plus GST maximum line charge for people who will use less than 8000 kilowatts a year. That is a move in the right direction. Up until now I understand that that has been voluntary and has been adopted by only one or two retailers but not everybody. The Minister is going to make it compulsory. But the public by and large do not understand it. Indeed MPs in this Chamber do not understand it. Stephen Franks is on record as saying that that will give the high-flying businessman the opportunity for cheap power in his holiday home and in an article by Ken Shirley of ACT Mr Shirley endorsed that view. My understanding is that that is not true and perhaps the Minister will advise this Parliament as to what the truth is. My understanding is that a person who goes on to that cheap line price will pay extra on a per unit basis and will gain something only if he or she uses less than 8000 kilowatts per year. I understand also that it is aimed at only the individual’s principal home. 
Cheap gas is running low and New Zealanders are concerned. Hydroelectricity over the last 2 years has proved unreliable basically because when our lakes are full they hold a capacity for only a few weeks or a couple of months at most I understand. So if we have a dry season then we cannot depend totally on hydro power. Wind power is only a bit player yet I think the Minister is pushing that like nobody’s business. But many many people are concerned about the noise of wind generators and they do not want to see windmills scattered all over hillsides. I understand that even if we adopt wind power in a fairly significant form it could be only a bit player in the power game. But we have got an abundance of coal. There are huge coal resources in this country—15 billion tonnes. I am told that something close to 9 billion tonnes is reasonably accessible. Yet in reading the select committee’s report on coal one has to wonder where the Government is going in terms of that fuel. We have an abundance of it. 
Hon PETE HODGSON (Minister of Energy) 
: 
 I thank the member for his comments and acknowledge his ongoing interest in the energy portfolio and his knowledge of it. He wanted to know whether I am happy with the situation and he wanted to know whether it has got better or worse. Well no I am not happy with the situation. 
I think the energy portfolio is quite a challenging one and I think New Zealand is going through an energy transition. When one tries to work out why that is one could say: “Oh we are trying to fix up the Bradford reforms and all of that.” but that will not do. The underlying cause of the energy transition we are going through is this: the Maui gasfield is running out. That gasfield had two characteristics. One was that it was very big. When it was discovered it was big by world standards. Even now it is big by New Zealand standards but it is running out. The second characteristic of the Maui gasfield was that the gas was cheap. The gas was cheap because when the contract was signed 30 years ago the price inflator on Maui gas was allowed to be half the price of inflation. So right through the 1970s and right through the 1980s the price of Maui gas was rising at half the price of what then was a very high inflation rate so that by now the well-head price for gas is NZ$1.80 or thereabouts a gigajoule. Let me just say that that is cheap. 
New fields are being discovered. The member is wrong to suggest that gas is running low—gas is not running low—but he is right to suggest that cheap gas is running low. There are new fields. Pohokura is one and McKee and Mangahewa are a couple of others that are running now. Dear old Kapuni does not seem to want to stop Kupe will be around in another couple of years and so on. Those gas fields especially Pohokura and Kupe will all sell their gas at a much higher price—maybe at twice the price; a 100 percent increase. So when the member says that we have price rises in electricity that is the underlying reason. There are others but that is the underlying reason. The future of electricity prices is not that they will return to where they were in the 1980s—they just will not. The member said we used to have an abundance of supply. We still do have an abundance of supply but we do not have an abundance of cheap supply and I invite the member to reflect on that. The cheap gasfield is gone and the cheap hydro sites have gone—we can use them only once. 
The member made a couple of other comments. He said that there is a bunch of things—he said there were four things and then he added a fifth or whatever it was—that he thought were important for energy. I would simply say that I roughly agree with that list. I roughly agree and I like the idea of security of supply at the top of the list. The member then went on to talk about incentivising conservation. I think probably he would prefer to use the language of incentivising energy efficiency because conservation tends to mean going without and efficiency tends to mean using the same amount of energy but smarter. I would say to members that this Government has more than trebled the effort into energy efficiency over the last 4 years. The budget has more than trebled. That is a very very significant increase and in the same breath much of it is still in front of us. There is still a lot of low fruit to pick in this country. 
The member instanced solar water heaters. He told us that Australia has a subsidy system for solar water heaters. So do we—New Zealand has solar water-heating system subsidies. In fact in the last Budget that quantum doubled. The amount of money put in was doubled. The idea is not to subsidise every household however. The idea is to grow quietly the level of solar water-heating installation by 30 to 40 percent a year until at some point—probably in the next couple of years—the number of units is so high that the price comes down and then the market transforms. At that point solar water-heating will become more available and affordable for many other people. So that is the gain there. 
Then the member went on to compliment the Government—and I thank him—on the 30c plus GST low fixed-charge option. He went on to say that the ACT party and the National Party had claimed this would mean rich people with baches would get cheap electricity and he asked what was good and socialist about that. Well of course they are wrong and the member is right. The ACT party and the National Party got it wrong and that is because they keep changing their energy spokespeople and they do not have people who understand the energy portfolio—unlike New Zealand First. 
I would say to the member that when he says that wind has only a small contribution to make at the moment he is right. But the potential for wind is around 3000 megawatts. Our total generation at the moment is around 8000 megawatts so let us not write it off. He talked about noise—I think he is wrong—and he talked about people not liking them. The member did not read the public opinion poll that was recently done by the Energy Efficiency and Conservation Authority which said wind was easily the most favoured generator in New Zealand. It went down to a lower level and asked: “But what if it is close to you? What if you can see it? What if you can hear it? What if you can see and hear it? How do you feel?” and still the level of support remained very high. So the member ought not to tell New Zealanders what they think about wind because we have just polled them and I think he should update his information. 
The member says we have a lot of coal and should be using it. Nothing stops us except price. Coal is more expensive than wind geothermal hydro or a combined-cycle gas turbine generally. Sometimes it is cheaper and if there is an existing plant that has already been paid for we should put coal in it by all means. That is why Huntly runs on coal. But generally speaking the reason we do not have a coal plant built in New Zealand is not that the Government has a law against it—we do not. It is just that it tends not to match the price that can be achieved by other forms of generation. 
Vote agreed to. 
Vote Research Science and Technology agreed to.  
Vote Transport 
MIKE WARD (Green) 
: 
 During the select committee examination of the transport estimates it was encouraging to hear the Minister acknowledge the importance of what may be seen by some to be fringe transport modes. The Minister made the point that when one takes into account the other threats to human health then cycling walking catching the bus and all those other means of transport take on a different look. I will quote his words because I found them particularly encouraging: “The road toll also includes the indirect toll that my predecessor gave some publicity to when he was the Minister and now probably even though it is only a statistic larger than the road toll from death by accidents the effect on human health of transport is material. If we start thinking about human health and safety that means that Transfund is going to have to pay attention to emission levels.” 
He referred to cycling as being something for which the Greens get laughed at but when one takes into account the type 2 diabetes epidemic it has a different focus. We get a glimmering of the holistic thinking that says in this area that the Government’s claim to a whole-of-Government approach is more than lip service. However the Minister acknowledged that there are gaps in the ministry’s expertise. When I examine the transport estimates and Transfund’s spending programme I see little evidence that the gaps are likely to be filled in the near future. 
So where are the gaps? The Land Transport Management Act clearly states that we have to look at demand management. The Minister acknowledges the need to change the way New Zealanders get themselves and their products around. We applaud the construction of dedicated cycle and pedestrian ways in towns and cities around the country and the improvement in public transport services in some parts of the country and the restoration of rail in others. While some are doing well others are much less successful. 
I have to ask why when Wellington has 25 percent or $25 million of its Transfund funding directed at public transport the top of the South Island—my region—with approximately a quarter of the population devotes 0.7 percent or $200000 of its allocation to public transport. Why do so few communities have well-developed cycle strategies and cycleway construction programmes? The programmes give the amount of $100000 over and over but have nothing down about where that money will be spent. Why is 80.5 percent of the national land transport programme funding still devoted to roads and a mere 0.3 percent to research and why is most of that devoted to roads and motor vehicles and so little to finding ways to persuade more of us to choose travel options that are less likely to overheat the planet or rush to use my grandchildren’s share of this planet’s fossil fuels? There is a gap in the country’s expertise and it is in the area of behaviour change. 
To its credit the Government has ratified the Kyoto Protocol. It has acknowledged the need to play our part in reducing our greenhouse gas emissions. It has recognised that transport solutions need to be sustainable and to not contribute to the diseases of inactivity obesity and air pollution. To date it has done little to contribute to reducing our dependence on the motorcar cool the planet persuade us to live closer to where we need to be or choose more appropriate modes of transport for our trips around. 
More disappointing however is the Government’s reluctance to insist on the research or the expertise necessary to understand the mechanisms of change to provide local authorities with the kind of advice that cities like mine so clearly need if they are to pursue a sustainable transport future. I am aware that when Transfund decides what money to hand out it decides on the basis of regional land transport strategies and those regional land transport strategies are clearly made by people who do not have the expertise or even any notion half the time of the kind of transport options that they ought to be pursuing. It is not reasonable to expect Nelson— 
Vote agreed to. 
Progress reported. 
The House adjourned at 9.55 p.m.