Bayly AndrewANDREW BAYLY (National—Hunua): Thank you Madam Chair. There have been three themes that have been running so far. And so I just wanted to first of all pick up on the theme that my colleague the Hon Gerry Brownlee spoke about and it relates to the issue of the small-business tax package—and the Minister of Finance referred to it before. The first thing I want to compliment the Government for actually changing the rules around the tax continuity rules so that small businesses can raise additional cash without having to actually go and worry about the shareholding arrangements because under the current arrangements if you raise new lots of cash from different shareholders and you breach the 49 percent continuity of the same shareholder rule then you lose all those tax losses that small companies—when they're in their start-up phase. So that's a good measure.But the issue I really want to pick up and it was the one that Mr Brownlee spoke about is this was the grandly announced tax package saying that the Government was going to make available $3.1 billion of savings to the community to the business community in the form of a tax loss carry-back scheme. And again we heard the Minister just before talk about the $3.1 billion and quote the Treasury estimate of that figure. I found at the time when the announcement was made and I still find now hearing the phraseology that is used that in my mind that gives the impression the way that the Government has announced it that it is the Government giving businesses cash to the tune of $3.1 billion and that is patently wrong. There is no cash handout free cash handout to businesses to the tune of $3.1 billion. What the tax loss scheme is about is for those businesses who are going to make a loss in this current financial year and we're just entering that financial year now—and there will be a lot of those businesses—in the ordinary course of events they would have claimed those losses in the year that they incurred it in the next financial year i.e. they would have offset it; the 2020-21 year would have been offset against the 2021-22 year. The measure that the Minister announced was to offset it actually against the previous financial year that has literally just ended the 2019-20 year. So the only benefit that businesses have achieved is the timing of when they could actually use that tax loss and minimise their tax payments. There is no forgoing of tax by the Government. That is the—if I can use the word—in my mind slightly misleading way it was presented to the New Zealand public and to the business community in particular. All that has happened is the Government has chosen to allow businesses to access last year's profits and offset with their projected loss for this year and in effect get a refund. But of course the provisional tax payments are not due until May and then again in August and then the following year in the early part of 2021. So what has happened is all the Government has done is provided the ability for those companies to get cash at an earlier pay stage and use that. But there is no subsidisation. There is no free granting of money to the small businesses or large businesses or even to that effect of the $3.1 billion and I find the way that the Minister has talked about it in his press releases slightly off-putting and I hope he's going to correct it today and confirm that that is the situation. There is no free money to the business community. It is merely a tax offset which they would have otherwise been able to do in the next financial year. The other thing I want to turn my mind to is the issue of the loan scheme that my colleague from ACT Mr David Seymour raised. I think the Minister should be upfront. The loan scheme that the Government has introduced was nicked from the UK. The UK was the one that thought up this loan guarantee scheme. That's where it came from and the New Zealand Government merely went and grabbed that and applied it to the New Zealand situation. There is no creativity in that. That was a scheme that was in operation. And as the member for ACT has noted there is an 80:20 rule around guarantees so what is meant to happen is that the Government is meant to stand behind 80 percent of the guarantee when it came to a position of last resort at the end of the funding round but in the meantime the scheme is to be operated by the New Zealand banks and they were potentially at risk for 20 percent of the loan. But as the member quite rightly points out many of us have been approached by small businesses trying to access these types of loans and have found in some cases that the banks have taken a view that they have looked at the loan in a traditional lending sense and have decided to apply normal lending criteria. And the difficulty they are having is that they cannot actually get the loans. They have not been able to get the loan that you would have thought was possible with the easing in the credit conditions with—in effect it would be an 80 percent guarantee underneath it. That is the anecdotal evidence that many of us are getting and I'm sure the Minister of Finance has had many emails to that effect from small-business owners who are saying that their personal bank is one—in many cases they've had a longstanding relationship where they have said We will require certain security." The Minister talked about a GSA a general security agreement and as the Minister will no doubt know there are two forms of security that's taken for loans particularly for businesses. The first one is a general security over the business and it may be over specific assets of the business if it has hard fixed assets. In most cases where companies have an existing loan with a bank—and I'm not hearing of examples of banks choosing to lend to new customers so we're talking about existing lending arrangements—in those cases they will have adequate security over those company's assets. So there shouldn't be anything new. But what we're finding with these business owners going to their existing bankers is they are not only making sure that they've got their security over the assets of the company but they are also seeking to enforce personal securities and also PPSRs personal property security registrations. Those are the things that many people are finding very difficult because in their hour of need they're finding that in some cases the banks are not providing or being flexible about the security arrangements. The counterargument is that if the Government is standing around 80 percent of the loan the bank shouldn't require additional security particularly at a personal level levelled against the owners of that small business. That is the issue that Mr Seymour so correctly highlights and I just hope that we're going to see and hear more from the Minister of Finance. I find it slightly inconceivable that in terms of relying on how the banks are operating he's going to rely on the Bankers' Association to provide those figures. I would have thought at the very least—and my question to the Minister is: has he actually spoken to the Reserve Bank and requested those numbers? I think it's a very important differentiation. If the banks have spent $5 billion as the Minister quoted before since the start of the COVID crisis if that has gone into residential lending which is the best form of lending from a banking perspective because that offers the highest and most flexible security arrangement i.e. a house that is largely unproductive lending and that is not going to support New Zealand businesses getting through this time of need.What we really want to hear from the Reserve Bank and hopefully the Minister of Finance is to what extent the lending the $5 billion has been directed into the areas where we really need it. And that includes areas such as the important farming community which is now underpinning many or much of our exports as it always has and also at a general small-business level which is what I was just talking about before because without the support of those 520000 small businesses that make up most of the employment of New Zealand without them being able to get the lending at this critical juncture that is the most crucial figure. I certainly asked the Reserve Bank Governor before the COVID crisis about the increased liquidity he's provided to the bank but I'm just hoping the Minister is going to respond. Has he requested those figures? When might he be able to present them to the House around the new lending and making sure that they've been directed to the proper areas of the economy where it's most needed and not into the unproductive areas of the economy which is not going to help to grow New Zealand out of this financial mire that unfortunately we find ourselves in. [Interruption]CHAIRPERSON (Hon Anne Tolley): I'll let the Minister respond.Hon Grant Robertson: Why don't you go and I'll sum up.CHAIRPERSON (Hon Anne Tolley): Oh OK."