Border Security Bill — In Committee 
Border Security Bill — In Committee 
[Volume:618;Page:13741] 
Border Security Bill 
In Committee 
Debate resumed from 26 May. 
Clause 1 and 2  
(continued) 
SHANE ARDERN (National—Taranaki - King Country) 
: 
 It was interesting to listen to Dr Cullen talking just a moment ago about the economic policies of the National Party. I am sure one could ask what that has to do with the Border Security Bill but this is what it has to do with it. A series of events took place that brought the Government to a position where it decided it needed to introduce this bill. The first one was the major assault on the US. It is amazing how Dr Cullen distances himself from the US at the moment but the major assault on the US on 11 September 2001 resulted in this Government—and many Governments around the Western World—deciding that there needed to be another look at border security. There is nothing wrong with that; it sounds like a sensible thing to do. 
Government officials were set to work and told to go ahead and draft a bill which they did. They did a lot of work on it and it went to a very good select committee. The Government Administration Committee’s staff looked through the bill and by and large they came back with some sensible recommendations. The select committee agreed with those recommendations and then at the eleventh hour or the eleventh and a half hour the Minister the Hon Rick Barker decided there was an opportunity to introduce a couple of new clauses clauses 7B and 8C that would charge the industry—that is importers exporters and the shipping companies in between—$20 million in tax. 
If we go back to where I started with the 9/11 event of 2001 we have to ask this question: was this whole initiative started as a result of a security breach or a potential security breach? Was it designed to try to fix any problems that may occur at our borders in relation to security? The answer is yes of course it was. The second question is this: has the State normally funded security? The answer is yes the State normally has funded security. The third question is this: what makes this situation different from anything else historically? I am sure the Minister in the chair the Hon Taito Phillip Field will take a call to answer those questions. I am sure he knows about this. 
Opposition Member 
: You’d never know he was the Minister. 
SHANE ARDERN 
: Well there it is. He is in the chair and I am sure he is the Minister. The Minister will answer those questions and the answer is that there is no difference between these security measures and all the other security measures. So the simple conclusion that the National Opposition has come to is that this is no more than a greedy back-door tax like a lot of the other greedy back-door taxes that this Government has tried to introduce. 
In fact on counting them up I think we are now up to about 23 new taxes despite the fact that in 1999 Labour stated on its pledge card that there would be no new taxes. Then at the next election in 2002 it reinserted that statement in another pledge card and stated there would be no new taxes. Yet today here is new tax No. 23 under the guise of the Border Security Bill. So I know the Minister will take a call to explain to us why this move is unique and whether there is a another jurisdiction in the world that has introduced such heavy costs on the industry—the exporters and importers—as a result of 9/11. I am sure the Minister will know that because he will have the list right in front of him when he answers that question. But there is no explanation that we can find anywhere in the Western World as to why as a result of this security measure one should introduce what is now a $16 million tax. 
The fact that the Government backed down and reduced the amount from $20 million to $16 million is in itself an admission that Government members got it wrong. That is in itself an admission that they should have read a bit more closely the Treasury recommendations in which Treasury stated that there were no known extra costs with regard to industry access or other costs that the cost was purely a security cost and that the Government would be setting a precedent by introducing it. 
Maybe the Minister in the chair will take a call. Maybe he will not; there is no evidence that he will. But I suggest to him— 
Hon David Carter 
: Why doesn’t he move? Is the Minister still alive? 
SHANE ARDERN 
: The Minister is still moving over there. So he may take a call and enlighten us as to why the Government felt the need to put a $16 million tax on the industry—on exporters and the like. The Treasury guidelines clearly stated that the Government had to define what the cost was. 
Hon DAVID CARTER (National) 
: 
 It is interesting that as we move to the Committee stage of the Border Security Bill we have just completed the Budget debate in which the allocations the Government makes to the various Government departments to carry out core Government functions are discussed. My opening comment on the border security legislation is that this Government is shirking a core responsibility of central government. A core responsibility of central government is to provide border security to protect this country so that we hope we never see the sorts of events that occurred on September 11 2001 in New York City. But this Government shirks core responsibilities. It now attempts to pass some of the costs of providing border security on to the importers and exporters of this nation. As my colleague Shane Ardern has said that is just another sneaky attempt to pass a further tax on to New Zealanders. 
We do not need to be reminded that this is tax No. 23 from a Government that came into power promising but one tax increase—the “envy tax” which took income tax to 39c for people at $60000 a level of income that the Government’s own Budget now acknowledges is about the level to which people need Government assistance. There have been 22 tax increases and now this one destined to raise a further $16 million from New Zealand importers and exporters and about to be rammed through the Committee today is tax No. 23. 
I acknowledge that the events of September 11 changed border security for all nations around the world. We clearly now need to put more resources in border security here in New Zealand. We clearly need to acknowledge that other countries around the world are putting more stringent controls on their borders. I fully accept the United States of America has every right to up the ante with regard to imports into that country and to require further stringent checking of any New Zealand goods that go from here to the United States of America. But the point at which I totally disagree with the current policy of the Government is the point at which it shirks its responsibility by passing this legislation back on to the private sector and telling it to pay because the Government will not. 
It is little wonder when the Government can skite about a $7 billion surplus that it is now starting to hand more and more money out in a desperate attempt to buy popularity but in doing so it is putting another tax on the productive sector of New Zealand. I spent yesterday at the Mystery Creek field day where farmers have the chance to show their ability to secure the prosperity of the economy. I can tell members that most of the farmers I spoke to are totally aware of the new tax that is about to be passed by the Government—the “terrorist tax” as they call it—and all of them said to us that that is not a cost that should be passed on to the productive sector of New Zealand but a core Government function. It was interesting to note that at those field days there was a little stand tucked away in a corner—the Labour Party stand. 
Jill Pettis 
: Not tucked away in a corner! 
Hon DAVID CARTER 
: I assure Jill Pettis that it was tucked away in a corner but surprisingly— 
Simon Power 
: Anyone there? 
Hon DAVID CARTER 
: Yes! That was the surprising thing. There were quite a number of New Zealand farmers there and they were berating the poor volunteers the Labour Party had found to man that— 
Simon Power 
: Any MPs there? 
Hon DAVID CARTER 
: I did see one MP. It was Jim Sutton but he was in disguise. 
PETER BROWN (Deputy Leader—NZ First) 
: 
 If the issue in this bill had been addressed correctly—in other words if the Government had accepted that the extra cost of border security was to be paid for by general taxation—I think everybody in every party in this Chamber would support the bill We are absolutely in favour of increased border security and absolutely in favour of the costs being met. But instead the Government chose to levy $8 million from exporters $4 million from importers and $8 million from trans-shippers. In its generosity it has halved the $8 million from exporters leaving them facing a bill of $4 million. The exporters will not be charged directly; the levy will be charged against the carrier. The ship will be charged an amount that I have seen but cannot recall— 
Simon Power 
: Four. 
PETER BROWN 
: I think each ship will be charged so many hundred dollars. I forget the exact amount. Let me tell members what that will do to the shipping industry per se. The small ships that go around the Islands and carry a limited amount of cargo will have to pass on the cost and because it will be spread across a relatively small amount of cargo the increase on those exports and imports will be relatively high. The larger ship that is trading further will no doubt absorb the cost to some degree and therefore the importer and exporter will pay proportionally less. I ask whether that is fair. Is it fair to Pacific Island nations for example who might be dependent on small ships operating to and from New Zealand? It is not. 
When we last debated this bill the Minister of Customs the Hon Rick Barker took a call and endeavoured to explain his thoughts on trans-shippers and trans-shipments. The trans-shipping of cargo means that cargo comes in on one ship is landed on the wharf then goes out possibly on another ship or sometimes on the same ship and maybe at a later date or time. The sum of $8 million will have to be raised from that cargo and again I have no doubt that the charge will apply to the shipowner. 
The principal reason we are charging exporters and importers is the risk of a bomb being in a container or something like that. Let me suggest that if a bomb were in a container the person who was up to mischief would leave the cargo on the ship sitting in the harbour. That person would not arrange for it to be trans-shipped out; it would be left on the ship. There is no charge against that—thankfully. I do not want to give the Government any ideas! 
Quite clearly ensuring the safety of cargo that is taken out of a ship later to be reloaded on to another one—or even on to the same ship as I have just suggested—is the responsibility of this nation. Quite clearly that cost should be paid for out of taxation. When we think of the value of exports out of this country we know that this country could not survive without exporters. None of us would survive without exporters. This country takes the cream of their cake in many many ways and clearly exporters or carriers should not be charged for border security. Border security is a cost that we should all bear—everybody—and it should be borne evenly across all walks of life and all activities. In other words it should come from general taxation. 
The Government is doing a huge disservice to the people who make this country tick—namely exporters and importers. I would urge the Government in the fullness of time—I know that it is too late for this bill—to re-look at this legislation because that $20 million should be a charge we all come to terms with and all pay for and I have tried in the time available to illustrate why it is unfair. New Zealand First would have loved to support this bill but we will not vote for something that in principle is totally wrong. It is totally wrong. This bill should have provided for the Government to meet the costs of border security and I think the average New Zealander expects that. In fact I would go as far as to say that the average New Zealander would demand it if he or she were asked who should pay for border security. Why should it be a private enterprise outfit like an exporter or importer? Quite clearly it should be paid for by taxation. 
JILL PETTIS (Senior Whip—Labour) 
: 
 I move  
That the question be now put 
. 
DEBORAH CODDINGTON (ACT) 
: 
 It is interesting to hear Peter Brown say that New Zealand First will not vote for something that in principle is totally wrong because that does not reflect that party’s track record to date. Like the National Party ACT agrees that there is an increased need for border security but this Government has inserted in this legislation—as it does increasingly with legislation that comes before this House—a new provision that is just another way for it to raise taxes from people. 
The bad principle in this legislation that Peter Brown talks about—and he is absolutely right—is that it gives private industry the role of protecting citizens. That is the State’s role. It is the core function of Government to protect its citizens from harm—from each other or from people in other countries. That is one of the reasons why this legislation needs to be supported. We need to protect people in this country whether it be from terrorism from outside from war from attack or from other threats like larvae that could cause diseases or plant materials that could affect everybody’s quality of life if they got out of control. Gorse is a classic example of one such plant that we have now. And that is why Governments collect taxes. They collect taxes from people so that people can be protected. 
But what this Government is doing with this legislation with clauses like new clause 7B which inserts new section 34A “Fees and charges relating to granting certificate of clearance” is just introduce another way to raise taxes. The initial figure that Treasury came up with was $19.7 million and the Government was told that it was an arbitrary figure. It was just plucked out of nowhere. Now it has come down to $16 million but increasingly this Government is making private industry in this country pay twice for something. In this case it is paying for a public good. Border security is a public good and it should be funded out of the consolidated account. 
This Government would get nowhere if it introduced a bill that levied private citizens every time they called the police to their properties to protect them from people who were stealing their goods or about to harm them. No Government would get anywhere trying to pass legislation like that or to insert clauses into bills that forced that sort of tax on to people because protection is the role of the State. The ACT party does not oppose user-pays where it is a private good. But as I said protection is a public good and the Government is totally abandoning the true functions of the State in passing this legislation with clause 7B which enables the Governor-General to make regulations setting fees and charges. 
What will we see done with that money when it is collected? What we will see done with it is exactly what we have just finished debating. We will see that money being used to bribe voters for future elections. That is what it will be used for. 
It is not prudent fiscal policy that has given this Government a $7 billion surplus; it is the overtaxing of the people of this country. We have seen so many new taxes come in. We will see more new taxes and levies come in very soon that will sock another area of private industry in this country—the private tertiary institutions that educate international students. Again we will see the majority taxed to protect the few. This is what we are increasingly seeing. We saw a tax come in with the motor vehicle dealers’ bill. What did one of my colleagues from National say before? Fifty-nine new taxes have come in. 
Shane Ardern 
: 23. 
DEBORAH CODDINGTON 
: It is 23. I should not say that too loudly; it will be 59 by lunchtime! There have been 23 new taxes just since the last election. That is a disgraceful record. It is such a pity that the Government could not resist bringing that clause into this bill to gather up more taxes. If it had not done that the bill would have received the wholehearted support of all members. 
DAVE HEREORA (Labour) 
: 
 I move  
That the question be now put 
. 
Hon Dr NICK SMITH (National—Nelson) 
: 
 Is it not interesting that in the Chamber this afternoon not a single Government member has risen to his or her feet to defend what the Government is proposing to do in imposing a new tax on the wealth creators of New Zealand? If Government members really believe that what they are doing in this bill is right and proper even the Minister would feel the need to get up and defend the reason why exporters and importers should have to pay into the Government’s coffers an estimated $6 million a year. 
Shane Ardern 
: $16 million. 
Hon Dr NICK SMITH 
: My colleague corrects me. An extra tax of $16 million per year is being imposed through this bill. I want to know why we have not heard a contribution from Mr Jim Anderton. He is the Father Christmas of industry. 
Hon Member 
: Who? 
Hon Dr NICK SMITH 
: He is a maiden member. I understand that some of my colleagues do not know who Mr Anderton is. But Mr Anderton has been going around New Zealand playing the role of Father Christmas and saying how much this Government supports industry. He is writing out cheques for this business and for that business and saying that this Government values exporters. I would like to know from Government members what is sound about Government policy when Mr Anderton runs around the country playing favourites and writing out cheques and the Minister of Customs imposes a new tax on every single exporter in New Zealand for the costs of security. 
Is it not interesting the number of times I have heard Labour members get to their feet and say security is a core function of the Government? They suggest that it is outrageous for instance that members on the Opposition side of the Chamber believe that if prisons can be better run by the private sector rather than by the State sector we should do that. We would still get the taxpayers to pay for prisons; it is just an issue of how their management is delivered. But Government members do not support that; they say that security is a core function of the Government. Why do they change their tune now? Why is it that when it comes to an issue of border security and dealing with the threat of terrorism suddenly this Government wants to pack up and send the bill to exporters? 
I also want to challenge the minor parties in this Chamber that will support sending the bill for these measures to industry. Will the United Future party support the Government in imposing a $16 million tax on all the businesses in New Zealand? 
Shane Ardern 
: The United Future members have certainly spoken against it. 
Hon Dr NICK SMITH 
: Well let us just test their courage. What about the Green Party which is keen to spend— 
Hon Peter Dunne 
: I raise a point of order Madam Chairperson. I am not sure whether the speaker on his feet intended to do so but to imply a lack of courage or resolve is contrary to the Standing Orders. The member should know that and he should withdraw his comment. When he talked about testing people’s courage in my view that was contrary to the Standing Orders. 
The CHAIRPERSON (Ann Hartley) 
: The member should avoid that. 
Hon Dr NICK SMITH 
: I simply say to the United Future party that its members cannot go around telling the exporters of Nelson that they are on the side of the economy and then jump into bed with the Government and vote for legislation that will impose a $16 million—[ 
Interruption 
] Why did the member not simply say that? 
Hon David Carter 
: He had to check. 
Hon Dr NICK SMITH 
: He had to check. Mr Dunne the leader of the United Future party did not even know that party’s position. I hope the United Future members will join in this debate and I hope they will put pressure on the Government. 
I would be interested to know about the Green Party. What is the position of the Green Party? Its members spoke out against this legislation as well. Will they be voting for these provisions? 
Hon David Carter 
: Ian Ewen-Street put out a press release saying he was opposed to the bill. 
Hon Dr NICK SMITH 
: It is getting even more interesting. We have Ian Ewen-Street of the Green Party saying he is opposed to the bill so I ask the Government where the majority is coming from. 
Hon David Carter 
: I think Ian Ewen-Street may have changed his mind. 
Hon Dr NICK SMITH 
: I see. The Green Party has done a flip-flop in the tussle we see between United Future and the Greens for a relationship with Labour which gets more interesting by the day. The Green Party has done a U-turn. It together with every Labour member is going to dump on exporters and importers and impose this $16 million tax on them. 
My challenge to the Labour members is this: how can they possibly justify collecting a whole lot of taxpayers’ money giving it out in industry grants and then imposing this sort of new tax on industry? I challenge Government members to think again. I challenge them to justify why those who create the wealth for New Zealand—the fishers the farmers the forestry industry people and all those who work in the manufacturing of those products—should be sent the $16 million bill that has come as a consequence of Mr bin Laden and al-Qaeda. That is where this bill has come from—from those concerns with regard to security. Why should that cost be imposed on those who create wealth for New Zealand? 
Hon PETER DUNNE (Leader—United Future) 
: 
 I was not going to speak in this debate until I heard that extraordinary speech from the member who has just resumed his seat. I put on record categorically without equivocation or anything of that nature that United Future has opposed the Border Security Bill from the moment it was proposed has voted against it at every stage in the House—I do not know where the member has actually been—and will be voting against it at this Committee stage. My colleague Gordon Copeland who has done a huge amount of work on this bill—and I am grateful that Mr Ardern acknowledges that—has received a personal commendation from the trade and tourism coalition for the work he has done in mounting a very strong campaign against the provisions of this bill. If members of the Opposition were more interested in the reality of the issue than in petty politics they would have acknowledged that and also Mr Copeland’s contribution both in the House and through the select committee process in the Government Administration Committee. 
This bill does create new impositions that are unacceptable—impositions that we think fall properly within the defence of the realm and are public responsibilities that should not be borne by any individual sector of the economy. We have made that point throughout the debate on this bill right from the time it was proposed and before it was even introduced to the House when we were talking to the trade and tourism coalition and others who are affected by it. We raised questions in the House from the time that this measure first came on to the agenda which I am sure that the Minister would testify to and we have spoken against it on every occasion. Let there be no doubt about the strength of our opposition. Let there be no doubt about our view that this is not a wise move. It is not in New Zealand’s long-term interests in terms of our ability to grow our export trade and it is also not in our long-term interests in terms of any sense that if impositions are made upon us in order to meet requirements imposed by other countries we should duck the notion that those are legitimate defence of the realm matters and pass the buck to the particular sector upon whom we think some benefit may accrue. 
This is a bad principle. It is wrong in its concept and wrong in its practice. We have opposed it and let there be no doubt about that. 
LUAMANUVAO WINNIE LABAN (Labour—Mana) 
: 
 I move  
That the question be now put 
. 
The CHAIRPERSON (Hon Clem Simich) 
: The question is that the question be now put. 
JOHN CARTER (Senior Whip—National) 
: 
 Mr Chairperson I sense that you have accepted the motion and I am not disputing that in any way. I wonder whether I could perhaps seek the Committee’s indulgence on a special occasion. Given that Mrs Ardern Shane’s mother is in the gallery and has come to see her son perform I wonder whether the Committee may by leave—and I seek leave for this—allow Mr Ardern to make a 5-minute contribution so that Mrs Ardern can watch her son perform and continue the pride that she has in him. I so seek leave. 
The CHAIRPERSON (Hon Clem Simich) 
: Leave has been sought. Is there any objection to that course? There is not. 
SHANE ARDERN (National—Taranaki - King Country) 
: 
 I acknowledge the speech of the previous speaker the leader of United Future. Yes United Future has voted against the Border Security Bill all the way and has opposed it all the way and I congratulate it on that. The question is whether United Future would have been so unequivocal in doing that if the Green Party which also spoke against it and voted against it on a couple of occasions had not buckled. That is the question. I wonder whether it would have been; I am not sure whether it would. I shall come back to the bill for a few moments and remind the Labour Party of a couple of documents it put out. I think the Prime Minister is on the front of one of those documents. I am not sure whether it is her. If paintings are signed by Helen Clark does that mean they are hers? I am not sure about that. 
For the benefit of Labour Party members who want to forget these little documents I remind them that the 1999 document states: “Create jobs through promoting New Zealand industry and better support for exporters and small business.” That is pledge No. 1. “My commitments are”—how unequivocal is that? That is absolutely what that document states. The first four words of bullet point No. 7 read “No rise in income tax”. If members look at the 2002 document and I am pretty sure that is the Prime Minister on the front of it but as I said a painting signed by Helen Clark may not be hers although this looks as though it could be— 
Hon David Carter 
: It’s not my mother. 
SHANE ARDERN 
: It is certainly not my mother; that is for sure. The document reads: “Work with all sectors to create an innovative growing economy with more jobs.” Pledge No. 7 on the backof the leaflet reads “No rise in rates of income tax” again. If dumping $16 million worth of new taxation on exporters importers and the shipping companies in between them is not a step away from those two absolute golden commitments that were supposed to be unbreakable—“My commitment to you.”; Labour’s commitments to voters—what is it? The Minister may want to take a brief call to answer that question. Certainly members on the Opposition side of the House are curious about how commitments like that are made and then absolutely ignored in the way the Government has in clauses 7B and 8C of this bill. 
I would also like to know what the Hon Michael Cullen is going to do with the extra $16 million of taxation he will collect from our exporters importers and shipping companies. As the member Peter Brown mentioned before that figure is made up of $4 million from exported goods another $4 million from transhipped goods and $8 million from imported goods. Of course the figure was $8 million from both sides until the Governmentbacked down on the export side by 50 percent and brought the figure back to $4 million. What will Michael Cullen do with that extra $16 million of taxation once he has received it? The Treasury papers that were presented to the Government Administration Committee stated that charges for services provided by Crown agencies that are in excess of the cost of the provisions could be interpreted as a tax. That is where we come to the conclusion from that this must be yet another tax. In fact it is tax No. 23—23 new taxes. 
Given that the Committee gave me the indulgence of making a speech because my mother is present I will not linger on that argument any further other than to say that this is a back-door tax. We oppose it and it should never have been introduced. Other than that the bill is a reasonable piece of work that needs to be passed and I am very pleased that the United Future members have stood up and been unequivocal in the Committee for the first time in the whole time that they have supported this Government. We have had a win there on this back-door tax. 
A party vote was called for on the question  
That the question be now put 
Ayes 61 
New Zealand Labour 51; Green Party 8; Progressive 2. 
Noes 54 
New Zealand National 26; New Zealand First 13; ACT New Zealand 7; United Future 8. 
Motion agreed to. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 61 
New Zealand Labour 51; Green Party 8; Progressive 2. 
Noes 54 
New Zealand National 26; New Zealand First 13; ACT New Zealand 7; United Future 8. 
Clause 1 agreed to. 
Clause 2Commencement 
The question was put that the amendment set out on Supplementary Order Paper 220 in the name of the Hon Rick Barker to clause 2 be agreed to. 
A party vote was called for on the question T 
hat the amendment be agreed to. 
Ayes 61 
New Zealand Labour 51; Green Party 8; Progressive 2. 
Noes 54 
New Zealand National 26; New Zealand First 13; ACT New Zealand 7; United Future 8. 
Amendment agreed to. 
A party vote was called for on the question  
That clause 2 as amended be agreed to. 
Ayes 61 
New Zealand Labour 51; Green Party 8; Progressive 2. 
Noes 54 
New Zealand National 26; New Zealand First 13; ACT New Zealand 7; United Future 8. 
Clause 2 as amended agreed to. 
The Committee divided the bill into the Customs and Excise Amendment Bill and the Immigration Amendment Bill pursuant to Supplementary Order Paper 219.