Swain Paul: Electricity (Disconnection and Low Fixed Charges) Amendment Bill — Second Reading 
Swain Paul: Electricity (Disconnection and Low Fixed Charges) Amendment Bill — Second Reading 
[Volume:646;Page:15117] 
Hon PAUL SWAIN (Labour—Rimutaka) 
: 
 I hung off every word there and I was waiting waiting waiting to hear a policy. I was waiting to hear what the National Party would do if it was ever in Government—not in my lifetime but if it was ever in Government—about electricity prices. That is what I was waiting for. The member Gerry Brownlee led us on a bit of a merry dance down the path. He talked about the issues and the problems—he slowly took off each veil and suddenly we had the expectation that the naked policy would be there standing in front of us. But unfortunately we got nothing. I will come back and ask some questions around that in a minute because he did ask us to address some questions. 
Of course the member is right. He chaired the Commerce Committee—and did not do a bad job of it I have to say—and this bill is about two basic issues: the low fixed-charge tariff which the member mentioned and the big problem of the fact that it is now for a standard 8000 kilowatt hours across the country. Of course as the member pointed out in the colder parts of the country that amount gets used up pretty quickly so the ability to have some flexibility across the country is obviously a good idea. The second issue the bill deals with is the problem of disconnection and to some extent the tragedy that occurred in Auckland. I will come back to those points in just a minute but I will now take up some of the points that the member raised about electricity issues. 
Mr Brownlee asked why it is that electricity prices keep going up. Well that is a good question which maybe we should go back and ask Max Bradford. I actually recall Max Bradford saying in this House that as a result of the electricity reforms that the former National Government introduced in the late 1990s—1998 as I recall it—electricity prices would go down. 
Hon Ruth Dyson 
: Did they? 
Hon PAUL SWAIN 
: Well of course they went up. For the National Party that may not be much of a difference—up and down down and up—but it is actually quite a big thing when it comes to consumers. When consumers heard National say that if we went through all of that electricity reform their power prices would go down and then they went up consumers would have wondered what had happened. We heard National say that prices would go down but then they went up. Then we heard the National member criticise the fact that electricity prices are going up. 
What I really wanted to hear from Mr Brownlee was what National would do about it. For example would National introduce price control? 
Hon Clayton Cosgrove 
: Would it? 
Hon PAUL SWAIN 
: I do not know. Let us ask the National members. I ask the National members whether they would introduce price control on electricity to stop prices going up. I do not hear any response from anybody on the National side. What happens during a dry winter when people use more power and it costs more money to generate it? Is National saying that that should not be reflected in the price of electricity? Or is it saying that the Government should regulate the cost of power? If the Government does that what message does that send to the generators? There is some market economics which apply to electricity in here. I would expect National to come forward with some ideas. I presume it is not advocating regulation. 
Chris Auchinvole 
: I presume that you’re short of ideas because this is all you have done for the last 8 years. 
Hon PAUL SWAIN 
: We have heaps of ideas and I am going to come to them in just a minute. 
Chris Auchinvole 
: It is under your watch that the prices are going up. 
Hon PAUL SWAIN 
: Well OK. Mr Brownlee tells us it is an outrage that the power price is going up but I want to hear the National Party’s ideas on how to address that because we have done a number of things. Of course the other thing is that he says the Government is heavily involved in the electricity sector and he is absolutely right about that. In fact we were 100 percent involved in the electricity sector until the National Government sold off Contact Energy in the late 1990s as well. 
I asked the National Party members over there whether one of its solutions to doing something about the power price was to privatise more generators. You see this is the problem. We know that the National Party wants to say yes they should be privatised because deep down fundamentally it believes in the privatisation of electricity generators. But the National members cannot bring themselves to say that because they know it is unpopular and they will not get elected. I think that the big problem is that the public would ultimately support them more or at least consider their policy more if they were prepared to be frank and say “Look we the National Party believe in the privatisation of State assets. In fact we think that a couple of those generators should be sold.” At least their policy would be clear. The problem which everybody now knows is that the National members think they can slip and slide on this kind of policy right up to the election. And if the National Party were ever elected to Government as I say—with no disrespect to Mr Deputy Speaker and not in my lifetime—everyone knows that it would sell the generators off. So people are asking why National does not come forward and tell them that now. They wonder why it does not come forward and tell them that now not at 5 past 12 on the election-day Saturday. People want to hear that and for them to be told that at 5 to 12 would be probably a little more helpful to them than to be told later even though the polls would still have closed. 
So the issue is really that the problem of electricity is a difficult one. But the Government has implemented a number of initiatives—for example initiatives to address hot-water heating and through local authorities insulation. Many of those kinds of initiatives have been taken to address some of the fundamental problems but in the end the issue is that electricity is a market and of course the tension always is—when a party is in Government and actually has to say what it thinks—between on the one hand people having to pay for power and on the other hand the importance of a correct signal being given so that generators can go out and generate new electricity. The demand for electricity is rising and no one will thank a Government if the lights go out. So that is the real tension. In the end some people get caught in the middle between price rises to fund new generation on the one hand and consumers not being able to afford the prices on the other. 
That is why this good Government has introduced this legislation to try to address that issue. It recognises that although electricity is a market—and the Government does not want to regulate prices across the board—some people will struggle to pay the bill. There are low fixed charges already in regulation but having been introduced this good listening Government—which goes around the country listening to people hearing good ideas and taking them back discussing them thoroughly at caucus and coming forward with positive legislation—has recognised that perhaps a standard rate across the country and across all temperatures is not a very good idea. Such a rate applies equally in sunny Hawke’s Bay where Chris Tremain is from and in the deep south where it is colder. So the Government says that perhaps we should introduce some flexibility so that people can adjust the kilowatt hours. That is a good idea and because this is a good Labour Government that listens to people it is prepared to take that option. 
Then of course if people are not prepared for the cost of electricity and get themselves into trouble there should be rules around disconnections. Rather than people just willy-nilly cutting off the power there should be some rules to be followed for disconnections particularly if people are attached to machines that require electricity—which was the issue faced in Auckland. So we are saying there needs to be some ability to address those issues and that is what this bill also does. 
Debate interrupted.