Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeQuestions for Oral Answer — Questions to Ministers[Sitting date: 07 May 2014. Volume:698;Page:17557. Text is incorporated into the Bound Volume.]Questions to MinistersMinisters—Confidence1.Hon DAVID CUNLIFFE (Leader of the Opposition) to thePrime Minister: Does he stand by all his statements?Rt Hon JOHN KEY (Prime Minister): Yes which is a lot more than Trevor Mallard can say.Mr SPEAKER: Order! [Interruption] Order!Hon David Cunliffe: Does the Prime Minister stand by his statement that “We have a lot to be proud of.” and if so does he include in that list his handling of Judith Collins’ massive and undeclared conflicts of interest a Minister who thought it was acceptable to call the police about an ongoing prosecution and revelations of ministerial “cash for access” programmes being run out of his Government?Rt Hon JOHN KEY: Yes the first part of the question I do stand by. There is a lot to be proud of—so much to be proud of that Shane Jones left Labour for a National-led Government.Hon David Cunliffe: I guess he will have to ask the diplomats whether they agree with him.Mr SPEAKER: Order!Hon David Cunliffe: Is he proud to lead a Government that prioritises giving millions to big businesses like RioTinto does deals with companies like Skycity and Chorus but tells New Zealanders like the Pike River families that he has no moral obligation to help them?Rt Hon JOHN KEY: In relation to the last part of the question I really think it is a disgrace actually that that member would say that with all the things that this Government has done in relation to Pike River including funding to go up the drift which is in excess of about $9 million. I have personally been to the West Coast on numerous occasions. To play games actually with those families who have gone through an enormous amount shows how low that member is getting as Leader of the Opposition.Hon David Cunliffe: While the Minister is on his high horse he can go and find MrWhittall and bring him back.Mr SPEAKER: Order! I call the Hon David Cunliffe to ask a supplementary question.Hon David Cunliffe: Is he proud to lead a Government where a senior Minister Maurice Williamson believed that it was acceptable to improperly interfere in a police investigation into domestic violence againstDonghua Liu?Rt Hon JOHN KEY: What I am proud to do is lead a Government that has standards. If a Minister does not meet those standards then they pay a price. But you see if I was part of a Government that campaigned against secret trusts and the very first step I took was to establish one to set up what must be explosive conflicts of interest and not to declare them it is no wonder New Zealanders have such a low view of David Cunliffe.Mr SPEAKER: Order! [Interruption] Order! The level of interjection now coming from my right is unacceptable.Hon David Cunliffe: Do the Prime Minister’s high standards include the standards and values of his Minister Judith Collins who misled him and the public about her involvement inOravida attacked a press gallery journalist and made veiled threats against others and wants to drain every swamp but her own?Rt Hon JOHN KEY: The first thing is the Leader of the Opposition needs to get a better question writer.Grant Robertson: I raise a point of order Mr Speaker.Mr SPEAKER: Order! This is a point of order.Grant Robertson: I appreciate it was a political question but that was not actually an answer as such from the Prime Minister. He needs to at least attempt to address—Mr SPEAKER: Order! I need no assistance at all. The Prime Minister was asked a question that was very politically loaded. I allowed it to go forward. I certainly did not rule it out. The Prime Minister has chosen to answer it by addressing it in the way that he has. That is satisfactory to me.Hon David Cunliffe: As the Prime Minister so obviously cannot defend the Minister of Justice why does he not do what all New Zealanders expect as the inevitable and let her go?Rt Hon JOHN KEY: Far from that the Minister enjoys my full confidence. I think that as a Minister in a number of portfolios for the last 5½ years she has done an outstanding job. What she has not done is set up a secret trust to hide donors. What she has not done is had the hypocrisy of being part of a Government that campaigns against trusts and then takes money from people—Mr SPEAKER: Order! That answer is sufficient. [Interruption] Order! The Hon Gerry Brownlee—please tone it down a little.Hon David Cunliffe: If the Minister believes in high standards does he believe that paying for access to Government Ministers including the Prime Minister whether it is through a so-called charity golf game or undisclosed attendance at the Antoine’s dinners whether it is throughOravida or the systematic abuse of the Cabinet club which contravenes theCabinet Manual—does the Minister think that those are the standards that New Zealanders have a right to expect of him or his Government?Rt Hon JOHN KEY: If you will bear with me for a moment because this is a slightly longer answer but let me start with theCabinet Manual. Paragraph 2.54 makes it quite clear around what a Minister can and cannot do. They certainly cannot take additional remuneration unless I sign off on that and only one Minister so far has done that and that was Maurice Williamson. Paragraph 2.94 makes it quite clear that Ministers can go to fund-raising functions for their own electorate or for any other member of Parliament. If they are paid for that they are meant to donate that. They can also—theCabinet Manual makes quite clear—be at events where people pay political donations. They can talk about their portfolios interests and all of those things. That is because they fundamentally go in their capacity as an MP or a member of the party. But let me—if you will bear with me just for a second on these points—say that I am aware of a couple of interesting situations. I am aware of a situation where a market stand was established where a fee of $1250 plus GST was paid—Grant Robertson: Point of order Mr Speaker.Rt Hon JOHN KEY: No sunshine! Sit down!Mr SPEAKER: Order! The Prime Minister will resume his seat. [Interruption] Order! If members on my right want to stay for the full question time I expect some cooperation. [Interruption] Order! A point of order has been raised. It will be heard in silence.Grant Robertson: I raise a point of order Mr Speaker. I have actually got two points of order. The first of those is that for a considerable time after you were on your feet the Prime Minister continued to talk barrack and completely ignore your rulings and—Mr SPEAKER: And your second point?Grant Robertson: I hope that you will rule on both these points of order thank you. The second point is that the Prime Minister’s answer was very long was straying into highly irrelevant matters. He had dealt with the question. If he wants to do a speech he should do one in the general debate.Mr SPEAKER: No I do not need assistance. [Interruption] Order! As to the first point of order the Prime Minister should resume his seat immediately when I stand. I said that to him so I consider that matter closed but it had better not happen again. On the second point of order when I considered the allegations in the question I allowed a reasonable amount of licence in the answer given by the Prime Minister. I do accept the point that at this stage it had gone on for long enough and I do not expect that answer to now be continued further.Rt Hon JOHN KEY: I raise a point of order Mr Speaker. The member asked me a very loaded political question. As part of that I gave him the very straightCabinet Manual advice that is there for everybody. On the basis of the very political question that was asked I think I am quite entitled to point out that there are other examples that have taken place and I do not think I was given the chance to answer my question. The reason that Mr Robertson got on his feet was that he knew I was about to point that out.Mr SPEAKER: Order! I have heard enough. The Prime Minister gave a factual answer referring to theCabinet Manual. I accept that. He then added quite a lot of political content and I allowed that. I consider the answer has gone on for long enough.Hon Gerry Brownlee: Supplementary question.Grant Robertson: To the rescue Gerry!Mr SPEAKER: Order! All members have a right to ask a supplementary question.Hon Gerry Brownlee: Has he seen any reports of interesting and innovative fund-raising methods deployed by political parties? [Interruption]Mr SPEAKER: Order! There is no prime ministerial responsibility for other parties. [Interruption]Hon Gerry Brownlee: Point of order Mr Speaker. [Interruption]Mr SPEAKER: Order! I just want to clarify before I take the point of order that the member is not in any way attempting to relitigate a ruling I have given because if that was happening I would be tempted to ask the member to leave. If it is a point of order I will hear it but it better not be—Hon Gerry Brownlee: I raise a point of order Mr Speaker. There is always that temptation but what I am simply saying is that I asked the question whether the Prime Minister has received any reports.Mr SPEAKER: It is a matter of prime ministerial responsibility. It asked about any reports but then you went on Mr Brownlee about other parties’ innovative means of fund-raising or words to that effect. I ruled instantly that I did not consider that that had prime ministerial responsibility.Rt Hon JOHN KEY: Point of order Mr Speaker. [Interruption]Mr SPEAKER: Order! This is a point of order. It will be heard in silence.Rt Hon JOHN KEY: I seek leave to table a report that shows that a market place was established where $1250 was paid for an opportunity to meet one-on-one in a short meeting with your choice of MP. That was at the Labour Party conference last year—Mr SPEAKER: Order! The document has been satisfactorily explained. It is in the House’s hands when I put the leave as to whether members want that document tabled.Grant Robertson: What’s the source?Mr SPEAKER: The member is asking what the source is. That is a reasonable question.Rt Hon JOHN KEY: The Labour Party website. [Interruption]Mr SPEAKER: Order! My patience is fast running out with members on the right-hand side of this House. If the source is the Labour Party website then that is freely available to all members and I will not be putting—[Interruption] Order!Rt Hon JOHN KEY: Point of order.Mr SPEAKER: Again can you just clarify whether this is a fresh point of order?Rt Hon JOHN KEY: It is a fresh one—yes. I seek leave to table a document that shows people had paid $500 to attend a lunch—Mr SPEAKER: Order! Again I want the source of the document.Rt Hon JOHN KEY: Well I am not sure of the source but I am sure I can get it for you—Mr SPEAKER: Order!Dr Russel Norman: I raise a point of order Mr Speaker. [Interruption]Mr SPEAKER: Order! This is a point of order. [Interruption] Order! The noise is coming relatively equally from both sides. On this occasion I will not be ejecting any member. But I have points of order raised. I call for silence; I expect silence.Dr Russel Norman: Mr Brownlee asked a supplementary question and you ruled it out of order. Then you said to Mr Brownlee that if he disputes your ruling you will be tempted to throw him out. He did dispute your ruling and you in—Mr SPEAKER: Order! No. What I took from the second point he raised was that he sought clarification rather than to dispute. That is the way I ruled it.Rt Hon JOHN KEY: From the source Scoop I seek to table—Mr SPEAKER: Order! The member will resume his seat. Scoop is available to all members and if this sort of nonsense continues from the Prime Minister to restore order again I will have no choice but to ask the Prime Minister to leave the Chamber.Economy—Outlook and OECD Report2.SIMON O’CONNOR (National—Tāmaki) to theMinister of Finance: What reports has he received on the New Zealand economy and how do those reports fit with the economic outlook to be presented in the Budget next week?Hon BILL ENGLISH (Minister of Finance): The OECD has just released its latest country report on New Zealand which says the economy is in good shape. Amongst other points it says that “economic growth continues to be strong but so far inflation pressures have remained muted thanks to renewed currency strength and moderate wage increases.” The OECD also says that the Government is on track to a small surplus next year. That follows the IMF making a favourable report on New Zealand recently. These reports are consistent with an economic picture that puts New Zealand back on its feet and delivering gains for New Zealand families.Simon O’Connor: What does the OECD’s latest country report on New Zealand say about the outlook for the current account and how does this outlook compare with New Zealand’s current account position 6 years ago?Hon BILL ENGLISH: The OECD paints a much-improved picture for the current account certainly compared with the record deficits New Zealand was running up to 2008. It expects New Zealand’s current account deficit to fall to 3.3 percent by December this year. It then expects the current account deficit to shrink further to 2.7 percent of GDP next year. I cannot help thinking that this improvement is directly related to the Labour Party saying it is a crisis. This is not only considerably better than deficits of around 8 percent of GDP in the years up to 2008 but much better than the situation that Treasury has been forecasting since Budget 2009 where it predicted a deficit of 5.5 percent for 2013 and it actually turned out to be about 3.5 percent.Simon O’Connor: How is the higher growth outlook for the economy translating into more jobs for New Zealanders and what will the Budget forecast be for jobs over the next 4 years?Hon BILL ENGLISH: Interestingly the household labour force figures released today showing that 84000 more people were employed in the year to 2014 indicate that we are on track to deliver the 170000 new jobs discussed back in Budget 2010. The quarterly employment survey also out today showed that average wages increased by 2.5 percent in the year well ahead of inflation of 1.5 percent. Labour market participation—that is the proportion of the working-age population available for work—increased to 69.3 percent which is the highest level ever recorded in this series. Alongside that high participation rate unemployment remained steady at 6 percent in March.Simon O’Connor: What steps will the Government take in the Budget to further support sustainable economic growth and keep interest rates lower than they otherwise might be?Hon BILL ENGLISH: We will assist in keeping interest rates lower by being disciplined with fiscal policy—that is with Government spending and revenue—and by ensuring that we can get more houses built more quickly to prevent a runaway housing market. We would expect that if we can meet these conditions we will do much better than in the run-up to 2008 when first mortgages reached 11 percent Government spending was out of control and the housing market was running away.Tax System Changes—Impact on Revenue3.ANDREW WILLIAMS (NZ First) to theMinister of Finance: For each of the years ending 30 June 2011 2012 and 2013 what was the reduction in tax revenue specifically in the top tax bracket as a result of the tax reductions in Budget 2010?Hon BILL ENGLISH (Minister of Finance): It is not possible to give the member an exact figure because we can only measure it against assumptions about what tax would have been paid. However as a rough estimate if the top tax rate had stayed at 38 percent and all other things had remained equal income tax revenue would have been higher by around $400 million in the 2011 tax year and by about $1 billion in 2012. However members will recall that all personal income tax payers in all tax brackets had a significant income tax reduction in 2010 at the same time as GST went up. Analysis done at the time demonstrated that the combination of a reduction in income tax rates and an increase in taxes on investment property and increased GST weredistributionally neutral—that is it had roughly the same effect on income distribution across the income range.Andrew Williams: I raise a point of order Mr Speaker. The Minister mentioned 2011 and 2012. My question also specified 2013.Mr SPEAKER: Yes but the member will recall that the Minister started his answer by saying that it is simply not possible to answer the question accurately. The member has further supplementary questions. That is the way to delve into it.Andrew Williams: I seek leave to table from the Parliamentary Library a paper detailing each of the years 2010 2011 2012 and 2013 in terms of totalling $4 billion—Mr SPEAKER: Order! [Interruption] Order! The member will resume his seat. The point of tabling a document is to give further information to members. I am prepared to put the leave but it is not for the member to take the opportunity to make a political statement. Leave is sought to table that information from the Parliamentary Library. Is there any objection? It can be tabled.Document by leave laid on the Table of the House.Andrew Williams: If it was so vital to sell State assets for about $4.7 billion why did the Government—based on these Parliamentary Library figures—give away $4 billion to top income earners over the past 4 years?Hon BILL ENGLISH: The tax package in 2010 did not give away $4 billion to top income earners. What it did was change the mix of taxes for the same total revenue. Higher-income earners paid more GST and the impact of about a billion dollars of extra tax collected on investment property fell largely on higher-income earners. The analysis done at the time by Treasury and Victoria University showed that the tax package was roughly fiscally neutral and that it was roughlydistributionally neutral—that is it had the same impact on income groups right across the income range. It is a tax package that this Government is proud of. We have a very good tax system and it collects revenue very efficiently. Among high-income earners there is much less tax dodging than there was under the previous Government.Andrew Williams: What is the estimated loss in the Government’s revenue stream in the 2014-15 Budget year as a result of dividends foregone due to the sale of $4.7 billion in State assets over this past year?Hon BILL ENGLISH: I cannot give the member those numbers off the top of my head. However if he looks at the investment statements that were published for the electricity companies he will be able to see that. I must say though that from the taxpayer’s point of view these large risky businesses are now being managed and scrutinised by people who have much better capacity to deal with the complexities of the electricity market than the Government ever had.Andrew Williams: I seek leave to table and the source again is the Parliamentary Library a paper detailing the amount of dividends foregone—Mr SPEAKER: Order! Leave is sought to table that particular document. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.Andrew Williams: Does he agree that had he not made the $4 billion in tax cuts over the last 4 years to top income earners and had he invested this and maintained Government contributions to the high-performing Cullen superannuation fund New Zealanders would all be much better off long term in terms of their retirement superannuation; if not why not?Hon BILL ENGLISH: No I do not agree with that.Andrew Williams: I raise a point of order Mr Speaker. I ended the question by saying “if not why not?”.Mr SPEAKER: Order! [Interruption] Order! The member has been here a long time. He gets the ability to ask a supplementary question. If he puts two legs in it and the Minister chooses to answer one that is satisfactory.Andrew Williams: Does he accept that having already given up over $4 billion in tax revenue in the last 4 years—over a billion dollars per year—the 2010 tax cuts were misguided given next week’s anticipated paper-thin Budget surplus and critical areas ofGovernment spending such as conservation and biosecurity having suffered; if not why not?Hon BILL ENGLISH: The member is simply wrong. The Government did not give up $4 billion worth of revenue. It reduced income taxes across the board which we are very pleased about because that means better incentives to work and to save and to exporting and we increased GST and the tax on investment property. If one can recall at the time New Zealand had been on a debt-funded consumption boom and we decided to do something about it. It was effective and now we have one of the stronger growing economies in the developed world. We are very pleased with those decisions. They were fair and they were economically sound.Budget 2014—Apprenticeships4.COLIN KING (National—Kaikōura) to theMinister for Tertiary Education Skills and Employment: What further steps is the Government taking to increase the number of apprentices in New Zealand?Hon STEVEN JOYCE (Minister for Tertiary Education Skills and Employment): Yesterday the Prime Minister announced that Budget 2014 will contain an additional $20 million to expand the Government’s very successful apprenticeship reboot scheme by an additional 6000 places. The extra funding means a total of 20000 apprentices are now eligible for the reboot scheme. Under the reboot apprentices or trainees who sign up for training have been able to apply for a subsidy of $1000 towards the cost of tools and off-job course costs or a subsidy of $2000 for those in priority trades. Employers are also eligible for a similar payment. The reboot is proving successful in getting more apprenticeships under way especially in the priority trades we need for the rebuilding of Christchurch and the housing construction boom in Auckland. It is giving Kiwis vital vocational skills that will set them up for their working lives while meeting the needs of a growing economy.Colin King: What other actions is the Government taking to increase the profile of apprenticeships?Hon STEVEN JOYCE: A big part of the vocational training story in New Zealand has always been apprenticeships but under Labour the importance of apprenticeships slipped in favour of more generic industry training which in many cases involved a lot of short courses and very low levels of completion. This Government has created the newNew Zealand Apprenticeships which are a premier vocational pathway into an industry-based career for New Zealanders. The new apprenticeships provide the same level of support and the same level of subsidy for all apprentices regardless of their age. We have increased funding support for each apprenticeship and boosted their educational content as well. This Government is very committed to raising the skill levels of New Zealanders as part of our Business Growth Agenda.Colin King: How does the Government’s work around apprenticeships feed into the wider employment picture in the economy?Hon STEVEN JOYCE: Well that is a very good question. Today’s household labour force survey confirms that the hard work of New Zealanders with the support of the Government over the past few years is paying off. Eighty-four thousand more New Zealanders are in jobs compared with a year ago. That is the largest growth in jobs in New Zealand in a decade. Labour force participation is at its highest level ever and is now very much higher than Australia. Through our comprehensive Business Growth Agenda the Government has a very strong focus on creating the opportunities for competitive businesses to invest and employ more people.Carol Beaumont: What specific steps has the Government taken to increase the number of women in apprenticeships given the appallingly low levels in industrieswhere there are significant skill shortages and where temporary migrant labour is consequently required such as in building and construction where only 1 percent of trainees in 2013 were women?Hon STEVEN JOYCE: The member raises a very interesting question in terms of the occupational preferences of different people. The reality is that she is right of course. There are less people involved in the construction trades who are women than men—Hon Trevor Mallard: Fewer—you’re the Minister for Tertiary Education; get it right.Hon STEVEN JOYCE: There are many things I do not take a lecture on from you Trevor Mallard and one is the English language. The good news though for the member is that there are many more women involved in some of the higher level university study courses than men so I am sure it balances out over time.Carol Beaumont: I raise a point of order Mr Speaker. That answer made no attempt to answer the question about specific steps around women in apprenticeships.Mr SPEAKER: It was a very long-winded question. The Minister has addressed it. I accept that it may not be to the satisfaction of the member. If the member wants to take the matter forward the way is to ask further incisive supplementary questions.Reserve Bank—Monetary Policy5.Hon DAVID PARKER (Deputy Leader—Labour) to theMinister of Finance: Does he agree that the objective of the Reserve Bank in the Reserve Bank of New Zealand Act 1989 should be changed; if not why not?Hon BILL ENGLISH (Minister of Finance): No I do not. It has served New Zealand well through three significant recessions and a global financial crisis. The second reason is that going soft on inflation is worse for those at the bottom of the income range. Thirdly if we keep it in place it means you will not end up with silly policies like cutting people’s net pay by 15 percent with no effect on interest rates as the Labour Party proposes.Hon David Parker: Does he stand by his statement that Labour’s proposed changes to monetary policy are “nothing new” or does he stand by his other statement on the same day that Labour’s upgrade of monetary policy is risky because it is untried?Hon BILL ENGLISH: Yes I stand by those statements. There is nothing new about a policy that says that we will raise KiwiSaver contributions. If that is a big new idea well it is not that new. The risky bit is messing up the current monetary policy decision-making framework by basically taking it from the Reserve Bank and putting it in the office of the Minister of Finance.Tim Macindoe: Under the policy targets agreement the Minister signed with the new Reserve Bank Governor in 2012 what other objectives does the Reserve Bank have to consider in setting monetary policy in addition to price stability?Hon BILL ENGLISH: Interestingly the policy targets agreement that I signed with the new Governor in 2012 was very similar to the one drafted by the Minister of Finance under the Labour Government Dr Michael Cullen which says that in pursuing its price stability objective the bank—and it goes on a bit—shall have regard to the efficiency and soundness of the financial system and “seek to avoid unnecessary instability in output interest rates and the exchange rate.” That means that the Opposition’s view that the Reserve Bank Governor does not take account of things like the exchange rate or the impact on the current account is simply wrong. We have got an agreement that was actually largely written by the previous Government when we did have bipartisan agreement on these things.Hon David Parker: Why does he stand by his statement that no changes are needed to monetary policy settings given that New Zealand interest rates through the cycle are significantly higher than those in our competitor countries and we have not had a current account surplus for 40 years?Hon BILL ENGLISH: If the member wants to use interest rates and current account numbers as a measure of success then he should take account of this. Interest rates today are slightly higher than a 50-year low and they are half the level when the last Labour Government left office in 2008. The current account deficit is 3.5 percent—heading to 2.5 percent according to some forecasts. When that Government left office having tried all his theories it was 8 percent—the worst on record—for 3 years in a row. So all the problems are at least only half as bad as they were and getting better. We think that that is a recipe for sticking to the plan. Labour says that it is a crisis and that we should go back to making the same mistakes as last time.Hon David Parker: Is the reason our already overvalued exchange rate has increased recently even though dairy prices have fallen by 21 percent in 3 months due in part to the interest rate increases caused by out-of-control house prices in Auckland?Hon BILL ENGLISH: People can speculate on any reason they like why the exchange rate is higher but it does indicate that something is happening in this economy that is pretty important. Something is happening that is pretty important that is different from the analysis of the Opposition. The exchange rate has been at 80 percent - plus against the US dollar for a long time and last week we had record exports. No one would have predicted that 4 or 5 years ago nor would they have predicted that interest rates would have stayed at 50-year lows for 3 or 4 years. So it could well be that some long-term structural problems in the New Zealand economy are actually improving. I know that that is bad news for the Opposition but it is good news for New Zealanders.Hon David Parker: Is the Employers and Manufacturers Association wrong to say that our proposed monetary policy changes have merit is Westpac wrong to say that our policy is sensibly modest and is Brian Fallow of theNew Zealand Heraldwrong to say that our monetary policy looks good because it preserves the inflation control of the existing regime?Hon BILL ENGLISH: All those entities are in the same position as the Labour Party leader and the caucus and that is that as they ask questions about what it actually means like it is a proposition for a 15 percent pay cut for tens of thousands of low-income New Zealanders they too will change their minds. One has only got to see the comments made by the leader of the Labour Party to understand that he never read the policy before it was announced and he cannot answer basic questions like “By how much will New Zealanders’ pay be cut in order to try to keep interest rates down?”.Tim Macindoe: What reports has the Minister seen rejecting the idea of changing the Reserve Bank of New Zealand Act and particularly proposals to broaden its core focus away from price stability?Hon BILL ENGLISH: The Reserve Bank of New Zealand Act has been examined a number of times and so have the mechanisms of our monetary policy over the last 15 years. There was one such report in 2008 by Parliament’s Finance and Expenditure Committee which was helpfully chaired by the Labour Party’s most outstanding economic thinker in a generation Charles Chauvel! It made a number of important inclusions stressing that monetary policy remained the primary means of achieving low inflation and that New Zealand’s monetary policy approach is standard among small open developed economies. At the time the Minister of Finance for the Labour Government Michael Cullen sensibly agreed with the select committee and no major uncertainty was created through sophisticated globally-leading but inexplicable ideas.Ministers—Attendance at Cabinet Club Events6.Dr RUSSEL NORMAN (Co-Leader—Green) to thePrime Minister: Does he have confidence in all his Ministers?Rt Hon JOHN KEY (Prime Minister): Yes.Dr Russel Norman: Is it acceptable for Ministers to attend events known as the Cabinet club where a few private donors pay thousands of dollars to the National Party for access to those Ministers?Rt Hon JOHN KEY: Other than the fact that the member is making some assumptions on the last bit absolutely it is. TheCabinet Manualmakes it quite clear and has done for a very long period of time that it is actually totally appropriate for Ministers to go and attend these types of events. They are free to speak about their portfolios. What they cannot do is accept additional payment themselves unless they have my approval for doing that. It has been so much of a longstanding thing that I could if members wanted me to table an address to the New Zealand Labour Party fund-raising dinner by Michael Cullen which interestingly enough was actually delivered by the person who has been asking all the questions in this area Trevor Mallard.Dr Russel Norman: Does it corrupt our democracy for Ministers to grant access to individuals on the proviso that they donate thousands of dollars to the National Party?Rt Hon JOHN KEY: I really think that member needs to recognise that his high horse went lame when he parked it up at the Dotcom mansion. But if he wants to carry on down this track just make sure he tells New Zealanders he has never met Phillip Mills he has never spoken about green growth and he will never be part of the Labour-Greens Government because boy is that hypocrisy coming into the House with that.Dr Russel Norman: I raise a point of order Mr Speaker. It was a pretty direct question—a politically loaded question I give you that. The Minister—[Interruption]Mr SPEAKER: Order! I am going to ask the member to start his point of order again because I could not hear it and this time I demand silence from the Government side.Dr Russel Norman: Thank you Mr Speaker. It is a very simple point of order. The question was quite direct. It was a political question I give you that but it was a direct question. The Minister made no attempt to answer it.Mr SPEAKER: I thought the Prime Minister made an attempt to answer it that certainly satisfied many in the House. It may not have satisfied the member but it was certainly a very political question that was asked.Dr Russel Norman: How many Cabinet club events have his Ministers attended in this term of Parliament?Rt Hon JOHN KEY: I do not have that information with me but it would not matter what that number was because theCabinet Manual is quite clear. It is absolutely thoroughly appropriate for Ministers to do that. They go in their capacity as an MP or a member of the party but they can absolutely go to those events. They can absolutely talk about areas of their portfolio and take questions. There is nothing wrong with that. It will not matter how many times Mr Norman gets on his feet and tries to claim something different; he is actually fundamentally wrong and he needs to go and read theCabinet Manual.Dr Russel Norman: So is the Prime Minister saying that it is acceptable in his Government for Ministers to engage in a cash-for-access scheme whereby members of the Cabinet club pay thousands of dollars to the National Party in order to get access to Ministers of the Crown?Rt Hon JOHN KEY: Absolutely not but it is quite acceptable for Ministers to go in their capacity as MPs to a fundraising event and talk about their portfolios. That has been happening for a very very long period of time across parliaments. I could give you an example where for instance a political party ran an event it charged $500 and you could go with the leader and have an opportunity to pick your key MP and discuss “important issues”. I could show you an example of a political party that asked people to pay $1250 to have an opportunity for a one-on-one meeting of your choice on a subject of your choice with any MP or senior party official. I could give you examples where fund-raising dinners were done and held by a Deputy Prime Minister and released on public websites. They all come from the Labour Party and if you really want me to stay on my feet I can continue to do so—Mr SPEAKER: No; thank you for the invitation. The answer has been long enough.Dr Russel Norman: When the Prime Minister attended the Cabinet club luncheon in Dunedin on 3 September 2009 how much money was paid to the National Party in exchange?Mr SPEAKER: The Prime Minister has no responsibility as Prime Minister for the fund-raising of his political party.Dr Russel Norman: When the Prime Minister attended the Cabinet club luncheon in Dunedin on 3 September 2009 who was present and what was discussed with the Prime Minister at that exclusive event?Rt Hon JOHN KEY: I do not have those—Hon Bill English: 25000.Rt Hon JOHN KEY: No there were not 25000; there should not have been! I know that 25000 wanted to get in. I am sorry; the place was not that big. I do not have those details. If the member wants to put that down in writing to my office I can give them to him. But I can exclude two people. Kim Dotcom was not there because he was too busy having the leader—Mr SPEAKER: Order! That answer is now sufficient.Dr Russel Norman: I seek leave to table the diary from Michael Woodhouse describing the Prime Minister’s Cabinet club luncheon on 3 September 2009. [Interruption]Mr SPEAKER: Order! I will put the leave. It is for the House to decide. Leave is sought to table the diary of the Prime Minister on that particular day. Is there any objection to that being tabled? Is there any objection? [Interruption] The source was Michael Woodhouse. That means it is from the Prime Minister’s—I am putting the leave. You can deny it if you want. Leave is sought to table that document. Is there any objection? There is none.Document by leave laid on the Table of the House.Budget 2014—Cochlear Implants for Children7.JOANNE HAYES (National) to theMinister of Health: What investment will the Government make in Budget 2014 to assist children with profound hearing loss?Hon TONY RYALL (Minister of Health): Last week the Government announced that Budget 2014 will include an extra $6.3 million to provide two funded cochlear implants for children with profound hearing loss. The current 100 percent subsidy is for only one implant. Also $2.1 million has been set aside to provide a funded second implant to children under 6 who have already received a single implant through the cochlear programme and were unable to get a second. These implants are a game-changer for young children and will help give them a great start in life.Joanne Hayes: What reports has the Minister received about this new funding?Hon TONY RYALL: I was very pleased to hear a report from the mother of a 5-year-old girl who was born deaf that when she got her cochlear implant she “brightened up became more confident curious and playful. Her world is much more open now. She does get tired at school having to listen so hard and to concentrate with just one hearing ear. That is why we are so excited”—said the mother—“about now being able to have another implant so it will be easier for her to hear and learn.” This is a great investment by the John Key - Government in the future of young New Zealanders.Ministers—Attendance at Cabinet Club Events8.CHRIS HIPKINS (Labour—Rimutaka) to thePrime Minister: Is he satisfied that all of his Ministers have fully complied with section 2.54 of theCabinet Manual; if so how does he satisfy himself that those provisions are being adhered to?Rt Hon JOHN KEY (Prime Minister): Yes. Ministers are not permitted to accept additional payments without my permission. Of course if any were accepted they would need to be declared in the register of pecuniary interests.Chris Hipkins: Can he guarantee that no members of the Cabinet club have used their paid access to Ministers at a cost of $10000 a year to lobby for changes in legislation Government policy or specific ministerial interventions; if not why not? [Interruption]Mr SPEAKER: Order! The Prime Minister may not have heard the question. I had trouble hearing it and the reason it is difficult to hear is the level of interjection coming from my right-hand side. I will ask the member to repeat his supplementary question.Chris Hipkins: Can he guarantee that no members of the Cabinet club have used their paid access to Ministers—at a cost reportedly of up to $10000 per year—to lobby for changes in legislation Government policy or specific ministerial interventions; if not why not?Rt Hon JOHN KEY: As I said in answer to the earlier question what is quite clear is that Ministers can go to Cabinet clubs or other fund-raising events—actually Labour did those sorts of events the entire time it was in Government. What the Ministers are quite capable of doing is talking about their ministerial portfolios and areas of interest. The Government makes decisions based on its own analysis and its own decisions.Chris Hipkins: I raise a point of order Mr Speaker.Mr SPEAKER: Can I just say to the member that if he is going to raise a point of order about whether that question was addressed I can assure the member the question was addressed.Chris Hipkins: A supplementary question then. Can he guarantee that none of the people attending Cabinet club meetings have a potential beneficial interest in the decisions of the Ministers they are paying up to $10000 to rub shoulders with; if not why not?Rt Hon JOHN KEY: Political parties right across Parliament attend events that are fund-raising events. People always have interests—of course they do; that is the real world. In the same way the Labour Party accepted $60000 from Phillip Mills—Labour and the Greens accepted $60000 and $65000 respectively—and very soon afterwards the Labour Party started promoting green growth. We know that Shane Jones for instance had his leadership bid funded in part by the oil and gas sector and again very soon came out and started talking about that. I have quite a long list. If Labour members really want to invite me to table all of those they are welcome to do that but I just make one little warning to them: do not go there. But if you want me to I am more than happy to.Chris Hipkins: Are Cabinet club events open to all those wishing to attend or only those who are willing to pay an annual subscription to be a member of the club?Rt Hon JOHN KEY: They are fund-raising events like many fund-raising events. As I said earlier they are quite within theCabinet Manual. The one thing that is a good point here though is that quite simply we declare our donations. People know where they come from. What do we know about David Cunliffe? He raises money and he will not say where that money came from.Chris Hipkins: I raise a point of order Mr Speaker. My question was pretty specific. It was about whether the events were open to anybody or only to those willing to pay a subscription. The Prime Minister has not even addressed that part of the question.Mr SPEAKER: The Prime Minister was certainly addressing the question—maybe not to the member’s satisfaction. He has further supplementary questions and he should use them.Chris Hipkins: If the Cabinet club is such a legitimate fund-raising tool for the National Party is he satisfied with the answers his Ministers gave yesterday when asked about it such as Paula Bennett who said: “I’m not sure. I’m not sure.” and Anne Tolley who said: “I don’t know. What is Cabinet club?”. Why are they trying to hide it?Rt Hon JOHN KEY: People are entitled to give their own perspectives. Not every electorate has a Cabinet club. Others call them different things—pizza and politics; a range of things. But what I do know is this and members on the other side will be interested to know. We declare our donations. Does the Labour Party? [Interruption]Mr SPEAKER: Order! Order! You can have the conversation afterwards.Budget 2014—Canterbury Recovery9.Hon KATE WILKINSON (National—Waimakariri) to theMinister for Social Development: What recent announcements has the Government made about providing support for beneficiaries to contribute to the Christchurch rebuild?Hon PAULA BENNETT (Minister for Social Development): Yesterday the Prime Minister announced a new initiative and I was there as well called 3K to Christchurch which will help beneficiaries find much-needed work and will be able to assist with the rebuild. An amount of $3.5 million in new funding will go towards giving keen beneficiaries outside Canterbury a one-off payment of $3000 if they have a full-time job offer in Canterbury and are ready and willing to move there. The rebuild is creating thousands of jobs in Christchurch and unemployment there is down to 3.3 percent. I have just heard that we have had more than 50 inquiries already from people who are interested in taking this up.Hon Kate Wilkinson: How will the 3K to Christchurch initiative work and will it also apply to my own Waimakariri electorate?Hon PAULA BENNETT: To the second part of that question I am pleased to let the member for Waimakariri know that yes it will include her area. It is the Greater Canterbury region if you like where it goes to. We will target the 19000 beneficiaries aged 18 to 24 with work obligations who currently live outside of Christchurch although beneficiaries of any age can apply. The payment will help them with sorting accommodation travel clothing and actually getting there. We will work closely with employers to make sure that we connect them with beneficiaries who would be suited and would be willing to do the work. The job must be for over 30 hours a week and for longer than 91 days.Hon Kate Wilkinson: What other support for Canterbury has she announced?Hon PAULA BENNETT: Although the Christchurch rebuild is going at full speed the Government recognises that some Cantabrians are still struggling with the impact of the earthquakes. Yesterday I announced ongoing support for counselling services andhelplines as well as the Earthquake Support Coordination Service worth $13.5 million over the next 4 years which will pay for coordination support for up to 5000households. What the evidence tells us is that they can still be feeling the psychosocial effects of the earthquakes for up to 5 to 10 years afterwards. We want to continue with that counselling support and this money will do that.Hon Ruth Dyson: In light of the fact that there are currently 495 priority applications for Housing New Zealand homes in Christchurch and that since the February 2011 quake rents have risen by 34 percent what provisions for suitable affordable accommodation are being made for these additional 1000 new Canterbury residents let alone local people?Hon PAULA BENNETT: Well of course there are a number of initiatives one being the accord that the Government has just signed with the council injecting another $75 million—[Interruption] You asked the question. Another $75 million is going into that to make sure that we can see that we are freeing up land and actually partnering with the council. But the point I will make is that we have seen students who can make amendments. Most of these are young people as I said they are likely to be single and they can go into flatting situations. I know the member herself said yesterday that you can see houses being rented for anywhere from $400 to $600 a week. If you took it on a room-by-room basis actually that is about $100 or $150 a room. They can board. They can go in with relatives. They are pretty inventive in what they can do. Employers themselves are there to help them with their accommodation. I just think it is a bit of a catch-22: if you do not have the workforce you cannot be building those houses.Justice Minister—Visit to China10.GRANT ROBERTSON (Labour—Wellington Central) to thePrime Minister: Does he have confidence in the Hon Judith Collins; if so why?Rt Hon JOHN KEY (Prime Minister): Yes; because over the almost 6 years Judith Collins has been a Minister she has made a significant contribution to the Government and New Zealand in the portfolios she has held.Grant Robertson: When he and his office provided material to the Cabinet Office to assess whether Judith Collins had a conflict of interest did that include material from the Ministry of Foreign Affairs and Trade about her visit to China?Rt Hon JOHN KEY: There was a variety of different sources which I felt ensured that the Cabinet Office could make a fair ruling and we provided all that information to it.Grant Robertson: I raise a point of order Mr Speaker. That was a very specific question.Mr SPEAKER: I will allow the member to repeat the question.Grant Robertson: When he and his office provided material to the Cabinet Office to assess whether Judith Collins had a conflict of interest did that include material from the Ministry of Foreign Affairs and Trade about her visit to China?Rt Hon JOHN KEY: I cannot absolutely 100 percent say yes but I am pretty sure the answer is yes because part of what was discussed with the Cabinet Office was the name of the person the agency they worked for and their seniority. I assume that came from the ministry but I cannot be sure.Grant Robertson: Was the Cabinet Office provided with all of the material that the Ministry of Foreign Affairs and Trade held about Judith Collins’ visit to China including the change of the programme that led to the visit to theOravida headquarters?Rt Hon JOHN KEY: It was provided with all of the information that would have been relevant. The fact that a programme changes is of absolutely no relevance whatsoever. But what is interesting is this. The paperwork shows right through this that not only did the Minister have a very busy programme which the member wants to gloss over all on judicial and justice issues but secondly all the way through it talksabout a private dinner. That was at a time when the information was never likely to be in the public domain. I say this to Perry Mason: “It’s time to sling your hook son.”Grant Robertson: What did New Zealand Ambassador Carl Worker tell him about that dinner and who attended it when he discussed it with Mr Worker on his visit to China in March 2013?Rt Hon JOHN KEY: He told me it was a private dinner that he did not attend.Grant Robertson: Would the Prime Minister like to clarify whether that comment he has just made was the only thing New Zealand Ambassador Carl Worker told him about the dinner and who attended the dinner?Rt Hon JOHN KEY: I do not tape ambassadors and everything they say but the broad conversation we had was that it was a private dinner and he did not attend it.Grant Robertson: Does he believe that it was appropriate for Judith Collins’ husband David Wong-Tung to have contacted the New Zealand Ambassador to China to lobby forOravida’s products to be showcased at events in China on his visit in April 2013 using information and contacts Mr Wong-Tung gained while accompanying the Minister on a trip to China in 2012?Rt Hon JOHN KEY: I refute the last part of the question. In terms of the first part of the question lots and lots of companies contact embassies and say they want to showcase their products. There is nothing new about that.Oravida is a genuine New Zealand company that is building an export market in China. If the member does not want that he will—I can actually understand why he does not want that. Let me rephrase that. I understand that the member does not like economic development because that is exactly what Shane Jones said when he quit.Grant Robertson: Point of order Mr Speaker. [Interruption]Mr SPEAKER: Order! I am trying to assist the member with his point of order.Grant Robertson: I seek leave of the House to table an email from David Wong-Tung to the Ambassador to China Carl Worker which includes the statement talking about his visit in 2012: “I remember vividly your advice—Mr SPEAKER: Order! Leave is sought to table that particular email.Hon Gerry Brownlee: I raise a point of order Mr Speaker. We are not going to oppose the leave but I would point out that yesterday the House gave the opportunity to Mr Robertson to table some documents. Upon inspection those documents were not as he described. It would only be reasonable that he—[Interruption]Mr SPEAKER: Order! First of all I am going to put the leave to table that particular email and then I will make a comment on the point raised by Mr Brownlee. Leave is sought to table that particular email. Is there any objection? There is none. It can be tabled.Document by leave laid on the Table of the House.Mr SPEAKER: As regards to the point raised by Mr Brownlee if any member seeks leave to table a document andmisdescribes it that is a serious offence and then there is an appropriate way to address that—not by raising it as a point of order; the matter needs to be raised rapidly with me as the Speaker.Grant Robertson: Don’t tell lies.Mr SPEAKER: Grant Robertson that sort of interjection will lead to disorder.Grant Robertson: I raise a point of order Mr Speaker. Gerry Brownlee stood up and made an accusation that you yourself have said is a very serious one. It is a complete lie—Mr SPEAKER: Order! The member is in danger of having to leave the House. That is going to create disorder. I accept the point. The member may disagree with what Mr Brownlee said but as I pointed out to Mr Brownlee if he believes it wasmisdescribedthere is an appropriate avenue for dealing with it. It is not something that is appropriate to be discussed on the floor of the House.Hon Anne Tolley: I raise a point of order Mr Speaker. Can I ask you just for some clarification? If a document is released under an Official Information Act request is it then the practice of this House that those papers can be tabled one at a time? The opportunity was offered yesterday to table them all. Are we now going to expect that in this House? I thought the ruling was that anything that was publicly available was not able to be tabled.Mr SPEAKER: No that is not the ruling. It is a matter that I consider case by case and at the end of the day if I am in doubt as to whether to put the leave I will put the leave and let the House decide. So it is ultimately the House not me that decides as to when a document gets tabled. My intention with the tabling of documents is that when members seek to table a document I consider whether it informs the current debate before the House. If it is something that is freely available to all members such as media reports or from Scoop or some matter like that there is little point in even seeking leave. It will not be put. But with something like an Official Information Act release if members want to release it and they think it is something that would be valuable information to the House I will consider it at times to be appropriate to put the leave and then it is for the House to decide.New Zealand Defence Force—Budget 2014 and Upgrades11.Hon TAU HENARE (National) to theMinister of Defence: What will Budget 2014 mean for the New Zealand Defence Force?Hon Dr JONATHAN COLEMAN (Minister of Defence): As we announced last week in Budget 2014 the Government will be investing $100.9 million of operating expenditure in defence for the 2014-15 year. This is the first stage of an allocation of $535 million in additional funding over the next 4 years. This new funding will enable the New Zealand Defence Force to deliver on theDefence White Paper 2010 to maintain and improve its current mix of capabilities and to sustain and grow personnel numbers over time.Hon Tau Henare: Why is investment in the New Zealand Defence Force needed?Hon Dr JONATHAN COLEMAN: The Government inherited a significant funding hole from the previous Labour Government. It had ordered new equipment that it could not afford to run such as the NH90 helicopters. TheDefence White Paper 2010 signalled that new money would be required over time to maintain and improve New Zealand Defence Force capabilities. The Government commissioned the Defence Mid-point Rebalancing Review to look at the costing of various combinations of capabilities that would enable the New Zealand Defence Force to meet the Government’s expectations. Budget 2014 provides the funding that the New Zealand Defence Force now requires.Hon Tau Henare: What new capabilities are on the horizon for the New Zealand Defence Force?Hon Dr JONATHAN COLEMAN: In the last year the Government purchased eight new Seasprite naval helicopters for $242 million 200 new state-of-the-art trucks and 11 new T-6C air trainers as part of a $154 million pilot training package. Just last week the Defence Force signed a $446 million contract for a self-defence upgrade of the navy’s frigates and a contract for a new battle-training facility for the New Zealand Special Air Service will be signed shortly.Hon Phil Goff: Will the problems disclosed in the Minister’s latest Defence Force annual report—which discloses that critical trade groups are “seriously degraded” that the Defence Force is unable to “meet all expected outputs and readiness” and that thereis “an increase in the risk of Army’s ability to sustain a deployed force”—be solved by his latest package where he is putting back in $100 million but since 2012 has been demanding cuts of $350 million to $400 million a year which caused those problems?Hon Dr JONATHAN COLEMAN: What I can say is that the defence budget has not been cut. It is completely untrue to say that. We are putting extra money on top of that. We are solving the problems we were left by Phil Goff. When he was Minister of Defence the front page of theNew Zealand Heraldon Thursday 4 September 2008 said “Can’t sail can’t fly can’t fight” and that the defence chiefs presented a damning picture of the state of New Zealand’s armed forces under Phil Goff. We have been left with solving the problems which we are doing.Hon Phil Goff: I seek leave of the House to table a statement from the Minister of Defence in 2012 that the Defence Force—Mr SPEAKER: Order! No. Such information is freely available to members.Climate Change—Government Position12.Dr KENNEDY GRAHAM (Green) to theMinister for Climate Change Issues: Does he agree that climate change is a clear and present danger as highlighted by the landmark US Climate Assessment Report released overnight?Hon SIMON BRIDGES (Associate Minister for Climate Change Issues) on behalf of theMinister for Climate Change Issues: In light of the fact that the report came out late last night New Zealand time and is some 841 pages I have not read all of it and I have not yet been briefed on it. I do however agree with MinisterGroser’s endorsement of the recent Intergovernmental Panel on Climate Change report which concluded that the warming of the climate system is unequivocal. The Government considers climate change to be a serious issue. This is why we are undertaking a range of measures over the short medium and long term to help mitigate and adapt to the effects of climate change.Dr Kennedy Graham: I seek leave of the House to table a hard copy of the report which has only just come out. It is an overseas publication and I think it would benefit the House.Mr SPEAKER: Order! That is for the House to decide. I will put the leave on the basis that this is the hard copy and it may not be readily available to members. Leave is sought to table this particular document. Is there any objection? There is objection.Dr Kennedy Graham: Given the Associate Minister’s response that the Minister takes climate change as unequivocal and serious notwithstanding recent comments subsequent to that by other Cabinet Ministers will his Government be undertaking a national climate risk assessment as the US administration has done and as requested by the Wise Response petition tabled here last sitting week?Hon SIMON BRIDGES: I think the member will be well aware that we commission numerous reports. We have officials doing numerous assessments and indeed through the Intergovernmental Panel on Climate Change process we are constantly assessing where we are at against the global position.Dr Kennedy Graham: In light of the US President’s pledge to rely on the advice of US scientists to guide US climate policy will Minister Groser retract his statement in this House of 15 April where he dismissed the accepted findings of a leading New Zealand scientist as “complete and utter nonsense”?Hon SIMON BRIDGES: I think precisely what the Minister was referring to was that that academic was absolutely entitled to his opinions but he really gets deference only when he is talking from his expertise and not straying off that field of expertise.Dr Kennedy Graham: If the Minister agrees with the US report that the amount of future climate change “will … be determined by choices society makes aboutemissions.” will he change his Government’s policies which are currently on track to increase New Zealand’s emissions by 50 percent over the next 10 years?Hon SIMON BRIDGES: Well of course those figures are projections based on an extremely low carbon price globally at the moment. I do not think that anyone is predicting that that is where it stays. What is also true is that the Government has a policy and a strong set of policies to do our fair share both globally where we are pushing for a comprehensive agreement and also domestically through our emissions trading scheme and in numerous complementary measures where we are spending significant sums of money in bioenergy in the Pacific and in many other areas that if the member would like to know more I am happy to tell him about.