Robertson Grant: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeRobertson Grant: Questions for Oral Answer — Questions to Ministers[Sitting date: 18 April 2013. Volume:689;Page:9537. Text is incorporated into the Bound Volume.]1.GRANT ROBERTSON (Deputy Leader—Labour) to theMinister of Energy and Resources: Has he been advised whether the Prime Minister agrees with the Deputy Prime Minister that “a lot of us don’t like the power bills that we get” and if so has he been advised what action the Prime Minister proposes to take to reduce New Zealanders’ power bills?Hon SIMON BRIDGES (Minister of Energy and Resources): Yes I have been advised that the Prime Minister agrees with the Deputy Prime Minister’s actual comment as I do which was: “A lot of us don’t like the power bills we get but the one thing that will be worse and more wasteful will be politicians running the electricity system. And that will look cheap for a while and then you’ll find that the technology hasn’t been upgraded that the new generation that we need hasn’t actually turned up and then there’ll be a big spend by the Government to subsidise something and the prices will go up.” I knew that the Deputy Prime Minister was a religious man; I did not know he prophesied Labour-Green policy.Grant Robertson: Have the Max Bradford reforms delivered cheaper electricity to New Zealanders as the National Party promised; if not why is he so ideologically blinkered that he is tied to a policy that will not lower power prices?Hon SIMON BRIDGES: Well given that I was about 12 at the time it is hard to recall. But I can say yes—yes I think they did. Unfortunately though what happened was a Labour Government where power prices went up by 72 percent so it is hard to disagree with what Rob Hosking said in theNational Business Review this morning which was that the Labour Party was full of power price gouges that took place between 2002 and 2008.Grant Robertson: Why is the Minister so ideologically blinkered that he is tied to an electricity system that means New Zealand consumers pay the second-highest residential power prices in the OECD despite two-thirds of our power being generated from cheap hydro and where prices have risen at double the rate of inflation? Why is he so tied to that system?Hon SIMON BRIDGES: It is hard to take being called ideologically blinkered from a party that wants to—Rt Hon Winston Peters: I raise a point of order Mr Speaker. Down this end of the House we could not hear half of that question because of the raucous noise from the shameful person saying “What a shame.” and others. So perhaps we could hear it again.Mr SPEAKER: Order! I am going to invite the member Grant Robertson to repeat his question. This time there was so much noise that I had trouble hearing the last part of the question myself.Grant Robertson: Why is the Minister so ideologically blinkered that he is tied to an electricity system that means New Zealand consumers pay the second-highest residential power prices relative to industry in the OECD despite two-thirds of our power being generated from cheap hydro power and where prices have risen at double the rate of inflation since the Bradford reforms?Hon SIMON BRIDGES: Well it is hard to take criticism at being ideologically blinkered from a party that wants to renationalise the electricity system. But be that as it may we have a very competitive system where actually in Christchurch right now by switching from the most expensive to the least expensive retailer one can save nearly $600 per annum. That is more than that party’s new policy would save.Grant Robertson: Does the Minister realise that there are 30 states in the United States of America that use a similar single-buyer model to the one proposed by the Labour Party and when will he be auditioning for Fox News given his views?Hon SIMON BRIDGES: No and as I have said if the party opposite wants to reintroduce some kind of Albanian energy policy that is good for it but this side of this Parliament does not want that.Grant Robertson: Has he taken the Prime Minister to task for failing to deliver on his promise to Grey Power in 2009 that his policies would “help constrain electricity prices” when power prices rose by at least five times the rate of inflation over the last year?Hon SIMON BRIDGES: How can I take the Prime Minister to task when he has in fact met that quotation given that under that Government prices went up 72 percent and under us they have been much more constrained going up by only 20 percent.Te Ururoa Flavell:Tēnā koe Mr Speaker. Is the Minister aware of the Māori Party’s policy to enact an annual power rebate for low-income whānau installation of low-cost heating and insulating 10000 low-income homes per year including rental properties and does he agree that the Government needs to look seriously at addressing the quality of life for low-income families?Hon SIMON BRIDGES: I was not aware of that policy. It sounds intriguing. Can I say to the member that I think the best thing we can do is to continue with our pro-competitive drive that we started in 2010. The Electricity Authority is leading that and we are seeing real competition all throughout New Zealand where nearly 700000 people have switched from more expensive to less expensive retailers.Rt Hon Winston Peters: What does the Minister think of the Māori Party’s policy of piloting insulation in homes in Ngati Porou and Ngāpuhi two of the warmest areas where Māori live and how practical is that?Hon SIMON BRIDGES: It sounds like good policy.Te Ururoa Flavell: I raise a point of order Mr Speaker. It is very fortunate or some might say unfortunate that the Minister does not have any responsibility for Māori Party policy so I think that question is out of order.Rt Hon Winston Peters: He was talking about the Māori Party policy before to the Minister in a question. The Minister answered it even though he had no responsibility and so he has allowed in my question on the same basis.Mr SPEAKER: And on that basis too I think the Minister is quite capable of answering the question.Hon SIMON BRIDGES: It sounds like very good policy and I think that the Māori Party can share in the credit where this Government has now insulated nearly 230000 homes and will do by September of this year.Grant Robertson: Does the Minister realise that there is no functioning electricity market in New Zealand under his Government’s policy and that Labour’s plan will see incentives for new players to enter the generation and retail market and ensure that New Zealanders will save at least 10 percent on their power bills? Why does he not want New Zealanders to save 10 percent on their power bills?Hon SIMON BRIDGES: As I have said the member opposite shows some sort of Albanian economics understanding there. The fact of the matter is that under this Government we have a very competitive system. There are 15 independent retailers at work in this country competing against each other and we have seen that with 700000 different consumers changing from one to another.Brendan Horan: Is the Minister aware that his own Government’s figures show that average household power prices have soared in Tauranga at a rate 15 percent greater than the rest of New Zealand and what action does the Minister propose to take for the people of Tauranga?Hon SIMON BRIDGES: I think the people in Tauranga are exceptionally satisfied with the political representation they get and the kind of quality electricity system they get.Brendan Horan: I raise a point of order Mr Speaker. How was that answering the question?Mr SPEAKER: The question was adequately addressed.Andrew Williams: Has the Government considered New Zealand First’s proposal to introduce a 10 percent discount subsidy from State-owned enterprise power companies for SuperGold Card holders and pensioners who are struggling to meet winter power bills; if not why not?Hon SIMON BRIDGES: No. In fact I met with Grey Power this week and we talked through some of its concerns. I have explained I think the system that we have and why it is becoming more competitive every day. I have considered New Zealand First policy and frankly it is almost as loony as the Labour Party’s policy. What they are effectively saying also is they want to see the power generators back in Government hands and I just think that is bad policy all round.Grant Robertson: Further to the Minister’s previous answers if the electricity market is working so well under the Bradford model which he favours why have electricity prices continued to rise and rise over the last decade?Hon SIMON BRIDGES: Well there are probably many reasons and I do not accept the basic proposition in the question. But one reason would be the way the last Government took so many dividends from the power companies and that is why it is now belatedly trying to apologise to the people of New Zealand with admittedly some “loony tunes” policy.Grant Robertson: Are New Zealand residential consumers paying too much for their power?Hon SIMON BRIDGES: Well every consumer thinks they are paying too much for power Mr Robertson. But the fact of the matter is that at the moment we have a competitive system where there are options and where we have real security of supply—something actually we could not have taken for granted under the last Labour Government.Hon Trevor Mallard: I raise a point of order Mr Speaker. Although the Minister went in the direction of that question it was a straightforward question. It was not whether New Zealanders thought they were paying too much for their power; it was whether the Minister thought they were paying too much for their power. He said that New Zealanders did think they were paying too much but he did not include himself in that group.Mr SPEAKER: Let us have the question again and the Minister can re-answer the question.Grant Robertson: Are New Zealand residential consumers paying too much for their power?Hon SIMON BRIDGES: Well with respect the question is ill-conceived because it is not a question of the price but whether it is competitive and the system today is much more competitive than it was under the Labour Government. Since 2010 when we implemented our reforms we have seen it become more pro-competitive. It has still got some way to go and I think as the Electricity Authority made clear yesterday it is getting better and better.Dr Russel Norman: On what basis does the Minister claim that the market is competitive when the same five companies control 93 percent of the generating and 95 percent of the retail market?Hon SIMON BRIDGES: Well of the many bases how about this one? In Auckland at the moment if you switch from the most to the least expensive retailer you can save $312; in Wellington $212; in Christchurch $595; and in Balclutha $419. That is competition by anyone’s measure.Dr Russel Norman: So is the Minister telling us that he is comfortable with a market in which five companies—the same five companies—control 93 percent of the generating market and 95 percent of the retail market?Hon SIMON BRIDGES: Yes because what the member seems to ignore is that there are from there six other players that yes are smaller but are offering sharp deals—like Ōpunake Hydro—and a number of other ones all around this country. We have low barriers to entry and frankly I understand there is something like four power players at the moment that are looking at coming in. So it is a very sharp competitive system that yes could do better but is getting better day by day.Dr Russel Norman: Well if this market is so sharp and so competitive then how come since National gained office when demand has been flat the price of electricity to residential consumers has increased by 19 percent?Hon SIMON BRIDGES: There are a number of reasons. One is transmission costs and the hundreds perhaps small number of billions of dollars that it is reasonable to pass on. The fact of the matter is that under Labour-Greens policy we would not see another dollar invested in transmission or generation by the private sector because of the economic lunacy of that—Rt Hon Winston Peters: I raise a point of order Mr Speaker. The Minister is required to answer the question he was asked not to give us his views of other political parties’ policies. He is well into his answer and half of it has now been devoted to criticism of the questioner and that is not satisfactory.Mr SPEAKER: No the Minister was addressing the question quite satisfactorily with some connotation. Has the Minister now finished his answer?Hon SIMON BRIDGES: Yes.