Norman Russel: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeNorman Russel: Questions for Oral Answer — Questions to Ministers[Sitting date: 06 November 2013. Volume:694;Page:14393. Text is incorporated into the Bound Volume.]2.Dr RUSSEL NORMAN (Co-Leader—Green) to thePrime Minister: Does he stand by all his statements regarding Government policy?Rt Hon JOHN KEY (Prime Minister): Yes.Dr Russel Norman: Does he stand by his statement that “The Government supports irrigation because of its potential for significant economic advantages.” and how does he reconcile that statement with advice from Treasury which in examining the proposed irrigation schemes came to the conclusion that they generally promised poor to average rates of return?Rt Hon JOHN KEY: In answer to the first part of the question yes.Dr Russel Norman: With reference to his answer to my last supplementary question then how does he reconcile that support with the fact that Treasury when analysing irrigation projects came to the conclusion that these projects generally promised poor to average rates of return?Rt Hon JOHN KEY: I have not seen the specific advice—that would have been sent to other Ministers—but what I can say is that there have certainly been projects where irrigation schemes have made a significant economic difference to New Zealand. As we know with the South Island probably one of the fastest ways actually to lift economic growth in the South Island would be to ensure that there is irrigation. A huge amount of water that falls on the South Island from snow or rain basically pours out to sea and if that was stored it would allow for greater development of the South Island as would be true in parts of the East Coast of New Zealand.Dr Russel Norman: How could it be economically prudent for a Government to spend up to $400 million—which is the number that has been floated—to support the irrigation projects that are on the agenda currently when Treasury analysed the projects and came to the conclusion that these projects generally promised poor to average rates of return? How could it be economically prudent to support such a project?Rt Hon JOHN KEY: As I said I have not seen the specific advice but what I can say is that it is important to understand that although the Government is prepared to put in up to $400 million it is actually as an equity player. So over time there is the expectation that cash would be returned. But if the member really wants to get into following and being a worshipper of Treasury advice—and that would be a great thing if the member decides he wants to do that—then he should go and ask Treasury what it thinks of his barmy idea about power.Dr Russel Norman: Given that Treasury came to the conclusion that “farm gate analysis indicates that irrigating the proposed areas would (in aggregate) constitute a loss-making investment” how can it possibly be economically prudent for the Government to put hundreds of millions of dollars of taxpayers’ money into a loss-making investment?Rt Hon JOHN KEY: Well as I say I have not seen the specific analysis but over a long period of time there is no question I think that if there is greater irrigation in the parts of New Zealand where there is a shortage of water that will have a significant impact not only on the GDP of New Zealand but overall on the jobs and opportunities. That member as we now know is a weekly participant on theFarmingshow. I know that because David Cunliffe gave it the one-finger salute and decided—Mr SPEAKER: Order! This has very little to do with the answer required.Dr Russel Norman: I seek leave to table the Treasury papers from the Official Information Act request with all the Treasury papers for the Prime Minister’s benefit about irrigation.Mr SPEAKER: Leave is sought to table a volume of Treasury papers I take it?Dr Russel Norman: Yes.Mr SPEAKER: Is there any objection to that course of action? There was objection.Dr Russel Norman: With regard to the broader economic effects that the Prime Minister referenced in his answer to the last question is he aware that in Treasury’s analysis of the broader economic effects it found that those broader economic effects arose principally from the stimulatory effects of the construction activity—so it was the construction activity alone or principally that produced the broader economic effects—and if you could construct anything and produce those kinds of stimulatory effects why is the Prime Minister proposing to spend the money on these projects?Rt Hon JOHN KEY: Maybe the answer to this question lies in the valuation of a property that has access to water and irrigation. If it is solely of economic benefit to both the farmer and the country to build an irrigation project and not actually use it then maybe the member would like to explain why farms that are irrigated sell for so much more and have so much greater economic productivity. I think the member can sit there if he likes and probably misrepresent Treasury—I do not really know I have not read the research—but the bottom line is that New Zealand would be well served if it advances irrigation. I encourage the member to go on theFarmingshow on which he now has replaced David Cunliffe and tell the farmers exactly what he thinks.Dr Russel Norman: Is the Prime Minister honestly trying to tell the House that his approach to economic development is to identify things that the Prime Minister would just like to build—because he thinks they are good things—and that regardless of the analysis that is conducted by Treasury whose job it is to analyse these proposals he just happens to like those proposals so he is going to spend hundreds of millions of dollars on them?Rt Hon JOHN KEY: Let me make this challenge to the member then. We will go over to Treasury and we will ask on a scale of one to 10 how much it dislikes these things. If it dislikes irrigation more than it dislikes his power programme we will stop our programme. But if it dislikes his power programme more will he campaign on stopping his? I do not think so.