Volume 655 Week 16 - Tuesday 23 June 2009 
Volume 655 Week 16 - Tuesday 23 June 2009 
[Volume:655;Page:4491] 
Tuesday 23 June 2009 
Mr Speaker 
 took the Chair at 2.30 p.m. 
Prayers 
. 
Ministerial Statements 
Swine Flu—Change from Containment to Management 
Hon TONY RYALL (Minister of Health) 
: 
 I wish to make a ministerial statement under Standing Order 347(1) relating to AH1N1 the swine flu. I undertook to keep the House informed of any significant changes. 
Reflecting the wide community transmission of the flu on Friday New Zealand moved from a containment approach to managing the epidemic. This is in line with World Health Organization recommendations. This means that New Zealand is now treating this new flu like the usual seasonal flu. As a result of the tremendous efforts of our public health authorities and primary-care professionals New Zealand has delayed the likely peak of the swine flu beyond the annual flu peak. As of today 12 of the 21 district health board areas are in the “manage it” phase with a further four district health boards expected to enter this phase by the weekend. The decisions to transition to that phase are made by regional medical officers of health and the Ministry of Health. 
Over the coming months the AH1N1 flu will present challenges to the health system and the community. I have been advised that this flu will become very widespread. The number of confirmed cases has grown by one-fifth overnight. This rate of spread will put pressure on hospital emergency departments and general practitioner clinics in particular. For example there may well be lengthier delays in emergency departments and some surgery may need to be deferred because of the pressure on hospital beds and staff. District health boards will be establishing flu centres as appropriate. It is even more essential now than it was previously that Kiwi families take simple precautions to prevent the spread of the flu and we are making information on how to do this widely available. Businesses schools and other organisations should have contingency plans for more people being away sick than usual so that normal life can go on. 
In light of health officials’ advice we are now using the national Tamiflu stockpile strategically. This is because in nearly all cases the flu is mild and it is wise to conserve our stockpile for a possible second wave of a more serious nature. 
I conclude by reinforcing that although the flu will become very widespread—that is expected—it is mild and we have the resources plans and health professionals to deal with it. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 First of all I acknowledge the Minister of Health and his statement. I thank him for ensuring that all parties have had an ongoing opportunity for briefings on this issue from officials. That openness is appreciated. I acknowledge also the huge additional workload that is being carried by those working within our health system and thank them for the work that they have been doing. 
I reflect on those who have contracted swine flu. For some it has been very mild but for others it has been extremely serious. I am sure that all members of this House wish everyone with swine flu a speedy recovery. Many others have suffered financially due to schools and businesses closing and for some that additional financial burden is very hard to bear. I reinforce the message from the Minister: we all need to continue to take simple precautions to prevent the spread of this flu. The change in status may be confusing for some people and I am pleased to be part of sending what I hope will be a unanimous message from this Parliament this afternoon to continue to encourage everyone to do everything we can to prevent the spread of swine flu. Thank you. 
KEVIN HAGUE (Green) 
: 
 When I previously spoke in this House in response to the Minister of Health’s first statement on AH1N1 I indicated my belief that it was unlikely that this virus would be contained expressed the Green Party’s best wishes to all those affected by the epidemic and offered the Green Party’s assistance and support for measures to help manage it. In light of the Minister’s statement today and of recent events it is appropriate to reiterate the appeals for calm that we all made on that occasion and at the same time remind New Zealanders of the need for vigilance. Although the severity of illness associated with this virus is generally mild to moderate we need to brace ourselves for the reality that at least serious illness will be experienced by a significant number of our citizens and that the disruption will be considerable. Any steps that can be taken to slow the epidemic in New Zealand will be of tremendous value in the long term. 
The Green Party is very pleased to see the new restriction being placed on the use of Tamiflu. We have been concerned for some time about New Zealand’s experiment in having this medicine available over the counter and hope that we will now see the drug’s use aimed at minimising the development of resistant strains as well as maximising our supply to prepare for future need. I add our voice in praise of the herculean efforts by officials from the Ministry of Health district health boards and throughout the health sector to slow the onset of this epidemic phase. Their work has been extraordinary and a great many New Zealanders owe them a debt of gratitude. Recently I inadvertently overheard two officials from a district health board commenting on how their organisation had coped with AH1N1. They concluded that there was a sense of calm and control because the pandemic preparedness planning process undertaken over the past several years had prepared the organisation for what it would need to do. So I take this opportunity to extend acknowledgment and gratitude to the previous Government for steering that process. 
It is inevitable that at some point the world will experience a pandemic that causes substantial loss of life in New Zealand. It is critical that even as we implement our previously laid plans to cope with AH1N1 we commit ourselves today to keeping a critical eye on what we can learn to ensure that next time our response is better still. The Green Party applauds the measures that the Government has taken and offers our continued support for this considered and well-judged response. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I rise on behalf of the ACT Party to thank the Minister of Health for keeping Parliament completely informed of the Government’s response but more particularly to thank the Minister for keeping the public of New Zealand informed of what is a very difficult and potentially scary development and for what I believe to be a very intelligent measured and considered response to this flu. Yes a lot of work was done by the previous Government in preparing New Zealand and the health authorities for this situation but the Minister has been at the forefront and I think his job could not have been done better by anyone in this House. I commend the Minister for that. 
Hon TARIANA TURIA (Co-Leader—Maori Party) 
: 
 The Maori Party stands in support of the Minister of Health and his statement bringing attention to the need for caution and collective care in our response to any influenza-like illness. We endorse the comments of the Minister that this is a time when we must all take full responsibility to ensure that people are informed of the symptoms and the risk factors associated with the disease. We have a particular concern as it relates to Maori. We know from accumulated research that Maori already experience higher rates of illness from respiratory conditions. On top of that the evidence points to the fact that socio-economic deprivation increases the likelihood of poor outcomes and respiratory disease. When over 56 percent of Maori are located in three of the most deprived socio-economic deciles it makes for particular concern that we must be vigilant in our care of each other. 
The Maori Party believes that it is critical that we all step up to the mark in respect of taking care of each other and taking preventive care of our whanau. The current situation really gives us all the more reason to take all the necessary precautions to maintain good health. We must be alert to the vulnerability of our neighbours our whanau and our communities. This is about taking a common-sense approach: staying home when sick and protecting the life around us. I commend the previous Labour Government for putting in place the pandemic programme and I say thank you to the Minister for the way in which he has approached this issue and ensuring that everybody has been kept informed including the public of New Zealand. 
Hon PETER DUNNE (Leader—United Future) 
: 
 I thank the Minister of Health for his statement to the House updating us on developments of the pandemic as they emerge. I also acknowledge the work of the previous Government in getting us to the state of preparedness where the plans now being implemented were able to be adopted quickly. 
I think we are entering a particularly dangerous phase with this pandemic especially if reports are correct in stating that up to half of the population may acquire this virus without being aware that it has done so. In that eventuality a number of the precautionary steps that are being proposed will be more difficult for people to take if they are not aware in the first place that they are suffering from this particular virus. I think the prudence that has been adopted in recent times has been very beneficial in terms of New Zealanders not overreacting but reacting properly to the emergence and spread of this virus. 
There will be challenges in the future. I put this proposition to the Minister: in terms of some of our larger institutions—our schools and our hospitals in particular—the Government may need to become more activist in terms of ensuring that those institutions have good sanitary materials and physical equipment available and that the message about washing hands and keeping clean is delivered. I think that many people want to do the right thing but they are unsure about how to go about it. Maybe as this virus moves to its next phase that sort of practical information and practical advice is something that needs to be considered by the authorities. 
I conclude by simply acknowledging the work that has been done. This is a difficult time for all New Zealanders and I congratulate the Minister on the prudent way in which he and his officials have handled the situation thus far. 
Hon TONY RYALL (Minister of Health) 
: 
 I thank members for their I think well-deserved praise of our public health authorities and the work they are doing. I also advise Minister Dunne that the Ministry of Health is sending materials to schools to assist them in their messaging for young New Zealanders. In Victoria schools have proven to be the main area of spread and that is why so much effort is going into communicating with schools as to what we can do with our kids in order to help to prevent the flu. Thank you Mr Speaker. 
Questions to Ministers 
Jobs—Statements 
1. 
 Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he stand by all his statements he has made as Prime Minister in relation to jobs? 
Hon JOHN KEY (Prime Minister) 
: 
 Yes. 
Hon Phil Goff 
: What have the three main ideas that emerged from the Job Summit and that he promised would save or create thousands of jobs delivered in actual job numbers? 
Hon JOHN KEY 
: I would say that the Job Summit has and will create thousands of jobs. 
Hon Phil Goff 
: Is it not true that the first idea the $2 billion credit fund has produced nothing and has fallen over; the second idea has created 345 jobs which is approximately the same number of job losses that occur in 1½ days under his Government; and the third the nationwide cycleway has become a pathetic remnant of the original idea and has created no jobs so far? 
Hon JOHN KEY 
: Is it not weird that the Opposition does not like success? You see this is a Government that goes out and engages with people in real debate and gets businesses unions and the Government all on the same page working hard for the country. I think the Leader of the Opposition should take a look at this chart. It is the Roy Morgan Research survey. I know that Opposition members do not like talking about it but the business confidence survey shows what New Zealanders think. When Labour was in Government the line on the graph was down; now it is up. This Government is working for the country. 
Hon Phil Goff 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: A point of order has been called and there will be silence. 
Hon Phil Goff 
: Mr Speaker just because the Prime Minister turns his back on you does not mean that you cannot bring him to order when he does not even attempt to address the question which he failed to do in that instance—as you well know. 
Mr SPEAKER 
: I think the member makes a fair point of order. I think the Prime Minister should seek to address the question asked by the honourable Leader of the Opposition. 
Hon JOHN KEY 
: National said at the Job Summit that some ideas would be progressed and some would not. In the case of the fund that the banks were looking at that idea was floated at the Job Summit and yes by the banks themselves. They agreed not to progress it because it would affect their capital ratios. But I point out to the Leader of the Opposition that as he well knows even before the Job Summit started—but as a result of the Job Summit—ASB had put up $1 billion for investment in job creation areas. 
Hon Phil Goff 
: Nothing to do with the Government! Absolutely nothing to do with the Government! 
Hon JOHN KEY 
: The member does not like ASB. Maybe he should go down and have a chat to them. They are out there working hard for the economy. 
Hon Phil Goff 
: We will try again. What has the Job Summit actually done for the more than 1000 Kiwis each week who are losing their jobs and joining the dole queue? 
Hon JOHN KEY 
: For a start off let me take the Leader of the Opposition back to the Job Summit. We were under no illusions when we went into the Job Summit. We actually said— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. It is the same point of order that Phil Goff raised before. There is a requirement in the Standing Orders and Speakers’ rulings to address the Chair. The Prime Minister has again turned his back on you. 
Mr SPEAKER 
: I am more interested in the content of the Prime Minister’s answer. I am not too hung up about his speaking to the wider House. I think he was actually going to answer the question asked by the honourable Leader of the Opposition. 
Hon JOHN KEY 
: It is amazing how members on the other side of the House have amnesia; I saw Helen Clark looking that way for 9 years! Putting that to one side at the Job Summit I said quite clearly that unemployment would rise over the next year. Why? In part because the Labour Government had let productivity levels in this country get so low; that is part of what is affecting jobs. Second out of that Job Summit came a quite long list of initiatives. They are being worked on. For instance the insulation fund costing $343 million was set against the Government’s Budget which was well received by New Zealanders. It is out there creating jobs in the worst economic conditions since 1930. That is what Phil Goff was saying in January—that these are the worst economic conditions since 1930. 
Hon Phil Goff 
: Does Mr Key stand by his statement at the Job Summit: “As I have stated many times I am interested in what works …”; how does it fit with his comments yesterday when asked about the number of firms taking up the 9-day working fortnight he replied: “It doesn’t really matter. I think the fact that it’s there is the important thing.”? 
Hon JOHN KEY 
: There are two things. Firstly the success of the 9-day fortnight is not judged by the number of people going on it; it is the fact that it is there to support businesses if they need it. Secondly I suggest that the Leader of the Opposition have a talk with the head of the Council of Trade Unions Helen Kelly who said to me that one of the greatest things to come out of the Job Summit was the fact that businesses unions and the Government were all on the same page working hard for New Zealand. The last time there was a summit in this country it was held by Labour. It was called the Knowledge Wave and Labour could not get anything achieved at that one. 
Hon Phil Goff 
: Does he stand by his statement: “I believe it is important to save as many jobs as we can while we can.”; if so why was there nothing new in the 2009 Budget to save and create jobs given the fact that 4000 Kiwis have joined the dole queue since the Budget and 16000 since his Job Summit? 
Hon JOHN KEY 
: Firstly that statement made by the Leader of the Opposition is ridiculous. The $343 million insulation fund is acknowledged by I think pretty much every party in the House—obviously with the exception of Labour—as creating thousands of jobs. I tell the Leader of the Opposition that if he wants to make sure there is wholesale job loss in this country this is the way to do it: spend lots of money and get the country’s credit rating downgraded and businesses cannot borrow. That is exactly what would have happened if Labour was in charge. New Zealanders are grateful for a Government that knows what it is doing economically. That is why the graph I am holding up looks like it does and not like it did when Labour was in office.  
Hon Phil Goff 
: Speaking of spending a lot of money does the Prime Minister agree that had he given tax cuts to people earning $40000 or less who are struggling to make ends meet and to raise their families he would have created far more stimulus for jobs than was created by his giving a third of the $800 million to his mates in the top 3 percent of income earners who just saved it or paid off their mortgages? 
Hon JOHN KEY 
: No I do not agree but I do agree with the policies that the Government has rolled out: a credit upgrade for this country half a billion dollars for infrastructure brought forward half a billion dollars for small to medium sized enterprises tens of millions of dollars for the Export Credit Office a 9-day working fortnight a cycleway a home insulation package— 
Mr SPEAKER 
: Order! 
Hon JOHN KEY 
: I could go on. 
Mr SPEAKER 
: No the Prime Minister has given us sufficient information. I warn the Hon Trevor Mallard he cannot interject in that manner across the House. In fact I will ask him to withdraw that statement. 
Hon Trevor Mallard 
: I withdraw. I raise a point of order Mr Speaker. What remedy do we have when a Prime Minister makes a comment about an upgrade that he knows is untrue. 
Mr SPEAKER 
: The member knows that he can use supplementary questions to attack the Prime Minister’s answers to questions. They have been available since the first question. There are many more supplementary questions available to the honourable member. 
Hon Phil Goff 
: Does Mr Key stand by the commitment he made in his opening speech at the Job Summit: “We can take steps to ensure that young people who cannot enter the workforce are able to up-skill in the meantime.”; if so what does he say to the 2800 apprentices in the building and construction trades who have lost their jobs before completing their training; and why did he allow the Budget to cut funding for job skills training cut the scholarship schemes that enabled low-income kids to get to university and cut the Enterprising Communities scheme which provided good programmes like the Otorohanga youth apprenticeship programme? 
Hon JOHN KEY 
: Firstly I think those apprentices will be grateful that this Government has brought forward infrastructure spending on roading and housing. I think those apprentices will say good on this Government for making sure we have a home insulation package. I think those apprentices will say good on this Government for having the Youth Guarantee scheme. I think they will say good on this Government for having an adherence to literacy and numeracy skills. No one is arguing that there are not tough economic conditions out there but let us get this right: unemployment in this country is 5 percent; in the United States of America it is 9.4 percent. This is a Government that is working hard. day after day to take the pressure off businesses and on not one occasion does the Opposition vote for anything that will take the pressure off businesses—never. 
Infrastructure—Investment 
2.  
CRAIG FOSS (National—Tukituki) 
 to the  
Minister of Finance 
: What steps has the Government taken to boost New Zealand’s productive infrastructure? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Budget 2009 outlined the Government’s plan to spend $7.5 billion extra over the next 5 years in improving roads rolling out broadband and modernising schools and our housing stock. This included $500 million of accelerated projects announced in February and now under way which are supporting New Zealanders in jobs. Another $3 billion will be spent in the next 4 years upgrading the national grid and this includes $1 billion extra to be spent on State highway construction over the next 3 years. This increased investment shows that the Government is channelling resources to two priorities: the first is supporting jobs through the recession and the second is a long-term increase in our productivity. 
Craig Foss 
: How will the increased infrastructure investment support jobs? 
Hon BILL ENGLISH 
: There has been a range of estimates about how many jobs are supported by this spending. In the short term $500 million worth of accelerated projects announced in February are providing an immediate boost for tradesmen and suppliers across the housing transport and education sectors. For instance in housing the Housing New Zealand Corporation estimates that its expenditure is supporting 1341 jobs. The New Zealand Institute of Economic Research published an estimate some months ago that said that the Government’s stimulus spending would support around 10000 jobs. I do not think that there is any doubt that the Government’s decision to keep spending through the bottom of the recession is supporting thousands of jobs and one of the measures of that is the fact that our unemployment increase is one of the lowest in the developed world. 
Hon Sir Roger Douglas 
: Does the Minister agree with Thomas Sowell that spending on infrastructure to get out of a recession is like someone mailing a letter to the fire brigade and telling it that his or her house is on fire; if not why not given that tax cuts provide an immediate stimulus whereas infrastructure investment can take years to work its way through the system? 
Hon BILL ENGLISH 
: I cannot agree with Thomas Sowell—not because he is not very knowledgable; he is but I do not understand the analogy he is using. The fact is that the Government’s commitment fulfils both objectives. For instance roading and the electricity grid are two of the main bottlenecks in our economy; there has to be investment to free up those bottlenecks if we are to have growth. And that will support jobs as we spend the money. It would be great if we could spend it all now but these projects do take time. 
Craig Foss 
: Has the Minister seen any reports on alternative approaches to infrastructure investment? 
Hon BILL ENGLISH 
: One of the jobs the new Government has had to do has been to clean up the mess left by the last Government in respect of infrastructure spending. Just one example is the fact that the previous Government bought KiwiRail for almost $700 million. The current valuation is about $350 million and a cash-flow valuation would give it a negative value—that is the Government could in theory pay someone to take it away and we would be better off. 
Families Commission—Appointment of Christine Rankin 
3.  
Hon RUTH DYSON (Labour—Port Hills) 
 to the  
Prime Minister 
: Does he stand by his reported statement as Prime Minister in relation to the appointment of Christine Rankin to the Families Commission that she was appointed for her expertise when it comes to abused children; if so why? 
Hon JOHN KEY (Prime Minister) 
: 
 Yes because I believe that she has something positive to offer the Families Commission and will work hard on behalf of Kiwi families. 
Hon Ruth Dyson 
: Does the Prime Minister believe that Christine Rankin was demonstrating her expertise and knowledge of child abuse issues when she said that people are told when they ring the Child Youth and Family that the service is too busy and cannot be there for 6 weeks but if a child is smacked then the service is there the next day? 
Hon JOHN KEY 
: I think she was offering her perspective on the matter. 
Hon Ruth Dyson 
: How can the Prime Minister reconcile his defence of Christine Rankin’s appointment on the basis that she had been “a very vocal advocate for abused children” with his decision to ban her from campaigning on section 59 of the Crimes Act which was to remove the defence against assaulting children? 
Hon JOHN KEY 
: The Families Commission has a stated position in relation to the referendum and as a Families Commissioner it makes sense for Christine Rankin to make sure that she does not contravene that line and speak out by campaigning in a way that would be inappropriate. Having said that I would expect more from the Opposition. When National was in Opposition we still cared about abused children and we did not spend our time playing political games. All those members care about is politics; they do not care about the abused kids of New Zealand. 
Hon Ruth Dyson 
: What is the Prime Minister’s definition of campaigning on the section 59 referendum? 
Hon JOHN KEY 
: I define that as if Christine Rankin had turned up to the press conference yesterday but she did not. In fact most sectors of the media are arguing that she has been muzzled. I go back to the point I just made: members on this side of the House care about abused kids. We look in the hospitals of New Zealand and see thousands of abused kids and Christine Rankin has spoken out about the damage that is happening to those kids. We are going to do something about abused kids because not enough happened under the previous Labour Government. 
Sue Bradford 
: Is it true that Christine Rankin was originally offered the post of Children’s Commissioner and that it was her choice to turn the job down because she did not want to move to Wellington rather than the Government’s choice because she posed too big a political risk? 
Hon JOHN KEY 
: I am not aware of that. If that was the case it was never brought to my attention. 
Hon Ruth Dyson 
: How many times will the Prime Minister tolerate Christine Rankin’s defiance before he takes action? 
Hon JOHN KEY 
: Firstly I am more focused on the kids than on political point-scoring—but that is OK. Secondly I do not believe Christine Rankin has been defiant; most sections of the media believe that she has been muzzled. Members on this side of the House care about abused kids but members on that side do not. 
John Boscawen 
: Is the Prime Minister saying that a New Zealander appointed to the Families Commission loses his or her right to free speech and the right to express his or her public and very well-known view that a light smack given to a child by a loving parent should not be illegal and was not this silencing of dissent roundly rejected at the last election? 
Hon JOHN KEY 
: No I am not saying that. As I said at my press conference yesterday afternoon I was quite relaxed about the comments that Christine Rankin made. I do not think they were terribly provocative; nor do I believe that they were anywhere out of line; nor did I expect Christine Rankin to express a view she does not hold. But if a Families Commissioner has an agreed position although he or she can express a broad view in the context of the overall responsibilities he or she cannot get out there and campaign for the “No” vote. 
Jobs—Jobs Saved Created and Lost Since Job Summit 
4.  
METIRIA TUREI (Co-Leader—Green) 
 to the  
Prime Minister 
: How many jobs were saved or created by the Job Summit and how many jobs have been lost since the Job Summit was held on 27 February? 
Hon JOHN KEY (Prime Minister) 
: 
 The member will know that jobs are created and lost in the economy all the time. I am aware of a study showing that between 2002 and 2007 each year about 250000 jobs were created in New Zealand and about 200000 jobs were lost. The Government does not routinely collect this information however so it is not possible to say how many jobs have been lost since 27 February. Even if we had that information it would be near to impossible to identify separately the number of jobs saved by the Job Summit. For one thing many Job Summit proposals related to the fundamentals of the economy like infrastructure spending improving regulations and the like. These are good proposals but it is hard to put a specific number of jobs against each of them. 
Metiria Turei 
: What plans does the Prime Minister have to create 28000 full-time real jobs across the economy by utilising out-of-work qualified builders to tackle the waiting list for State houses and provide warm dry homes for the 10000 families in need? 
Hon JOHN KEY 
: The Government is building albeit a very modest number of new State houses. But the member will be aware because her party worked on this that the Government is spending $343 million over the next 4 years on creating jobs to also insulate and warm those homes. The member’s former co-leader was on a platform with me in Christchurch to celebrate that fact last Thursday and I welcome Jeanette Fitzsimons’ expertise in that area. 
Metiria Turei 
: What plans does the Prime Minister have to create 40 percent more jobs for the same money that is to be spent by diverting funds from new motorways into bus and train services walking and cycling infrastructure and road maintenance as laid out in the Green Party’s Green New Deal stimulus package? 
Hon JOHN KEY 
: We do not have plans to do that. We have plans to spend a billion dollars a year on new State highways. We are spending more money I might add in some of those other areas: public transport and cycling. But we are spending a billion dollars on State highways. The previous Government was spending $650 million—or to put it another way the equivalent of 5 years of spending on the entire road infrastructure in this country would have been spent on the tunnel in Mount Albert if Labour had built it. The reason we are doing this is that it will create jobs because it will make New Zealand more productive. By the way I tell the member that roads are a form of public transport. Buses drive on them all the time. 
Metiria Turei 
: What plans does the Prime Minister have to create 4500 jobs by fencing and planting waterways restoring water quality and protecting New Zealand’s clean green reputation as laid out in the Green Party’s Green New Deal stimulus package? 
Hon JOHN KEY 
: The Government is always spending money on trying to make sure we improve the quality of our environment because that is very important. We have seen and will continue to see expenditure in that area. We support the member’s view that New Zealand’s reputation as a clean green environment is one of the foundation stones on which our tourism industry is built. 
Metiria Turei 
: If the Prime Minister has no such plans as it appears and as is widely understood for dealing with rising unemployment—1000 people a week are going on to the dole—and with both the current crises of climate change and the recession by creating jobs and a sustainable economy will he then borrow some more solutions from the Green Party and our Green New Deal stimulus package solutions that will be just as successful as our home insulation package which he has already adopted? 
Hon JOHN KEY 
: Firstly I utterly reject the proposition that there is no plan. For a start let us understand why the chart looks like this. It shows consumer confidence as being at pretty much an all-time high and business confidence as being at an all-time high despite the fact that we have a 1930s-style recession. Why? Because this Government avoided a downgrade; it had an upgrade. The Opposition members when Labour was in Government wanted to send us into debt and deficit for a lifetime. This Government is out there reforming things like the Resource Management Act so that our country can get going; Labour had 9 years in Government and did nothing about that. This Government has spent hundreds of millions of dollars more than was being spent on a small to medium sized enterprise package; Labour while in Government landed costs endlessly on that sector. This Government has come up with 20 initiatives. They are on our website and I am happy to table them. They go on and on. This Government has produced one of the lowest unemployment rates in some of the worst conditions that we have had. I am proud of my record in these difficult economic times and it looks as though we have the support of almost everybody other than the Labour Opposition. 
Adult and Community Education—Upskilling and Retraining 
5.  
Hon MARYAN STREET (Labour) 
 to the  
Minister for Tertiary Education 
: What role does she see for adult and community education in the upskilling and retraining of people seeking to make themselves more employable during the recession? 
Hon ANNE TOLLEY (Minister for Tertiary Education) 
: 
 This Government is committed to funding adult and community education that directly supports further study or leads to employment outcomes. Our commitment to adult and community education is demonstrated by the fact that over the next 4 years we will spend $124 million on the sector. 
Hon Maryan Street 
: Why will parents who proactively seek to take parenting courses be denied access to them because the Government has cut funding not only to parenting courses but also to all other adult and community education courses? 
Hon ANNE TOLLEY 
: That member is not correct. I am advised that parenting courses currently receive funding from a whole range of different social service agencies including district health boards. Schools that have received adult and community education funding for parenting courses will be able to engage with the Tertiary Education Commission through the funding process over the next couple of months. I suggest that the member instead of scaremongering out there in the sector advises those services to contact the Tertiary Education Commission immediately. 
Hon Maryan Street 
: Why after a meeting of educational professionals in March that recommended increasing the number of parenting courses available did the Minister decide to overrule that recommendation by reducing not increasing the number of courses as a result of the cuts to funding for adult and community education? 
Hon ANNE TOLLEY 
: I repeat the answer that I gave to the member previously. Parenting courses are funded through a whole range of different social service agencies. The best thing those organisations can do is talk to the Tertiary Education Commission about funding for next year. 
Colin King 
: What reports has the Minister seen on how adult and community education should be funded? 
Hon ANNE TOLLEY 
: I have seen a report from the member who asked the primary question calling for the funding changes to be reversed. That is typical of the Labour Party because there is no mention of how it would be paid for. [ 
Interruption 
] Members opposite do not like it when we tell the truth about them. They have not come up with any way of paying for it. All they have come up with is debt. In fact we can only assume that they want us to borrow more in order to—[ 
Interruption 
]—put it on the bill—exactly. The previous Government left debts in education. It left unfunded promises. This Government is not prepared to continue borrowing to fund. 
Catherine Delahunty 
: Tena koe. Tena koutou katoa. What would the Minister say to the former adult education students whom I met in Canterbury on Friday who told me that participating in so-called “hobby” adult and community education courses led directly from a total lack of confidence to running a business and employing staff? [ 
Interruption 
] 
Mr SPEAKER 
: I want to hear the answer. 
Hon ANNE TOLLEY 
: What I would say to those people is that they may well still have those opportunities. They should talk to the people who run the courses because in fact those courses could still be available. Correspondence has come into my office—form letters I think we call them—from people around the country who are taking courses such as How to Look 10 Years Younger and Continental Cakes. These people say that they are taking these classes to increase their skills improve the quality of their lives and learn something new—and that is to be applauded. But they also say that they would be able to attend those classes even if the course fees were to increase substantially. So I would tell the people whom the member mentioned to talk to the people running those courses because they may well still be prepared to run them and those people can pay a little bit more and attend them. 
Hon Maryan Street 
: What does it say about this Government’s education priorities when it can find $35 million for private schools at the expense of accessible adult and community education courses for more than 400000 New Zealanders? 
Hon ANNE TOLLEY 
: I am pleased that the member asked that question because what it says about the Labour Party is that its spokespeople cannot get their stories straight. The member asks that sort of question when Labour’s education spokesperson says “that the government’s decision to increase private school subsidies has opened a can of possible savings or at the very least opportunities for reallocation based on fairness and equity.” On the one hand the Opposition’s education spokesperson is in favour of supporting private schools and on the other hand its tertiary education spokesperson is looking to take the funding. 
Warm Up New Zealand: Heat Smart—Role of Trading Banks 
6.  
JACQUI DEAN (National—Waitaki) 
 to the  
Minister of Energy and Resources 
: What role will major trading banks play in the delivery of the Warm Up New Zealand: Heat Smart insulation programme announced by the Government in Budget 2009? 
Hon GERRY BROWNLEE (Minister of Energy and Resources) 
: 
 All of the major trading banks have agreed to waive their fees for customers who wish to top up their mortgage by adding on some of the cost of the insulation and clean heating they install in their homes. Additionally I have been advised that TSB Bank Ltd has agreed to lower by 0.25 percent the interest charged on any money borrowed for installation and clean heating. We welcome the support of the banking industry in delivering this important initiative. It will create warmer drier and healthier homes for many thousands of New Zealanders. 
Jacqui Dean 
: What has been the response from the public to the Warm Up New Zealand: Heat Smart scheme? 
Hon GERRY BROWNLEE 
: The programme is proving to be very popular with the public. It is early days. The programme does not start formally until 1 July but I am advised that there have been over 100000 unique visitors to the Energy Efficiency and Conservation Authority site since the Budget announcement. That shows a great intensity of public interest. We are confident that when the 0800 numbers from the Energy Efficiency and Conservation Authority and EnergyWise transfer to the Warm Up New Zealand: Heat Smart programme from 1 July the number of visitors will increase even further. More important though New Zealanders will be getting warmer drier healthier homes because this Government has committed to the programme in conjunction with the Green Party. 
Jacqui Dean 
: Has the Minister seen any incorrect reports about the scheme; if so what do those reports state? 
Hon GERRY BROWNLEE 
: Yes I have seen incorrect reports about the scheme. It will come as no surprise to the member to learn that they came from the Labour energy spokesman Charles Chauvel. He has put it about that low-income households will be worse off under the scheme than under the small and miserable scheme the then Labour Government was running prior to the election. The reality is quite the opposite. Under the Warm Up New Zealand: Heat Smart scheme people with community services cards will get 60 percent of their insulation paid for and in most cases the balance will be covered by participating funders who are partners in the scheme. Crucially the Government will also give that sector of the community $1200 for a clean heating device. The Labour scheme did not have that component in it. Mind you there was no Labour scheme because it did not commit any money to it. 
Charles Chauvel 
: Can the Minister confirm that the major bank fee waiver will be worth around $200 to the average household and that in return each such household will have to add around 10 times that amount to its existing home loan in order to finance a retrofit? 
Hon GERRY BROWNLEE 
: I cannot confirm the value of the fee waiver but I can assure the member that tens of thousands of households will pick up on the scheme and will be delighted that the bank will allow them that extra lending at no additional fee. I cannot see why the member is so opposed to this programme. It may upset Labour members that we have got the programme off the ground when they could not but essentially they should be supporting New Zealanders getting access to warmer drier homes as a result of participating in this programme. 
Vote Education—Gifted and Talented Education 
7.  
Hon TREVOR MALLARD (Labour—Hutt South) 
 to the  
Minister of Education 
: What changes did she make within Vote Education Budget 2009 relating to gifted and talented education? 
Hon ANNE TOLLEY (Minister of Education) 
: 
 The Government ceased funding for gifted and talented education professional development services through the school support service contracts. That yielded savings of $5.4 million over 4 years. The advice I received was that the funding had a limited effect in small pockets of the country but overall was not delivering system-wide changes in the practices of schools and teachers. The Government is still committed to helping gifted and talented students by providing funding of $5.28 million over the next 4 years to support initiatives for gifted and talented students. 
Hon Trevor Mallard 
: Why were gifted and talented children such a low priority that the Minister singled out their programmes for budget cuts and did not put the savings into more effective programmes for those children? 
Hon ANNE TOLLEY 
: As I have said to the member the advice I received was that those professional development programmes had limited and isolated reach with not many schools benefiting from them. But we are committed to ensuring that gifted and talented students—like all students at school—are supported through the large amount of funding we spend on professional development. 
Nikki Kaye 
: What initiatives is the Government proposing in order to deliver system-wide change to help gifted and talented students? 
Hon ANNE TOLLEY 
: One example would be that in December of this year the Government plans to publish resources to support gifted education in all New Zealand schools including identification tools and quality teaching standards. Those resources are designed to promote system-wide change to help gifted and talented students rather than the very limited and isolated change that the spending on professional development has produced so far. 
Hon Trevor Mallard 
: Why are children from a generally privileged background in private schools and elite integrated schools being given money taken from gifted children in State schools? 
Hon ANNE TOLLEY 
: Again as I have already stated in this Chamber I am confused by that member’s stance on independent schools. On the one hand he is saying that they save the State money but on the other hand he is saying we should not be giving them any funding. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. You and I have corresponded on the issue of authentication and factual correctness in answers from Ministers. In this case the Minister is misquoting—as she did earlier—my blog on the site Red Alert. She has an obligation if she is quoting me to do it accurately. 
Mr SPEAKER 
: The member cannot dispute an answer by way of a point of order. On this occasion it was a point of order; last time this matter arose I was wrong and it was not a point of order. The member has raised a point of order and he cannot dispute an answer that way. However I ask the Minister to come more directly to the question the member asked. It has taken an awfully long time to hear an answer. 
Hon ANNE TOLLEY 
: I said to the member that the professional development services that were being delivered—that $5 million that we have taken from the Budget—was not delivering system-wide change. We are looking for system-wide change for gifted and talented students across the country. They deserve to have support. That is what we are attempting to achieve through both professional development across the board and the specific initiatives we are putting into place. 
Hon Trevor Mallard 
: Did she cut the money from gifted and talented education professional development because she was captured by politically correct officials who do not believe in nurturing tall poppies? 
Hon ANNE TOLLEY 
: No. 
Prisons—Capacity 
8.  
SHANE ARDERN (National—Taranaki - King Country) 
 to the  
Minister of Corrections 
: What reports has she received on prison capacity? 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 I have received several reports on the looming prison capacity crisis that this Government inherited. This crisis was first signalled in the briefing to the incoming Minister which noted: “An immediate concern is the prospect that existing in-use capacity is exhausted by mid-2010.” Since then I have received other reports from the department on the crisis. The Government has been forced to take immediate action to ensure that the Department of Corrections does not run out of beds next year. 
Shane Ardern 
: What options are being considered to address the looming capacity crisis? 
Hon JUDITH COLLINS 
: Unlike the previous Government this Government is working to ensure that we can house those prisoners. We need to deal with the fact that we will run out of baseline beds next year. Double-bunking and increasing capacity on existing prison sites using containers are viable short-term solutions. Justice sector forecasts point to an extra 5000 prison beds being required by 2018. Clearly we will also have to build a new prison and collectively we also need to try to reduce the number of people going to prison in the first place. 
Hon David Parker 
: Does the Minister take pride or shame in the fact that New Zealand has the second-highest rate of imprisonment in the developed world after the USA and how will keeping prisoners in containers reduce reoffending rates? 
Hon JUDITH COLLINS 
: Actually it is a national disgrace for this country to have the second-highest rate of incarceration after the United States. I have to say that it is a bit rich for that member to ever try to say anything about it because when his party took power there were 5000 prisoners in our prisons and now there are 8500. That is the legacy that Phil Goff left us with. 
Shane Ardern 
: What reports has she received on the cost of using containers at existing prisons? 
Hon JUDITH COLLINS 
: The latest costs I have from the department are for a landed per bed cost of $7625 and a plugged-in cost per bed of $53000 to $63000. That includes hardening concrete base service connections and unit-based infrastructure. Those costs could fall further given the interest in providing these containers that is being shown around the country. Containers are a viable and cost-effective solution and whatever option we choose we would have to provide a secure clean and humane living environment for prisoners. 
Maori—Open Access to Universities 
9.  
KELVIN DAVIS (Labour) 
 to the  
Minister of Maori Affairs 
: Does he stand by his statement “Maori students should be granted open access to universities at any age with no qualifications”; if not why not? 
Hon Dr PITA SHARPLES (Minister of Maori Affairs) 
: 
 Tena koe Mr Speaker. Yes I do. 
Kelvin Davis 
: How does allowing open access for Maori to university address the core issue of Maori underachievement at school? 
Hon Dr PITA SHARPLES 
: The member is right; it does not. We have had 60 years of challenging secondary schools to increase their work rate. Fifty-one percent of Maori boys leave secondary school with no National Certificate of Educational Achievement (NCEA) qualifications. We have a trial programme that allows Maori into university at some institutions without any qualifications then they do a bridging course to bring them up to standard and then they enrol in first-year papers. The other part of my request was that kaupapa Maori be introduced into the teaching at universities. 
Kelvin Davis 
: Why does the Minister want to give Maori free access to university at any age when the current policy allows open entry to university for all students from the age of 20 anyway? 
Hon Dr PITA SHARPLES 
: Part of the reason is the way that some teachers allocate subjects in years 9 10 and 11 to Maori students means that they are automatically taken away from the university entrance programme. A recent thesis produced by Margaret Taurere of Auckland University details subject choices and how they are made. Maori families do not know about that and there needs to be an education programme. But basically secondary schools have to lift their work rate. 
Te Ururoa Flavell 
: Tena koe Mr Speaker. Kia ora tatou. How does the Minister account for the fact that Maori students have the lowest rates of progression from school to tertiary education of any ethnic group and what is he doing about it? 
Hon Dr PITA SHARPLES 
: Over the years I have tried just about everything and still there is that gap in achievement in secondary education. As I said 51 percent of boys leave school with no NCEA qualifications. As the Associate Minister of Education I am running out the kotahitanga programme in more schools. I have an education programme for school principals to get them in the groove so they know what is required for Maori students. I will establish a trade academy and I have a literacy programme in South Auckland which I will be announcing very shortly. I am working on kaupapa Maori programmes kohanga kura wharekura and whare wananga and my task force on the economy has a transition programme to get secondary students into the tertiary sector. 
Kelvin Davis 
: If the Minister is concerned about providing bridging courses to better prepare Maori students for tertiary education why did he vote in favour of a Budget that cut funding to adult and community education for literacy and numeracy courses that prepare many Maori for higher education? 
Hon Dr PITA SHARPLES 
: As part of our arrangement with the National Government we give them confidence and supply— 
Hon George Hawkins 
: Sell-out! 
Hon Dr PITA SHARPLES 
:—a lifetime of working for one’s people is not being a sell-out so I tell that member to start learning—and that is the reason. 
Te Ururoa Flavell 
: Can the Minister explain why lifting the number of Maori people with degree-level qualifications is important to him? 
Hon Dr PITA SHARPLES 
: Maori people with degrees have a high participation rate in the workforce of 90 percent they have a strong resilience to unemployment of 3 percent and they earn 150 percent more than Maori people without degrees. At the macro level increasing the returns of Maori labour is the single most important action for improving Maori prosperity and ensuring that more Maori students get degrees is paramount. 
Kelvin Davis 
: Does the Minister still believe that he has no chance of getting the Government to agree to allow open entry of Maori students at university; if so is that statement an admission that the National Government is not listening to his views as either the Associate Minister of Education or the Minister of Maori Affairs? 
Hon Dr PITA SHARPLES 
: There are two answers to that question. Firstly Victoria University took my suggestion very seriously as did the Auckland University of Technology and will look at it. Secondly it is vital that we attack the problem of secondary schools not performing in terms of Maori youth. That is why I am highlighting the point that if secondary schools will not step up and deal with that problem then we go elsewhere such as universities to deal with it. 
Legal Aid—Public Defence Service 
10.  
CHESTER BORROWS (National—Whanganui) 
 to the  
Minister of Justice 
: What recent changes has he announced to the Public Defence Service? 
Hon SIMON POWER (Minister of Justice) 
: 
 The Public Defence Service which is administered by the Legal Services Agency is an in-house service providing criminal legal aid and duty solicitor services for up to one-third of all legally aided defendants in Auckland and Manukau courts. As part of the Budget the Government is providing $5.3 million in the year to come to expand that pilot service from the courts in Auckland and Manukau to include courts in Waitakere North Shore Pukekohe and Papakura. 
Chester Borrows 
: How has the Public Defence Service demonstrated its effectiveness? 
Hon SIMON POWER 
: A recent value-for-money analysis found that the flow of Public Defence Service cases through the court system led to a two-thirds reduction in jury trials resulting in material savings in court time and cost. That backed up an earlier evaluation. Those savings were achieved with no difference in outcome for the client as measured by overall conviction rates. 
Chester Borrows 
: Has he seen any other evidence regarding the working of the Public Defence Service? 
Hon SIMON POWER 
: Yes I have. Earlier this month I sat in on a session at the Manukau District Court where I was able to see the Public Defence Service in action. I was very impressed with the level of preparedness of the public defenders and the speed with which cases were progressed through the court. 
Dr Richard Worth—Confidence 
11.  
Hon PETE HODGSON (Labour—Dunedin North) 
 to the  
Prime Minister 
: Why did he lose confidence in Dr Richard Worth as a Minister? 
Hon JOHN KEY (Prime Minister) 
: 
 I refer the member to the response to question No. 12 on Tuesday 16 June. 
Hon Pete Hodgson 
: When the Prime Minister came to the view that he had lost confidence in Dr Richard Worth was he in possession or not in possession of substantive information that is not yet available to the public? 
Hon JOHN KEY 
: When I did that that was the point at which I lost confidence in Dr Worth. I did not believe that his conduct befitted that of a Minister. I will not go into the specifics of the information but I think members can rest assured that in losing confidence in Dr Worth I was satisfied that I could make that case. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. That was a very direct question. It asked the Prime Minister whether he was in possession of material not yet in the public arena. The Prime Minister did not address that question. 
Mr SPEAKER 
: The Prime Minister indicated that he did not intend presumably in the public interest to go into the matter in too much detail. The member obviously has a further supplementary question. I will listen very carefully to the Prime Minister’s answer. 
Hon Pete Hodgson 
: Let me put the question again then. When the Prime Minister came to the view that he had lost confidence in Dr Richard Worth was he in possession or not in possession of substantive information that is not yet public? 
Hon JOHN KEY 
: I will not go into the specifics of the information I had when I lost confidence in Dr Worth because I do not believe it is in the public interest to do so. 
Hon Pete Hodgson 
: I raise a point of order Mr Speaker. I pointedly did not ask the Prime Minister to tell us what the information was and the reason for that is that the Prime Minister had already advised the House last week that it was not in the public interest for him to divulge it. The question is whether he had that information in the first place and that question has not been addressed. 
Mr SPEAKER 
: I take the point that the member has made. He is not asking what the information is; I take it that he is asking whether the Prime Minister had any information at the time he lost confidence in the Minister that was not in the public arena. It is totally up to the Prime Minister whether he answers on that specific issue. I invite him to consider whether he can answer the question as to whether he was in possession of any information that was not in the public arena. 
Hon JOHN KEY 
: I do not think it is in the public interest to go into those specifics. 
Hon Pete Hodgson 
: I raise a point of order Mr Speaker. In summary I submit to you that it is not the Prime Minister’s choice whether he advises us— 
Mr SPEAKER 
: Is this a point of order? 
Hon Pete Hodgson 
: Yes it is. It is a point of order under Standing Order 377(1). My submission is that the Prime Minister does not have the discretion to decide whether he wishes to address the question. Standing Order 377(1) is a two-part Standing Order. The second part talks about the public interest and how that point might be invoked to not address a question. Otherwise the Minister must seek to address the question. Mr Speaker I put it to you with humility that you are obliged—[ 
Interruption 
] 
Mr SPEAKER 
: This is a point of order; it is a serious one. 
Hon Pete Hodgson 
: —to uphold the first part of Standing Order 377(1). To briefly recapitulate I say that the question is determinedly—on purpose obviously—a narrow question. The question does not seek to learn what information is being withheld; it seeks to learn whether information is being withheld. Mr Speaker I believe that you are bound to have the Minister seek to address that. 
Mr SPEAKER 
: I appreciate the seriousness of the point of order that the honourable member has raised. He may note that when the point was raised by the Hon Trevor Mallard I put the particular issue of his question to the Prime Minister and I think I summarised it reasonably when I put that to him. It was the Prime Minister’s judgment that it was not in the public interest to answer that particular question and as Speaker I cannot judge that because I do not know what information may or may not have been received—I am not in a position to judge that. In this case only the Prime Minister can be the judge of whether it is in the public interest to divulge that information. Standing Order 377(1) makes it very clear that it is the right of a Minister not to answer a question and that constitutes addressing the question. If a Minister says that it is not in the public interest for him or her to answer a question he or she has addressed the question as required by that Standing Order. Therefore I believe that the House has to accept the Prime Minister’s judgment that it is not in the public interest to answer that question further. 
Hon Pete Hodgson 
: I raise a point of order Mr Speaker. Speaking to your ruling if I may raise another point of order under Standing Order 377(1) I submit to you that because the question is only about whether the Minister has information for him to not answer it is disorderly. If let us say the Prime Minister has no information then he has already told the House that he is withholding information under the second part of Standing Order 377(1) and has in fact contradicted himself in the course of a week. If on the other hand he has information that he is not of a mind to impart—and no one can require that of him; it is his choice alone—then it would seem to me that he is obliged to tell the House that he has information so that we can put to one side the possibility that he does not. 
Hon Gerry Brownlee 
: Not only is Mr Hodgson challenging the ruling that you just made but also he is seeking to undo the ruling by Speaker Hunt Speaker’s ruling 157/8 which says: “A member cannot demand a ‘yes’ or ‘no’ answer to a question.” As the question was put to you by Mr Hodgson just then he is effectively asking for a yes or no answer. The fact that he did not put on the end of his question: “…yes or no?” is irrelevant. That is the nature of the question. The Prime Minister has answered as adequately as is possible under the circumstances. Parliament should allow that to be the case. Numerous Speakers’ rulings in here which I do not want to necessarily refer to make it very clear that although members may not be satisfied with an answer to a question that does not necessarily mean that the answer itself has in any way breached the Standing Orders. I support the ruling that you have just given. It makes it clear that if the Prime Minister determines that carrying on with this exchange in the way that Mr Hodgson wants is against the public interest then that determination should be accepted by the House. 
Hon Trevor Mallard 
: Speaking to the point of order Mr Speaker. 
Mr SPEAKER 
: This is the last one I will listen to. 
Hon Trevor Mallard 
: I think I might be going down a trail of irrelevance here but in considering the matter raised by Mr Brownlee I ask you to consider also Speaker’s ruling 163/2—again from Speaker Hunt—which says: “Ministers have a responsibility to the House and through the House to the country to account for the public offices they hold.” It goes on to say that Ministers should wherever possible answer questions. I have been contemplating the Prime Minister’s reply in this particular area and unlike my colleague I think I can contemplate one particular circumstance where it would not be in the public interest for the Prime Minister to answer the question. It is not a police matter. If it is a police matter then it would not hurt the Prime Minister to indicate that he held information; he would not have to say where it came from. I think the only area that it could possibly be is a security matter and I think in leaving it like that if it is not a security matter he is leaving Dr Richard Worth’s name— 
Mr SPEAKER 
: Order! 
Hon Gerry Brownlee 
: That was a very eloquently delivered piece of complete irrelevance from the Hon Trevor Mallard. It is interesting to note that on the same page of the  
Speakers’ Rulings 
 once again Speaker Hunt notes: “Question time is a political exchange. The adequacy of the performance of members whether in Government or in Opposition is judged on a political basis.” This nature of exchange is exactly that and as I have said I do not think the point raised by Mr Mallard is relevant. Your ruling should stand. 
Hon Peter Dunne 
: Speaking to the point of order Mr Speaker. 
Mr SPEAKER 
: OK I will hear the Hon Peter Dunne but I do not want to take much further time on this. 
Hon Peter Dunne 
: I just draw your attention to Speakers’ rulings 162/3 and 162/4 particularly with reference to the public interest. In 162/3 Mr Speaker Steward in 1892 and Mr Speaker Gray in 1991 ruled that the determination of the public interest was “in the opinion of the Minister interrogated”. In 162/4 your predecessor Madam Speaker Wilson ruled in 2008 that “ultimately the judgment of whether a particular reply is consistent with the public interest is for the Minister to make.” My submission today is as it was last week: the determination whether the public interest criterion is satisfied rests not with respect with you as Speaker but with the Minister who is being questioned at the time. 
Mr SPEAKER 
: I thank honourable members; I think all have made valuable contributions to what I accept is a sensitive issue. But at the end of the day members will note that I have—in fact today a couple of times—asked members to not just address a question but answer some questions. But the quid pro quo as the Standing Order intends of Ministers being required to answer questions is that if in their view it is not in the public interest to do so they can say so and actually not give an answer. The Standing Order makes it very clear that it is possible to do that. The fact that a Minister chooses to do that tells a lot about the nature of the question etc. and it actually says a lot in itself when the Minister or on this occasion the Prime Minister chooses to do that. So I think that as the Hon Peter Dunne pointed out the House has to accept that where a Minister invokes the public interest the Speaker and the House have to accept that judgment on behalf of the Minister. I would far sooner have a Minister say it is not in the public interest than waffle on for half an hour about irrelevant stuff. I believe it is the proper implementation of the Standing Order. 
Hon Pete Hodgson 
: Does the Prime Minister believe that his trenchant refusal to seek to address questions on this matter is a good look? 
Hon JOHN KEY 
: Yes it is because it shows that the Government is focused on the issues that really matter to New Zealanders and that the Opposition is in the gutter. 
Hon Pete Hodgson 
: Given that the Prime Minister said last week that he “acted fairly but firmly and swiftly.” how might the public judge whether he acted fairly but swiftly and firmly when he has chosen not to tell them what he was acting on or even whether he was acting on anything at all? 
Hon JOHN KEY 
: Firstly because they can tell by the actions. I know the Opposition is not used to a Prime Minister who acts but this side of the House is. That is the first point. The second point is that in the end the test of whether a Minister enjoys the confidence of the Prime Minister is a subjective test in the same way that it is a subjective test whether someone is promoted to Cabinet. 
Wine—Testing Requirements 
12.  
COLIN KING (National—Kaikoura) 
 to the  
Minister for Food Safety 
: What changes have been made to the testing requirements for wine? 
Hon KATE WILKINSON (Minister for Food Safety) 
: 
 On my instruction to reduce business compliance costs the New Zealand Food Safety Authority has removed the requirement that all wine destined for the European Union must be sent to Auckland for testing and now wine will be able to be tested closer to a winery’s own operations. [ 
Interruption 
] 
Hon John Key 
: I raise a point of order Mr Speaker. I am sorry to interrupt the member but the member Mr Mallard has been accusing me of being a liar and I think that is inappropriate in this House. 
Mr SPEAKER 
: On a couple of occasions during question time today I have heard the Hon Trevor Mallard interjecting exactly that. Offence has been taken on this occasion and I ask the member to withdraw and apologise for it. 
Hon Trevor Mallard 
: Before I do that Mr Speaker I make it clear— 
Mr SPEAKER 
: Order! 
Hon Trevor Mallard 
: I did not make the comment! 
Mr SPEAKER 
: The member will leave the Chamber for the rest of the day. 
Hon Trevor Mallard 
: For not making a comment? For goodness’ sake! 
Mr SPEAKER 
: The member will not dispute the Speaker. [ 
Interruption 
] And if he is not careful he will be named. [ 
Interruption 
] 
Hon Trevor Mallard withdrew from the Chamber. 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. I appreciate that we have to take this issue carefully. I think the issue was that Mr Mallard was trying to communicate to you that he had not used the phrase that the Prime Minister had accused him of making. Mr Mallard said he was happy to withdraw if he had breached parliamentary procedure by using an unparliamentary term but Mr Mallard did not say the very word that the Prime Minister said he had used. I heard what Mr Mallard said; I am happy to repeat it for you if that is of use to you. To eject a member and threaten him with being named when you had directed him to withdraw and apologise for something that he had not said and when you did not ask him to clarify what he had said does seem like Mr Mallard has paid a very high penalty. 
Mr SPEAKER 
: The matter is very simple. Today during question time I have listened to the Hon Trevor Mallard interjecting inappropriately on a number of occasions. I have pulled him up on a couple of occasions. The problem at the end was that when I asked him to withdraw and apologise for it because offence had been taken he started to dispute with the Speaker. I will not tolerate that. The manner in which he did it was the problem; it was not that he had interjected. He could have withdrawn and apologised for that. It is not a difficult thing. The dignity of the House was totally destroyed by the way that the member behaved and I will not tolerate that in the House. 
The honourable member will just have to learn to control his anger. It would have been perfectly within my right as the Speaker to have him called back into the House and have him named. I have not done that because I do not want to do that but the member will have to learn to behave with a little more decorum. He is a senior member. He has the authority from the Labour Party it seems to raise points of order on behalf of the party. The shadow Leader of the House appears to allow him to do that on a number of occasions. If he is going to do that he has to respect the House and respect the dignity of the House and not behave in the way that he did just now. He will be out for the rest of this day and he will learn to behave in a manner befitting the dignity of this House. 
I did not make that decision lightly. Members will note that I resisted the temptation. In my time in the House I have seen members named for that kind of behaviour as they left the Chamber. I did not want to do that because I realised that the member had lost the plot for a moment and he was angry. That is the end of the matter. But I want all members on all sides of the House to realise that it does not matter about me as the Speaker; it is the treatment of this House. This House will be treated with its proper dignity. 
Hon John Key 
: I raise a point of order Mr Speaker. Let me make it quite clear. On numerous occasions Mr Mallard yelled out at me: “Your nose is growing. Your nose is growing.” I think everyone understands what Mr Mallard meant by that. I took offence at it. The reason I took offence is that Mr Hodgson may not like the fact that I have not answered questions in the way that he would want but I have not done so because I am a liar or have misled New Zealand in any way; I have done so because I do not believe that it is in the public interest to answer those questions in the way that he would want. That is a vastly different proposition. I recognise Opposition members’ dissatisfaction with that and they are entitled to be dissatisfied but I am also entitled to answer questions in the way that I perceive to be in the public interest. There was no ambiguity about the implications of the statements that Mr Mallard made. Members will know that I have been in this House for 7 years and I have virtually never asked members to apologise but I will not put up with Mr Mallard implying very clearly that I am a liar. I am not. 
Hon Darren Hughes 
: I think what the Prime Minister has just offered the House goes directly to the point I have made to you. The Prime Minister took a point of order and accused Mr Mallard of calling him a particular word. Mr Speaker it was that which made you get to your feet and reprimand Mr Mallard. As you rightly said he had said that word earlier in question time and without hesitation withdrew it. But the Prime Minister who brought the issue to your attention by way of a point of order used a different word from what he has now admitted in his second point of order was actually said. 
The other point I would make is that you have given a long dissertation about your views on Mr Mallard using your authority as Chair in a way that I do not think we have ever seen; it was quite a detailed explanation given by somebody in the Chair. Mr Mallard has been penalised in this case for something that the Prime Minister himself who was the person who complained now admits was a false accusation about what Mr Mallard had said in the first— 
Mr SPEAKER 
: Order! 
Hon Bill English 
: Sit down! 
Mr SPEAKER 
: The member will resume his seat. And there will be no interjections even from the Deputy Prime Minister. I have let these points of order go on long enough because I realise that the House is concerned about the actions I have taken. But I say to the Hon Darren Hughes that anyone who thinks that what the Hon Trevor Mallard said was not an insinuation of lying does not have half the intelligence that I attribute to the Hon Darren Hughes. To insinuate a member is lying is out of order. It has been well—please do not dispute me while I am in the Chair. I have not asked many members to leave this House. But I will not have the dignity of this House insulted by members behaving in the way that the Hon Trevor Mallard has behaved just now. I will not tolerate it. It is up to members to treat this House with dignity. That is the last thing I will say on this matter. 
We were on question No. 12. I think Colin King has a supplementary question. 
Colin King 
: I raise a point of order Mr Speaker. Can I seek your indulgence if not the House’s indulgence to put the original question to the Minister again? 
Mr SPEAKER 
: I will let the member put his question because I think the honourable Minister had not finished answering it. 
Colin King 
: What changes have been made to the testing requirements for wine? 
Hon KATE WILKINSON 
: On my instruction to reduce business compliance costs the New Zealand Food Safety Authority has removed the requirement that all wine destined for the European Union must be sent to Auckland for testing and now wine will be able to be tested closer to a winery’s own operations. It makes sense that wine should be allowed to be tested at any appropriate lab rather than forcing wineries to send everything to Auckland. I thank the National MPs who lobbied so effectively on behalf of their local winemakers who had expressed frustration over the current process. 
Colin King 
: What reports has she seen in response to this announcement? 
Hon KATE WILKINSON 
: South Island laboratories have already indicated that they want to offer testing services so wineries should soon have a choice of providers and an opportunity to reduce their costs. Wine exporters have already expressed their support with the New Zealand Winegrowers Deputy Chairman Steve Green saying that he is pleased to see that the Government is supporting New Zealand wineries. 
Imprest Supply (First for 2009/10) Bill 
First Reading 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I move  
That the Imprest Supply (First for 2009/10) Bill be now read a first time. 
Bill read a first time. 
Supplementary Estimates 
Imprest Supply Debate 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I move  
That the Appropriation (2008/09 Supplementary Estimates) Bill and the Imprest Supply (First for 2009/10) Bill be now read a second time 
. The presentation of these bills to Parliament is an opportunity to reflect on the drastic change in the fiscal outlook that has occurred in the last 8 months in New Zealand. Back in 2008 the Government was forecasting fiscal surpluses with some cash deficits over the next 4 years. In Budget 2009 because of the impact of both the New Zealand domestic recession—in train since the beginning of 2008—and the later impact of the global recession that fiscal outlook has changed dramatically. The Budget outlined plans that show that the Government now faces 10 years of deficits and more than a doubling of public debt. That is after making substantial decisions in respect of tax deductions contributions to the New Zealand Superannuation Fund and other decisions including having a smaller operational allowance for new spending for Budgets over the next 10 years. 
It is important to remember that surpluses give us positive choices; deficits tend to give us more difficult choices. The Government has started out on a process that reflects the reality that fiscal constraint is now a permanent part of the Government’s plans. That is not a matter of ideological conviction or the democratic choices that the public make about Governments; it is the way the world has changed and it is a product of past misdirected policy under the previous Government. 
A bit of analysis of Government spending shows that the Government’s books are now significantly out of balance. Over recent years entitlements and Government spending have grown rapidly particularly under the Labour Government since the 2005 election. The effect of this is that when we calculate what is called the primary balance—that is Government revenue and expenditure excluding finance costs—we see that it is now significantly larger than anything that the New Zealand Government has seen in the last 25 or 30 years. Certainly the primary deficit is significantly larger than it was in the late 1980s which was the last time close attention was paid to New Zealand’s fiscal situation and a lot of Government policies were focused on remedying that outlook. 
The Government made a critical decision in respect of the Budget which is reflected in these bills and that was to continue with the election undertakings that it had made. This has the effect that through this next financial year the Government will continue to grow public spending at a fairly significant rate. We are doing that because we believe that it is important to support the economy through the most difficult part of this recession which we are in now. This will be a very tough 12 months; we have already seen rising unemployment and dropping tax revenues. At the same time we have set out a plan to get on top of rising debt over time. 
It is important to remember just how we got here and whom people should look to when they realise that they have to deal with some difficult issues. The last Government left this economy in much worse shape than its members believed and certainly in much worse shape than the public were led to believe. It is pretty straightforward: the economy was in recession through 2008 and that recession was caused by domestic excesses. Those excesses consisted of rapid growth in Government spending a lot of misdirected spending by the Government an asset bubble in the housing market a record current account deficit and appallingly low productivity growth through that time. Those factors left this economy in a weak state to handle the onset of the global recession. 
To turn to the Government books I say that this Government has had to deal with the global recession in the context of Government books that were already headed into deficit despite 10 of the best years of economic conditions that this country could have enjoyed. It meant that in Government we found ourselves starting not from the start line but from way behind. There was a dysfunctional immigration service a dysfunctional corrections service and a health and education sector that had been pumped up with large increases in funding and negative productivity growth. 
We have had to deal with particularly bad decisions around investment and a shortfall in accident compensation funding of $300 million a year—or $1 billion over the forecast period covered by the Budget—just because of neglect and bad management. KiwiRail was a black hole if ever there was one. The previous Government decided it was worth $700 million plus a set of concessions to the previous owners and it seemed to be intent on setting it up as a Government department. We have had to contribute something like $145 million to keep it running. We will have to put some basic investment into it next year but over the next few years that looks to be nothing like enough. So we have to clean up that particular mess. 
Along with that a whole set of regulatory changes were made that treated businesses as golden gooses that would keep laying eggs but that needed to be punished in case they were too successful. We have had to initiate sweeping regulatory reforms in order to create the kind of business environment where people will invest so that we can have employment because it is not until businesses invest that we can get the unemployment rate down. There will not be one new job until a business decides to invest and to employ someone. 
When people are concerned about the choices the Government is making they should lay the blame for that concern at the feet of Labour. We are cleaning up a mess left by an economically illiterate and fiscally reckless Government. Cleaning up that mess was always going to involve some difficult choices but the fact that the global recession has come on top of that will really test our capacity. 
I am impressed with the way that much of the Civil Service has decided to shift its framework now that the outlook has changed—not just the change in Government but the change in the economy. However some parts of the Civil Service do need to adjust a bit more to the realities. 
This Government has strongly supported the police. We are pouring millions of dollars into the police force in order to help the police to do their job. We are pouring money into Tasers so that police can be safer and into DNA testing in order to give them more capacity to resolve crimes. However I am not sure that the police are in step with the public in looking for a 4 percent pay increase. The police get a 2 percent pay increase regardless. That increase by any standard in respect of the rest of the community is quite generous especially compared with people who are losing their jobs and taking pay cuts. The Police Association is claiming 2 percent above that. This part of the public sector probably has the most secure jobs in New Zealand. The New Zealand Police has the strongest political backing of any Government department with the Government pouring so much money into the police and I think the association would do well to check whether it is reflecting the views of its membership and the communities that those members are serving. 
This legislation is part of a programme that the Government has embarked on to get the books back in order but more important it is the first step in a 3 to 5-year programme to deliver smarter and better public services to the public for the same or less funding. It is going to be a challenge but it is one we are up to. Just a few years ago Government departments were spending considerably less than they are now—in some departments it was 30 percent or 40 percent less—and at that time they were meeting many of the needs of the public. Those needs are going to grow in the recession; we are determined to meet them. 
Hon DAVID PARKER (Labour) 
: 
 The previous speech by the Minister of Finance Bill English should be contrasted with what he was saying before the election as the Opposition spokesperson on finance. He was saying to the electorate that they could have everything that they had under Labour plus tax cuts. He was not saying that the social spending or tax credits that surround both Working for Families and KiwiSaver were profligate. He told people that those policies were there they were secure they were good policies and people could rely upon National to protect them and superannuation—people could have everything they had under Labour plus tax cuts. 
He was warned before the election by journalists that Lehman Brothers had failed and the IMF was giving warnings of a major slowdown in the world economy. Those facts were put to Mr English when he was the Opposition spokesperson on finance and he was asked whether as a consequence the promises that he was making were unrealistic and unaffordable. He denied that they were. He made promises that he knew could not be kept in order to win the Treasury benches. Straight after the election we were here under urgency passing legislation for those unaffordable tax cuts. Not only were those tax cuts unaffordable but also they were so weighted to those who were already well off that they were terribly unfair. They were patently unaffordable and that was proven within 6 short months when we were back here in this Chamber reversing some of those tax cuts that we had voted for under urgency prior to Christmas. 
The Minister of Finance continues to pretend that his Government inherited a difficult set of cards but his Government inherited one of the best fiscal positions in the Western World. The third-lowest Government debt in the OECD is a wonderful set of cards to inherit in a time of recession not a difficult set of cards. The Minister has had more room to move than virtually every other Minister of Finance in the developed world. He should not complain to members of the previous Labour Government that we left a situation that was in a parlous state because nothing could be further from the truth. When Mr English last left Government—he was Minister of Finance in the last National Government—the Labour Government inherited Government debt of 38 percent of GDP. When the Labour Government gave back the Treasury benches to the National Government following the last election the National Government inherited Government debt that was less than 18 percent of GDP. 
Today the Prime Minister heralded the fact that New Zealand’s unemployment rate is in his view not too bad because it is at 5 percent when some of the rest of the world have higher rates. In a numerical sense that is true but who should get credit for that? The prior Government oversaw real growth in this economy. That growth saw New Zealand’s unemployment be the lowest or second-lowest rate in the world a position we swapped from time to time with South Korea. That is the legacy the Labour Government left to the incoming National Government. 
Mr English says that productivity growth was low in the period prior to the election. On an annual basis during the 9 years of the Labour Government growth in New Zealand was higher than it was in Japan the USA the European Union the United Kingdom and even although just slightly Australia during that period. It is true that growth in labour productivity during that period was not high but that is the statistical effect of reducing unemployment. If we have unemployment going down to the very low levels that we had in New Zealand the last people who are back in the jobs are the lowest skilled. Similarly the first who get laid off and cannot get a new job are generally the lowest skilled. Ironically when we have reducing unemployment we can also have low rates of increases in labour productivity. Mr English knows that well but he denies it in this House. 
There are a number of criticisms that can be made of the Budget. This Budget does very little to set up New Zealand to come out of the recession in a stronger position than we went into it because it takes money away from the training of people who through no fault of their own are normally made unemployed. It does not fund their training whilst unemployed. Sir Roger Douglas presided over the finances of this country in a very difficult time in the 1980s and he did some good things and some bad things. I congratulate him on floating the dollar and some other good things. One of those good things he and that Labour Government did was that in that period of dislocation when there was rising unemployment money was put into the retraining of people who were made unemployed. This Budget does not do that; in fact this Budget reduces payments to a lot of good courses. Let us look at the 9-day fortnight one of the big three ideas to come out of the Job Summit. It is an idea that I think most people in this House inherently think is a good idea if it is well managed but there is no skills package around it. The people who are not in work fully are not getting training as a way to improve themselves and therefore improve the future productivity of our economy. 
I want to deal with one of the exaggerations that we hear from the Minister of Finance relating to the increase in Government expenditure during the term of the Labour Government; Sir Roger Douglas does this too. They both include tax credits in the definition of “Government expenditure”. The Working for Families tax credits—effectively a tax reduction for people with families; over $100 a week per family with children was the average of the Working for Families tax credits that were voted by the previous Labour Government—and the KiwiSaver tax credits that encourage people to save are both counted as Government expenditure under the definition used by the Hon Bill English today and at times by the Hon Roger Douglas. They exaggerate the increase in Government expenditure by including the tax credits which are effectively tax reductions. If they did not agree with those tax credits they would have campaigned against them. But of course the National Party said it would keep them because it agreed that in the end they were a good way to deliver assistance and effective tax reductions to families with children. 
The other big glaring mistake in this Budget—I will not deal with some of the smaller choices like putting more money into private schools rather than public schools—is the issue of superannuation. New Zealand has an ageing population. We currently have approximately 500000 superannuitants in New Zealand and a rapidly ageing population. Baby boomers born from the time of World War II to 1960 are approaching retirement age. Between now and 2030 an additional 500000 of those baby boomers will move into retirement. At the same time the number of people in the workforce will decrease proportionately because we will have fewer working-age people as a proportion of our population. It is obvious that in order to maintain future superannuation entitlements Governments of today need to collect taxes from the people who are working today in order to fund that future superannuation. If that does not occur we create not just uncertainty as to future superannuation entitlements and we certainly do that but also we create intergenerational unfairness because we will have a generation of people expected to fund a million or so people on superannuation from a smaller working population. That would not be fair and it may not be politically sustainable. 
That reality is clear to everyone but it is denied by the National Government as it has stopped contributions to the superannuation fund not for 1 year but for the decade. So there will be $20 billion plus earnings less in that fund in the future when that increased number of people will be reliant on superannuation. As a consequence future entitlements to superannuation are at risk. The likelihood of means testing or age changes or decreased generosity of superannuation is denied by the National Government. It has again broken its promise on superannuation. 
Hon JUDITH COLLINS (Minister of Police) 
: 
 The people most upset with Budget 2009 are those sitting opposite me: Labour Opposition members. They went up and down the country during the last election and told people that a National Government would cut the benefit rates and entitlements of the poorest and most vulnerable but we did not. The angriest people are people like the Hon David Cunliffe—who I thought was about to have a heart attack he was so angry—because we did not do that. In fact the most vulnerable New Zealanders were protected even more than they ever were under a Labour Government. This Budget was not the “Slash-and-burn” Budget that some newspapers had gone to such efforts to have cartoons ready to portray. It was a Budget that was moderate sensible and had new core Crown spending of $2.9 billion combined with recent tax cuts. That is the sort of spending that will help keep this economy going. 
It is very important that we look at the circumstances of the elderly. This Budget locks in national superannuation at 66 percent of the average wage. Every member on this side of the House who went to all the Grey Power meetings during the election campaign had to listen to Labour Party members say that a National Government would cut national superannuation. National members said time and time again that national superannuation would stay at 66 percent of the average wage and by gosh it did! National fulfilled its promises. 
Benefits student support and Working for Families are maintained at current levels despite the worse economic conditions that this world has seen since the 1930s. Every other country is going through the most appalling situation with their economies with 9.5 percent of people in the US now unemployed. That is an appalling situation. Yes we have more people unemployed now than we did a year ago but this time a year ago it was pretty apparent that things were turning for the worst. I remember the Hon Ruth Dyson standing up as the then Minister of Social Development and Employment and skiting that only 290 people had lost their jobs or words to that effect. She said that everything was going to be fine. It was pretty obvious that things were not going to be fine this year—the level of how tough it was going to be was never obvious yet this Government has been able to present a Budget where more money is spent on things that will support the economy and our most vulnerable New Zealanders. 
This Budget provides a $3 billion boost for health over 4 years that is focused on front-line services not on conferences. That is something that really upsets the Labour Party because its view has always been to have a conference a strategy and a report then that is it. Well I say that that is not it. Conferences strategies and reports do not feed one child and they do not make the sick well. Yet in the last few months we have seen the Hon Tony Ryall as Minister of Health show what happens when we have a Minister of Health who is in charge and is on top of his game. 
We have seen $1.68 billion spent on education to raise student achievement. Why do we never hear about that from the Opposition? All those members want to talk about are Moroccan cooking classes that might have be dropped or as we heard today some make-up classes that were dropped—I can understand why the Labour Party is worried about that but the rest of the country is not. People want to know that their money is being spent wisely on creating jobs and in helping New Zealanders to get the education they need. Many New Zealanders will need to retrain but they will need to retrain for jobs and not for hobbies. Six hundred more police will be on the beat by the end of 2011—600 more than there were when we came into office—and there will be 246 more probation workers. 
I will take a little time to talk a bit about the Department of Corrections. When we came into office in December last year we found that in the dying days of the previous Labour Government Phil Goff had been asked for special help by the parole section of the Department of Corrections. But what had happened? That section did not even get an answer. Instead this Government was left with an utter mess. We were left with a parole system that was underfunded and completely under-resourced and that had had a whole lot of community sentences dumped on it without the resourcing for that. For year after year the parole section had cried for help for some budget assistance and some leadership from its Minister. But he was never there; he was always off overseas looking to buy cameras somewhere. 
Instead we have had to pick up this problem and now we have some fantastic results coming out of our parole section. We have some great results. When Mr Goff was last in office 58 percent of our high-risk offenders were complying with parole requirements; now 77 percent are—a complete turnaround in a matter of months—and that is before all the budgetary considerations have come into it. That is what leadership and some more money does—and no I tell Mr English that he cannot have any back. I say we are going to do even better. 
We were also left with a crisis of capacity in the prison service because the previous Government liked to lock up people but it forgot that the housing for that had to be provided. What that Government did provide was extraordinarily expensive. It cost $643000 a bed at the Spring Hill prison. I repeat: $643000 just in case anyone thought I had that wrong. Now all we hear from Opposition members in relation to other solutions about the burgeoning prison population is that the idea was not their idea so it cannot be any good. They do not have one solution despite 9 years of a Labour Government. Instead they have left us with another mess to pick up and we will sort that out. 
One of the other things we could talk about at this point is education. For the building of new schools and the modernisation of existing ones we have budgeted $523 million. Which one of us here has not been to a school in our electorate and thought about what could be done to improve education particularly for our most vulnerable children whose parents do not have any excess money to help their school and for whom their school has to be funded fully in all ways? Here is $36 million to help students meet national standards in literacy and numeracy. We can talk all we like about tertiary education and we can talk all we like about Moroccan cooking classes. We can do all of that but if our children are coming out of school after 10 years’ education and cannot read and write then that is absolutely a national disgrace. It is an international disgrace for a country like this where education has been free for primary and secondary schooling since the Great Depression to have people coming out of schools and frankly filling our prisons. About 80 percent of our prisoners are said not to have numeracy and literacy to the level they should do. Many of those prisoners have never had a chance at education because it has been denied for them from the very start. 
There is $900 million in this Budget for justice initiatives aimed at improving public safety. It is not about writing reports but about improving public safety. It is not about going to conferences—no it is about public safety. There will be 600 more police on the streets at a cost of $182.5 million 246 more probation officers 29 front-line managers and 26 psychologists to improve the quality of parole and home detention management at a cost of $255.9 million. There will be a thousand extra prison beds through double-bunking at five prisons plus planning for additional capacity at the cost of $385.4 million. That is a lot of money; it is a lot of money at a time when this country should have more money in the bank and when New Zealanders should have more money in their pay. Unfortunately so much money was wasted by the previous Government. That Government thought it was much more fun to go and buy a train set—KiwiRail—and burden this country with a debt for years to come. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 I raise a point of order Mr Speaker. Before I take a call in this debate I wonder whether I could remind you of the Speakers’ rulings that prohibit members from moving from their seat to gain an advantage in interjections. Paul Quinn has done that; he has been interjecting not just through David Parker’s speech but also through his own colleague’s speech. It is against Speakers’ rulings. I ask you to bring that to his attention and to ask him to comply with Speakers’ rulings. 
PAUL QUINN (National) 
: 
 As has been mentioned to me—under I think the Speakers’ rulings on pages 62 and 63; I cannot just place my hand on them—that the rules say that a member cannot move to improve his or her position. I put it to you Mr Assistant Speaker that as I think your office has said to me on a couple of occasions with my beautiful melodious voluminous voice it would not matter where I was sitting; my support for my colleague on this side would in fact be the same whether I sat here or sat at the back. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: I do not think that that is particularly helpful. The member raises the Speakers’ rulings about shifting seats to enhance a member’s capacity to interject which presupposes that a member will intentionally do that. On a number of occasions I have said that I am not rigid on this particular rule because I think that it is to the advantage of the House to have people drift down towards this part of the Chamber as members are wont to do rather than have them scattered around the place. It helps to create the ambience of the House. The second point I have made previously is that the people who built this Chamber built it as a debating chamber a chamber that invites interjections—it is not a lecture theatre—and interjections are part of debate. 
So I say to the member that I will ask her to take a call if that is what she wishes. I remind Mr Quinn that interjections should be rare and reasonable and hopefully witty and that the House has taken note of the fact that he has been interjecting quite consistently through this debate. The member might like to take that on board as we hear the remaining speeches. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 I am pleased to be able to take a call on this Appropriation (2008/09 Supplementary Estimates) Bill which Labour opposes. The Budget was a wasted opportunity and the Minister of Finance should be ashamed of his inability to deliver on quite fundamental issues to New Zealanders. He had 9 years in Opposition to prepare a plan to prepare some action and to galvanise support around this Parliament for a Budget that would deliver real opportunity for people but he wasted that opportunity. 
The Budget did nothing at all either to protect or to create jobs for New Zealanders. The biggest opportunity that can be given to New Zealanders is the chance for them to walk out of the door in the morning and go to a paid job but the Minister of Finance has made that chance harder for New Zealanders rather than easier. The Budget fails totally to invest in people our country’s biggest asset. It ignores the opportunity to develop our innovation our skills and our training. During a recession we should be investing in skills investing in people and doing everything we can to give them more security and more opportunity in the future because we will move out of recession into growth again. We could have had a better skilled able workforce ready to take up the chances that improved growth will offer to New Zealanders in future. But that was entirely squandered. There was no investment in the skills and innovation of New Zealanders and not a single thing done to give more security and protection in existing jobs let alone to create additional jobs. 
The Budget repealed under urgency the tax cuts that National bribed its way into Government with prior to the election. This Parliament put those tax cuts through under urgency prior to Christmas and we repealed them under urgency. I have not heard of one single New Zealander who believed Bill English when he said: “We thought tax cuts were affordable but then we found out they were not.” In fact that is not quite correct. I have heard of one such person but he is a member of the National caucus and that does not really count. He fell for that line but he is the single New Zealander who believes the excuse that Bill English and John Key gave to the country. They promised tax cuts when they knew they were unaffordable they rammed them through this House under urgency when they knew they could not be delivered and they repealed them under urgency. 
What opportunity did the ordinary New Zealander have to contribute to that debate? What opportunity have the people earning less than $40000 a year who did not gain 1c from National’s 1 April tax cuts—those ordinary hard-working New Zealanders—had to have any input at all into “now you see it now you don’t” tax cuts? None at all. That is because we know that one-third of the $800 million worth of tax cuts that National did keep in place went to the top 3 percent of income earners in New Zealand. One-third of the total tax cut package went to the top 3 percent of income earners. Are those the people who every week find it hard to pay their electricity bills or their food bills? Are those the people who cannot afford anything at all extra in their houses? Are the people in this Parliament struggling on their incomes? I do not think so. But I know that many of my constituents who work just as hard if not harder than members of this Parliament and do not earn a fraction of the money that we earn in this Parliament got nothing from the tax cuts. They got nothing at all from the National Government’s tax cuts. 
I say that is a disgrace but it is not nearly as bad as the dangling of hope that the Job Summit gave to New Zealanders. People were really hopeful about the commitment to get all the key stakeholders except anyone who voted for Labour or the Greens in a room together get them focused on the fact that we have increasing unemployment in New Zealand and we want to tackle that issue and then drive an action plan led by the Prime Minister. People were really hopeful about the opportunity that the Job Summit gave New Zealanders and now we know that not only were people like the leader of the Labour Party and our employment spokesperson excluded solely because they were Labour but also that we clearly should not have an opportunity to contribute about jobs despite Labour delivering the best employment record in New Zealand’s history during our term in Government. 
But what happened after the Job Summit? Well nothing happened after the Job Summit. The 9-day fortnight? It affected fewer than 350 jobs. For every single job that has been saved that is good. But we are talking about the New Zealand economy where 1000 people each week are losing their jobs. Every week 1000 New Zealanders lose their jobs so 325 people in total is not even half a week’s worth of unemployment under the National Government’s regime. 
People expected something to come out of the Job Summit. Then we thought there is the national cycleway. That was John Key’s idea right at the end of the summit. It did not arise in the workshops nor in his introductory comments nor in any conversation with people who might talk about it think about it and contribute to this idea. Right at the end John Key came up with this idea of having a national cycleway. But Bill English who holds the purse strings said that we would not be having a national cycleway—not this week not this month not next year not ever—under his stewardship. Those were the words that Bill English used in support of his leader and the cycleway. But in the Budget we saw the money for that. 
The money that was taken out of adult and community education and out of scholarships such as scholarships for medical students—genuine investment in skills training for New Zealanders—went into a cycleway that is now being described as a little ride around some regions of New Zealand. I think New Zealanders have already been taken for a ride. They were misled and bribed by National which said before the election: “You can have everything that Labour put in place. We won’t touch any of that and we will give you tax cuts as well.” That was the mantra. That was the Crosby/Textor mantra that went around the country from the National Party: “We will leave everything in place from Labour and by the way you can have tax cuts as well.” People bought that. Now the only part of the cycleway that has been delivered is the ride that New Zealanders know they have been taken on. They were misled in order to bribe National’s way into Government. New Zealanders are rightfully resentful of that. They feel as if their trust has been broken. In my view it certainly was broken. 
We had no investment in skills we had no investment in jobs and the worst trick of all was the one played on superannuitants—not the superannuitants of today but of the future. If the member who resumed her seat immediately prior to my speaking thinks that current superannuitants do not care about the future of the superannuation needs of their sons daughters and grandchildren she is wrong. I am very proud to have been to more Grey Power meetings than any member in this House. Grey Power members are not interested in their own personal well-being as a priority. They care much more about the future security for their children and for their grandchildren. They know that without the investment in the Cullen fund which has been taken away—not just for this year but for a decade—in order to fund the future superannuation needs of New Zealanders when there will be more people over 65 and fewer people under 65 paying taxes to enable us to afford superannuation either the age of entitlement will increase or the rate will go down or it will be a combination of both. We will not have that investment which was developed specifically to partly fund the future needs of superannuation in New Zealand and that is the worst trickery of all. 
ALLAN PEACHEY (National—Tamaki) 
: 
 In this opportunity to contribute to the Appropriation (2008/09 Supplementary Estimates) Bill I begin by referring to the Labour member who has just resumed her seat Ms Dyson. She described the 2009 Budget as a wasted opportunity but let me tell this House what the 2009 Budget was. It was a brave attempt to rescue this country from the wasted opportunities of 9 years of socialist rule. It was 9 years of some of the most sustained prosperity this country has seen being wasted. That crowd over there the Labour Party was more interested in taking that prosperity built up on the backs and the shoulders of decent hard-working New Zealanders through the 1980s and the 1990s to build up a sum of money to buy the 2005 election. The tragedy was not just the buying of an election but also that we then had to put up with 3 years of a Government that had lost its moral compass. That contributed even further to the difficulties that this Government is dealing with in the Budget. 
Members might like to reflect on the Thursday afternoon when the Budget was delivered in this House and on the offerings from the Leader of the Opposition. There was huffing and puffing and puffing and huffing but nobody was listening. Certainly on this side of the House we were not listening. There was pathos in seeing members on the other side of the House not listening but most important of all the people of New Zealand were not listening. The people of New Zealand wanted a very simple speech from the Leader of the Opposition and it needed to comprise only three words: “I am sorry.” He could have said that he was sorry for the mess that the previous Labour Government left the economy in. That is all the New Zealand people wanted to hear: “I am sorry.” Instead we have heard speech after speech from members opposite demonstrating that firstly they do not understand the damage they did to the New Zealand economy during their time in Government and secondly they are totally bereft of ideas. When the Opposition’s finance spokesperson Mr Cunliffe was asked on Radio New Zealand National when Labour would offer an alternative plan the best he could do was to say it would be sometime before the next election. That spokesperson knows that he is bereft of ideas and has not got a clue about how to get New Zealand out of the mess the previous Labour Government left. 
At least the National Government understands the importance of a credit rating. One of this Budget’s many successes was protecting New Zealand’s international credit rating. 
Hon Steve Chadwick 
: Don’t worry about the people. Just worry about the credit rating. 
ALLAN PEACHEY 
: When listening to the interjections coming from the other side of the House and thinking about some of the contributions and speeches from Labour members it becomes clear that they do not care. It does not matter whether it is Mr Cunliffe Mr Goff or any of them. They do not care do not understand and do not know. Well let me tell them something that they should understand. If New Zealand’s credit rating had been downgraded according to the Treasury it would have pushed up interest rates by about 1.5 percent. “So what?” members opposite might ask. Let me tell those members that on a $175000 mortgage that means another $50 a week that a household has to find. I suggest that the next Labour member who gets on his or her feet explains to the people of New Zealand why the Labour Party would be happy to have New Zealanders spend another $50 a week on their mortgage simply because Labour members do not understand and do not care what credit ratings mean. 
Labour is a party bereft of any sort of economic ideas. What has the Government had to deal with? One could probably speak until we rise at 10 p.m. tonight listing the difficulties that the Labour Party left for the new Government to deal with. They include a bloated bureaucracy loaded with unnecessary costs and $2 billion of deferred maintenance of Housing New Zealand Corporation properties. There was an accident compensation shortfall of $1.5 billion. It is not looking very impressive and it gets worse. KiwiRail was valued at half of what the previous Government paid for it. There was also falling economic growth rising unemployment higher inflation a rising current account deficit a deteriorating fiscal deficit and sharply rising Crown debt which was all the legacy of the previous Labour Government. 
Hon Members 
: Oh! 
ALLAN PEACHEY 
: Members opposite might like to listen to this one: annual productivity growth was an appalling 1.1 percent between 2000 and 2008. I do not think that any New Zealander needs reminding that in those years we had a socialist Labour Government a Government that was more interested in building a chest to buy an election than in doing what was right for New Zealand. The Department of Corrections was in need of major overhaul and the Immigration Service was dysfunctional. We could just go on and on. That is the legacy of the previous Labour Government that this Budget is attempting to deal with and that is why the New Zealand people wanted one thing from Phil Goff: “I am sorry.” For a long time the New Zealand public will remember the heroic efforts that went into the 2009 Budget and the failure of the Labour Party to take responsibility. 
In my remaining few moments I will turn to the education provisions of the Budget because there is something quite significant that has by and large not had any attention drawn to it. The Government has allocated $36 million to help students meet national standards of literacy and numeracy. That represents an end to the notion that academic achievement is not for all students. The Labour Party thinks it is not for all students but finally a New Zealand Government has made the statement in a Budget that academic standards and achievement are for all students. For the first time in the history of New Zealand schooling proficiency is being put at the core of education. Thank you. 
METIRIA TUREI (Co-Leader—Green) 
: 
 It has been reported today that some 1000 New Zealanders are joining the dole queue each week. The official unemployment rate in this country has more than doubled in the past year. We have seen major job losses in areas like the manufacturing agriculture forestry and fishing industries which are key productive industries in this country. We have also seen as we expected a major increase in the unemployment level of young New Zealanders; in particular those aged between 15 and 24. This recession is having an impact similar to that of the late 1980s and early 1990s when unemployment rose sharply and viciously leaving ordinary working people without incomes and homes and being treated by the then National Government as if they were without dignity. We are heading that way again with some projecting 20 percent unemployment among young people again under a National Government with no heart and no plan. 
Today in question time the Prime Minister was asked specifically about his plans to protect and create jobs for New Zealanders. He treated the questions about unemployment with contempt choosing instead to treat unemployment as a side issue so that he could crow about his latest polling. Polling is not a plan. It will not create jobs protect families or see us through to the long-term economic sustainability and stability that this country needs. The Prime Minister had no plans and indeed many of the ideas that he proffered this afternoon have already proven to have failed. 
The Job Summit which was lauded at the time as the great hope for new and innovative ideas has failed to produce anything like enough real solutions. It is true that one idea from the summit was successful: the Green Party’s home insulation fund. It was funded to over $300 million in the Budget and will create 2000 new jobs from the programme and protect 700 existing jobs thereby protecting and creating 2700 jobs in total. The Prime Minister might not have any plans and I do not believe he should feel that it is a problem to admit he does not have any plans and that his solutions have failed. But it is a problem if the Prime Minister continues to ignore the solutions that are on the table to protect New Zealanders into the future. 
This Budget desperately needed to address three key issues for our communities. We need to create jobs now through wise infrastructure investments we need to invest now in our communities and our people to create the environment for longer-term sustainable economic stability and we must provide New Zealand families with real income relief right now. 
The Green Party and our Green New Deal—The Green Stimulus Package have solutions that will contribute to all three key goals. Our home insulation fund is one such solution and we will see the benefits of those 2000 extra jobs rolling out over the next year or two. But we have other solutions that we have proffered for this Government. The Greens have calculated that investment of $600 million dollars in the clean-up and protection of our waterways—mainly through the planting and fencing of the banks of waterways—would create over 2000 jobs directly and about 4500 new jobs indirectly. It would have the added invaluable economic return of cleaning and protecting our clean green image on which our tourism is so heavily dependent thereby enhancing our primary production market access restoring tourism opportunities like trout fishing and reducing the dollar and human cost to local communities and farmers of flooding and drought. Those are key solutions to protect the environment and our economy and to create jobs. 
The current waiting list for Housing New Zealand Corporation houses is around 10000 families and rising and it will continue to rise as unemployment kicks in and more and more families lose their homes. Yet half the residential construction capacity is idle in this country. New residential consents have fallen by half since June 2007 which means that about 6000 new homes per year are not being built. That situation is devastating the construction sector. Investing $500 million in the first year and $750 million in years two and three in the building of new homes would give us something like 6000 new State houses for our families. That investment would save 10500 full-time direct jobs and create 18000 new full-time jobs in total across the economy. That would be an investment to keep our families warm dry and housed and to create further jobs across our whole economy. 
Because new road construction is highly capital investment intensive not a lot of new jobs are created for the amount spent. Motorways are the least jobs-intensive of transport projects and make us much more dependent on oil with higher greenhouse gas emissions. Our stimulus package spend creates 40 percent more jobs for every $1 million spent than the equivalent spend on new motorways. Forty percent more jobs could be created. A raft of other transport projects would employ far more people make our cities more liveable improve our transport choices reduce our carbon emissions and make us less oil dependent. They are key solutions to protect the environment keep our families well and create jobs. 
Our solution is to shift the low-quality spend that this Government will make—the $1 billion low-quality spending on motorways—into a range of transport projects: rebuilding and upgrading railway stations and bus exchanges so that people are kept safe warm and dry in them; integrated ticketing; and increasing cycle lanes and walking paths particularly for the many hundreds of thousands of children who want to cycle to school safely thereby reducing emissions reducing cost to their families increasing community safety and creating jobs all through the same solution. 
The Crown loan programme is another example. The lack of sufficient Crown loan funding over recent years has meant that hospital and other efficiency upgrades have not occurred. The savings to our hospitals from efficiency upgrades would go directly into front-line health services. For example $25 million loaned per year for 3 years would create 390 full-time direct jobs multiplied to 874 full-time jobs across the economy. By the same logic the same investment in energy efficiency in Government assets like schools prisons and other Government buildings would continue to build on that job creation thereby protecting the community protecting the environment and creating jobs. 
We need to invest in our communities and our people to create an environment for long-term economic stability. One core means for this is in education. We know that young people will suffer the most from unemployment so we must invest in their future by enabling greater access to educational opportunities. But instead this Government has slashed education funding particularly across the community and adult education sector. We have had a reduction of funding to universities of over $22 million per annum cuts in funding to regional polytechs without any kind of mechanism for other technical institutes and polytechnics or tertiary education organisations to take up the students and about a 50 percent cut in adult and community education funding thereby cutting jobs as well as reducing access to retraining that is so desperately needed. 
The Tertiary Education Union recently described how the Australian Budget put $7 billion extra into tertiary education to deal with the recession in the long term. 
Hon Tau Henare 
: We’re not Australian. 
METIRIA TUREI 
: I say to whoever it was who just interjected that the New Zealand Government could have provided about $1 billion in the 2009 Budget for tertiary education as a per capita response that would be a similar investment into our communities and our people when they need it most. Did the Government do that? No it did not. It cut funding massively thereby reducing the ability of our young people to get access to the education they will desperately need because they will not have the jobs to go to and restricting the ability of older workers to be able to retrain in order to prepare for the time after the recession when we need that long-term stability and economic sustainability. 
We need to provide relief for families who are suffering right now from high credit card and mortgage rates because the banks are benefiting from the cuts in the official cash rate and are not passing on those benefits to our communities. The Green Party has called for an inquiry into that issue because New Zealand families are entitled to have their elected representatives investigate the institutions that are preventing them from being able to get access to the benefits from the official cash rate cuts. New Zealand families are entitled to have their elected representatives stand up for them and say that they must benefit too. 
Hon Sir ROGER DOUGLAS (ACT) 
: 
 New Zealand has two classes of citizens. In New Zealand we all pay taxes yet some people get a bad deal for the money they pay. The people who get the rawest deal are those who are the least well off and the least able to provide for themselves when the Government fails to deliver. We have two classes in New Zealand not because the Government is not doing enough for the poor but because what the Government does for the poor denies them choices destroys the incentive they have to get ahead and subjects them to political abuse. The past 80 years of political control has achieved a larger welfare budget more people on welfare and barriers for those at the bottom to get ahead. Personal taxation in New Zealand takes $25 billion; 54 percent of that amount goes to health a third goes to superannuation and 13 percent goes to welfare. 
Let us look at some of those areas. Superannuation costs everyone one-third of the personal tax we pay. For people who earn a little above the average wage that is almost $4000 a year. Superannuation is not free; it costs and it delivers poor results. Despite the average person paying $4000 every year in tax for superannuation a single pensioner gets $311 a week and a married pensioner gets $239 a week. They pay in well over $200000 during their lifetime for a miserable pension. Our superannuation scheme is designed so that people pay today for the retirement of their parents. If we simply adjusted the system so that the money people pay went towards paying for their own retirement most would get a cushy retirement. If that money was put in the bank and was earning 7 percent nominal interest and 5 percent real interest then the average worker would retire with $1.8 million in the bank. It would like winning Lotto and then retiring. The interest on that money would give you far more per week than you are currently getting. After tax the weekly income of a superannuitant would be around $1210 a week. The difference when compared with current Government superannuation is around $900 and that is without any capital contribution. The present system creates second-class citizens. So why do National and Labour not alter this when they are in Government? It is because National and Labour want to make the people of this country dependent upon them. If the average citizen had $1.8 million in the bank he or she would not want politicians interfering in their lives. 
Let us look at health. Of your and everyone else’s personal tax 54 percent goes towards health care. Saying that it is 54 percent can hide what this means. If you earn the minimum wage you will pay about $2500— 
Mr DEPUTY SPEAKER 
: You have brought the Speaker into the debate a couple of times now. I indicate not to as I am impartial in this matter. 
Hon Phil Heatley 
: He’s a new member! 
Mr DEPUTY SPEAKER 
: I am on my feet. 
Hon Sir ROGER DOUGLAS 
: If a person earns the minimum wage he or she pays $2500 every year for health care. If people earn the average wage they pay over $6396 in health care every year. People say we have free health care. To me it seems that free health care has never been more expensive. When health care costs the average person $6000 a year and costs a two-income family over $10000 a year one would hope that it would really deliver. However it does not deliver. Despite the enormous cost we ration health care. People who are sick get placed on a waiting list and people on waiting lists get worse not better; some die. The suffering that takes place on the health waiting list is rationalised away as if the goal of equality justifies denying health care to people who desperately need it. 
The most pernicious effect of socialised medicine is how it creates second-class citizens in this country. The first way it does so is through a bizarre mixture of subsidies. Some medicines are fully subsidised some are partially subsidised and some are not subsidised at all. Decisions over what medicines one can take are determined not by the patient or the doctor but by some bureaucrat here in Wellington. The second way it creates second-class citizens is how pressure can be applied to get treatments performed. Doctors patients and politicians can all pressure the system to get certain operations performed at the expense of others. If people can get their stories on  
Campbell Live 
 they can be sure they will get a treatment. If people can form a pressure group to get Herceptin subsidised then they will get that treatment. But in socialised health one’s treatment comes at the expense of someone else’s and because the affluent tend to be more politically connected more influential and more organised treatment for the rich comes at the expense of the poor. The third way it creates second-class citizens is the fact that wealthy people can afford to pay twice. They can afford to pay tax for health care and then buy health insurance on top. The very people who are denied this opportunity are the very people whom universal heath care was meant to help. While the poor die on waiting lists the rich pop down to the private hospitals. 
No one would seriously contend that the system treats people equally and the solution to this problem is the same kind of pathetic snake oil we hear from all the political parties in Parliament: that all the problems could be solved if only we would spend more money. What rubbish! When will we wake up to that lie? Under Labour health spending increased in real terms by 50 percent. Despite that huge increase in real expenditure the productivity of doctors declined by 15 percent and the productivity of nurses decreased by 11 percent. Overall the drop was 8 percent. It was only 8 percent overall because the productivity of cleaning and orderly staff surged and those services were outsourced to the private market. This gives a hint of the kinds of benefits that could be achieved if we dropped the pretence and lived up to the reality. Socialised health care has failed. If we simply gave people on the average wage the $6000 they currently pay this would enable them to buy catastrophic insurance put money aside for their health care and retirement and pay for their day-to-day health care needs at the doctor. 
When we look not at the goals of the welfare State but at the actual performance we see that the results are depressing. In the last 80 years we have grown far wealthier than we once were yet there are more on welfare today than before. We have created a system that gives options to those who can afford them and denies choices to those who most desperately need them. We have created a system that taxes and regulates opportunity for the poor out of existence and conscripts them into poverty. We have created a system with two classes of citizenship in this country and at the very same time the solutions put forth by all the other political parties in this Parliament except ACT are more Government spending on health more Government spending on education and more Government spending on welfare. Only ACT stands against the philosophy that is creating two types of citizens. When will we wake up? On its own terms the welfare State has failed. 
Hon TARIANA TURIA (Co-Leader—Maori Party) 
: 
 Kia ora Mr Deputy Speaker. Tena tatou katoa. Last weekend on Saturday night was a chance to sit in front of the fire cheer on the All Blacks and laugh as the painted rooster outsmarted the security team at the Cake Tin. It was a bittersweet victory. A win on the night was not enough to secure the 6-point margin we needed to win the trophy but we got over it. But for five young New Zealanders it did not stop there. They took their anger out on an unsuspecting member of the French rugby team punching him and throwing him to the ground in an unprovoked assault which left the player with a suspected broken eye socket and stitches to the face. 
So what does this have to do with the additional expenses in capital expenditure required for the financial year? Is it just an isolated attack that bears no further comment? If we were to read yesterday’s papers we might find a different story with the headline “Surge in violence during recession”. We could read that the Christchurch women’s refuges have seen a huge jump in the number of women asking for help as the recession bites. The Battered Women’s Trust described an extraordinary increase of 60 percent in the number of women asking for help from about 200 community clients a year ago to about 360 now. 
At the other end of the motu a special circumstances court is being proposed to cater for the increasing numbers of homeless living on Auckland streets. The manager of the Methodist Mission’s Lifewise service has called for a 24-hour service hub as an initial contact point for homeless people. Throughout the country the number of food parcels being given out has increased. The economy continues to lose jobs and people are finding it impossible to stretch the family finances even further. For many of these New Zealanders the recession signals just more of the same. These are the New Zealanders who live on very low levels of absolute income—those people who represent the extreme end of income disparity. 
This is the phenomenon that the Maori Party expected to see addressed in the Appropriation (2008/09 Supplementary Estimates) Bill. Increasing levels of violence homelessness food deprivation and poverty are just some of the effects of the recession that must be spoken about. We have been pleased to support the initiatives that emerged in the Budget process to assist New Zealanders in responding to the impacts of the global economic downturn. The Maori Party has gone on record in looking at the opportunities that may arise for Maori from the $7.45 billion investment in infrastructure or the allocation of up to $40 million for the community responses to the recession. 
But there are other areas that could benefit from further analysis and we have been looking to legislation with poverty in mind. The supplementary estimates go into some detail in specifying appropriations for the Wiri Inland Port’s rail link a screen production incentive fund and a contribution to joint venture airports. There are allocations for participation at Expo 2010 in Shanghai China and there are more appropriations for State highways and railway development. There is investment in generating reserve electricity at Whirinaki and even funding for a transformational initiatives fund. But there is nothing in this legislation that is transformational in terms of eliminating poverty. There is nothing to suggest that the earned income threshold for beneficiaries could rise by $80 or that over-crowding or homelessness will be addressed. 
Although the changes in emphasis regarding infrastructure and transport initiatives are to be expected it is disappointing that the estimates contain so little about incentives for our most vulnerable populations. The Child Poverty Action Group spells out in no uncertain terms that “Insisting on fiscal prudence now at the expense of children will prove to be very short-sighted when the future social costs hit high.” The Maori Party will not neglect the rights of our children. We are committed to the long-term view a view in which whanau ora prevails and a time when marginalisation is reduced. We will speak the words that others may be afraid to say. We will do what we can to prevent poverty to address discriminatory language and to confront social exclusion. 
If we have an eye to the long-term view it will mean that we are clear about the outcomes before we proceed on any policy process. If the problem is that it costs over $600000 to build a prison cell the answer may be far more wide ranging than creating a solution out of converted shipping containers. It is about reintegration and restoration of offenders. It is about reducing the recidivist offender rates and putting in place whanau support to encourage offenders not to turn to crime. If the problem is that approximately 5000 New Zealanders die each year from tobacco use we should not be putting all of our investment into programmes that tell smokers to quit. We would be far better off investing in early intervention and prevention strategies that discourage young people from ever starting to smoke. One of the solutions might be to remove the tobacco from the shop shelves in the first place. If the problem is boy racers we might consider working with the boys themselves which would provide a vital opportunity for change rather than focusing on the vehicles alone. Better yet we might consider supporting youth networks and positive youth employment initiatives. 
All of the investment in reducing hospital waiting lists is in many ways meaningless if the foundation of health promotion is eroded. We must be open to doing as much as we can for those who have the least opportunity. How do we lift the sights of vulnerable children to let them know that their world can change? What does whanau ora mean for them? It should not be a 21st century version of  
Oliver Twist 
 when someone is asking for more when there is no more to be had. 
Last week was Volunteer Awareness Week. If there was one message that came through over and over again it was the demonstration of how rewarding the gift of giving can be. In my role as the Minister for the Community and Voluntary Sector I am constantly humbled by New Zealanders who show their humanity to one another through gifts of time gifts of money and gifts of kind so that they can share. There is nothing more inspiring than to see such generosity transform lives. I see everyday people who have rejected the race to clutter their homes with accumulated wealth and who have instead dedicated themselves to helping others around them. It does not matter how they give; it is the fact that they give in the first place. Let these people become our models in this Parliament in terms of how to restore that sense of common unity that sense of community spirit which will be so critical in our recovery. Kia ora. 
Hon TAU HENARE (National) 
: 
 I want to give members a bit of a history lesson. 
Hon Members 
: Oh! 
Hon TAU HENARE 
: I do not have to say much before the rabble starts denying history. The members on the opposite side of the House do not even know what I am about to say and they start denying things. They cannot even handle— 
Grant Robertson 
: Tell us about Wilberforce again! 
Hon TAU HENARE 
: No I want to talk about the history that the previous Labour Government has left this nation. This speech will be called the leftist speech. The Labour Government left behind an absolutely dysfunctional Immigration Service. It left us with an accident compensation shortfall of $1.5 billion. 
Hon Member 
: How much? 
Hon TAU HENARE 
: $1.5 billion. It left us with KiwiRail and its value is about half of what Labour paid for it. It left us with falling economic growth. Between 2000 and 2008 after all the money that the Labour Government spent all it could muster— 
Hon Steve Chadwick 
: Oh dear! 
Hon TAU HENARE 
: “Oh dear!” is what the public is saying; “Oh dear! I wish we had got rid of the previous Labour Government earlier.” I tell members— 
Hon Steve Chadwick 
: Let’s go back to New Zealand First days! 
Hon TAU HENARE 
: I was not in partnership with New Zealand First. I did not make the leader of the party the Minister of Foreign Affairs and then slobber all over the fact that he was our Minister of Foreign Affairs. I did not one day say that he is a nasty man and then the next day give him a bauble or two. That was not me. 
Therein lies my speech; it is about history. 
Craig Foss 
: Who gave him the baubles? 
Hon TAU HENARE 
: Well it was the lady who has gone. 
The previous Labour Government left us with an inflation rate of 3.5 percent. It left us with rising current account deficit. Here is an interesting figure: $16.1 billion was in the current account deficit in the 2008-09 year. 
Hon Steve Chadwick 
: Oh dear! 
Hon TAU HENARE 
: Those members keep saying “Oh dear!” because they cannot get away from the fact that they left the cupboard bare. There is nothing in the cupboard. On Budget day the Hon Bill English got up and delivered what is needed; not a wish-list but what is needed. Shortly afterwards New Zealand got a stable rating from the credit agencies. We did not get a downgrade and you can bet your bottom dollar that we would have been downgraded if that lot on the opposite side of the House had won the last election. We would have been worse off than we ever have been. 
Mr Jones should take note of this history: every time there has been a Labour Government for more than one term—and that does not happen very often but happened in the last two: the Lange Government and the Clark Government—it has left the cupboard bare. It left the cupboard bare not for the spend-up of a National Government but for those who really need it. I say to Mr Jones that they are those who live on “Struggle Street” to coin a phrase. 
Paul Quinn 
: He wouldn’t know. 
Hon TAU HENARE 
: Oh yes he would know. But the problem is that he forgot. He forgot where he is from; he is from “Struggle Street”. 
The Labour Government ate lavishly and spent up large and for what? Where were the results? No I am not a denier; those members are deniers. It made no changes to the things that really matter. For example it made absolutely no changes to the Resource Management Act. In fact the changes that did come hog-tied businesses and developers and nothing was done. For 8 years Labour members spent up large employing their mates in the Public Service and now they moan about the cuts and retrenchments in the Public Service. Let me tell that very new member over there Grant Robertson that a big Public Service is not the best idea in the world; the best idea in the world is having an efficient Public Service. 
While I am at it let us look at education. The unions are protecting members of the teachers unions from being good teachers. We know for a fact why there is large Maori underachievement. It is because of the poor quality of teachers and principals in this nation. The people who support and protect those poor teachers sit opposite us today. They protect those poor teachers and those poor principals. So what we have done and what we will continue to do is manage— 
Grant Robertson 
: How does money for private schools help? 
Hon TAU HENARE 
: It is not about money money money. It is not about that; it is about doing the job properly. If one cannot do the job properly it is time to get out. 
Grant Robertson 
: How does private school funding help? 
Hon TAU HENARE 
: It is not even about private schools any more; it is about teachers doing the job that was asked of them. But they are being protected because they do not want to go and learn—[ 
Interruption 
] 
Mr DEPUTY SPEAKER 
: There is too much noise. 
Hon TAU HENARE 
: They do not want to learn how to do the job properly. That is why we have statements like those from our Minister of Maori Affairs. All he wants to do is get the achievement rates up. We can argue till the cows come home about what he said but the fact of the matter is that a whole lot of people out there are underachieving and it behoves us to make sure that we find better ways of helping them achieve. 
Opposition members have the gall to say that they were in Government for 9 years and they did lots. If they did lots in those 9 years how come more Maori kids are underachieving now than in the last 9 years? I can tell members why: because none of the schemes and programmes of the previous Government in the last 9 years worked. Why do we have Te Kotahitanga? 
Grant Robertson 
: Who started Te Kotahitanga? 
Hon TAU HENARE 
: The Labour Government did not start Te Kotahitanga; Russell Bishop started Te Kotahitanga. Russell Bishop saw that teachers needed a helping hand and that helping hand was a change in attitude. Some teachers stepped up to the mark. Every teacher should be learning that stuff at training college rather than the Government having to spend millions of dollars on retraining. [ 
Interruption 
] No teachers should have been doing it when they were at training college. All of the Labour members’ argy-bargy about 9 years during which they did a wonderful job is a load of balderdash and a load of pixie dust. It does not wash. That is why 70 percent of the country is happy with the job John Key Bill English and the National Party are doing and that is why this Government will survive for quite some time into the future. 
Hon SHANE JONES (Labour) 
: 
 Tena koe Mr Speaker mou i pai te tuku maku tenei wahanga e korero. Thank you very much Mr Deputy Speaker for inviting me to make a few remarks. Unlike the speech of the previous speaker Tau Henare my remarks will actually relate to the legislation we are talking about. Also they will not be tedious or repetitive and they will probably be instructive for Mr Quinn. 
Let us come to the first thing that one would really want to say about the Government’s stewardship to date. There is no doubt that we confront very large dangerous issues. There is no debate about that. We also know that debt—Government borrowing—will rise. That means that the Government in the near future has one of two things to focus on. One is that it has to start cutting expenditure. Surprise surprise it has held off on its real agenda. The Government was relying on Graham Scott and a host of other advisers and it has found that the bureaucrats and chief executive officers can find only so many savings. So the Government has to focus soon on where it can slash cut and reduce expenditure or boost revenue. 
You see Labour when it was in Government was about boosting revenue. Not only did we undertake great forays to drive international trade but also we worked constructively with key sectors to boost the revenue of those sectors. That is why in 2008 when the party across the Chamber arrived in Government it inherited a situation that when one took account of our liabilities and assets was actually a net positive position I say to Mr Foss. Admittedly we work in a dynamic framework and things have changed. Borrowing will now rise. But this Budget did not outline what the Government will do to boost revenue nor how it will do it. The Budget recited a host of perceived ills that the Government wants to hold us responsible for but overlooked the fact that the Government has the waka—it has the car. The voters who are the ultimate parents of all politicians have given the Government the keys but this Budget said not a single word about how revenue is to be enhanced. How will the Government grow the economy? No. Tau Henare obviously read the wrong end of the  
New Zealand Herald  
this morning. He started to talk to us about the current account balance. I say to Tau that come Thursday he will know the answer. Come Friday he will know the answer in terms of our GDP performance. 
We all know that current account problems have afflicted our country for a long time but what is the Government going to do about that? Where is its plan? What will the Government do? What is its strategy to boost exports and to boost revenue? Members opposite can continue to say the previous Government was slack in some areas and was a little ambivalent in terms of monitoring various pots of expenditure but the Government has to develop a plan. There is no plan in that Budget. There is nothing that shows how the Government will boost exports. 
Craig Foss 
: Which volume did you not read? 
Hon SHANE JONES 
: Secondly the Government said it is too expensive to work with agriculture. If there is one thing our country can prove to be very successful at I say to Mr Foss it is producing food. The goods and services associated with the food sector— 
Craig Foss 
: You’re good at digging dirt! 
Hon SHANE JONES 
: Far be it for me to comment on the manure currently being sprayed from the Hawke’s Bay member. I will not do that. But if we are to have this debate we must come back to the key point. The Government did not put a plan forward. It ended up pinching a lot of ideas from our side. OK it took a pale version of working with the agricultural sector for petty political reasons. It rained foul rhetoric upon Mr Anderton and his $700 million approach to enhancing productivity in that sector. The Government ended up taking a tiny piece of his thinking and in a miserly sort of way introduced it as its own idea. That will not cut the mustard—no! 
Let us talk about John Key’s illusion. He will stand as he has stood in the past and continue to tell this House that over his dead body or words to that effect superannuation entitlements will not change. But the reality is that once he decided to change the consensus on superannuation and fracture the model for how we could account for meeting the costs of a rapidly ageing population he has opened up the debate all over again. There is no consensus on superannuation; there is no consensus whatsoever. Members opposite have now decided that for the period of time—mercifully short I would hope—that they enjoy the Treasury benches they will pretend that there is no long-term superannuation problem. What they have not worked out is that in that period of time people who are in their 30s or 40s those who are approaching their 50s will be fearful. Insecurity is rising. Members opposite know that the consequence of their miserly punitive approach towards a savings strategy that would have overcome some of the long-term problems is that they have turned their backs on those problems. They have turned their backs on that vulnerable group of New Zealanders who have been paying tax for a long time based on the social accord that one day when they reached the point when they could have superannuation they would not be denied it. 
The Government ended up having to find dough from somewhere so it has started to gut KiwiSaver. That is further evidence that Government members do not believe in savings. Unlike ourselves members on that side of the House do not believe there is a savings problem in New Zealand. Without thinking it through members opposite moan and complain that Labour was a poor steward in relation to the current account deficit problems. But if there is a deficiency in savings that account is where it would show up. Those members do not believe there is a savings problem. Not only did they gut KiwiSaver but also they have now turned around and plundered the Cullen fund. The Government has plundered it in the following way: it has refused to allocate as was intended the ongoing allocations that were built into that scheme. 
A fund that would rival something akin to one of the more developed economies’ sovereign funds was an item that every New Zealander could have taken pride in and Governments could have looked upon it as a long-term option to deal with the growing costs associated with us all getting older. Of course Mr Key will say that if we do not save the money now there will be more money in the current economy. But that is not the case because a plan was absent from the Budget for how our most vulnerable communities such as the Pacific Island community and the Maori community were to boost their skills. 
It is all very well for Dr Pita Sharples to talk about Maori access to university. I do not really want to condemn him. I am sure he did not intend to say that all Maori could just arrive at university—bypass kohanga reo and turn up at Victoria University. He was seeking to raise the problem that far too many Maori families do not produce enough kids who have either the right attitude or sense of engagement with school—something to that effect. But he has overlooked the fact that if one associates with a party in Government that gives its tax cuts to the rich and denies tax relief to the poor and vulnerable then that Government will have fewer resources to dedicate towards education skills and training. It is a vicious circle. The thing that really requires education in relation to Dr Sharples is what convinces that man to continue to hang out with such a bad crowd. Of course in 2½ years we will visit the answer to that question upon them. 
Let me round up here. Unless we are to invest in education—Mr Quinn needs a great deal of it—we will not raise the levels amongst the vulnerable communities that will be key contributors. 
Paul Quinn 
: I notice you’ve steered clear of Economics 101 in this appropriations debate. 
Hon SHANE JONES 
: Stick to the point Mr Quinn. “Stick to the point” in Maori is “hangai ki te kaupapa” [ 
remain focused on the topic 
] not “hangia te papa” [ 
bake the earth in an earth oven 
]. Kia ora tatou katoa. 
Mr DEPUTY SPEAKER 
: Before I call the next member I say the discussions that are going on are making it very difficult for me to concentrate. We have lobbies for that and members may wish to go out into them. But I can hear some of the conversations and I ask that we give members the courtesy— 
Hon Member 
: They are interjections. 
Mr DEPUTY SPEAKER 
: They are not interjections. They are low-volume conversations but I can hear what is being said. I ask members if they want to continue those conversations to please go to the lobbies. 
KATRINA SHANKS (National) 
: 
 It is my pleasure to speak to the Appropriation (2008/09 Supplementary Estimates) Bill and the Imprest Supply (First for 2009/10) Bill tonight. I will respond to the member who just sat down Shane Jones by talking about education and investment in education. Labour was in Government for the last 9 years. For 9 years it had the opportunity to invest in education and to lift literacy and numeracy but it failed. I ask members to look at the number of children who are coming through school who do not have the levels of numeracy and literacy to even get the most basic jobs to even enter the polytechs or to enter some of the trades. They do not have those basic literacy and numeracy skills. That is how the Labour Government failed this country and failed our children. This Government is determined not to let any child be left behind. In this Budget in our first year we have invested a lot of money—$1.68 billion over the 2008-09 to 2012-13 period has been invested to improve facilities and lift educational achievement. Of this $1.68 billion $1 billion is new spending that we will invest in the future and in our children because they are a priority for a John Key - led Government. We will build new schools and modernise new existing schools with an investment of up to $523 million. We will help our students meet national standards in literacy and numeracy by investing $36 million. 
As a mother of three children I have to say that the literacy and numeracy standards our children currently have is not clear to parents. They are not transparent. Parents do not understand how their children are going. They do not know whether they are improving from one year to the next. They do not know how they are doing against the national average. They do not know how to help their children they do not know whether they are gifted and they do not know whether they are falling behind because there is no transparency from the school to the parents. There is no accountability from the school to the parents. 
I have been in the school system for the last 9 years with my children and it is the same now as it was 9 years ago. There is no reporting back to the parents and that is what this bit of money will do. This $36 million will ensure that we have a national standard and that those children will sit the tests that they already sit: the progressive achievement test and the asTTle test. They currently sit those good tests and the parents are not informed about them. They never get to see the results. Parents never get to see inner tracking or how their children are tracking. I speak to many parents around those issues. One of the parents I spoke to recently said that what that parent would love to see is a child’s education graph set out like the graph in a Plunket book. The average is a line going up the range is another line going up and the child sits on one side or the other. As long as a child is tracking up the parents should be comfortable with that and will understand where the child is. But how do people know if they are not told? That $36 million is crucial for me as a mother with three children in the primary school system to understand that my children are going to do well when they leave school. 
Not only that we extended the 20 hours early childhood education scheme to include playcentres and kohanga reo. I went to a playcentre in Johnsonville last week a lovely playcentre and I have no idea why they would be excluded from that 20 free hours. Why choose to exclude a playcentre? They add so much value to early childhood education which is a fantastic iconic type of early childhood education that this National-led Government understands—and that the previous Labour-led Government did not understand—because playcentres are about families. Opposition members do not understand how parents can be good educators very powerful educators in their own right which is what playcentres are. We put another $69.7 million into playcentres and kohanga reo because we unlike the previous Labour-led Government which put no priority on families acknowledge that parents are fantastic educators. 
These estimates are about helping New Zealanders through the recession and supporting jobs. We are using the strength of the Government’s balance sheet to absorb much of the shock of this recession. What this means in plain language is that we are keeping up spending on public services and on entitlements to income support despite the fact that the Government’s revenue is dropping significantly. Our approach is to provide a considerable stimulus to the economy to stop the country from falling into a further recession. In the Budget we maintained all of the entitlements to income support including superannuation benefits and the Working for Families scheme. We are also increasing spending on front-line public services particularly in health education and justice. 
Hon Steve Chadwick 
: No training back to work. Cutting training programmes for getting back into work. 
KATRINA SHANKS 
: If that member over there would like to talk to me about adult learning in community centres that is great. You know I would love to do a pottery course. In fact I have done one at a community centre and it was really good. But it is a hobby and I think I should be able to pay for that hobby myself. I do not think that the Government should subsidise it. In fact I would rather the Government spent the money on reading recovery. What would the member prefer I do? [ 
Interruption 
] That is right. Would the member prefer that the Government paid for my pottery course or that my child did not get reading recovery? It is about priorities; it is about putting the money where it is needed. I tell members that in our schools reading recovery literacy and numeracy—and you know it as well—are where our priorities should lie not with the pottery course not with the public speaking course not with the Moroccan cooking course. You had 9 years to make a difference and you made no difference; we had 9 years of surpluses and you just blew it. You threw them away— 
Mr DEPUTY SPEAKER 
: The member has brought me twice into the debate. 
KATRINA SHANKS 
: I am sorry Mr Deputy Speaker. 
I want to talk about one of our initiatives in particular: an investment of $323 million over the next 4 years in a campaign to make New Zealand homes warmer drier and healthier. I tell members that John Key understands that families need to stay warm. [ 
Interruption 
] You had 9 long years to make these homes warm and healthy—9 long years. I say to Steve Chadwick that you can shake your finger at me but you had 9 long— 
Mr DEPUTY SPEAKER 
: You know what I am going to say do you not? 
KATRINA SHANKS 
: I do. I am sorry Mr Deputy Speaker. The Labour Government had 9 long years to make a difference; 9 years to make our homes warmer healthier and safer and it could not do it. In 9 long years of surpluses even with “Visa-nomics”—with putting it on the bill—Labour still could not provide the money to do this. Instead Labour just wasted it because that is the only way to describe what it did. The Labour Government just wasted it. 
I want to talk about New Zealand insulation funds. We will allow more than 180000 New Zealanders to receive kickstart grants of $1800 to insulate their homes and to install clean-heating devices. A number of electrical companies city councils and banks have indicated they will do their bit by offering loans to cover any extra expenses incurred. This policy will have a range of benefits. It will stimulate the building and construction industry and create jobs for the men and women who will do the refitting. There will be jobs at the level that we need them in construction for electricians for builders and for plumbers. It will stimulate and improve energy efficiency in people’s homes and in the longer term New Zealand families and children will experience warmer drier and much healthier living conditions. 
The Budget also includes funding for measures we announced earlier in the year to help the sharpest effects of the recession including the ReStart package for people made redundant and the small-business relief package. It also includes funding for initiatives that came out of the Job Summit in February. These include the $50 million for the New Zealand cycleway the 9-day fortnight scheme the boost to workplace literacy funds the introduction of summer research scholarships for university students and increased investment in international education promotion. In total we deliver a net increase in new operating spending of $5.8 billion over the forecast period out to 2011-2012. 
In addition to this year’s spending there has been a considerable amount of reprioritisation within existing levels of Government spending. We identified a total of more than $2 billion in spending over the forecast period that either did not accord with our priorities or had a relatively low value. We have used that money to fund other initiatives of more value. 
Hon MARYAN STREET (Labour) 
: 
 I speak in this debate to draw attention to a number of things the National Government has done that work in exactly the opposite way to its stated aims. National members have said repeatedly their aim is to protect Kiwis from the worst effects of the recession yet where do they go to in order to make some of their most trenchant cuts in this Budget? They turn to education. At just the moment when a Government should be investing in its people this Government has chosen to prioritise school buildings. Although school buildings will always require maintenance and development a time when we are seeing redundancies forced lay-offs and the contraction of the economy is the moment when any thinking Government that had a commitment to New Zealanders would be investing in people by allowing them to have cheap access to programmes where they can upskill and retrain in order to fit themselves to meet the demands of this recession. What this Government has been doing denies New Zealanders access to some of the lowest-cost and most universally available courses in the country for training retraining and upskilling themselves. 
I will start with adult and community education because one of the things that members opposite keep saying is that they are investing and are investing more in literacy and numeracy skills. The figures do not bear that out; the figures in fact demonstrate that in this Budget there has been a substantial cut to the provision for literacy and numeracy projects over the term of the Budget. Apart from that it is also clear that this Government has no awareness of the number of jobs that are being adversely affected. 
Let us just take the adult and community education sector to begin with. There are other things that I wish to talk about in the course of my 10 minutes and I will get to them. But I say that in the adult and community education sector this Government is realising only now because of the petitions and the postcard campaign that the adult and community education sector is spearheading around the country that 400000 New Zealanders access quality accessible community-based education programmes on an annual basis. 
The Minister of Education Anne Tolley seeks to denigrate and ridicule courses that hundreds of people are writing to me about. I refer to all the emails and letters that are pouring in to me about the cuts to adult and community education and about how those cuts will impede people’s ability to access formal education and skills programmes that give them the confidence having been made redundant to re-enter the workforce. After having been made to feel worthless by a forced redundancy people’s entry back into the paid workforce has typically been through skills training and the courses that have been offered at a grassroots level through school programmes. We commonly think of those as night classes although they are frequently run at other times of the day as well. But beyond that people forget and clearly this Government has forgotten that 9.5 percent of the funding that goes to secondary schools to run adult and community education programmes has to go forward to other community organisations to enable them to run other programmes. 
That brings me to one of the things that I wanted to talk about. The Minister for Social Development and Employment Paula Bennett talked earlier this year about the need to have parenting education orders in place to compel the parents of problematic and troubled children who are presenting in our justice system to attend parenting courses. Those parenting courses are run by a range of providers but quite frequently they are run as secondary school night classes by adult community education programmes and by community organisations. The money given to the secondary schools is passed on to those organisations to fund those programmes. On the one hand the Prime Minister and the Minister for Social Development and Employment say we should enhance and expand the programme of parenting courses and on the other hand the Minister of Education is taking away the wherewithal to provide those courses. 
I also mention something that really makes no sense in the context of this recession and that is the cutting of funding for industry training. The Minister of Education proceeds with her offensive and insulting denigration of what she deems to be a “hobby” course when in fact learning Italian at Wellington High School was of enormous benefit to a man who fixes European cars. He specialises in European cars and wanted to learn Italian because the manuals for some of those cars are written in Italian. Why should he not go and learn Italian? But the Minister would have us believe that is a hobby course. It is clearly imperative to that man’s business for him to understand Italian. If I had an Italian car I would quite like it to be repaired by somebody who understood the manual as opposed to somebody who had taken a guess at it. 
The cuts to the funding for industry training make less sense than anything else that this Government has cut in education. The Minister of Education has chopped $15.1 million from industry training funding and that includes cutting the CPI adjustment for 2010—that is $9 million. It means reducing the growth in funding for embedded literacy programmes. I am sorry but the rhetoric does not match the practice. The rhetoric is all about the need to improve literacy and numeracy skills yet exactly that kind of programme—an embedded literacy programme—is being cut with the reduced industry training funding. If people cannot retrain and upskill themselves in their workplace or if they have lost their jobs retrain and upskill themselves through additional industry training available through apprenticeships and through employer-assisted programmes then how will we manage to pull New Zealand out of this recession with a better-skilled more literate and more numerate labour force? 
The Minister of Education needs to answer those charges because at best there has been an under-investment at every turn in education just at the time when investment is important and at worst there have been drastic and Draconian cuts. Members opposite know that because they are beginning to get petitions and they are beginning to get postcards like the ones I am holding up—and these do not even reflect the number of email communications I have sitting in an email folder in my parliamentary computer. The lack of foresight and lack of thought in this Budget simply beggar belief. This Government does New Zealanders a disservice in the way it is approaching education. This is the moment in time when education should be the priority not the poor relation. This is the moment in time when the Government’s Budget ought to reflect education as being a priority for this nation. The Budget is a shame. 
JOHN HAYES (National—Wairarapa) 
: 
 I have listened to Parliament for some time this afternoon and it strikes me that any fool can criticise and many have been doing so this afternoon. I stand to congratulate John Key and Bill English on a wonderful Budget which is full of common sense and leadership and makes the choices that have to be made. Contrary to comments made in the House this afternoon by luminaries like Ruth Dyson a perfect example demonstrating that “critics are the stupid who discuss the wise” I have to say that the Opposition has come up with nothing that should concern our electorate. It is carping criticism for the sake of it. 
I want to report to the House that the people of the Wairarapa in my electorate stretching from Ngawi in the south to Waipawa in the north are absolutely delighted with this Budget. They keep stopping me in the street and they say they are really supportive. They say that John Key is doing a great job and Bill English is doing a great job. They are really proud of the Government— 
Hon Phil Heatley 
: And Phil Heatley! 
JOHN HAYES 
: They say: “Thank goodness we moved the people on who tried to send us to the cleaners.” Yes they like Phil Heatley because he is about to announce more honorary fishing officers to come to the Wairarapa coast. So even the people in my electorate are very supportive of the Minister of Fisheries and good on him! They are highly supportive of this Government. They can see that John Key and Bill English have moved to cushion our community from the sharp edges of this recession. Those people see that new core Crown spending of $2.9 million on projects like improving Muldoon’s Corner and upgrading the Kuripuni school in my electorate combined with the tax cuts will keep supporting this economy and will keep this country ticking over. Contrary to comments made by the previous speaker and the one before I can confirm that superannuation has been preserved at 66 percent of the average wage and all this carry-on from the Opposition about cuts being made to superannuation is simply not true. 
We have also maintained benefits for the students and Working for Families. We have improved public services by putting $3 billion extra into the health sector over the next 3 years. We have put $1.68 billion into the education sector and yes some cake-decorating courses are being cancelled. We have put 600 new police into the community. We are strengthening the economy for the future so that businesses can thrive. I can report to the House that for example JNL Juken Nissho Ltd operating in Masterton went from— 
Mr DEPUTY SPEAKER 
: I am sorry to interrupt the honourable member but the time has come for me to leave the Chair. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
JOHN HAYES 
: I will just recap a little. Earlier on I made the point that I had been sitting through the debate in the House this afternoon; I have to say that any fool can criticise and this afternoon many have been doing so. On top of that because a lot of fear and misinformation was being promulgated by the Opposition I will point out and really make it clear that the Government moved very specifically to guarantee superannuation at 66 percent of the average wage. The Government also went out of its way to maintain benefits to students and to those on Work and Income benefits. It also made a commitment to improve public services and agreed in the Budget to spend a further $3 billion on health and $1.68 billion on increased education expenditure. And my colleague the Minister of Police has found the money to provide an additional 600 police. 
I feel that the Government has moved very strongly to strengthen this country’s economic future and we support that. People in my electorate are saying they are very very supportive of the Key-English direction of this economy. In my electorate we are beginning to see improvements. One of our biggest companies Juken Nissho Ltd which processes logs went from three shifts to one shift but it has now just gone back to two shifts. If we look at other entities in the Wairarapa like the Taratahi Agricultural Training Centre which employs 700 full-time equivalent students and which has a total budget of $25 million annually we see that these sorts of institutions are making huge fundamental differences in driving our economy forward. We need to grow the educational capacity of our young people if we are to move this country and this economy forward. 
There are two areas though where I am a little bit concerned. Although the Government is going through Government agencies line by line and is making sure that the taxpayer money it is spending is being spent wisely and necessarily I do not see the same happening in the five local bodies in my electorate. I am very concerned that some local bodies under their long-term plans feel that the Government can move through tax cuts to put more money into people’s pockets and keep benefits flowing but those bodies then seem to think they can vacuum up that surplus. For example the South Wairarapa District Council is planning to raise rates by 20 percent next year and the Masterton District Council is going to raise its rates by 30 percent over the next 3 years and rates are due to rise in Waipukurau by 16 percent and Waipawa by 10 percent. These sorts of rate rises are unacceptable to the people in my community and in the context of our present economic environment and in the direction this country is trying to go under John Key’s leadership I think these rate rises really have to be addressed by our communities. 
As well the South Wairarapa District Council has 29 councillors servicing a community of 40000 people. We can traverse then to Mr Hide’s moves on the Auckland super-city where there will be 20 councillors dealing with 1.4 million people. Something is out of whack. I am finding that our communities want change my constituents want change but the obstacles to change very often are the councillors who do not wish to vote for an early Christmas; I think that that is highly unfortunate. We must as communities take charge of our circumstances in our communities and drive efficiencies in a way we have previously not moved. 
So I call on my communities to rise up against these rate rises and to force common sense on our local bodies. We have seen that the Government led by Michael Cullen and his colleague “Put-it-on-the-bill-Phil” left a series of black holes for the following Government—us—to fall into. We saw it in accident compensation expenditure where there was a black hole of between $1.5 billion to $2 billion. But I was astonished last night to discover that in South Auckland we have thousands—I am told—of young Pacific Island children who are not in our schools and not getting access to health care because their parents are too afraid of being caught out as being overstayers. This is the problem that that previous Labour Government has left to us; it did not address this sort of problem. Just as that Government did with accident compensation it has dropped us in a hole. Well we must address these problems. We cannot let this country go on in the shambolic way our Labour colleagues drove it over the last long 9 years. For those reasons I am very supportive of the direction this Government is taking. 
We are seeing that the global shocks are now abating we are seeing firms that cannot continue to cut their stock levels we are seeing investor panic receding and we are seeing householders rehabilitate their balance sheets. Our Government’s activism is helping this country to recover more quickly and we are seeing markets in China and Brazil rebounding. We still have tough challenges to address in this country but John Key’s Government is up to it. Thank you. 
MOANA MACKEY (Labour) 
: 
 I am very pleased to stand and take a call in this debate. That was a very telling speech from the member who has just resumed his seat. I do not think he actually talked much about this bill at all. He talked about how he wants to amalgamate all the councils in his local area and he blamed all the democratically elected councillors over there in his electorate. That is fine and good on him but I suspect that if he keeps passing the buck blaming everything on his local councillors and not accepting any responsibility as a member of a Government he might not be the local member for very long. 
This Budget was a real opportunity for the Government and the people of New Zealand expected to see some vision and a plan—a plan for lifting New Zealand out of recession faster a plan for ensuring that we do not make exactly the same mistakes the National Government made last time we went through a recession and a plan that ensures that when we do come out of recession we hit the ground running and New Zealand is not left at the back of the pack as we were the last time Mr Carter was a Minister in Government. 
I think that New Zealanders hoped that National might have learnt from the failures of the past—learnt what worked and what did not—and might have come up with some kind of concrete visible transparent plan to assist New Zealand during this difficult time. But we got no plan. There was no plan for jobs and the Prime Minister admitted yesterday that 1000 New Zealanders are joining the dole queue every single week. As we heard in question time today he has no plan to stem that—no plan to create jobs— 
John Hayes 
: It’s a good place for you to go. 
MOANA MACKEY 
: Well you see that is the level of debate that we get from National members. Even Mr Paul Quinn is being quiet because he is taking this seriously. 
Paul Quinn 
: Ha ha! 
MOANA MACKEY 
: I knew that would get him started. All John Hayes can say is that the dole queue is a good place for me to go. That is the level of intellectual thinking on that side of the House. [ 
Interruption 
] I tell Mr Hayes that we on this side of the House take the situation a little bit more seriously than his party does quite obviously. 
We hoped we would see something—anything—to create jobs in New Zealand and to hold on to the jobs we have. We hoped we would see something of a plan to help the people who unlike Mr Hayes do not have a guaranteed job in here for 3 years and are genuinely concerned about how they will feed their families over the course of the next few years. We hoped we would see a little bit of a plan in this Budget but there was no plan. 
Let us look at some of the areas of the Budget and let us look in particular at research science and technology. The Government had the gall to put out a press release stating that this Budget made a substantial increase in its investment in research science and technology. Of course it failed to mention the fact that when we consider that the Government has removed Labour’s research and development tax credit we see that there is in fact a cut of more than $1.2 billion. There has been a cut of $1.2 billion in the very sector that could help to bring us out of this recession faster the very sector that we need to help us create wealth in this country. 
The National Government has said that it does not value that sector at all and does not think it is important enough to keep those incentives. Mr John Walley said just this week that recent statistics show that New Zealand’s private sector investment in research and development is 0.51 percent of GDP. That is a third of the OECD average. He called on this Government to take that seriously and to reinstate some kind of tax incentive. 
Members on this side of the House are not saying the Government has to reintroduce exactly the same thing we did. What we want to see is some kind of tax incentive because it has been shown to work everywhere around the world. So I want to know what the Minister of Finance knows and I want to know what every single one of our trading partners who has these tax incentives in place does not know. 
Not only are tax incentives working in those countries but they are also putting New Zealand at a strategic disadvantage. When we look over the Tasman we see that Mr Kevin Rudd is increasing and improving the tax incentives for research and development yet New Zealand is going 100 kilometres in the opposite direction by removing them in their entirety. 
I come now to the New Zealand Fast Forward Fund. National likes to talk about being the party of the agricultural sector. If we compare the scheme that Labour put in place with the insipid anaemic scheme that has replaced it we would have to say that that is absolutely not true. Although we can talk about the quantum of that fund and that is very important National seems to have failed to grasp that one of the most significant things about the Fast Forward Fund is that long-term funding certainty was provided for our research sector for the first time. The sector knew that the fund was there for 10 to 15 years and that it was a significantly sized fund. The sector knew that it was not something politicians could dip into and it knew it would not have to come cap in hand to the Government every single year just hoping that it would get an appropriation. 
Researchers working in the food and pastoral sectors quite rightly feel very worried. They have told me that next year’s appropriation for pastoral and food innovation initiatives might go the same way the tax cuts went. How can the sector be certain that its funding for next year will be there? How can it be certain that its funding for the year after will be there? The reality is that it cannot. 
One of the fundamental foundations of the Fast Forward Fund was that long-term stability and that has gone as well in this Budget. So we do not have any plan to stimulate the economy. We saw that a full third of the tax cuts in the Budget went to the top 3 percent of income earners. That is nothing more than just paying off one’s cronies; let us be honest about it. There is absolutely no economic reason why we would push the tax cuts towards people who will save the money or go on an overseas holiday and spend it on stimulating other people’s economies. 
If we really want to use tax cuts to provide economic stimulus we would give them to the people who will spend them. We would give them to the people who need them now—the people who will use them to pay the bills feed their families and pay their mortgage. That is the kind of thing one would do with that money. Not only is that economically the right thing to do but it is morally the right thing to do. These are the very people who are struggling right now. 
One of the big issues in this Budget really had to be the stopping of payments into the New Zealand Superannuation Fund. We have heard a lot of comments from National members. They have been crowing and saying that superannuation has to remain at the current level of entitlement. But what they do not say when they make those comments is: “But we’ve stopped the funding that will pay for that.” 
Hon Anne Tolley 
: Rubbish! 
MOANA MACKEY 
: Oh it’s rubbish. 
Hon Anne Tolley 
: The fund will fund only 14 percent. 
MOANA MACKEY 
: Oh right! The fund will be $35 billion short by the time the baby boomers retire. 
Hon Anne Tolley 
: You don’t understand. 
MOANA MACKEY 
: I say to Mrs Tolley that if Labour had realised we did not need to pay for superannuation then we would not have had a fund at all. We would not have had a fund if we had realised that money was not the problem. 
Now is the time we should be maintaining this fund. The superannuation fund did very well last month. Can the Government members who are all yelling at me now answer one simple question? How can we maintain the current levels of entitlement to New Zealand superannuation if the money is not there to pay for it? 
Hon David Parker 
: They believe in Santa too. 
MOANA MACKEY 
: That is right. Maybe the pixies will bring it. Maybe Santa will bring it for them. The fact is that it cannot be done. 
National has made a political calculation that it will not be here when that problem arises. That will be a problem for a future generation. 
Hon Darren Hughes 
: When Paul Quinn is Prime Minister. 
MOANA MACKEY 
: When Paul Quinn is the Prime Minister this will be his problem. 
While we are on the topic of cuts that will affect our young people we have to look at the cuts in education industry training tertiary education and adult and community education. We have to ask what this Government is thinking. National did this the last time we went through a recession. The last time New Zealand went through a recession a National Government cut industry training funding cut tertiary education funding cut funding to the areas that will upskill people and cut apprenticeships. 
We are now going through a period when people need to be upskilled. A lot of people have got jobs that are not particularly skilled. They are now finding that they are the first in the dole queue because they are the unskilled workers. The first port of call for these people would be adult and community education. That is absolutely their first port of call. They will want to upskill. 
Paul Quinn 
: Now we’re on to adult education are we? 
MOANA MACKEY 
: I suggest that Mr Quinn might want to have a look at taking a few adult and community education courses. 
The fact is that we will come out of this recession with an unskilled workforce exactly as we did the last time National was in Government. What happened the last time we were in a recession? New Zealand took a lot longer to recover and we had bottlenecks within our economy because we had such an unskilled workforce. This National Government knows that because it was National’s fault—National did it. It was a Labour Government that had to come in and deal with the reality of it. Labour had to come in and boost industry training. Labour reintroduced Modern Apprenticeships and boosted them up. We moved faster than we promised we would because there was such a bottleneck in our economy. And here we are again! 
John Hayes 
: Do you realise you’ve said nothing of substance in 10 minutes? 
MOANA MACKEY 
: I say to Mr Hayes that a definition of insanity is doing the same thing over and over again and expecting a different result. This Budget was the very definition of insanity. 
CRAIG FOSS (National—Tukituki) 
: 
 I am looking forward to speaking on the Appropriation (2008/09 Supplementary Estimates) Bill and the Imprest Supply (First for 2008/09) Bill which form part of the “road-to-recovery Budget” as read by the Hon Bill English on 28 May. I have a few notes to speak to but I cannot resist picking up on some of the points the previous speaker made. Excuse me if I do not quote her exactly but I think it was that now is the time to invest. [ 
Interruption 
] To borrow? Well I will come back to that in a minute. I think it was to borrow funds to invest. It is very interesting because under the previous Government’s watch last year the superannuation fund lost $5 billion to $6 billion accident compensation lost about $3 billion to $4 billion and the National Provident Fund lost about $1.5 billion to $2 billion. Those members are now trying to give us investment advice. 
They should think it through think what the legacy of the—[ 
Interruption 
] I am more than happy to call it the Cullen fund when it is doing that. That does beg the question and I know that another speaker said this on the reading of another bill along the way: “Tell us what you would invest in.”. I say to those sages give us some advice! Should investment be on shares currency or in fixed interest and should it be in New Zealand or outside New Zealand? Would that previous Government have continued to invest in Australian infrastructure with the superannuation fund? Or would it start to invest in New Zealand? What would it have done? Where is the advice? Labour should remember that it lost about $10 billion to $11 billion of net worth off the balance sheet in the last year. Those members should not stand up and try to give investment advice. Please! They should not even attempt to do that. They can talk about the generics but do not say that now is the time to invest without coming up with something they think is worthwhile for the taxpayers of New Zealand to invest in. 
Opposition members keep forgetting the other side of the balance sheet. I will come back to that again. Under the current set of accounts—the accounts as Labour left them and the accounts as they deteriorated after Budget 2008—in May whatever the case the previous Government would have had to borrow and to continue to borrow. It is worth mentioning that in that Budget State financial asset sales of $6.7 billion were announced and an extra borrowing of $6.7 billion was announced. When members on the other side get up and start to claim that it is a new world or there are new accounts the previous Minister of Finance had the numbers right in his hot little hand. 
It is very interesting and somewhat questionable I guess how fast and rapidly the accounts deteriorated post-Budget 2008. Interestingly in that Budget there was hardly any reference at all to the KiwiRail purchase other than a mention in the contingent liability of a potential write-down which I will come back to again. As we know the negative asset of KiwiRail was paid for at about $1.2 billion all up and is now worth $350 million. Basically in the space of under 8 months that supposed asset ended up as something that Wall Street New York would be proud of. It was bought by the previous administration but $800 million - odd has been knocked off its value. Members opposite should not dare get up and ask questions about why there is no money for this that and some other proposal. They should not dare to get up and pass on investment advice when in fact under their Government’s watch we lost billions upon billions. 
New Zealand entered a recession about a year before the rest of the world. We led the world in beginning the global recession so a number of reasons contribute to the fact that this Budget has to be in the shape and form of a “road-to-recovery Budget”. It is a Budget that is right for these times and it is a pragmatic Budget. 
We did not take on board the unfunded spending of the previous Government but we did have to take on board its spending. Some hard choices were made. That is quite correct. Some reprioritisations had to happen. Almost all of them were uncomfortable to do but we are quite proud that we have stepped up and been honest and transparent. If we look at the forward track of this Budget we see the results of a very strategic Budget as read by Mr English. As I noted page 1 of the Budget has the debt graphs. If the previous administration had stayed in office and if their policies as in their press releases and as announced had continued then the debt to GDP ratio which was already nudging 70 percent would have continued to go north over the next 4 or 5 years. In fact we now see the curve coming down. It will go to about 37-odd percent of GDP. 
From that simple graph and those statistics came New Zealand’s upgrade in our credit rating. I will come back to that again because members opposite do not seem to comprehend one iota how important that is to New Zealand. I was very surprised that their leader a former Minister of Foreign Affairs and Trade who I thought had knowledge of these things had no idea embarrassing himself on national TV on  
Breakfast 
 the day after the Budget saying that it did not really matter. Not long after that his finance spokesman had another version of events but again we will come back to that. 
I will show members the quick statistics because some members opposite keep saying it is all a surprise about what the Budget shows today. Budget 2008 forecast a surplus of $1 billion. Before the last election remember when Labour was still in Government the figure came down to negative $1.7 billion which was a deficit. The deterioration was obvious. We have seen it happen around the globe and the situation was rapidly deteriorating. At that stage the bad scenario from the Treasury forecast looked pretty much where we are now. The December Economic and Fiscal Update showed a deficit of $4.1 billion. As announced in this Budget unfortunately but realistically we have a $7.7 billion deficit. No that is not good. No we do not enjoy that fact but we are being up front honest and open. We are showing New Zealand what has to be done to start the recovery from the previous 9 years of unfocused unaccountable non-transparent unmeasurable announcements that the previous Government made which had core spending going up and up whilst core revenue was always very vulnerable and deteriorating down. 
That brings me to a very interesting point. A previous speaker the Hon Shane Jones kept asking where the revenue boost is and where the hike is. That spoke volumes about that party because what is revenue? It is an increase in taxes. Right there he alluded to what would be in the supposed mini-Budget after the election if his party had unfortunately managed to get in. Actually that party was going to hike taxes because of its concentration on just that side of the ledger which again speaks volumes because it is not just about one side of the ledger. It is not just about revenue. There is expenditure the funny old thing that has put New Zealand in the situation we are in right now where expenditure is compounding up and up and core funding is going down. It just shows where members opposite concentrate their thinking: “There is a problem. I know let’s raise taxes.” I guess they are being truthful because between 2004 and 2009 tax revenue went up about $20 billion per annum. 
There has been a lot of attention given to the Government’s reprioritising of spending on adult and community education. I fronted a meeting yesterday. About 70 or 80 people were there and we discussed it. We all agreed on the unfortunate situation as to why we have to reprioritise so much in the accounts. We gave the example of KiwiRail. We talked about the $1 billion that had been written off and was not available for education health or the small little courses that these people had been signing up to and attending whether they were hobby courses personal growth courses or whatever they were. That is the bit that members opposite do not get. There is the net worth. There are two sides to the Budget and it comes down to this number I am pointing out. It is a big negative. We inherited one big negative in a decade of deficits. 
Hon Darren Hughes 
: That’s not cash Craig and you know that. 
CRAIG FOSS 
: Does the member want to discuss it? I say step outside and we will discuss it sir. 
Where does the cash come from? It has to come from borrowings. It was in the previous Government’s Budget. It started the borrowings. So there are assets liabilities net worth and cash. It speaks volumes again that members opposite are confused about this particular matter. 
I will come right back to where I started to the sage investment advice from members opposite who talked about how it is time to invest! Basically they are saying we should go out borrow money for the superannuation fund and invest it in something because all investments make money. Goodness gracious me! A final point is that when the superannuation fund was set up by the previous Minister of Finance the entire construct was made to allow for movements and fluctuations in cash in the economy. It is stated there and I have quotes from the previous Minister of Finance if necessary. Thank you. 
KELVIN DAVIS (Labour) 
: 
 My contribution to the Appropriation (2008/09 Supplementary Estimates) Bill and the imprest supply debate will centre on tourism and education. 
Tourism speaks for itself when we look at the statistics. Tourism is our greatest export earner. It contributes 20 percent of our economy. One in 10 New Zealanders is employed in the tourism industry. It makes sense to invest in tourism. When we look at the figures for our investment in overseas marketing we see that we receive $26 back for every dollar we spend in Australia we receive $11 back for every dollar we spend in the United Kingdom and we receive $16 back for every dollar we spend in the United States. 
The money we spend marketing New Zealand to overseas markets is a return we receive within a season. Members can imagine that people over in Australia now who are looking at the “what’s on in New Zealand” advertisements about the ski season and the snow-covered mountains do not look at those advertisements then decide to visit New Zealand in 10 years’ time in order to enjoy the snow experience. They want to come now within the season within 12 months. So it makes sense that New Zealand invests in marketing. 
Unfortunately when we look at the Budget we see that $6 million has been taken off the fund to market New Zealand. I have spent time talking to people in the tourism industry in Kaitaia the Bay of Islands Whangarei Auckland Wellington and Queenstown. Every single tourism operator I spoke to said we have to invest in marketing New Zealand so that we maintain market share overseas. Countries such as Norway market themselves as the New Zealand of the north asking why customers should travel for 24 hours to get to New Zealand to see fiords and snow-capped mountains when they can fly just 2 hours from London to experience the same deal. People from the United Kingdom will take the short option unless we maintain our market share. It is unfortunate that our funding for marketing has been cut. 
When we are told that we are in a recession and there is not much money to go around it just absolutely blows me away that the Prime Minister in his role as Minister of Tourism can find a lazy $50 million sitting in his back pocket to build a cycleway. We know now that that cycleway will not be the dream strip of concrete or whatever it was going to be running from Te Rerenga Wairua—Cape Reinga as others know it—down to Invercargill. Instead it will be a series of great rides. I am a cyclist; I enjoy cycling. The cycleway is not a bad idea I guess. But the $50 million cycleway was going to create something like 3000 jobs. So far I know of one job that has been created by the cycleway. I know that somewhere there is a policy analyst who is employed to try to progress the cycleway. So I guess the cycleway has not been a total waste of money; $50 million has gone towards funding some policy analyst somewhere who is trying to progress this idea.  
I was at the Trenz conference the week before last in Auckland where a number of tourism operators came together to sell their wares to companies from overseas. If New Zealand tourism operators can get their businesses in magazines and brochures overseas then it is really beneficial and lucrative to their businesses. We were told the Prime Minister would make a significant announcement so people held their breath waiting for this significant announcement on tourism. What did we get? We got a facelift for Auckland; $20 million is going towards buying Queen’s Wharf. I can solve another problem for the Government with that $20 million. When the Rugby World Cup is over—when party central is over—we can put the containers back on Queen’s Wharf throw in some windows with bars and have Queen’s Wharf prison. We can kill two birds with one stone. 
I want to ask the Prime Minister how many tourists he will attract who are not already going to be here for the Rugby World Cup at party central. How many people are sitting in their lounges somewhere in the United Kingdom Europe or the United States saying “Wow! New Zealand is doing up its waterfront and doing up Queen’s Wharf. It will fill in the potholes on Jellicoe Street so let’s go to New Zealand.”? Absolutely nobody is going to come to New Zealand just because Jellicoe Street has been done up. It is a joke. I have to tell members that the delegates at the conference were highly disappointed. They got nothing out of it. I do not disagree with the party central theme for the Rugby World Cup. It will be fantastic for those people who are here for the Rugby World Cup. But I think we are suffering a bit from “world-cup-itis”. No tourism operators outside of Auckland will benefit in any real terms from Jellicoe Street having a new layer of tarseal and a lick of paint. The tourism industry is disappointed. The Prime Minister decided he wanted to be the Minister of Tourism and he promised so much yet the tourism industry received so little. I share its concerns because as I said earlier the tourism industry from Cape Reinga to Invercargill is saying that marketing of New Zealand is the best value for money we can get. In the Budget I am sorry to say funding for marketing was cut. 
Moving on to education I hung my head in shame at question time today to think that some people believe that moving Maori kids who are failing at secondary school to university is the solution to fix schooling. The solution to fix schooling is investing in teachers and professional development. I take the point made earlier by my whanaunga over there Tau Henare that teachers’ colleges should be training teachers in skills such as Te Kotahitanga. It is a fantastic programme; he is right. [ 
Interruption 
] It is being done. The principles of Te Kotahitanga are being taught in training colleges at the moment. But the big problem is that a number of teachers who have been teaching for 20 or 30 years have not yet had that experience. They need to be trained. They need professional development to be invested in them. Teachers who have been teaching for 20 or 30 years will not have had the benefit of Te Kotahitanga. It is important that we understand that. That is why professional development is the way forward. 
If we are going to solve the problem of Maori underachievement we should not shift the problem on to universities. One of the problems in trying to engage Maori kids in schools is that they do not like being lectured to. They do not like what we call “talk and chalk”. Yet Dr Sharples said today that we should move the kids to university so that instead of being in a class of 25 or whatever they can be in a class of 500. They will have a lecturer at the front of the lecture theatre whom they can see with binoculars who will definitely “talk and chalk” to them and who will basically turn them off. That is the pedagogy that turns kids off. It is very disappointing to see that professional development has been cut and also that adult education courses have been cut significantly. Thank you Mr Assistant Speaker Roy. 
JACQUI DEAN (National—Waitaki) 
: 
 Here we are for the imprest supply debate and the second reading the Appropriation (2008/09 Supplementary Estimates) Bill talking about a Budget that in effect is tidying up after 9 years of a Labour Government 9 years of Labour mismanagement with us the National Government not only having to deal with the effects of a worldwide economic downtown but also having to spend a lot of time and energy dealing with the mess the Labour Government left behind it. One of the previous speakers this evening Moana Mackey who spoke after the dinner break said it all. When Moana Mackey was speaking on contributions to the Cullen fund she said “Now is the time that we should be investing”. My question to Moana Mackey and members of the Labour Opposition as we sit on a $7.7 billion deficit is “Investing with what?”. Moana Mackey’s comment just goes to show that Labour does not understand the times. The economic times have passed Labour by. Once again the National Government has been left to pick up the pieces after 9 years of good economic times which Labour entirely failed to capitalise on. “Now is the time that we should be investing” said Moana Mackey. Investing with what? I would love to hear the answer to that question. 
Another previous speaker this evening and other contributions to this bill have raised with some bemusement the subject of the magnificent Budget initiative to invest $50 million over 3 years in a regional cycleway. What a fantastic initiative on behalf of a National Government the cycleway is! I will tell members why the national cycleway is a great investment. The Otago Central Rail Trail has invested $7 million into the Central Otago economy. Over 300 jobs have been created in Central Otago. Pubs that were dying are now back open again. Farmers who were struggling now have income coming into their farm operations through accommodation. People who were previously struggling and looking for work are now employed because of the cycleway. 
Labour members do not understand. They do not understand that in provincial New Zealand 350 jobs are significant. An injection of outside money of $7 million is significant. The beauty of this cycleway strategy is that that will be replicated up and down the country. That is good news. But Labour does not like good news. It cannot cope with good news. 
There are some good news stories in this Budget. I want to turn to those. This Budget is focused on jobs. In terms of the cycleway strategy Labour members do not understand. They think there is one big-bang thing that will create jobs. They do not understand that a number of strategies are contained in this excellent Budget and that they are what will drive the recovery of the economy of this great country. 
I will start with the excellent home insulation programme. The reason I want to start with that programme is that in the South Island we experience some pretty severe winters. I was in Cromwell yesterday. It was minus 6 degrees then a shower of rain came at 7.30 in the morning and the roads turned to ice. I can tell members that people are cold in their homes in places like Cromwell Ranfurly Alexandra and Invercargill. The South Island is cold in the winter. This home insulation programme is good news for the people of the South Island and of course for people all over New Zealand. So what is the programme? It is a campaign to fit homes that were built before the year 2000 with insulation and clean-heating devices such as heat pumps and approved wood burners. 
About 180000 households are eligible for grants of up to $1800 regardless of income. This is good news. It is very good news for the people of the lower South Island. Of course community services card holders will be eligible for grants of up to $3000. This initiative starts on 1 July this year and many many people are inquiring about it. The best news of all is that it is fully costed and fully funded unlike the rather pale imitation of an initiative that Labour pulled out in the dying days of its regime which as we know was not funded at all. I move on to health and this is another concern of the people down in the South Island. If people are not warm in their homes if they do have good access to health services they feel it. 
The Budget in 2009 includes an additional $3 billion of investment in health services. This is such good news. It includes $750 million in 2009-10. The intention of this is to improve the services of district health boards and to meet population pressures. The population is growing in Central Otago. There will be 800 more health professionals to increase elective surgery capacity and that is worth $70 million. The National Government will be improving maternity services. Once again that is an area where many concerns were brought to me when I was in Opposition. Many concerns about maternity services and access to them were brought to me particularly from people in rural areas. This initiative of $103.5 million will help to meet that need. That is great news for young women and their partners in places like Central Otago east Otago north Otago and South Canterbury—I could go on—where there has been a level of concern about this. 
There will be an upgrading of the health sector infrastructure including a start to the construction of 20 new dedicated elective surgery theatres. That is good news for us in the south and that is worth $245 million. 
This Government is investing in health and education. There will be $1.68 billion over the years 2010-13 to improve facilities and to lift educational achievement. Our excellent Minister of Education the Hon Anne Tolley has been very strong on the need for us to improve on literacy and numeracy. So it is excellent news that from 1 July 2010 the National Government will expand the 20 hours’ free early childhood education scheme to 5-year-olds; the scheme will also include playcentres and kohanga reo. Many communities around my part of the country have playcentres only. They felt that they were missing out on the advantages of early childhood centres that had access to this funding. Now National is bringing them access to that funding and that is good news. 
There will be $36 million going towards helping students meet national standards in literacy and numeracy. Parents care about literacy and numeracy for their children. 
I could go on about the many many Budget initiatives but I want to close by saying that this is a good Budget for 2009. This Budget is designed to keep the economy going amidst some severe global turmoil. It is a wide-ranging Budget. It is focused on growth and it is focused on jobs. 
DAVID BENNETT (National—Hamilton East) 
: 
 As I follow on from that excellent speech I have to say it is important that New Zealanders look at the history of the circumstances we are in at the moment. This is not a time when New Zealanders need a Government or a Parliament that is expressing wild views and desires. This is a time when New Zealanders need a Parliament that is realistic pragmatic and conservative. This is a time when some major economic issues are facing our country our people and the international community. It is not a time to make rash promises. It is not a time to say— 
Chris Hipkins 
: That wasn’t the National Party position before the election. 
DAVID BENNETT 
: This is not a time for that kind of rash talk from the Labour Party members. This is a time when we need to be out there and listening to the people working out what is needed and delivering it. 
This Budget is a pragmatic Budget. This Budget takes into account the economic circumstances we face as a country. This Budget has delivered a solution that has had international success in that we had a credit upgrade within hours of this Budget being released. This Budget has shown that financial management in difficult times can be done in a way that maintains core services but at the same time is fiscally prudent. That is the balance that the New Zealand Government wanted and the Minister of Finance Bill English deserves a big pat on the back for doing that. 
Our compatriots across the ditch in Australia were not able to do that. Their Budget was far too optimistic one could say in regard to what they saw as their growth projections and it did not go down as well in the international community as our Budget did. When people looked at our Budget from a distance they said that it takes into account what is required to provide those core services to the New Zealand public while actually providing a direction for this country to get through the recession. 
That balancing act is something the National Government can be very proud of achieving—as can the parties that worked with National on this Budget. A lot of the smaller parties in this House came through and delivered for their communities but at the same time were part of a Budget that was rational and delivered to the whole country. I thank those parties for stepping up to the mark and being supportive. I am talking about parties like the Maori Party the ACT Party and United Future. They are all very successful members in terms of getting this Budget through so that we have a strong Budget for this country as it goes forward. 
This Budget is not without sacrifices. We had to make a big sacrifice in regard to taxation and we had to make a sacrifice in regard to superannuation. But the sacrifice in regard to taxation has I think been very much one that the New Zealand public has supported. When we go about among the public at the moment they are aware that they could be losing their jobs tomorrow. That is the reality people face. Those who are in business are also aware that they are not making profits. These are very difficult times for New Zealanders out there whether they are in business or are wage earners and they wanted a Budget that took that into account. We did that. We looked beyond the political ideology that the Labour Party looked at. We looked at what was right for New Zealand in these circumstances and we delivered that in this Budget. 
I turn now to superannuation. Labour Party members are going on about superannuation but they forget that the best thing we can do to pay for superannuation is to have a strong economy going forward. There is no point in borrowing money to put on the New York Stock Exchange. I would like to see those Labour members go to their individual bank managers tomorrow and ask to borrow the value of their assets and to put them on a US stock exchange. I want to see those Labour members do that and then see how far they get kicked out those doors. The reality is that it is not prudent investment at this time. For this country to get in a better position economically borrowing is not in its best interests. For New Zealanders going forward we can build a stronger economy and we can invest in infrastructure. We can make a strong country that will grow and therefore deliver the dividends to its citizens in the future. Those economic dividends will come through superannuation in time. But to get to that stage we need to build that economic environment. 
I applaud our team for doing that. I applaud them for taking into account those fundamental policy initiatives that we have been looking at maintaining such as in education in health in law and order and in infrastructure. But at the same time those members are delivering some economic rationale which will build a strong economy for us to go forward as a country. When we look at the infrastructure it is important to note that we have fulfilled many of our election promises around that in this Budget. There was a lot of talk about the broadband plan the upgrading of schools and the investments in transport. Those major infrastructural projects will not only deliver economic growth in the future but in the meantime they will deliver jobs for New Zealanders—jobs that are very difficult to come by at this time. 
The National Government has delivered a Budget that delivers to people now and in the future. It is a sensible Budget; a Budget that New Zealanders can be proud of. It is a Budget that defines the political landscape. On this side of the House the political landscape is one of a listening Government that makes the best decisions in the current circumstances. On the other side of the House what does one have? There is an Opposition party that wants to spend. It characterises itself as holier than thou while wanting to spend all the money that may be around. The fact is those members cannot justify what they are doing and saying. Imagine if they had actually written a Budget on the basis of what they were going to spend. What would the position of New Zealand be after a Labour Budget? It would be a shameful position. New Zealanders would be paying higher rates of interest on their mortgages. New Zealanders would see a lot of spending in areas that would not provide long-term returns for this country. New Zealanders would not have pride and respect for a Government that delivered a Budget that was important in the circumstances we face. I think that is important for New Zealanders to remember. 
At the end of this Budget debate it is all right for the Labour members to say that we should have spent money here and we should have spent money there but the reality is that the money is not there to spend. The New Zealand economy does not have the money that the Labour Party members are talking about. We have to be careful of how we spend money because every dollar counts at the moment. There is no room for rash promises. There is no room for taking money and spending it on political whims. There is no room for trying to buy votes as the Labour Party has constantly done. What we needed and what we got was a sensible Budget that takes into account our fiscal position but delivers a future. 
I am very proud to be part of a National Government that has set its first Budget in stone and is creating a great fundamental base for us to build on because not only are we building a structure that can go forward but we are doing it in a way that gives New Zealanders confidence in their Government. They are not seeing politicians making Budgets for political purposes. They are seeing a political party make Budgets in the best interests of this country. That is something that has been quite different from what one has seen in the past and shows the contrast between us and the Labour Party. The previous Labour Government’s Budgets have not been in the best interests of New Zealand. They have just been there for political expediency. Now New Zealanders will see financial management that takes into account where this country is where this country needs to go and how this country will get there. That is why the investment in those key fundamentals is so important. 
When we look at the Labour Party we see them try to provide this dream and this panacea of how things were with a Labour Budget. The reality is that Labour gave us our worst economic situation more so than any other Western country. It provided us with a situation where we were in recession before most other countries and it made expenditures on things like KiwiRail that were not in the best long-term interests of New Zealand. But the National Government has picked up on that. We have tried to do the best we can do in these circumstances. We have taken the power and made sure that even though we were given a raw deal from the previous Government we have delivered a Budget that will go forward into the future. 
A party vote was called for on the question  
That the Appropriation (2008/09 Supplementary Estimates) Bill and the Imprest Supply (First for 2009/10) Bill be now read a second time. 
Ayes 69 
New Zealand National 58; ACT New Zealand 5; Maori Party 5; United Future 1. 
Noes 52 
New Zealand Labour 42; Green Party 9; Progressive 1. 
Bills read a second time. 
Appropriation (2008/09 Supplementary Estimates) Bill 
Third Reading 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I move  
That the Appropriation (2008/09 Supplementary Estimates) Bill be now read a third time 
. 
Bill read a third time. 
Imprest Supply (First for 2009/10) Bill 
Third Reading 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I move  
That the Imprest Supply (First for 2009/10) Bill be now read a third time 
. 
Bill read a third time. 
Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill 
First Reading 
Hon Dr NICK SMITH (Minister for Climate Change Issues) 
: 
 I move  
That the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill be now read a first time. 
 At the appropriate time I intend to move that the bill be considered by the Emissions Trading Scheme Review Committee with an instruction that the committee report finally to the House on or before 26 June 2009 and that the committee have the authority to meet at any time while the House is sitting except during oral questions and during any evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House despite Standing Orders 187 and 190(1)(b) and (c). 
I will speak on the detail of the bill and why it is necessary and then I will give a broader perspective around the very important issue of climate change and the Government’s approach to it. But first I thank other parties for their consideration of the bill and I thank the Business Committee for its agreement to allow it to progress quickly. 
The bill has three parts around the reporting and the process issues for the forest sector under the Climate Change Response Act 2002. The first issue that the bill addresses is the requirement in the existing law that any deforestation during calendar year 2008 be reported and declared by 31 January 2009. This bill does not change the legal requirements that go with deforestation under the emissions trading scheme; it changes only the required reporting times by extending that date to 31 January 2010. The dates remain the same for reporting deforestation that occurs in this calendar year. We also made changes to the requirements to surrender units associated with that 2008 deforestation. This date has been put forward by 1 year from the end of April 2010 to the end of April 2011. 
The second change in this amendment bill is in respect of the application for exemptions for small forest lots of less than 50 hectares. The current Act requires that applications for exemptions be made to the Ministry of Agriculture and Forestry by 30 June 2009. The bill amends that with a provision that allows an Order in Council to set the date in future relative to the progress in the report of the Emissions Trading Scheme Review Committee. 
The third element of this bill is in respect of the publication of the forest allocation plan for pre-1990 forest owners. This allocation plan is a compensatory mechanism for forest owners who will be subject to deforestation liabilities under the emissions trading scheme. This has been quite a contentious area and it was subject to many submissions at the review select committee. The bill defers the requirement for this forestry allocation plan from 30 June this year—again the date will be set by an Order in Council—to a date that is appropriate after the select committee review has been completed and subsequent amendments to the emissions trading scheme have been brought back to the House. 
Part 2 contains some corrections to minor technical drafting errors that arose when the original legislation went through this Parliament under quite pressing time frames. The reason for changing time lines is quite straightforward to justify. The current review committee inquiry and the examination of the emissions trading scheme have absorbed a huge amount of energy and effort by many of those affected by the emissions trading scheme. There has been a particular focus on the forestry provisions of the scheme and it is noteworthy that New Zealand is the first country in the world that is attempting to include forestry in such an emissions trading scheme. If the Government pressed participants to meet the compliance requirements of the existing law at the very time those instruments are being reviewed by the review committee it would be unfair and it would send mixed signals. 
I have found that even Government agencies were not completely on time in reporting deforestation by 31 January this year. I am sure that many other forest owners—thousands I suspect—will also be in non-compliance. The particular issue around the forestry allocation plan is that it would be nonsensical for the Government to continue to develop and consult on the detail of an allocation plan when such key issues as offset and other provisions around forestry participation in the emissions trading scheme are being openly debated. It would create confusion and that is why the Government has not gone down that path. 
It is highly unlikely that the thousands—if not tens of thousands—of small lot forest landowners are aware of their obligation to apply for an exemption by the end of this month. It would be unfair on foresters for this oversight to result in them being adversely affected and that is why this bill sensibly provides for that date to be pushed out. 
In bringing this bill to Parliament I have consulted other parties. The Labour spokesperson on climate change Charles Chauvel has raised with me a preference that the two dates regarding forestry exemptions and the forestry allocation plan be firmly fixed at the end of June 2010 rather than be subject to an Order in Council. I understand and accept that that is quite a legitimate point and the Government has agreed to support an amendment by Mr Chauvel to this effect. In exchange for the Government’s support of that amendment the Opposition will support the timely passage of the bill. 
Similar concerns were raised by the Green Party. It also indicated a preference for fixed reporting and allocation plan dates. It is a pretty even toss as to whether a fixed date or a more flexible Order in Council mechanism is required albeit I openly acknowledge that it puts more pressure on the Government to get on and resolve the details of a modified emissions trading scheme and that is why the Government is happy to accept those. My expectation is that this change will be considered at the time this bill is referred to the special select committee. 
The Maori Party has fairly raised with the Government the very substantive issue in respect of the interaction of forestry and the emissions trading scheme with the central North Island Treaty settlement and with other Treaty settlement negotiations. The concern is that any changes in climate change policy in respect of forestry could adversely impact on the central North Island settlement. 
On behalf of the Government I would like to make it plain that we are determined to see that settlement and other settlements progressed and implemented. We will ensure that such settlements are not disadvantaged by any substantive changes to the emissions trading scheme. In many respects the concerns that have been raised with me by the Maori Party reflect the growing economic muscle of Maori and their strong interest in the success of the New Zealand agricultural forestry and fishing industries. This in many ways connects with concerns that National has and it requires a very careful balancing of New Zealand’s economic and environmental interests. 
I also acknowledge that there are other Treaty settlements—not just that of the central North Island—where this issue needs to be managed carefully and I am working closely with my colleague the Minister for Treaty of Waitangi Negotiations Chris Finlayson to work those through. 
I emphasise that this is a relatively minor technical bill. It simply deals with the reporting requirements and the allocation plan in the forestry sector which is particularly important for New Zealand in respect of climate change. I thank other parties for their cooperative attitude on this issue. It bodes well for our being able to build a broader consensus around the bigger challenge of climate change policy and the emissions trading scheme. I acknowledge that the process for the advancement of the bill is a short process. The special select committee needs to ensure that the bill covers only those matters that I have raised and that is why the shortened process is appropriate. 
In terms of the broader issue of climate change this Parliament will need to deal with a more substantive emissions trading scheme amendment bill at the appropriate time when the select committee has completed its review. My expectation in terms of the time line is that the select committee will be able to report back to Parliament in August and there will then be a substantive responsibility on the Government and on Parliament to progress a more substantive bill. I commend the bill to the House. 
CHARLES CHAUVEL (Labour) 
: 
 As the Minister for Climate Change Issues has said the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill seeks to do five things. First it will amend the Climate Change Response Act 2002 to delay certain requirements applicable to the forestry sector under the existing emissions trading scheme. Secondly it will amend section 168 of the Climate Change Response Act concerning the making of regulations so as to allow for dates for applications for exemption for landholdings of less than 50 hectares of pre-1990 forest land to be made by Order in Council. Thirdly it will amend section 183(3) of the principal Act to remove the requirement for applications for exemption for landholdings of less than 50 hectares of pre-1990 forests to be made before 30 June 2009 and replace it with a requirement for such applications to be lodged by a date to be made by Order in Council. Fourthly it will amend section 196 to defer the date by which 2008 deforestation must be notified and alter the timing of the obligation to surrender the relevant New Zealand units. Finally it will amend section 196 by inserting new section 196A which will give the Minister the power to withdraw or suspend certain draft allocation plans. 
As the Minister for Climate Change Issues the Hon Nick Smith advised the House he approached Opposition parties to consult over this amendment. Labour’s reaction was that it would be less than desirable to allow the second and third changes that I referred to just now—that is the exemption for land holdings of less than 50 hectares of pre-1990 forest and the requirement for lodgment to be dealt with by Order in Council. Our position is that it would be far better to have those matters dealt with by substantive legislation with the amendment itself specifying dates by which these events must occur. If there has to be a delay our preference is for a short delay and we have suggested that it would be sensible for the date to be the end of June 2010. 
The Minister also advised me that it would be entirely feasible for the Government relying on its support party and coalition arrangements to simply pass the amendment bill through all stages in the House but he was amenable to a request that there be a brief referral to a select committee. As a result the bill will be the subject of some advice from officials before the select committee at lunchtime on Thursday I believe prior to its coming back to the House for passage through its final stages next Tuesday in time for the 30 June deadline up against which the Government has run. I will suggest the amendments I have outlined—omitting the references to an Order in Council and replacing them with fixed dates—at the select committee meeting. I have advised other parties including the Greens of this intention and I understand that there is general support for following that approach. So that will be the Labour Party’s approach to the amendment legislation. 
Just as the Minister took an opportunity to say a few words on the wider question of emissions trading I will take a brief opportunity to do that as well. Labour members have said that we will support this legislation because the forestry sector has probably been one of the worst affected by the delays in the implementation of the emissions trading scheme. The House will know that the sector was effectively brought into the emissions trading scheme retrospectively when it came into force last year. 
Obviously with the staged bringing into force of the emissions trading scheme to all sectors and all gases—which is the uniquely New Zealand approach to emissions trading—the forestry sector was looking to be able to trade with other sectors as soon as they were brought into the scheme notably the stationary energy sector on 1 January of next year. Unfortunately Government policy has caused delay and doubt in the emissions trading and climate policy area. The decision to set up the Emissions Trading Review Committee and the conflicting statements made by Ministers about the future of climate change policy have cast that area into doubt and caused real difficulties both internally and externally. 
The forestry sector has probably suffered more than any other from this doubt. There has been deforestation. We hear reports of 8 million seedlings rotting in the ground. It is unfortunate to have to subject the forestry sector to yet more delay but if there has to be a delay—and clearly there does given the uncertainty around emissions trading and climate policy and given that the select committee process will as the Minister noted possibly drag on into August as far as a report-back date is concerned—we might as well try to achieve some certainty for the sector as to date. 
We urgently need in my view to have agreement as to emissions trading policy. It is a shame that we could not have had that agreement under the previous administration but as is a matter of public record the Labour Party has offered to have talks with the Government about whether we can achieve bipartisan certainty on the wider questions concerned. 
As I said to the Minister Labour will approach that task in good faith and I hope he acknowledges that so far we have done so. We do so with a desire to achieve a system that will be durable and in the best interests of not only New Zealand industry but also the New Zealand environment. We do not see the interests of industry and the environment as competing with each other. We see the future for New Zealand as one that really lives the “100% Pure New Zealand” brand. We see a future where we have an environment that not only has integrity but uses integrity in a meaningful way concerning the products we sell overseas particularly in terms of food products and the tourism destinations we market overseas. 
When we talk about the “100% Pure New Zealand” brand it should be something that people overseas can have some real reassurance about. Those people will know that we really mean it rather than just paying lip service to it. If we are to do that then we need to put a price on carbon at the margin. That is the only way as everybody recognises we will get meaningful behaviour change. It is the only way for example we will avoid continued conversions of marginal land to dairying as opposed to forestry or other uses that are much more in the national interest and it is the only way we will be able to restore our international credibility as a country that takes these matters seriously. 
Although we are a small emitter by global standards our per capita emissions are high and growing and we are seen as a country that ought not to follow other countries but should show a bit of a lead on this issue. In fact even if we act now internationally it would not be as if we were taking a huge lead given the positions of Europe the positions that are developing in Australia and the positions that are developing in the United States. By the time we get to Copenhagen at the end of the year we will hopefully have armed our delegation with meaningful legislation and hopefully an emissions trading scheme will be in force with some good complementary measures and with a good target for emissions reductions not only by 2050 but also by 2020. 
The world will then be able to see that the last few months in New Zealand were just a hiccup an unfortunate little pause for a cup of tea and we will be able to really get on and give some certainty not only to business but also to other stakeholders. We will be able to tell them that we really mean what we say when it comes to climate change policy. Certainly that is the aim of the Opposition in offering the opportunity for talks to the National Government. We regret the need to do it. We regret that it could not have been done 12 months ago but we hope that we can reach a durable settlement and have an emissions trading scheme that has credibility. That will be our aim. Thank you Mr Assistant Speaker. 
CHRIS AUCHINVOLE (National—West Coast - Tasman) 
: 
 It is a pleasure to follow the Hon Dr Nick Smith who introduced the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill and my parliamentary colleague Charles Chauvel who spoke with I thought a most balanced approach and spoke about having talks between the parties to get this particular situation right. 
National believes that New Zealand is a responsible international citizen that as a country that values its clean green environment must act to reduce its greenhouse gas emissions. I do not think that there is argument over that point. This bill amends the Climate Change Response Act 2002 to delay certain requirements applicable to the forestry sector under the New Zealand emissions trading scheme. 
To background the bill I say that National as part of its supply and confidence agreement with the ACT Party established a special select committee the Emissions Trading Scheme Review Committee to review aspects of the existing climate change policy. The review has taken longer than planned because I understand the committee has been so thorough in its approach. The committee has now indicated that it will report back at the end of July or in early August. As a result the sector with pre-1990 forest land would have to meet legal obligations before the completion of the final allocation plan for the sector. 
To those who are not familiar with the minutiae of this particular legislation it probably sounds a little bit complex but it is not really. Under the Climate Change Response Act 2002 the Minister has a duty to issue a final allocation plan for the pre-1990 forest land before 30 June 2009. The Government wishes to consider introducing offsetting or another mechanism for the pre-1990 forest land. To finalise this policy and ensure compliance the 30 June 2009 date in the Act has to be changed. So this is really a technical bill to keep everything in sync. The 30 June 2009 date is intended to be replaced by an Order in Council with 1 July 2010 a likely date. But in introducing the bill of course the Minister for Climate Change Issues spoke of different means of achieving that change. 
Of the roughly 1.8 million hectares of forest in New Zealand about 650000 hectares were planted pre-1990. Under Kyoto forests planted from 1 January 1990 accrue carbon credits which have a value. Forests planted before 1990 do not accrue carbon credits but there are liabilities when the trees are cut down. Those liabilities will fall on the landowner. A lot of this land is Crown land—public land—and some of it is part of the settlement under the Treaty of Waitangi. Landowners of pre-1990 forests that are less than 50 hectares can apply for an extension under the emissions trading scheme but there is a risk that these landowners will not meet the 30 June 2009 deadline. This amending legislation will ensure adequate levels of compliance. That is the purpose of the bill. Thank you Mr Deputy Speaker. 
Hon DAVID PARKER (Labour) 
: 
 I rise to speak to the first reading of the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill. I think it behoves me to record a little bit of the history of why we have got to where we are. You know there has been ongoing debate round the world for a couple of decades now as to whether climate change is real. We in the Labour Government supported by the Greens made up our minds some time ago that there was enough compelling evidence to require us as policymakers to no longer sit on the fence but to actually do something to reduce emissions. Scientists are telling us that unless we do something to reduce emissions the future of our world is pretty dire. The consequences are not just modest changes to the way we live; they are dramatic and catastrophic changes for many species. They include the mass extinction of plants of animals and of aquatic communities as a consequence of the changing acidification of the oceans; changes in the places where food can be grown; and the increasing desertification of parts of Africa Asia including food-producing parts of China and of course closer to home Australia. 
In addition a number of people will be made homeless by rising sea levels. I do not know whether members have ever seen photos of the capital of the Maldives which sits on an island just 1 metre above sea level. The whole capital city of high-rise buildings would be wiped out by a 1 metre rise in the sea level. Thirty million people in Bangladesh would have to move if the sea level rose by 1 metre. 
Hon Sir Roger Douglas 
: I was there 20 years ago and it was like that. 
Hon DAVID PARKER 
: I say to Sir Roger that since World War II more people have died as a consequence of flooding of Bangladesh at current sea levels than as a consequence of the bombings of Nagasaki and Hiroshima in Japan. Thirty million people on the move in Bangladesh would have very real consequences. It could cause war it could cause civil conflict throughout Asia and it could well have knock-on effects through our own region. These are very very serious consequences. 
It is easy to talk about these issues then do nothing about them. In this country we have had a long debate on how we should get the right economic signals into our economy in order to reduce emissions. We have to encourage businesses to go in the right direction rather than increase their emissions. New Zealand has an obligation under the UN agreement the Kyoto Protocol to take financial responsibility for emissions above 1990 levels. That already costs our country. How do we improve the environment by reducing emissions and also minimise the costs of the bill under that international treaty? Well a central part of doing that is the pricing of emissions. 
There are three ways that we can price emissions. We can force a cost upon people through regulatory action—try to regulate every little area where emissions occur. That is quite an inefficient way to do it but it is better than doing nothing. Alternatively we can price emissions in one of two ways: we can have a carbon tax which is what the Labour Government supported by the Greens originally proposed or we can proceed with an emissions trading scheme. In reality those instruments are not very different; they both cause industry to pay for the cost of increases in emissions and they both reward it for any conduct that reduces its emissions. They change behaviour by changing prices. Sir Roger Douglas is always saying to Parliament that we should price things in order for people to value them not to waste them and not to do the wrong thing. There is something in that argument especially around the environment. If we do not price environmental externalities into the commercial contract they are largely ignored by those who are making the commercial decision. Therefore they build another gas-fired power station rather than a renewable power station and they increase emissions. 
What happens with emissions pricing is that throughout the economy we are changing the relative price of goods and services to make low emissions goods cheaper and higher emissions goods more expensive. It is as simple as that; it really is that simple. At the margin someone buys a wooden ladder because it is relatively cheaper than an aluminium ladder. Conversely somewhere else in the economy it becomes cheaper to run an aluminium car because it is lighter than a steel car which is heavier and uses more fuel. All of those little changes of behaviour make a difference and the world’s emissions go down instead of up. It is not the only thing that needs to be done but it is a very important thing to do. 
We already have legislation in New Zealand to that effect. We have the emissions trading Act which is already in law. After a number of false starts on the carbon tax and very very difficult politics around the emissions trading scheme Parliament finally passed legislation last year that is essentially sound. No doubt there are line calls in it where the National Government might have a different view from the Green Party which might have a different view from the Labour Party but essentially it is sound legislation. 
The National Government came to power with a promise to change it. It said it was not going to delay things; it was going to be a quick change. Well history already shows that that was wrong; the select committee process continues and here we are now with legislation delaying the implementation of the emissions trading scheme in the forestry sector. We in Labour want to if possible reach consensus with National on this without sacrificing our bottom line principles as to what is needed for an effective scheme but it saddens us that we have to delay some of these dates and that cannot go without comment. On the positive side I thank the Minister for Climate Change Issues for agreeing to the amendments suggested by Charles Chauvel. Rather than leaving open what the future dates are he is specifying an end date. With that amendment we can support this legislation as we try to find common ground—if we are able to—with National on amendments to the scheme that will not change its fundamental efficacy but might make it more durable for the future. No doubt there are some things that can be done better; everything can be second-guessed. 
One point I would also make is that during the debate on the primary legislation—the emissions trading scheme legislation—we had National members saying it was rushed legislation it was shonky legislation and lots of technical amendments were required. Well I have the original Act here. It is 224 pages long; it is long and technical legislation on which the select committee officials the Government and support parties laboured long and hard. The technical amendments to the existing legislation—the 224 pages of the original legislation—that the Government has so far identified are in Part 2 of this bill under the title “Miscellaneous technical amendments”. How long do members think those amendments are? They are less than a page long; they comprise clauses 8 9 10 and 11. The legislation is already in good shape. It was not fundamentally flawed as the Opposition in the last Parliament pretended it was and it remains a very good starting point for the debate that we are now having. 
I cannot say it is with pleasure that Labour members consider this amendment bill but I do think that some progress has been made towards finding consensus. I think it is nonsense when people say New Zealand is leading the world in its response to emissions management. We are not. A lot of countries are doing better than us. We have turned the corner on renewable electricity. Last quarter we had 74 percent renewable electricity. That is the highest percentage of renewables that we have had for about a decade. We have turned the corner with more wind and geothermal generation being built. We do not need much more hydro generation but wind and geothermal generation will push the percentage climb towards the target set by the previous Government of 90 percent renewable energy by 2025. 
We have also made progress on public transport. It saddens me to see that under the current Government we are starting to go back with the reprioritisation of roads away from public transport. None the less we are still in a better position than we were previously. There is some unfinished business with complementary measures and I urge the Minister to look at the issue of efficiency rules for cars coming into the country. Once a car comes into the country it is used till the end of its useful life. It is a valuable commodity and someone will run it. If an inefficient vehicle is brought into the country it not only costs the world in terms of greenhouse gas emissions but it causes the country a cost in respect of wasted energy. It is an area where I think the Treasury modelling is flawed. It focuses only on the cost of emissions and does not look at the efficiency benefits for the economy of an improved more efficient fleet. It is an area where New Zealand could improve its own wealth by reducing waste on its roads whilst at the same times reducing its greenhouse gas emissions. 
In agriculture some good work is being done but there needs to be more work. Most members on both sides of the House agree that science will play an important part but a change in mindset amongst many in the agricultural community is needed to implement change in their practices in order to minimise their emissions. The Climate Change Response (Emissions Trading) Amendment Act 2008 is a good foundation. 
JEANETTE FITZSIMONS (Green) 
: 
 The Government has come to Parliament tonight to ask Parliament for a “get out of jail free” card. Some might call it a technical “get out of jail free” card as Chris Auchinvole did but nevertheless that is what it is. The Government has done that because unless Parliament agrees to suspend the Standing Orders on the amount of time it takes to put a bill through Parliament next Tuesday the Government will be in breach of the law. 
The Climate Change Response Act that we are referring to was passed in August last year. Since then there have been 10 months for officials to get things right. It is an Act that relies on allocation plans and regulations to have any substance. That was one of my main criticisms of it last year—that we were essentially passing a bit of a shell that left a lot of the really tricky stuff to the officials to do through regulations and not through Parliament. Without those regulations without those allocation plans the law can have no effect. But the obligations and the entitlements for forestry began in January 2008. Forestry has been in the emissions trading scheme for 18 months. One would think that in 17 months the foresters could have got their act together and reported their deforestation as the Act requires them to do except that calculating deforestation carbon losses is a fiendishly difficult technical thing to do and it does not sound as though the officials have been particularly active in helping them so far because climate change policy has been in a complete mess. Moreover there have been 10 months since the Act was passed for the Government to develop its allocation plans for forestry and it does not appear that anything has been done there yet either and that is where the Government will be in breach on Tuesday if we do not pass this law. 
In December last year the new Prime Minister came in and said he was putting the emissions trading scheme on hold. I asked a number of questions in Parliament about how the Prime Minister could do that when it is the law without passing legislation. It then became apparent that it was not being put on hold because forestry would stay in the emissions trading scheme and nothing else would come in until next year. So the Government set up a special committee to review the emissions trading scheme except in this rather Kafkaesque way the committee was given very detailed terms of reference which asked it to do virtually everything one could think of except review the emissions trading scheme. It was given a wide range of issues to inquire into but the Act that it was meant to be reviewing was never mentioned and the task of reviewing it was never mentioned. Nevertheless everybody assumes that we are reviewing the emissions trading scheme and no doubt we will do some of that but not because we have been asked to; we will do it just because it appears to be the most useful job at hand at the moment. I have often suspected that the committee that we are all working very hard on is actually a bit of an excuse to park the issue until the Government has decided what it wants to do next. 
During all of this time foresters have been subjected to extreme uncertainty. Last year with the Act in place and apparent certainty they ordered some 7 million seedlings enough to plant some 7000 hectares and they are being ploughed in this winter because nobody is planting them because nobody knows what the rules are going to be. When the Prime Minister made his initial announcement they started to wonder whether they would even get credits for the last year. The answer eventually came that yes they would get credits for carbon sequestered since January 2008 but actually they will not be worth anything for a while yet because nobody has any obligations to buy any carbon credits nobody is buying any carbon credits so the foresters cannot with one or two minor exceptions sell their credits to anyone at the moment. 
After 7 months the Government is about to be in breach of the law and 1 week before that breach it recognises that and brings us amending legislation. Forestry is in breach of the law already over its reporting of deforestation and everybody is in a mess because the rules are still in complete flux and there is masses of doubt about what is going to happen. It would be somewhat tempting as a small Opposition party to say to the Government “Well stew in your own juice.” But actually forestry needs certainty so we will not do that. We will support this legislation. Last week I met with the Minister for Climate Change Issues Nick Smith and pointed out that we could not support completely open-ended replacement dates. It turns out that that was the same thing that the Labour Party had told the Minister so we all have an agreement that that will be remedied at the select committee on Thursday. On that basis we will support the leave that the Minister is seeking and we will support the legislation. 
In my last few minutes I want to point out that there is worse coming up on the issue of the emissions trading scheme. This is only the first “get out of jail free” card because on 1 January next year the stationary energy sector comes into the emissions trading scheme. That sector includes the big industrials like cement steel and aluminium which are totally relying on free credits for up to some 90 percent of their emissions in order to cope with the fact that their overseas trading competitors do not face a price on carbon. There is no allocation plan for how they get their free credits or how many they should get. Without that allocation plan they will on 1 January be liable for 100 percent of their carbon emissions and if that state of affairs were to persist a number of them would fall over and close down. 
So why do we not have an allocation plan for the stationary energy sector? Because the Government has not decided yet what obligations the stationary energy sector will have how they will mesh with all of the other rules they have and on what basis they will be allocated. That is not something that can be done in a hurry because under the law as it stands those allocation plans have to come to Parliament. It is not something that can be done over a weekend. They are fiendishly complicated. In fact the most politically divisive and difficult part of the whole emissions trading scheme system is developing those allocation plans. We know the retinue of lobby groups that will be besieging the Minister and the officials once it is known that those allocation plans are under construction because it is the same retinue of lobbyists that the select committee saw all of last year that the select committee has just seen all over again this year and that we will no doubt see for the third time when the Government brings amending legislation to the House later this year—if in fact it does. 
The Government has a huge conundrum on its hands there because I predict that before 1 January next year the Minister will be back with another little amending bill to delay the coming into force of the energy sector. I have to remind folks that by the middle of next year we will be halfway through the Kyoto period. We are already 1½ years into that 5-year period and so far nobody other than poor deforesting foresters faces any obligation at all to pay for any part of their emissions. So for this period 2008-12 the taxpayer will still carry the main bulk of the liability—and this is a Government that wants to bring down taxes. 
It has been indicated a number of times that the Government would really like to align New Zealand with Australia. Well tonight I want to celebrate one hero in Australia who is a climate change denier. Members probably did not expect to hear me say that but I tell them there is one independent senator who does not believe in climate change; he thinks the effects are all caused by solar flares or whatever— 
Charles Chauvel 
: That’s this week. 
JEANETTE FITZSIMONS 
: —well all right; this week—and who is not going to vote for the Rudd Government’s proposed carbon reduction plan. Therefore the Government will be a vote short and the plan will not go through. Even the Green Party over there which strongly supports carbon reduction and which supports emissions trading if they can get the rules right does not support the pathetically weak scheme that the Australians have. So there will be no Australia scheme for New Zealand to align to. We need to get on and make our own and make it work. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 I rise on behalf of the ACT Party to support this legislation but I guess that my position could not be further away from where Jeanette Fitzsimons left the debate. 
Jeanette Fitzsimons 
: Proud to be different. 
Hon RODNEY HIDE 
: Yes we are proudly different. I think that John Key is providing good leadership on this issue by saying that we should be aligning with Australia and I would like to see the Minister for Climate Change Issues provide the road map for New Zealand by stating how he intends to align New Zealand’s response to climate change with that of Australia. 
Jeanette Fitzsimons 
: There isn’t one. 
Hon RODNEY HIDE 
: Well that is why we in the ACT Party are somewhat confused. It seems to me that we are in a situation of some considerable adhockery where we have a statement from the Government saying that it wants to halve greenhouse gas emissions by 2050 from what they were in 1990 which I think Jeanette Fitzsimons would agree with me is a very ambitious goal and would probably flatten the New Zealand economy but we do not see a plan to achieve it. Then we have the proposal that we are going to align with Australia and not get ahead of Australia. Yet we have the legislation that was left to us by the previous Government and the previous Government’s ambition was to lead the world on this issue. 
In order to provide some certitude for people in New Zealand whatever side of the argument they are on we need to know where the policy is on climate change. What is this Government’s policy and what is its plan? It seems to me that what we have now is not satisfactory according to the Government because the present legislation does nothing to align us with Australia. We are having now a series of ad hoc decisions whereby as sector groups line up to come up we are rushing a bit of legislation through in order to push actions out into the future. Well where is the certainty or certitude in that? 
I suggest that yes we have the select committee process reporting back and that yes we have a cost benefit under way but we need to be providing some certainty and certitude and this legislation does nothing to provide that. I suggest that we should be putting the introduction of the emissions trading scheme on hold until we actually work out what the policy of this Government and this country on climate change will be. Otherwise we will be left either with the mess the Labour Government left us or with a series of ad hoc reversals which I have to say are better than the status quo. But surely the Government can do better than that. 
I look to the Minister in charge of the bill and tell him that the ACT Party stands here to welcome anything and is willing to work on anything that will stop the nonsense of the huge cost of the emissions trading scheme to the New Zealand people and the New Zealand economy and especially anything that will stop the devastating impact it will have on our agriculture for no good reason. 
The idea that New Zealand rushing ahead of the rest of the world is somehow good policy or good for the world is frankly nuts. The idea that that is good for New Zealand is nuts. The idea that we should line up with Australia has some logic to it but I ask where the plan is. Thank you. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe Mr Deputy Speaker. Kia ora tatou katoa e te Whare a kia ora tatou kua tae mai i tenei po. I te ahuatanga o nga korero i runga i o tatou marae ko taku i te tuatahi he tuku poroporoaki ki a koe e Wiha ki a koe Maxine. Korua tahi kua ngaro atu i te tirohanga kanohi nga pou o te reo Maori i te wa i a korua. Ko tetahi i eke ki te ahuatanga o te kuia ko tetahi he tamariki tonu. Hoi ano ahakoa pehea korua tahi haere. Whakangaro atu i te tirohanga kanohi me te mohio ano hoki kua tutuki pai nga ahuatanga i te wa i a koutou mo te aha? Mo te painga o to tatou reo. 
[An interpretation in English was given to the House.] 
[ 
Thank you Mr Deputy Speaker. Greetings to us all the House and to those present tonight. With due respect to speeches on our marae the first thing for me to do is to farewell you Wiha and you as well Maxine both of you pillars of the Maori language in your time. One lived to an advanced age the other was still in the prime of life. And so regardless I say to you both farewell. Disappear from view knowing full well that what you set out to do in your time has been achieved. And for what purpose? To advance our language 
.] 
This last week Maoridom lost two key figures who advanced te reo Maori: Wiha Malcolm—I think that was her name at the time of her passing—and Maxine Tamihori who was well on in age. Both were doyennes of Maori language and that has some influence in respect of discussion about the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill in the sense that the context of the Maori world around us is something they knew in their time. They were promoters of the notion that we as tangata whenua use te reo Maori to express our world view. Our environment our weather system and our natural world are woven throughout all the waiata they used in order to teach about our stories and those elements help to guide our daily lives. 
To help the House understand that one example of how we use te reo Maori to express that notion of the environment being intertwined with us as a people is to look at this whakatauki: “Nau i whakatakoto i to hinaki i te wai tawawarua anei te waituhi ka taha.” Loosely interpreted the message is that the eel pot should be set during the main flood after all of the smaller eels have passed through leaving the bigger ones to follow. That whakatauki is saying that to be effective timing is everything. I have been thinking about that simple message as we have looked into the forestry sector amendments as they apply to the New Zealand emissions trading scheme. In essence the key issue in this slim little bill is to delay requirements relevant to the forestry sector under the emissions trading scheme as other speakers have alluded to. 
The Maori Party has been well served on the Emissions Trading Scheme Review Committee by our member for Te Tai Tokerau Rahui Katene. Ms Katene in turn appreciated the excellent advice that came forward from nearly 30 submissions from Maori trusts corporations and runanga. It goes without saying that we are mindful of the advice from the Climate Change Iwi Leadership Group people including Api Mahuika of Ngati Porou Timi te Heuheu of Ngati Tuwharetoa Mark Solomon of Ngai Tahu and other iwi actively engaged in the emissions trading scheme. The group supported the delay. Ngai Tahu are comfortable with the delay and I understand that the Central North Island Iwi Collective have also passed a resolution supporting the delay on the basis that they have been given assurances that their position would be no worse. This is an excellent and important qualifier with the support being conditional on the basis that iwi will not be in a worse position. 
As other speakers have mentioned the current law under the Climate Change Response Act requires foresters to have reported any deforestation during the 2008 year by 31 January 2009 and to apply for exemptions for small forest blocks by 30 June 2009. Without putting too fine a point on it that is next Tuesday. Those dates are unreasonable given the process still in train of the committee review and the associated lack of public awareness of these requirements. Therefore we recognise that without this bill many forest owners would unknowingly find themselves in breach of the law or adversely affected by it. 
Although it is a very complex picture it seems that iwi with forest interests support the delay. We respect their views. Some of the inherent complexity can be understood by looking at the Central North Island Iwi Collective in a little bit more detail. We know that there is likely to be a split view across different iwi with forestry interests depending on whether they supported the emissions trading scheme in the first place but there are other layers to the complexity. Reaction to this bill may depend on whether an iwi is a part of the Central North Island settlement group whether they want to settle or not or whether like Ngati Tuwharetoa they have forest lands included in the Central North Island settlement and extensive forest estates outside of it. It is a complex picture and it is vital that we get it right not hurry for the sake of political expediency. We must take care to consider how we meet the Kyoto obligations and how we can protect the climatic systems from excess carbon emissions while also considering the adjustments required specifically to achieve fair and equitable provisions for the forest sector. 
The House has the benefit of some very strongly expressed views from Maori to assist it in how we can improve upon the legislation. There was the consistent recommendation that there should be a clause included in the bill that establishes a bottom-line position namely: “Nothing in this Act shall be inconsistent with Te Tiriti o Waitangi.” The Federation of Maori Authorities went so far as to say that the bill breaches the Treaty in failing to uphold rangatiratanga while Morikaunui Incorporation said that the bill as drafted conflicts with the principles and provisions of Te Ture Whenua Maori Act 1993. The sticking point is the bill imposes an encumbrance over Maori land that is effectively an alienation. 
Perhaps one of the clearest explanations of the issues related to this bill comes from the submission from Te Runanga o Ngai Tahu. Their concern was chiefly to do with their land; they considered it to be the most suitable for conversion to another commercial use. Ngai Tahu purchased this land before 2002 when the Government announced its intention to introduce some form of deforestation controls. Ngai Tahu were therefore unable to take advantage of the 2002-08 period to deforest key areas of land as many owners of the pre-1990 forests have done. In fact they concluded that Ngai Tahu would suffer a disproportionate and significant liability as a result. The financial costs for Ngai Tahu would be huge in scope. It was the thinking of Te Runanga o Ngai Tahu that land returned as a part of a Treaty settlement that falls into those categories should be excluded. Ngati Awa of the Whakatane area meanwhile believed that those iwi in the same position as them should be eligible for a one-off adjustment to choose how they wish to use their lands in the future without reference to the emissions trading scheme. Such an option would have meant that they can make the choice that they originally envisaged they would have when they purchased the forest and therefore be required to comply with the emissions trading scheme. 
I described the context of this bill as complex. The more one reads through the submissions and appreciates the range of issues emerging from it it becomes all the more evident that there is a great deal more to this bill than the five pages initially indicate. Wairongomai Incorporation put it bluntly: “The bill is inequitable and has disproportionate negative effects on Maori.” It was their position that the Crown had assumed to itself the ownership allocation and management of the carbon allocation resource. 
I return to the advice from the Federation of Maori Authorities. The federation told the select committee that Maori know full well the need for climate change policy that tangata whenua are fully in support of the focus on behaviour change to mitigate human impacts on the climate and that that was in line with their kaupapa of kaitiakitanga—the capacity to nurture the spiritual cultural and environmental protection of Te Ao Marama. That is taken for granted. But when we get to this bill what we see is significant inequality of treatment of Maori. By locking Maori lands into this regime and legislating how Maori are to use their lands the bill perpetrates a system of inequalities that I am sure the Minister for Climate Change Issues will consider as the bill moves through its various stages. 
Finally the Maori Party has supported the call from many runanga iwi and incorporations for the Treaty of Waitangi clause to be added to the bill and the call for amendments to protect the integrity and durability of the settlement. Now we listen again to the views of Maori who are saying that they should support the call to delay and therefore that will be our vote for this first reading of the bill. Tena tatou. 
NICKY WAGNER (National) 
: 
 I rise to support the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill. The Government is introducing this bill to deal with technical aspects of the timing of the emissions trading scheme as it relates to forestry. The reason we are proposing this bill is that the special Emissions Trading Scheme Review Committee is still debating the issues and the process will not be completed before 30 June. The committee will report back in late July or early August so unless we amend the law now before 30 June many forest owners may find themselves acting in breach of the law and they may be adversely affected. 
It does not make sense for the Government to publish an allocation plan by 30 June when issues surrounding forestry are still in debate. The review committee has heard many and detailed submissions from the forestry sector and is still considering the final shape of the emissions trading scheme for forestry. It is also considering the introduction of offsetting or another mechanism for pre-1990 forests. Getting the inclusion of forestry into an emissions trading scheme is a complex process. New Zealand is the first country to attempt it so we must take our time and we must do the work to get it right. We are well aware of the enormous financial and environmental importance of forestry to New Zealand and to our economy and we understand that these decisions are critical for foresters. Of course we are working towards the substantive climate change amendment legislation later in the year and this is where the final shape of the forestry scheme will be spelt out. 
New Zealand is a country that values its clean green brand. Most New Zealanders identify closely with the natural environment and understand that we must be responsible international citizens when it comes to dealing with climate change and reducing our greenhouse gas emissions. Our two biggest industries agriculture and tourism rely heavily on the quality of our natural environment. Tourists come to see our beautiful clean green country and when we sell our agricultural products overseas food safety is of the utmost importance. In doing good for the environment we do good for our economy as well. 
So the Government and New Zealanders are committed to making emissions reductions but we want to reduce emissions in ways that result in the least cost to society and the economy. The Bluegreens the environmentalists in the National Party have developed a series of values that help us make decisions on environmental matters. The overriding principle is that we must use our resources in a sustainable manner and we believe that economic growth and improving the environment can and must go hand in hand and I was very interested to hear Charles Chauvel saying something very similar earlier this evening. 
It is important that all environmental decision-making is based on good science. It is the only way to get quality decisions. We also believe that people respond best to change when they are engaged or given incentives and that is why we generally support financial instruments rather than just adding another tax. Philosophically we prefer the flexibility and choices available within an emissions trading scheme to a carbon tax. We believe that financial instruments when used effectively can provide incentives for businesses and organisations to do the right thing environmentally by choice rather than by rules and Draconian legislation. 
We want to harness the innovation of New Zealanders and New Zealand companies to develop ways to manage their greenhouse gases and protect the environment. Of course the profile of New Zealand’s greenhouse gases is heavily influenced by our agricultural emissions. Over 50 percent come from our farms whereas in most developed countries agricultural emissions are nearer 12 or 15 percent. We have an unusual profile of emissions and one that is particularly difficult to manage but New Zealand is recognised for its expertise and research and development in the agricultural and forestry sectors and that is why we are leading the development of an international research centre focused on greenhouse gas emissions from the agricultural sector. The Centre for Agricultural Greenhouse Gas Research will be a great opportunity for us to use our unique knowledge and expertise to tackle the issue both in New Zealand and internationally. Of course we will be doing anything we can to tackle the other major areas that produce greenhouse gas emissions: energy use and transport. 
As I said New Zealand is a country that values its clean green brand. New Zealanders identify closely with the natural environment and want to be responsible when it comes to dealing with climate change. Forestry is an important part of our environment our economy and our response to climate change. The Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill will ensure that we take our time to do the work and understand the international conditions so that we can create an effective long-lasting and sustainable emissions trading scheme for forestry and for New Zealand. 
MOANA MACKEY (Labour) 
: 
 I am very happy to stand and take a call on the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill. First of all I thank the Minister in charge of the bill the Hon Dr Nick Smith for his engagement with other parties on this legislation. Certainly all members of this House see some benefit in as many parties as possible coming together to find a solution to climate change and ultimately to support an emissions trading scheme that is environmentally credible and has the support of as many parties as possible. That is needed to ensure its longevity and provide certainty for those sectors that at the moment are finding themselves in a very uncertain position. It is from that perspective that Labour will support this bill’s referral to the Emissions Trading Scheme Review Committee this week. Of course we have indicated that we will seek to make changes to the bill and the Minister has already indicated that he is happy to accept them and we appreciate that engagement with him as well. 
It has been really interesting to listen to the debate on a number of issues raised in speeches on this bill tonight because many of them do not have anything to do with this particular bill. This is a relatively technical bill that extends deadlines ensures the Crown is not deemed to be liable and ensures the forestry sector knows where it stands. In that regard it is technical legislation but it has been interesting to listen to the speeches and hear about the issues that are coming up. Members wish to raise those issues even though they are not covered by this bill. We assume they will be covered by a much larger and more substantial bill to amend the emissions trading scheme. As a member of the Emissions Trading Scheme Review Committee I can assure members that in respect of the issues that have been raised in speeches—with the exception of Mr Hide’s perhaps although not entirely—the committee has not really been interested in reviewing the science of climate change at all. We decided that that issue should be put aside that the debate has been had on it and that we need to get on with designing the best scheme possible. 
I want to talk about the delay in the emissions trading scheme because that is really why we are here to pass this bill. It is a technical bill and we accept it provided that we have the changes we want to see in it. This bill has come about because of a delay in the emissions trading scheme and Labour has been very critical of that delay in the process. Although I think it would be fair to say the Labour members have been engaging really constructively with other members at the select committee and working very hard to try to tease out some of the issues that has not been easy. A lot of the submissions that we heard were the same submissions we heard last year; they concentrated more on the legislation rather than the terms of reference that were before the select committee. It is not always easy to guide submitters towards the terms of reference when they want to talk about the legislation that they know and that they spoke about the year before. It has been interesting to try to get broad overview opinions on all the issues when people wanted to talk about this section and that section about taking a bit out of the legislation and about their wish to be exempted because they say they are completely different cases from those intended to be included and can make arguments for that. The committee has worked in very good faith to do that work because we decided that rather than play politics on an issue that is so important to our country our economy and our environment we want to be part of finding the solution. Although some element of politics is always inevitable in such situations we certainly do not want to be obstructive during that process. 
It is interesting to note some of the reasons that we have been going through the delay. One of the reasons is that we have been looking at harmonisation with Australia. The Australians are going through their own process now with their own version of an emissions trading scheme. But tonight we have heard that whereas on 4 June the House of Representatives passed the Carbon Pollution Reduction Scheme which is the Australian version of our emissions trading scheme within the last few hours the Upper House in Australia has voted to suspend all further consideration of that scheme until 11 August. 
Hon Rodney Hide 
: Great! 
MOANA MACKEY 
: I thought Mr Hide would be very happy about that. The Upper House has demanded that the Australian Government remodel the scheme and the Minister for Climate Change and Water in Australia has come out and said that will not happen. We are seeing an impasse on the Australian scheme and it will be interesting to see who blinks first or whether we are looking at some kind of double dissolution of the Australian Parliament. I am sure the Minister for Climate Change Issues will be watching the situation very carefully. 
The situation in Australia shows the reason why we need to set our own timetable for our emissions trading scheme. Although a level of harmonisation will always be desirable where it is possible New Zealand really cannot wait for the Parliaments of other countries to decide on their path before we move ahead on ours. It has to be in our best interest and Labour does not believe that it is in our best interest to delay the emissions trading scheme further and further. We want to see changes happen and we want to see them happen as soon as is practicable. Although we did not vote for the special select committee process we wanted to engage with it at that level and be constructive. I think we feel we would like to get on and do something. 
Part of the reason why we have to change the time frames today is that the Government did not suspend the existing emissions trading scheme passed by the previous Labour Government. That scheme is still in place; it is still active. I am sure all parties in this House want to be able to give all the industries that are due to come into that scheme including forestry which is already in the scheme and is looking for sectors it can trade its credits with as much certainty as possible. We want to be able to tell industries as soon as possible the time frames they will have to work to. Already some of those time frames have shifted. I am sure the Minister will make a statement about what has happened in Australia. Labour and the members of the select committee will be interested in knowing exactly what it means for our emissions trading scheme in light of the Minister’s strong desire for as much harmonisation with Australia as possible. As I have said that is not undesirable but given what has happened tonight obviously we cannot control it. As much as I would like to be able to blame the Minister for what has happened in Australia tonight I am not going to do that—I cannot do that. But we need to know exactly what it means in terms of the process here in New Zealand. 
I want to pick up on a couple of things that the previous speaker said. We very much look forward to getting a bit more information about the greenhouse gas centre of research excellence—I think that is its name—and about what exactly it means and how it will work because at the moment we are not quite sure. I know it will be a virtual centre rather than an actual physical one in a building somewhere. But given that our Crown research institutes already work very well together and we are seeing that on this cause I think some more detail around whether it will be like one of the centres of research excellence that have already been set up would be extremely helpful. 
Nicky Wagner gave a really nice speech. It was a very nice speech but I say sometimes the rhetoric just does not live up to the reality. National MPs can give lots of really nice speeches that say really good things but at the end of the day they have to deliver. Although a lot of what she said was true the fact is that it is very difficult for her to get up and talk about the importance of innovation and of science and research in this area given what happened in the recent Budget. I do not say that in order to be deliberately negative; I just say I was astounded that she actually made those points given the canning of the research and development tax credits—the fact is that other countries around the world are bolstering their research and development tax credits but we entirely got rid of ours—and given the fact that despite all the spin around the replacement for the Fast Forward fund it is a poor poor cousin to what Labour had put in place. It is significantly less money for a start. 
But as I have said time and time again what is more important than the amount is that the Budget took away stable funding. The Minister of Research Science and Technology still does not get just how important that is. Researchers have to go cap in hand to the Government every year for an appropriation not knowing from year to year whether that money will continue. We were promised tax cuts and now they have gone. We had tax cuts in last year’s Budget and now they have gone. Who knows whether the money for phases two and three of the replacement for the Fast Forward fund will be there? Again that was going to be an important factor for our pastoral and food research areas. 
All I would say to the National members is that they should all get a copy of Nicky Wagner’s speech pin it up on their noticeboards and then try to live up to it. I think if the National members lived up to the rhetoric that was in that speech then our environment and economy would be in a much better state. But unfortunately at the moment we are not there. As I said the select committee is working very hard— 
Chris Tremain 
: Moana what about the rhetoric over the last 9 years? 
MOANA MACKEY 
: I can tell Mr Tremain that we actually delivered a research and development tax credit and the Fast Forward fund. We put in place the emissions trading scheme—[ 
Interruption 
] I was going so well. I was being very nice and conciliatory then I got to about 9 minutes and 30 seconds and it all fell apart. 
LOUISE UPSTON (National—Taupo) 
: 
 I rise in support of the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill. The bill delays the reporting requirements under the emissions trading scheme and the publication of the allocation plan by the Government because the Emissions Trading Scheme Review Committee process is yet to be completed. It is a hard-working committee. It has been considering a lot of submissions but its work is not yet complete. 
The current law under the Climate Change Response Act requires foresters to report any deforestation during 2008 by 31 January 2009. They need to apply for exemptions for small forest blocks by 30 June 2009. Those dates are unreasonable given the committee review and the lack of public awareness of the requirements. Without this bill which is a technical bill that amends a date many forest owners would unknowingly find themselves in breach of the law or adversely affected. It does not make sense for the Government to publish an allocation plan by 30 June this year for pre-1990 forest owners when issues around offsetting and the underlying approach to the emissions trading scheme are still being considered by the review committee. 
I would add that New Zealand is the first country in the world to attempt to introduce forestry into an emissions trading scheme. These extensions are about having the time to get this right. It is critical that the details are accurate. This industry is of significant financial and environmental importance to New Zealand. In the Taupo electorate over 1000 people are employed in forestry so I like many others in the House am particularly aware of the need to get this right. 
Let us have a look at this industry. We are talking about a date change in this amendment bill. New Zealand has one of the largest areas of protected natural forest in the world—nearly 6 million hectares. It is also home to the world’s biggest and most intensively managed tree plantations which cover nearly 1.8 million hectares. Of those 1.8 million hectares we are talking about 650000 hectares that are pre-1990 forest. 
As I said before the forestry industry is vitally important in the Taupo electorate. It is very important that we get this right. I along with the Minister of Forestry David Carter recently met with companies involved in forestry in Tokoroa and Taupo. They expressed their grave concerns about the proposed time frames. Tonight they will breathe a sigh of relief knowing that the Government is taking a pragmatic and cautious approach. 
I am delighted to support the first reading of the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill which is in the name of the Hon Nick Smith. I commend the bill to the House. 
STUART NASH (Labour) 
: 
 I too rise in support of the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill. I do so for several reasons but the main reason is that the country needs to be given a level of certainty around climate change and the Government’s response to the major global issue around greenhouse gas emissions. We all know that under Helen Clark’s leadership this country used to lead the world in terms of climate change policy. However the rhetoric of Key and English at the last election tried to divide economic sustainability and success from prudent environmental management. In a country like New Zealand that need not be so. First and foremost we absolutely need to understand where New Zealand’s competitive advantage lies and that is especially so in this day and age of globalisation where increasingly countries market themselves and develop a series of brand attributes that companies can then go out and leverage themselves off when marketing themselves in the international market. 
What is our competitive advantage? It is our clean green image based partially on the perception that we live in a country that cares about the environment and cares about a future when carbon neutrality is a reality and in a country where achieving zero emissions is a policy that is aspirational and something that all New Zealanders should buy into. That image will provide us with a competitive advantage given that brands are vital not only to success but also I would argue to the survival of small economies like ours. Actually that is more so in a country like ours than elsewhere. We face the tyranny of distance and we must be great at creating markets that are built upon a perception of real excellence in the areas where we wish to differentiate ourselves. 
What is the clean green image worth? Let me quote from a report that the Ministry for the Environment wrote on this very point: “New Zealand’s clean green image does have a value. Environmental image is a substantial driver to the value New Zealand can derive from goods and services in the international market place. The study suggests this image is worth at least hundreds of millions possibly billions of dollars—aggregating value elements from dairy tourism”—Kelvin Davis spoke about that earlier—“and organic produce and extrapolating to other sectors such as meat. New Zealand is relatively clean and green. This is mainly attributable to our low population density resulting in relatively benign environmental pressures.” 
The emissions trading scheme put forward by the previous Government a Labour Government was a real positive step in the right direction. The National Government’s dilly-dallying on this very important legislation I contend shows a lack of leadership. Also it potentially inflicts serious harm on the country’s ability to successfully show global leadership. As those members who are in the House will know many countries around the world have used this recession to start the transition for the citizens of their country from a fossil fuel - dependent economy to one known as a green economy. But since taking office last November the National Government has walked away from a strategy for long-term low-pollution economic growth. Instead of the plan that we had hoped to see in the Budget National has simply caused uncertainty. Uncertainty causes a loss of jobs loss of credibility and loss of investment in key New Zealand industries. 
As for forestry I ask whether the Minister understands anything about the forest industry and its underlying dynamics. It does not sound as though he does at all. This industry is one of the largest earners of export dollars yet again it is being treated very poorly due to a lack of decisive leadership vision economic development and an understanding of the key employer of New Zealanders. Forestry demands a rotation of between 24 and 30 years. With a crop that takes that length of time to reach an economically viable age legislative certainty is a must policy certainty is imperative and sound direction is vital. This was Labour legislation that we had consulted the forestry industry on widely. We listened to the industry’s requirements and changed the bill accordingly in response to the industry’s input. We were pretty far down the path towards creating an environment that would allow the forestry industry to completely rebrand itself and refocus its attention towards the best land-use options. 
When I lived in Taranaki I used to write forestry plans for farmers in the belief that optimising land use was the best way to be a responsible steward of the land. The plans I would write now would differ significantly from the plans I used to write 10 years ago because there are forestry programmes in place that allow forests to be farmed for carbon. Forestry has the ability to act as a very important carbon sink; we all know that. The economic possibilities are endless. The time is now right for forestry to move to the next level of economic development and market itself to a whole new sector of non-traditional forest owners. There are possibilities where for example Maori landowners who demand an economic rent from their land but who do not wish to own the assets resident upon their own land can manage a forestry resource on behalf of an owner who is searching for carbon credits. That is the way forward for this industry as it allows land to be used in a truly optimal way. That is the way forward for New Zealand because it allows us to make the most of our competitive advantage. 
Forestry and the associated industries employ around 32000 people. Export earnings from the forestry sector bring in about $3.4 billion annually. This is a serious industry that contributes significantly to the country’s economic well-being. The sector not only requires but demands certainty in order to be able to invest grow and market itself internationally. I say to Dr Smith that this bill and its proposal to delay the implementation of the emissions trading scheme delays the establishment of certainty once again. He heard the guys from the Institute of Forestry talk about this saying they are dismayed about the delay again. The benefits of the forestry sector are not only economic. We all know that planting trees sustains marginal land purifies water and helps water tables. Trees rejuvenate degraded land and promote the regeneration of native wildlife. There are numerous non-economic benefits of forestry. We all know that the cultural significance of trees goes back well over 1000 years. The image of New Zealand as a forested landscape is iconic. 
But forestry is in a state of flux yet again due to the uncertainty created by the Government’s inaction and due to the Minister’s inaction. The forestry industry is ready and willing to embrace the current emissions trading scheme—it is ready. Nearly every consultant forestry executive and regional or local council person understands the opportunity created by the possibility of carbon farming. Those people want it to be introduced now and Nick Smith is not able to deliver it now. Goodness me! The opportunity is there; we should just get on with doing it. Here we are again with National annoying the hell out of one of our major industry and business groups. National has no idea what makes the forestry industry tick or what it needs in order to realign itself. Although I do support this bill I ask members to believe me when I say the delay is no friend of the forestry industry of those who must make the emissions trading scheme happen or of the New Zealand economy. 
NIKKI KAYE (National—Auckland Central) 
: 
 I am delighted to rise to speak on the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill this evening. I was very fortunate to be in Ethiopia with the member opposite Mr Nash. When I was in Ethiopia I had the opportunity to chair a climate change committee. One thing I was very clear on is that many nations around the world are trying to do something about reducing their emissions. But one thing that has been made very apparent to members on this side of the House tonight by members opposite—and Moana Mackey said this quite clearly—is that those members are concerned about the issue of the rhetoric versus the reality. I want to make one point this evening: if we continue to talk about being world leaders in climate change policy then we will fail. At the end of the day nations should be judged on their record and the record of the members opposite in terms of the environment and in terms of climate change is pretty appalling. As a nation our aim should actually be to be judged on our record. 
The reason we are here this evening is to amend the Climate Change Response Act by delaying certain requirements applicable to the forestry sector under the New Zealand emissions trading scheme. This was part of our confidence and supply agreement with the ACT Party whereby we established a special select committee to review aspects of existing climate change policy. 
We in the National Party have very clear principles in the area of reducing emissions and one of them that I want to talk about this evening—it is relevant to my background; I did a Bachelor of Science in genetics—is that good science is essential to quality environmental decision-making. Some really exciting stuff is happening in New Zealand in that area at the moment. I know that this Government is very committed to making sure that good science is behind any decisions that are made in terms of reducing emissions. 
I would like to talk further about that point but the other point that I would like to make this evening is that as the Minister has said without this bill many forest owners would unknowingly find themselves in breach of the law. That is why it is essential that we proceed with this legislation this evening. You know New Zealand is the first country in the world to attempt to introduce forestry into an emissions trading scheme and these extensions are about taking the time to get critical details right. 
I am pleased to stand this evening and support this bill because it is really important that we get the details right and that we make sure that we have good science behind our environmental decision-making. I commend this bill to the House. Thank you. 
Bill read a first time. 
Hon Dr NICK SMITH (Minister for Climate Change Issues) 
: 
 I move  
That the Climate Change Response (Emissions Trading Forestry Sector) Amendment Bill be considered by the Emissions Trading Scheme Review Committee 
 with an instruction that the committee report finally to the House on or before 26 June 2009 and that the committee have the authority to meet at any time while the House is sitting except during oral questions during an evening on a day on which there has been a sitting of the House and on a Friday in a week in which there has been a sitting of the House despite Standing Orders 187 and 190(1)(b) and (c). 
Motion agreed to. 
Sittings of the House 
CHRIS TREMAIN (Senior Whip—National) 
: 
 Mr Deputy Speaker the House has made good progress this evening. I seek leave for the House to rise early. 
Mr DEPUTY SPEAKER 
: Leave is sought for that purpose. Is there any objection? There is no objection. 
The House adjourned at 9.59 p.m.