Subordinate Legislation (Confirmation and Validation) Bill (No 3) — First ReadingText is incorporated into the Bound VolumeSubordinate Legislation (Confirmation and Validation) Bill (No 3) — First Reading[Sitting date: 11 October 2007. Volume:642;Page:12320. Text is incorporated into the Bound Volume.]Subordinate Legislation (Confirmation and Validation) Bill (No 3)First ReadingHon MITA RIRINUI (Minister of State)on behalf of theMinister of Finance: I moveThat the Subordinate Legislation (Confirmation and Validation) Bill (No 3) be now read a first time.At the conclusion of the first reading debate I will move that the bill be referred to the Regulations Review Committee with an instruction that the bill be finally reported back by 12 November 2007.This is a routine annual bill to confirm and validate items of subordinate legislation that in accordance with the confirmation and validation provisions in the Acts under which these various instruments are made lapse at stated times unless earlier confirmed or validated by an Act of Parliament. This year the bill provides for Parliament to confirm or validate and confirm 16 Orders in Council made under 10 Acts. To avoid the subordinate legislation lapsing the bill must be re-enacted by the end of 2007. The 12 November report-back date will allow time for the select committee to receive explanations on the contents of the bill from the various departments that administer various orders and regulations while still leaving time for the bill to pass its remaining stages before the end of the year.Two of the 16 orders apply movements in the consumer price index to the rates of social security benefits New Zealand superannuation and war pensions. One of thoseorders also makes an additional increase to the rate of New Zealand superannuation so that the net amount payable to a married civil union or de facto couple is 66 percent of the net average wage. Three orders are made under the Customs and Excise Act 1996. These orders apply movements in the consumer price index to the rates of excise and excise-equivalent duties on alcohol and tobacco products and motor spirits.One order is made under the Tariff Act 1988. It changes from 1 September 2007 the duty-free quantity of alcohol spirits that passengers may import into New Zealand from one 1125 ml bottle to not more than three 1125 ml bottles. This order was accompanied by a separate regulation to exempt alcohol from the diminished provision where duty is not collected if the total amount payable is less than $50. These changes reflect current practice in maintaining the status quo in light of the inflation increases in duty. Six of the orders deal with commodity levies and three replace similar orders relating to pipfruit that expired in December 2006 vegetables and fruit that expired in July 2007 and will expire in November 2007 and avocados that expired in August 2007. Those orders were voted on by the respective industry participants themselves. Each is payable to the industry organisation to finance activities of benefit to the industry.The other three commodity levy orders relate to fisheries. One exempts for 5 years the existing order relating to fish. It was made at the request of the New Zealand Seafood Industry Council to which the levy is payable and it finances work on policy issues research promotion and administration for the seafood industry. Another order replaces the existing levy order relating to southern scallops that expired in July 2007 and also changes the way in which the levy is calculated. The third fisheries-related order made under the Commodity Levies Act 1990 imposes a single levy on farmed green-lipped mussels Pacific oysters and salmon. It replaces two existing levies on farmed green-lipped mussels and Pacific oysters and a voluntary levy paid on farmed salmon. It is payable to the recently established industry organisation Aquaculture New Zealand. A further order concerning fishing is made under the Fisheries Act 1996. This order made a number of changes to the administrative aspects of the quota management system. The aspect of the order concerning the annual catch entitlement holdings for the South Island’s West Coastpāua fisheries requires confirming and this is achieved by confirming the whole order.Regulations made under the Animal Products Act 1999 give effect to cost recovery proposals for services provided by the New Zealand Food Safety Authority and Biosecurity New Zealand relating to the production processing and export of animal products and the export of live animals and animal germ plasm. The regulations redistribute fees and charges so that they are more equitable and justifiable and replace various fees and charges that have been in place since 2003.An order made under the Gambling Act 2003 specifies the problem-gambling levy that will be payable between 1 July 2007 and 20 July 2010 by the gaming-machine operator a casino operator the Lotteries Commission and the New Zealand Racing Board. This levy money funds the costs of developing managing and delivering an integrated problem-gambling strategy by the Ministry of Health. The final order to be confirmed is made under the Road User Charges Act 1977 and increases rates of road-user charges for heavy vehicles. I commend this bill to the House.TIM GROSER (National): I will just take a brief call on this legislation that the National Party is of course supporting. Quite clearly this is fairly technical legislation—a part of our legal process to ensure that the regulations that are subordinate to legislation are fully consistent with the law. We have just heard a fairly comprehensive explanation of the range of activities we are talking about here which go from the relatively mundane but no doubt popular idea that we might be able to bringin three duty-free bottles of gin rather than just one in the future knowing that this is fully legally consistent through to things that are of great importance to the people of New Zealand such as the consumer price index adjustments for their superannuation payments. So we are dealing with smaller pictures and with some quite large issues of great importance to our society actually in making sure that this proceeds in a proper rigorous legal framework. Let me also just say that the fees and charges levied from a number of organisations are used to perform a number of public goods in a pretty efficient way in my opinion.Before going into a couple more examples I would like to make some more general comments on regulations. It is probably stating the obvious to say that Governments of whatever complexion they may be achieve their objectives either by the direct provision of public goods financed by taxation or other revenues or by relying on private agencies and then putting regulatory frameworks around them. There is a lot of hot air I think sometimes of an ideological nature about free markets versus regulatory frameworks. The reality is that most free markets in order to operate in a socially responsible way do indeed require an adequate regulatory framework. This myth of the untrammelled power of the free market is usually totally exaggerated in political discussion; we all buy into the idea that we need effective and firm regulatory frameworks to police the free market. Then it becomes a matter of looking at market failure remembering there is no such thing as a perfect alternative or a perfect regulation and making a sensible and balanced judgment.So we are dealing with a number of Governmental objectives here—shared I am sure probably by all parties and not just the two major political parties. I will take the commodity levies as one example. They are essentially designed to deal with what is called in the literature the free-rider problem. We know if we take Pipfruit New Zealand for example that the organisation itself needs to come to a democratic vote as to whether it wants to levy its members but because of the existence of the free-rider problem it needs the power of Government and the force of regulation behind it to levy its members. So it can start from a democratic base and deal with the free-rider problem through regulatory frameworks then use the money from the levies—which are then compulsory on its members—to achieve public goods that the State would otherwise have to fund directly. Those are usually excellent public goods: research and development joint marketing promotion and other activities that all of us recognise are in the collective interests of the industry as a whole and they can proceed in a pretty efficient manner. In this case I have just taken pipfruit but we could use the seafood examples mentioned earlier to make the same basic point.On the other hand we also know that there is a bigger picture out there; it is called regulatory creep. I do not want to enter into a divisive debate on that when we have just discussed it in question time but frankly the almost ludicrous example of the spread of regulations concerning childcare facilities to Sunday schools gyms and creches is an example of where mindless regulation needs to have some greater political judgment put on to it. I do not have the exact quotation in front of me but I recall very clearly a well-known anecdote that says that the Ten Commandments are something like 100 words long the Gettysburg address is 120 words long but the European 2002 oilseeds regulations are 23684 words long. So it is not just a problem for us—let us be quite clear about this—this problem of regulatory creep is a global problem and we need some greater discipline there.Although these regulations are widely supported politically in other areas the debate perhaps gets off to not quite the right footing by its being seen solely as a compliance cost issue. Well yes that is a serious issue but when we analyse it more deeply we find that the real costs are not the compliance costs—although they can be substantial inthemselves—they are the actual economic effects of the regulations which will often lower productivity and disadvantage productive behaviour in the country. By analogy one could ask “Taxation—what does it do?”. Yes taxation has a compliance side to it and it costs a great deal of money although all Governments need to have that side to raise revenue—in the literature it is called the deadweight costs of taxation. But the more powerful issues are not about the compliance costs; they are about the actual economic consequences of taxation. In an economy that is driven essentially by market forces influenced by regulatory frameworks this is the bigger picture.The National Party supports this legislation. It is a fairly mundane technical and proper thing to do but we should bear in mind that there is a bigger picture out there. There is a problem of regulatory creep and we need a greater resolve to address that if New Zealand is to move forward in a sustained and competitive sense.CHARLES CHAUVEL (Labour): It is good to know that this legislation has at least bipartisan support. As the previous speaker said the Subordinate Legislation (Confirmation and Validation) Bill (No 3) is a routine and annual bill to confirm and validate items of subordinate legislation that if not so confirmed would lapse by the end of the year.It was interesting though to hear TimGroser’s observations about the importance of quality regulation. Certainly this Government has shown by its actions that it agrees with that precept. I merely have to refer members opposite to the excellent work done by the Minister of Commerce in the Quality Regulation Review which is the first time in the history of New Zealand that a Minister has really grasped the nettle and met that problem head-on. It is really terrific to see the work that Lianne Dalziel is doing to make sure that our regulation framework does have some quality and rigour to it.As a member of the Regulations Review Committee to which it is anticipated that this legislation will be referred I am very pleased to say that we are doing our bit on that very hard-working committee to make sure that we look at regulations in a systematic way and consider whether there is justification for their continuation. The member who has just spoken might like to know that at the moment we are looking at every regulation on the statute book. We have written to every department and every entity responsible for the administration of a regulation and we have asked them to justify the ongoing need for that regulation. It is quite an important thing to keep the delegated statute book up to date and I can assure that member that not only is the Minister of Commerce making brave efforts in that regard but also the Regulations Review Committee.Just turning to the detail of the bill it would provide for this Parliament to validate and confirm 16 Orders in Council which are made under 10 pieces of primary legislation. Two of those 16 orders apply movements in the Consumers Price Index to the rates of social security benefits New Zealand superannuation and war pensions. One of those orders also makes an additional increase to the rate of New Zealand superannuation so that the net amount payable to a married civil-unioned or de facto couple rises to 66 percent of the net average wage.Three orders are made under the Customs and Excise Act 1996. They apply movements in the Consumers Price Index to the rates of excise and excise-equivalent duties on alcohol and tobacco products and on motor spirits. One order increases the amount of duty-free alcoholic spirits that passengers may import into New Zealand—that will make incoming passengers happy—from one bottle to three bottles of 1125 millilitres of spirits and adjusts the amount of duty allowed to be forgone in line with this. I see that Mr Foss is particularly welcoming of that measure and a good measure it is too.Three orders deal with commodity levies for fruit and vegetables and replace similar orders. These orders were voted on by the respective industry participants themselves. Each is payable to the industry organisations in order to finance activities of benefit to the industry—like work on policy issues research promotion and administration in respect of the seafood industry. Three deal with commodity levies relating to fisheries. One extends for 5 years the existing order relating to fish. One replaces the existing levy order relating to southern scallops. One imposes a single levy on farmed green-lipped mussels Pacific oysters and salmon. Again each is payable to the respective industry organisation in order to finance the activities of benefit to the industry.There are four other validated pieces of subordinate legislation. One is under the Fisheries Act relating to the quota management system. Some regulations under the Animal Products Act 1999 give effect to cost recovery proposals. One is under the Gambling Act specifying the problem gambling levy to be payable from 1 July 2007 to 1 July 2010 by either a gaming-machine operator a casino operator the Lotteries Commission or the New Zealand Racing Board—those with a statutory monopoly in other words—to conduct gambling. As members will know this levy money is important because it goes into Vote Health to ensure that the deleterious effects of gambling can be countered by Ministry of Health - funded programmes.The final piece of subordinate legislation that will be dealt with relates to the Road User Charges Act and increases rates of road-user charges for heavy vehicles.If the legislation is referred to the Regulations Review Committee in accordance with the Minister’s expressed desire then I certainly look forward to detailed consideration of it.Dr the Hon LOCKWOOD SMITH (National—Rodney): In listening to the last Labour member speaking Charles Chauvel one could say that one is almost encouraged to hear that the Government is actually starting to ask what regulation is still required. But there is a huge difference between simply going through the bureaucratic process of questioning whether regulations are still required in this country and actually getting rid of some of them. The test on this Government is whether it gets rid of some of the plethora of regulations that makes doing business in this country so increasingly difficult.So far the track record of this Government is not good. If we look at recent regulation that has come into this Parliament so much of it does not have a cost-benefit analysis associated with it at all; and that is not good enough. Every new piece of regulation should have a thorough cost-benefit analysis so that Parliament on behalf of the people of New Zealand can be satisfied that the benefits of the regulation definitely outweigh the costs. There have been plenty of occasions where regulation has been put through this Parliament where in fact the benefits do not outweigh the costs.The test remains on this Government of whether it will do anything to reduce the burden of regulation. Talking about it and starting some bureaucratic processes are not the solutions. Actually doing something about it is what is crucial. What is often quite difficult with legislation like the Subordinate Legislation (Confirmation and Validation) Bill (No 3) is that it is the kind of thing about which Parliament can easily say that it is just confirming some stuff and that it should just put it through. So it is important that it goes to the Regulations Review Committee.The other quite important thing is that some of the provisions and confirmations in this bill are adjusting some benefits like superannuation and retirement income according to indexation for inflation. Those are measures that everyone accepts are really important and at times it is too easy to let those positive important measures override some of the tax-gathering measures that are also contained in this legislation.We should note that the legislation confirms increases in taxation through measures under the Customs and Excise Act 1996 and also the Road User Charges Act 1977.It is all very well saying that the Government just puts tax up by the rate of inflation but when it comes to tax we should really be always questioning whether this is necessary. Is it necessary to keep putting tax up? I have looked at the most recent notes to the Crown’s financial statements and at how much tax the Government has been gathering through the measures covered by the regulations this bill would confirm particularly the Customs and Excise Act Regulations and the Road User Charges Regulations. It is really interesting to look at how much tax the Government is collecting. If we look at the Road User Charges Regulations in the June year 2006 we see that the Government collected $731 million. In the year ending June 2007 it collected $55 million more—$55 million more tax—from heavy motor vehicles that pay road-user charges. That is a significant increase in tax and we should not be just accepting that these taxes go up willy-nilly with inflation. We should be questioning those increases all the time.With regard to road-user charges there may be a good argument that road users in the case of the heavy vehicles do have to pay to help contribute to the construction and maintenance of the roads in New Zealand that carry those heavy vehicles because one has to acknowledge that our roading network in the Auckland region is falling further and further behind requirements. Despite the Government’s claims that it is spending more money the result is a worsening situation not an improving situation as we heard in question time today. If we look at some of the other amounts collected though it is really interesting. The amount collected under the customs duty has gone up by $750 million from $1.083 billion to $1.836 billion which is amazing. That is a big increase. If we look at the alcohol excise it has gone up by $40 million. Again with the alcohol excise I guess that one could argue that we need some of that money to spend on dealing with some of the negative consequences of alcohol consumption but I think the customs duty increase is something that we should be questioning this Government about. Is that massive increase of three-quarters of a billion dollars in just 1 year justified or is that a windfall gain for this Government?And so it goes on. It is interesting that the petroleum fuel excise has gone down slightly in the last 12 months so there is probably a good argument for that one to increase. But the point I am making is that this Parliament should make sure each confirmation of these individual regulations is looked at carefully to make sure that where more taxation is being taken from New Zealanders it is justified. In some cases National fully accepts it is; in other cases I think the issues should be given full scrutiny to make sure that those increases in taxation are in fact justified and that the benefits outweigh the costs of collecting that taxation.Although National supports the first reading of the Subordinate Legislation (Confirmation and Validation) Bill (No 3) and although some might say it is just confirming and validating certain measures there are important issues buried within this legislation. It is important that the Regulations Review Committee and Parliament scrutinise some of the taxation increases and that we do not develop a habit of just automatically upping taxes by the rate of inflation or indexing them automatically every year because I do not believe that is in New Zealand’s interests. In some cases it makes sense; other cases I think should be scrutinised. I hope that is what happens with this legislation at the select committee.Dr PITA SHARPLES (Co-Leader—Māori Party): There are two remarkable points of relevance to this debate on the Subordinate Legislation (Confirmation and Validation) Bill (No 3) that the Government motion No. 1 debate brought to our attention. The first is to acknowledge the debt the House owes to David McGee and tohis excellent service as the Clerk of the House for some 22 years. As part of that service he has defined the value of bills such as this Subordinate Legislation (Confirmation and Validation) Bill (No 3).In the third edition ofParliamentary Practice in New Zealand on page 410 he describes the need for such bills as being purely and simply about confirming regulations that might otherwise lapse. These lapsed regulations are commonly brought together in a single piece of legislation—a regular baker’s dozen of bits and pieces.True to form in this one bill as has been said already we have the vital order to ensure that passengers can import duty-free into New Zealand three 1125 millilitre bottles of spirits instead of one alongside commodity levies orders for apples pears fish southern scallops vegetables fruits avocados mussels oysters and salmon. Indeed if we took all these requisite components apart we are faced with a virtualhākari of regulation—a feast of provisions—that we are encouraged to accord the greatest priority to.The second tasty morsel that arose from the Government motion No. 1 debate was the vexed issue of the speed of lawmaking. David McGee has evidence of a dramatic reduction in the number of minutes allocated to passing each single page of legislation identifying that the total of 12.3 minutes per page awarded in the 2002-05 Parliament was the lowest amount of time recorded over the previous 50 years. I am aware that the defence for this speed will be to attribute it to the quality work that occurs in the select committees. Having experienced partisan select committee behaviour I have my doubts.As we come to debate this riveting piece of regulatory readjustment I also raise the issue of the unseemly haste in the placing of items on the House programme at this point in time. It would not have gone unnoticed that the Order Paper has been completely reshuffled overnight. Although yesterday’s top 10 items included just one first reading of a bill the Protected Disclosures Amendment Bill suddenly today’s top 10 includes a whopping seven first readings. Where did they all come from—and why the sudden placement of priority on the Order Paper?I wonder whether the combination of Treaty settlement legislation and the political numbers has anything to do with these sudden overnight changes. Funnily enough the TeRoroa Claims Settlement Bill which yesterday was No. 7 on the Order Paper dropped 12 places overnight down to No. 19.For those members who burn the midnight oil or set the alarm to watch the breaking news of prime television onTeKarere it would also have been noted that there is growing speculation that the Government lacks the numbers to pass controversial settlement legislation for either the TeRōroa or Te Arawa affiliate groups. The legislation is controversial because the settlements are wrong. The behaviour by the Government in respect of these two bills is about winning. It is not about justice. It is not about fairness. It is not about doing what is right. It is about winning at all costs.I raise these matters in the context of our deliberations on the Subordinate Legislation (Confirmation and Validation) Bill (No 3) because I think it is critical that members maintain a watchful eye on the checks and balances against stacking the parliamentary agenda. This is not to say that there are not crucial matters to be dealt to in the context of this current bill but more to make the statement about how priorities are determined and agendas set.One of the significant issues that concerns us in this bill pertains to the War Pensions (Rates of Pensions Lump Sum Payments and Allowances) Order. The bill validates and confirms the war pensions regulations set out in the 2007 order. The House will recall one of the last acts of courage demonstrated by the late ArchbishopWhakahuihuiVercoe who made a claim to the Waitangi Tribunal in support ofMāori Viet Namveterans who had been exposed to Agent Orange. The claim was presented by the Vietnam Veterans Action Group representing about 2000Māori Viet Nam veterans and their families.The claim estimates that 65 percent of those New Zealanders serving in Viet Nam wereMāori. Veterans have spoken repeatedly of their concern that the current system of compensation does not give justice to veterans. On 21 August Viet Nam veterans marched on Parliament grounds in protest against what they described as “the Crown’s consistent and despicable rejection of Viet Nam veterans’ health and welfare concerns.”Pita Paraone: What part is this?Dr PITA SHARPLES: The member should read it. We would hope that the honour of the late archbishop and these Viet Nam veterans might be respected enough in subsequent stages of this bill to address the discriminatory impact of the differences in pension payment and compensation available for Viet Nam veterans as opposed to other injured soldiers.Another issue in which discrimination appears to be manifest is the Social Security (Rates of Benefits and Allowances) Order. Although the intention of the bill is to increase the rate of New Zealand superannuation to 66 percent of the net average wage we have to bring to the table again the following questions. What about the other benefits? What about the 250000 children who are discriminated against by virtue of the fact that their parents are on income support and therefore restricted in the levels of support available from Working for Families? What about the levels of deprivation that continue to be experienced by our most vulnerable: the poorer poor?As we think of those who are currently facing the highest levels of deprivation one cannot help but think of the adverse impacts that gambling has on the lower socio-economic communities. The Gambling (Problem Gaming Levy) Regulations 2007 deal with the concept of building capacity to deliver the strategy on problem gambling. We in theMāori Party are completely in support of any initiatives that seek to eliminate gambling harm. We know that the accessibility of machines in low-income communities increases the risk of those living locally having a problem with gambling. We are also aware that for every dollar that a community group receives as a community grant through pokie machines $3 has been taken.Gambling creates an enormous strain on community resources and bumping up the levy to fund a problem-gambling strategy must not be seen as the be-all and end-all. As a starter we are interested in proposals for legislative change to the Gambling Act 2003 that would giveMāori a clear role in deciding the place of gambling in Aotearoa and would also empower communities to have the authority if they wish to remove gambling venues and pokie machines.Another of the proposals lumped into the Subordinate Legislation (Confirmation and Validation) Bill (No 3) is a set of schedule changes associated with freshwater eel stocks Otago cocklespāua fisheries and other items included within the total allowable commercial catch. We simply make the statement that with such amendments to the Fisheries Act consultation and negotiation over the finer print must proceed with mana whenua—theMāori fishing industry—as key players in the sector.We of course support the bill. We support the opportunity for the detail of legislation as included in this bill to come before the scrutiny of Parliament. We support this bill at its first reading but we will also continue to ask why some bills are slipping down down down the Order Paper with the risk that they may never see the light of day. Thank you.MARYAN STREET (Labour): I rise to speak to the first reading of the Subordinate Legislation (Confirmation and Validation) Bill (No 3). There are a couple of important issues in relation to this legislation not only in its content but in its process. TheRegulations Review Committee has been exercising itself recently with a review of regulation and subordinated legislation. The committee has—along with our Australian colleagues at conferences in recent times—considered such things as sunset clauses and whether legislation ought to have sunset clauses so that as a matter of course it comes back to the House for reconsideration.Those points are important when one considers the process of the drafting confirmation and implementation of legislation and its passage through this House. If we are going to have sunset clauses on legislation we would find it has a very salutary effect in that it means that at every point where there is a sunset clause there is a process by which that legislation is reviewed once more by Parliament. That is a very strong position. It is a very strong process. It means that the parliamentary scrutiny of legislation is paramount and is constantly reflected.This bill is a routine annual bill. Its purpose is to confirm and validate those items of subordinated legislation that will lapse unless we do this exercise by Act of Parliament by the end of this year. So there are a number of things in this legislation that—the previous speaker’s comments notwithstanding—would appear to be reasonably pedestrian but are however matters of real importance. When the matters are to do with social security benefits New Zealand superannuation war pensions or commodity levies—particularly those relating to fisheries—they are matters that are of importance and they are significant to the ongoing operation regulation and maintenance of those industries.I pick up a particular point that the previous speaker made in relation to the Gambling Act 2003 and the order within this bill made under that Act. This legislation specifies the problem-gambling levy which will be payable from between 1 July 2007 and 20 July 2010 by gaming-machine operators or casino operators the Lotteries Commission and the New Zealand Racing Board. I am keen to tell the House that Sue Bradford of the Green Party has raised concerns with Ministers about the problem-gambling levy and the way that it is set. It is important for this House to know that the Government is committed to these matters being reviewed within 18 months. That is a particular concern that has been raised with Ministers by the Green Party and that has been recognised by Ministers. I felt it was important that the House was advised of that matter.These regulations and provisions—the levies and so on—that are contained in this legislation need to be renewed and they need to be applied after consideration by this House because at each turn it means that these provisions will get renewed scrutiny. I alluded to this earlier in my speech but it seems to me that it may well be worth this House’s consideration in a more general forum or discussion and perhaps through the forthcoming report of the Regulations Review Committee that a number of other pieces of legislation which impact either on industry or on the provision of benefits and orders to individuals and families—and by those I mean such things as superannuation and war pensions—always have sunset clauses attached so that they can be scrutinised afresh by the whole of Parliament.This bill will be referred to the Regulations Review Committee I am sure at the end of this first reading but one of the committee’s functions—and this goes to the question raised by the previous speaker Pita Sharples—is around whether sufficient consultation has occurred in the renewal and the promulgation of these regulations. One of the things we always do in the Regulations Review Committee—and the member who spoke before me is very familiar with this because he sat for a time on the committee—is routinely ask whether the obligations to consult have been met. We have needed on occasion to ask for reports about the consultation processes that have been undertaken with respect in particular to fishing quota and levies in the fisheries area. Theconsultation with tangata whenua and the fisheries organisations has always been taken into account. We have asked questions about the consultation process received reports on it and have been ultimately satisfied that appropriate consultation has been undertaken. Where we have not been satisfied we have asked those bodies to go back to do consultation again. So the member who spoke before me is aware that consultation does occur and that the Regulations Review Committee does require it to occur.In conclusion I commend this bill to the House and particularly draw attention again to the concerns that the Green Party has raised about the way the problem-gambling levy has been set and the Government’s commitment to reviewing that within the next 18 months. Thank you.SUE BRADFORD (Green): It is somewhat unusual for the Green Party to care passionately—Nandor Tanczos: I raise a point of order Mr Speaker. I did indicate to Madam Assistant Speaker previously that the Green Party would be splitting its speech.Mr DEPUTY SPEAKER: Absolutely. I accept that thank you. That is the intention. The Green Party is splitting its speech. The bell will go at 4 minutes.SUE BRADFORD: It is somewhat unusual for the Green Party to care passionately about a bill like this a subordinate legislation bill but today is a bit different. This time there are two elements of the bill that we care about. My colleague Nandor Tanczos is going to speak in a moment about commodity levies but first I would like to say a few words about clause 11 which confirms the problem-gambling levy as set earlier this year.The Green Party has had concerns for some time about the way the levy has been set and we were very reluctant to simply rubber stamp its confirmation in the bill in front of us today. There are a few reasons for this. First of all the rate of payment expected from New Zealand’s six casinos is half that of pubs and clubs with no real justification. When working out the levy the number of people presenting to problem-gambling services with issues around harm caused by casino gaming is used as a basis for working out the levy calculation. However that does not take into account the fact that casinos cause a disproportionate severity of harm in the amount of money lost by individual problem gamblers the quantity of money ripped off from employers and so on. The harm done through problem gambling associated with casino play should be calculated differently and at a higher rate and casinos should be expected to pay their fair share of the levy.Secondly the rate of levy for clubs is unfair and too high. Clubs are levied for their pokie machines at exactly the same rate as pubs yet they have much better host responsibility policies and practices and for example operate substantially more comprehensive training for staff in relation to dealing effectively with problem gamblers on their premises. It is difficult to work out what the right rate for pubs and clubs should be at present because the figures of those presenting with harm from pubs and clubs are not disaggregated. The Government should move immediately to start separating out the statistics on presentations on harm being done by pokie machines in pubs and clubs so that next time the problem-gambling levy is set it can be done on a fair and transparent basis.Thirdly when the problem-gambling levy was struck this time around it was done on erroneous data. At the time the Government chose to believe the industry’s figures about the so-called decline in gambling spend. In fact once the first of the new electronic monitoring system reports came out a couple of months ago the figures showed that losses on non-casino gaming machines were in fact up by 5 percent not down. The basis of the calculation was simply wrong.Fourthly further incorrect information was provided in that the Gambling Commission said that treatment providers had no complaints with an effective cut in the amount allocated for treatment when in fact a number of organisations objected strongly—as one might expect. Although we are really unhappy about approving a levy struck on this basis at all the Green Party realised that we could not really expect the Government to backtrack completely at this stage. It is too late for that.However we did make our concerns known and it was with great relief that I heard the Government say through Maryan Street this afternoon that it is committed to reviewing the problem-gambling levy and how it is set within 18 months instead of the usual 3 years. This gives the Government time to do the necessary work on getting the levy calculations on to a better and more accurate footing without the affected groups and those they serve having to wait for the full 3 years. The Green Party is grateful to Dr Cullen and the Government for their commitment to cutting the review period in half and we will be watching developments over the next 18 months very closely.Because of the Government’s willingness to move on this issue we will be abstaining in our vote on this bill rather than voting against it as we would have done otherwise.NANDOR TANCZOS (Green): Although I welcome the gains that my colleague Sue Bradford has made in securing a review of the problem-gambling levy I have to express disappointment in another matter—specifically the commodity levies in relation to organic production.It seems to the Greens a basic issue of fairness that levies collected from a sector should be spent on activities that support that sector and that principle does not currently apply to organic producers. This issue was raised with me when I attended the inaugural conference of Organics Aotearoa New Zealand at Lincoln University a month or so ago. Organic producers are subject to commodity levies like other producers but although some of the activities funded by the levy money do have generic benefits across say the pipfruit industry the bulk of the benefit actually accrues only to conventional producers.The needs of organic producers are quite specific and are largely not addressed through conventional commodity levy spending. Research advice assistance marketing and support for organic producers and products are largely different from that needed by conventional producers. As I have said there are some benefits to organic farmers from conventional levy funding and I do not propose that the full proportion of a commodity levy paid by organic producers should go to the organic representative body. But it does seem fair and right that a proportion—perhaps 75 percent—of the money paid in by organic producers should go to organic representative bodies. So the Green Party is not voting for this bill because we could make no progress on that matter. We will however be abstaining in order to recognise other gains made by my colleague Sue Bradford and I intend to pursue further this matter of the commodity levy for organic producers.There are a couple of other matters worth relating in relation to that. First the organic sector’s advisory programme consists of $2.15 million over 3 years funded through the Government - Green Party co-operation agreement and includes specific support for applied research and extension-project work. This project support is managed through Organics Aotearoa New Zealand and in effect as a levy would be. The Greens acknowledge that support for organics but we also note that that funding is temporary and there are obvious questions about how to sustain it over the longer term. That is especially relevant as the organic sector becomes increasingly important in light of climate change—the carbon-sequestering properties of living soils are enhanced through organic production methods—and also because of challenges to conventionalfarming from imminent peak oil. RichardHeinberg spoke in the Beehive today about that very matter.Secondly the Ministry of Economic Development’s sector initiative fund which is $1.5 million over 3 years anticipates putting the sector in a position to consider and seek support for a levy referendum under the Commodity Levies Act or similar arrangements within the industry levy organisations at the conclusion of the contracts at the end of this financial year. Again although the Greens would welcome that we would be very unhappy to see such a levy put in place in addition to any current levies paid by organic producers. That would be unfair and the Green Party must insist that any commodity levy on organic producers must be in place of any levies they are currently required to pay rather than additional to them. There may be a need to recognise the benefits that organic farmers gain from conventional levy spending through some kind of split-funding arrangement—and we accept that—but simply to increase costs for organic farmers on top of what they already spend in terms of both levies and the additional costs they have to bear for organic certification and the like would be unacceptable and we could not support that.PITA PARAONE (NZ First):Tēnā koe Mr Deputy Speaker. On behalf of New Zealand First I am participating in this debate. I can say on a personal note that I have landed the privilege or opportunity to make a contribution on behalf of my party because I am the duty member at this point of time. When I found that I was required to speak to this bill I tried to get some information. I rang one or two offices and in particular the office of the Minister of Fisheries but I have to say that I had some difficulty in getting some information out of that office as to what this bill was all about. I thought to myself well I am a member of this Parliament and a member of a party that has a confidence and supply agreement with the Government but I am having some difficulty in getting information. So I decided that it was only proper for New Zealand First to support this bill going to a select committee in order to give the people of New Zealand the opportunity to have their say on it.We have heard that this is merely technical legislation and a routine and annual bill. But on listening to the contributions that have been made by previous speakers I think this bill is more than just routine and annual given the importance of some of the legislation that it covers.I want to speak particularly in relation to the New Zealand Superannuation and Retirement Income Act 2001 and the Social Security Act 1964 which this bill covers. My interest of course is in regard to the increase in superannuation to 66 percent of the average wage. It should not come as any surprise to this House that New Zealand First was responsible for that increase. But what concerns me is the fact that the previous speaker made a comment—and I am not saying he is wrong—that a lot of legislation particularly new legislation that has come to this House has lacked proper financial analysis. He said that the benefits of legislation should be weighed up against the costs. When I heard that I asked myself how the costs are measured and how the benefits are measured. I know that the previous speaker was making reference to financial costs but I want to talk about social costs. I know that all the superannuitants of New Zealand irrespective of which party they might support would certainly want their increase to be measured in terms of not only financial costs but social costs. In respect of New Zealand First I can say that we will be interested to hear the debate in the select committee process on this particular issue.The other part of this bill that we are certainly interested in—and particularly me from a personal aspect—is the amendment to the Fisheries Act 1996. I was able to find out that it is regarded as a mere amendment in relation to the South Island’s West Coastpāua stock and involves a reduction in catch from the present 1 tonne to 100 kilograms.I take on board the concerns expressed in terms of consultation with those involved in the industry and I am making reference not just to the importance thatMaōri fisheries contribute to this particular industry but also to the wider public especially the recreational and ordinary fishers who avail themselves of the resource that Tangaroa is able to produce for them.I do not need to take too long because I have already indicated that New Zealand First will be supporting this legislation going to a select committee. We hope the people of New Zealand will take the opportunity to avail themselves of the benefits that the select committee process provides in terms of expressing any concerns they might have. In closing I reaffirm New Zealand First’s support for this bill to be referred to a select committee.CRAIG FOSS (National—Tukituki): I rise to talk briefly on the Subordinate Legislation (Confirmation and Validation) Bill (No 3). We have been assured that this is a relatively administrative and procedural bill but it touches on many many facets of our society. The Regulations Review Committee will no doubt make sure that there is nothing dodgy or untoward going on here and we have full confidence that that is the case. Ten Acts and a number of Orders in Council will be confirmed by this bill. They will be rolled over they will be confirmed or they will essentially not expire. We have heard from other speakers and they have touched on themes from peak oil—from the Greens—right up to pipfruit and grower levies and someMāori issues as well. As I said many of these issues cut across various facets of New Zealand society but coincidentally many of them also have a large bearing and impact upon my electorate Tukituki and of course the region of Hawke’s Bay the home of the mighty Magpies—one of New Zealand’s best rugby teams—who are currently fourth-equal in the Air New Zealand Cup.I will touch on three of the Acts and/or Orders in Council that the subordinate legislation deals with. Clause 8 of Part 2 deals with the Commodity Levies Act clause 9 deals with the Customs and Excise Act and clause 12 deals with the New Zealand Superannuation and Retirement Income Act—coming on the back of the previous speaker’s remarks.Clause 8 talks about the grower levies. I want to talk particularly about the pipfruit levy being from Hawke’s Bay. That is in and around the enabling legislation as a previous speaker talked about. Growers themselves actually vote for these levies and good on them. This provision enables that to continue. Pipfruit New Zealand is mostly about apples though pears are also in there. Those funds will be used to continue to build upon the momentum that was gathered from the Aussie apple access protests which myself and Chris Tremain were actively involved with in the last 2 years and it is fantastic to see action finally happening. The World Trade Organization action will be taken apparently—we do not yet know when—by the current Government. But I say all speed to them and I ask them to please just get on with the job.Also the pipfruit levy will be used to help restructure and put further capital intoPrevar. A lot of people do not know what that organisation is. It is the research and development side of Horticulture New Zealand. It is a commercial company but there is an interesting shareholding tension at the moment. I for one am very very concerned that the future viability of years and years of research and development inPrevar is under threat at the moment as is New Zealand’s ability to commercialise research there. A lot of work needs to be done.A previous speaker talked about the commodity levies and particularly about organics. I think the member was saying organics need different treatment. I am quite keen to speak to the member—I think it was Nandor Tanczos—who was talking about that earlier. I am not sure whether he realises it but one of the biggest andgruntiestapple growers and squash players and exporters in New Zealand is actually organic. This grower competes very very well and gets better returns than traditional growers do.I will touch on clause 12 which deals with superannuation which is what the previous speaker from New Zealand First Pita Paraone talked about. This is one of the clauses that touches on CPI. Of course we all know what CPI stands for—the consumer price index or inflation. The previous speaker talked about the increase to 66 percent of the average wage as the married superannuation. He is right and that is part of New Zealand First’s confidence and supply agreement. But actually that confidence and supply agreement expires at the end of this parliamentary term. That means as is currently planned that married superannuation will go from 66 to 65 percent on the expiry of this Parliament so there will be an interesting tension come election time because that confidence and supply agreement expires at that moment.To touch again on the superannuation issue I say that the rate is currently 66 percent of the average wage. I have said many times in this House that there is a lot of talk about the rate of superannuation—66 percent 67 percent 65 percent. That kind of misses the point because it is based upon the average wage. If we look at the average wage in New Zealand we need to acknowledge how absolutely pathetic it is in international terms. Our average wage is about one-third lower than Australia’s. That is an absolute disgrace and it is upon that absolutely uncompetitive average wage that the superannuation is based. So when people talk about being unable to live on superannuation and have it get them through the week well actually that is because the average wage it is based upon is so low.A final point I will touch on is the Customs and Excise Act—clause 9 of the bill. This allows and confirms the Order in Council that allows indexation of those levies—the excise duty. Philosophically I do not have a problem with indexation at all although it is interesting that the Government is happy to index this but not for example our tax thresholds. It will be interesting to know where the tax thresholds should be after 8 years of about 25 percent compound inflation under the current Labour Government.I will touch on what actually happens with that excise. First of all the consumer price index which the excise is based on is high now and is expected to be high well through the 3 percent band over the coming forecast term. This actually means that the cost to New Zealand consumers will go up but the way that the excise duty is implemented means that the smaller producer the producer of 40-odd acres of grapes—the small niche producer—will have to keep eating this margin the indexation of excise tax. Those producers will not be able to add that to their margin because there are price points in the wine market that the large producers are able to reach with their economies of scale—that is fine; there is an advantage for them. But when this thing turns down to 3.04c or something those producers actually have to keep eating that margin to maintain their ability to compete and sell wine. The House should note that the smaller winemakers in New Zealand are under a lot of pressure and this does not help. I am not arguing against indexation per se—I actually agree with it—but again inflation in New Zealand is so high that it has a higher compounding effect on winemakers and on growers than on other producers in New Zealand.National is supporting this first reading and the bill going to the Regulations Review Committee. Good on it. That committee will have an interesting job ahead of it. National will be supporting this view. Thank you Mr Assistant Speaker.DIANNE YATES (Labour): I rise to speak on the Subordinate Legislation (Confirmation and Validation) Bill (No 3) and I note that it will be going to the Regulations Review Committee which deals with this type of legislation—and a verygood committee it is too. It is very well chaired I might say. I note that there are 16 orders that apply to movements and particularly to social security benefits and superannuation. In the dead of the afternoon the people who are most likely to be listening to the House at the moment are retired people. This bill is absolutely vital to those people who are over 65 and retired.I suspect I just heard a new piece of National Party policy come out of Mr Foss a minute ago. I thought he said that superannuitants were not getting enough money. He indicated that superannuation based on 66 percent of the average wage was something that National would be looking at. We should look very very closely at National Party policy on this because I remind the House that in the days of Mrs Shipley—and I note that some present parliamentarians on the other side of the Chamber are likely to follow her footsteps—it was actually reduced to 60 percent of the average wage. Everybody I think who is over 65 and who is listening today is saying “Oh no not again. We do not want to have our superannuation reduced to 60 percent of the average wage when it has now gone up to 66 percent.”So this subordinate legislation is vitally important to anyone who is over 65 and that is a very high proportion of our population. I refer to those people who lived and worked to make New Zealand what it is those people who have an entitlement to superannuation at age 65 and I think some of whom are a little bit afraid as well. We have heard some statements from Mr Key saying that he was keen to raise the retirement age and he thought he would do it gradually and gently over time. No reduction in superannuation no matter how gentle and how gradual is welcomed by those who are over 65. I think those people would be throwing up their hands if they could at those comments from Mr Key. We are looking forward to the implementation of this bill which will bed in the provision that New Zealand superannuation will continue at 66 percent of the average wage and for those who are over 65 years of age. So in that regard this legislation is very very important. I am sure that the Regulations Review Committee will not receive any submissions on that provision because I do not think anybody over 65 will want that percentage to go down and they will be very very happy that this regulation will be endorsed by the committee.There are a number of other pieces in the legislation that apply as we have said to food safety to biosecurity to the export of live animals to fruit to vegetables—a whole range of issues. The issue of gambling as has been mentioned by the Greens is one that needs continual and continuous attention by this House as we have evidence of how gambling legislation is implemented in the community and what is happening in terms of the effect of gambling on people in New Zealand.I commend this legislation to the House. I am sure that the Regulations Review Committee will look at all aspects of it in great detail. It is something that we can look at and think is dead boring and very routine but my goodness for anyone over 65 it is absolutely vital that he or she gets 66 percent of the average wage and that the age of eligibility stays at 65 years.Bill read a first time.Hon NANAIA MAHUTA (Minister of Customs) on behalf of theMinister of Finance: I moveThat the Subordinate Legislation (Confirmation and Validation) Bill (No 3) be considered bythe Regulations Review Committee and that the bill be reported back to the House by 12 November.Motion agreed to.