Debate on Crown Entities Public Organisations and State Enterprises — In CommitteeText is incorporated into the Bound VolumeDebate on Crown Entities Public Organisations and State Enterprises — In Committee[Sitting date: 17 June 2014. Volume:699;Page:18534. Text is incorporated into the Bound Volume.]Debate on Crown Entities Public Organisations and State EnterprisesIn CommitteeThe CHAIRPERSON (H V Ross Robertson): The debate on the performance of Crown entities public organisations and State enterprises is a series of debates on individual financial reviews of Crown entities public organisations and State enterprises as reported by select committees. A total of 3 hours is allocated for the debate. The debates on the individual financial reviews should be relevant to their performance in their 2012-13 financial year and their current operations. A member may have no more than two calls on each financial review. The compendium of the financial reviews available for debate is available on the Table. Reports on the entities yet to be reported cannot be debated. I understand that members have indicated the Crown entities public organisations and State enterprises they wish to debate. The first entity I understand members wish to debate is the New Zealand Tourism Board.New Zealand Tourism BoardDr RUSSEL NORMAN (Co-Leader—Green):I rise to speak on the New Zealand Tourism Board because I wish to discuss some of the challenges and headwinds that Tourism New Zealand and the New Zealand tourism industry face as a result of this Government.As we know the tourism industry is built on the “100% Pure New Zealand” brand. The founding asset of the New Zealand tourism industry—and of course Tourism New Zealand is an attempt to support that industry—is the natural environment of New Zealand. In particular it is the clean rivers of New Zealand. That natural environment is under attack by this Government. Time after time this Government has attacked the founding asset of the New Zealand tourism industry—an industry built on “100% Pure New Zealand”. For example we now have the problem where more than two-thirds of our rivers are so polluted that they are unsafe for swimming. This is a major challenge to the New Zealand tourism industry—an industry worth at least $6 billion in exports every year. The current Government has proposed new rules that would allow our rivers to be even more polluted—so polluted they would not be safe to swim in; they would be safe only to wade in.What the Government is saying to the tourism industry is that it intends to pollute New Zealand rivers to the level where you would be able to walk in them and put your feet in them but if you put your head under the water then you would get sick and ill. That is the standard that is being proposed by this Government and that is one of the problems that the tourism industry has to face. On top of that the Government is proposing to subsidise irrigation schemes to the tune of $400 million a year. We all know that the major driver of the decline in water quality in New Zealand is the intensive dairy sector. The Government is proposing to subsidise more intensive agriculture which will result in more polluted rivers. This is a challenge that the tourism sector has to face. On the one hand we know that our natural environment is the founding asset of this sector. On the other hand we have a Government that is out to destroy that asset. It is out to destroy the goose that lays the golden egg which is of course the natural environment.Let us talk about the Environment Canterbury region. The elected councillors of Environment Canterbury were removed from there by this Government because they tried to protect rivers and lakes. For that reason they had to be removed by the Government. We know that the water is so polluted now in Canterbury the medical officer of health has issued warnings that if you drink the water from your home bore then it could kill your babies—a thing called blue baby syndrome. The water now in the ground water of Canterbury is so polluted that the medical officer of health has issued warnings that people should not give that water to their children in baby bottles. We now have the situation where water is so polluted. This is a major threat to one of New Zealand’s most important export sectors.The most dangerous threat facing Tourism New Zealand right now is the National Party. The National Party’s constant attacks on the natural environment will destroy the long-term future of our tourism industry. A recent Environment Canterbury report has identified that people with their own wells are at increased risk of campylobacter salmonella cryptosporidium and gastroenteritis in areas of dairy and major irrigation schemes. So the Government is subsidising the very schemes that are destroying water quality and rivers and lakes across our country and in the process fundamentally undermining and destroying the natural asset on which the entire tourism export sector relies. One of New Zealand’s most important export industries international tourism is under attack by this Government as it consistently and constantly attacks rivers and lakes across the country and subsidises their pollution.If we do not change direction we will not just have two-thirds of our rivers so polluted that they are unsafe for swimming we will have all of them. The Government has proposed a new water quality standard that would mean that our rivers could be more polluted than the Yangtze River in China in terms of its nitrate pollution. That is the standard that the Government has recently issued in terms of water quality. If you ever look at any of Tourism New Zealand’s documents you will find that they are full of pictures of our rivers and lakes as key attractions—key attractions for international visitors. Yet this Government is doing everything it possibly can to pollute those rivers and lakes. Right across the country our rivers and lakes are highly polluted. Some of them are so dangerous that if you swim in them you will get sick. They had to close Lake Horowhenua because if you fell into the lake you could get liver damage. Time after time after time our rivers and lakes are under attack from this Government.Report noted.Reserve Bank of New ZealandHon DAVID PARKER (Deputy Leader—Labour):I rise to take a call in this debate. I want to reflect on the mandate of the Reserve Bank and why in the view of the Labour Party we should as a Parliament update it to cater for the challenges of today. New Zealand has not had a current account surplus for 40 years. For 40 years we have run a current account deficit.Hon Steven Joyce: Ha ha!Hon DAVID PARKER: Whenever I say that for some reason Mr Joyce finds it funny. He seems to think that getting back to about minus 3 percent of GDP as a current account deficit is the best that it can ever get. It is the best that it will ever get under the National Government because on these big calls National is always a follower; it is never a leader. It was not a National Government that introduced the Reserve Bank of New Zealand Act in the first place. It was not a National Government that introduced the Cullen fund. National members opposed it—in fact they called it a dog—but now they say it is good. It was not a National Government that introduced KiwiSaver.These long-term changes that make New Zealand a better place are generally brought about by the Labour Party. The last time New Zealand had a current account deficit we had terms of trade that were good. But do you know what? They were not quite as good as the terms of trade that we have just had. So in comparison with 40 years ago when we had terms of trade this good New Zealand had a 2 percent current account surplus and we still have a deficit that is around 3 percent. It might get a wee bit under 3 percent by the time it starts going out again but then it is going to go back out to over 3 percent.Every year that New Zealand has a current account deficit it plugs the gap in one of two ways and generally a combination of both. It either borrows more money from overseas lenders or it sells assets that were previously New Zealand - owned to overseas owners. As a consequence the burden on New Zealand’s economy to pay interest or dividend flows to those overseas lenders and owners grows every year.Of course the control of inflation is important. Prior to our announcements there was concern amongst some of the bank economists and academic economists that we were going to lose that grounding—the target to control inflation. But we have not done that. We have not done that.Hon Steven Joyce: No that won’t change.Hon DAVID PARKER: Mr Joyce chortles away there on the other side but he is a man of so little vision that he does not get the subtlety of any policy. He thinks the way to go about policy is to employ more than 50 spin doctors at the Ministry of Business Innovation and Employment. That is his view of policy. The reality is that we can cause the Reserve Bank to approach monetary policy in a way that best achieves external balance over the cycle and so that is what we have said it should do. If we do that we will also get the Reserve Bank encouraging better policy outcomes from the Government.We know that the reason interest rates are going up at the moment is that we have got enormous house price inflation in Auckland at a time when general price inflation is low. The failure of Government policy around housing is responsible for those interest rates going up higher than they would otherwise need to go. Part of that imbalance in the economy is caused by biases in our tax system—notably the absence of a capital gains tax taxing speculative property purchases.The National Party rattles on that we have already got a capital gains tax. That is not true. We do tax as income some traders in property but the vast majority of investors in property who buy a property and then sell it at a profit do not pay any tax on their economic gains. The IMF the OECD Treasury and the Reserve Bank all agree that these cause imbalances. One of the reasons why the Government gets away with not doing anything to address this—which is plainly in the interests of the economy even if it is not in the interests of the minority of New Zealanders for whom this National Government plainly governs and whose interests it prefers—is that the Reserve Bank is never under its current mandate really strongly incentivised to say “Well look if you don’t introduce a capital gains tax we are going to have to push up interest rates.”That is effectively the trade-off that we have in New Zealand at the moment and yet that is not exposed under current settings. So the changes that we propose to monetary policy would be one of the ways that New Zealand could keep its interest rates lower for longer. We have interest rates that throughout the economic cycle are higher than those of other countries. I am not talking about the variation within an economic cycle the timing of which will be different in New Zealand compared with overseas countries; I am talking about overall New Zealand interest rates being about 1.5 to 2 percent higher than they are in Australia. The difference in respect of some other countries is even higher. We will not get over our current account deficit and we will not be able to increase our wages in New Zealand and grow our export economy unless we address these problems.Hon STEVEN JOYCE (Minister for Economic Development):Well it is an interesting little story that Mr Parker runs. We have actually had in this country an independent Reserve Bank focused on fighting inflation since 1989. It was introduced of course by a Labour Government and in all other respects they are ashamed of it on the other side of the House but nevertheless the members of the Labour Party seem to be a little bit happier with this one.That model is based on transparency and independence and Labour has now decided—or more particularly Mr Parker has now decided—to pretend you can simultaneously have low inflation low interest rates a low exchange rate low house prices and a current account surplus all because David Parker magically says that is possible.The only way you can have a few of those things is if you allow more inflation in New Zealand. Actually it is a law of physics that actually unless you have an independent monetary policy then you will have more inflation. Labour is basically saying that if it is going to change this thing then the interest rates would be different and if the interest rates are different then that means more inflation. All inflation does is destroy the savings of New Zealanders it makes it more difficult for businesses and consumers to invest and it sets off wage and price spirals. And interestingly it hits the people who are struggling the most the hardest.As one commentator said after Labour had announced its policy: “It’s deeply bizarre that the Labour Party would actually actively promote policies that would harm the worst off in society the most.” That is what Labour’s proposed softening of its attitude to inflation would achieve which of course brings me to the small issue of the KiwiSaver idea the interest rate jack-up idea—the “big tool” that Mr Parker likes to refer to—which I respond to today. But the moment you think about that it falls apart because housing is less than half of New Zealanders’ debt. The rest is companies credit cards farmers councils and Government agencies.Apparently Labour is going to tell businesses and councils to carry on borrowing and spending because wage and salary earners will be forced to have more money taken out of their take-home pay to do the belt tightening for them. Weirdly Labour has still not come up with any sort of indication of how much it would require people to put into their KiwiSaver accounts to offset a 1 percent increase in interest rates. So here we are—I think it was the beginning of May that this thing came out—6 weeks down the line and Labour is still shtoom on any suggestion of what the actual trade-off would be between rising interest rates and forcing people to put more money in their KiwiSaver accounts.Well over on this side of the House we actually did the exercise. We reckon that to get 1 percent Labour would have to increase the KiwiSaver contributions by around 6 percent. Those members are out there today saying that they are already going to increase your KiwiSaver—Hon David Parker: Rubbish! Making it up.Hon STEVEN JOYCE: It is true. And if it is not true then the Opposition should actually come up with some numbers.Phil Twyford: You’ve made it up.Hon STEVEN JOYCE: They are not made-up numbers. They are actually worked out and what we know is that the Opposition has come up with nothing. So here we are debating the Reserve Bank of New Zealand Act and the Reserve Bank and the Labour Party is proposing to throw away the independent control of inflation. It is talking about this “big tool” this weird big tool which apparently magically can keep interest rates under control while boosting people’s KiwiSaver rates and it has no idea how that works.It is actually embarrassing in a debate about Crown entities for that sort of ridiculous policy-on-the-fly rubbish that the Opposition has come up with. So fundamentally the good thing about the Reserve Bank policy is that it controls inflation. Inflation is very tough particularly on those people who are struggling the most in society and what we know is that the Labour Party would change that. We know it would relax the control of inflation and we know that its monetary policy approach is to force people to have more money taken out of their take-home pay but Labour says: “Don’t worry. You’ll all get it back when you are 65.”So while you are sitting there with your families under Labour Party - type inflation conditions—which as we know is about 8 percent which is what it was at the last election or higher again; those were the high inflationary times—Labour will be saying to New Zealanders: “Don’t worry. The solution is to whip some more money out of your pay. Don’t worry that prices are going up. You will feel it for oh I don’t know maybe a year but the good news is that in the long run”—the very long run when you are 65—“you will get a little bit of it back.” That is those members’ answer and what a load of rubbish.Report noted.New Zealand Transport AgencyPHIL TWYFORD (Labour—Te Atatū):It is great to be here debating the financial review of the New Zealand Transport Agency because just yesterday we had the Minister of Transport the Hon Gerry Brownlee give one of his famous Morning Report interviews. It was a cracker actually. I am thinking of putting together as a campaign fund-raiser a collected edition CD of Gerry Brownlee’s transport interviews on Morning Report because they are quite remarkable—Hon Ruth Dyson: And the EQC ones.PHIL TWYFORD: That is right—and the Earthquake Commission interviews. He said some amazing things actually. When asked about the draft Government Policy Statement on Land Transport 2014/15 - 2024/25 he said: “The focus is not on roads.” As an example of deny divert and obfuscate it was one of the classics Mr Brownlee and I want to compliment you on that. The other cracker quotation from Gerry Brownlee was: “Until this Government came along no one was much interested in walking and cycling.” It is great to see Gerry Brownlee taking responsibility—taking personal credit—for the growth in public interest in and support for walking and cycling.I mention the Government policy statement because the very interesting thing about this is that the Government policy statement sets out the Government’s transport priorities for the next decade. The reason it is relevant to this debate is that the Government’s policy statement for the next decade is almost exactly the same as the Government’s priorities that we have had to put up with for nearly the last 6 years. It is all about roads roads roads with this Government. What we see in the Government policy statement is a continuation of its spending more than $1 billion every year on its new mega-motorway projects. If you look at the funding there it has allocated $20 billion to State highways and only a fifth of that—or $4 billion—over the same period to public transport walking and cycling. A full 87 percent of the Budget projections in the Government policy statement has been allocated to roads—39 percent for new State highways which are predominantly the roads of National Party significance—10 percent for public transport and only 1 percent for walking and cycling. Yet Gerry Brownlee goes on Morning Report and says that this is not all about roads. Well this Government is obsessed with building new motorways. It has poured more than a billion dollars every year into these projects at the expense of the regions at the expense of the maintenance of local roads and at the expense of public transport in our large cities.Why does this matter? Why does it matter that the Government has this incredibly unbalanced transport policy? Well one of the reasons it matters is that it is structuring into our transport system into the export supply chain gross inefficiencies. This Minister and this Government believe that every freight task can be done—no matter what it is and no matter where it is going—most efficiently by being hauled on huge trucks on brand new gold-plated and mostly duplicate motorway projects. It refused to build a truly sustainably and efficient freight supply chain in this country by investing in and getting the best out of all the different modes of transport and all the different pieces of the transport system. So what it refused to do and what the next Labour-led Government will do is take an intelligent and clinical look at how the ports how coastal shipping and how rail can work together with the roading system to achieve much better connectivity and get our products to market in the most efficient and sustainable way.But this Government is not interested in that and what was I think particularly revealing was that the Government policy statement on transport cannot under its own terms of reference talk about coastal shipping about rail and about ports. Critical elements of the transport system are separated out from the Government’s main policy-making tool and its main statement of priorities because the transport system basically exists in these silos. The Government likes it that way. Gerry Brownlee likes it that way because he does not want to have to consider those other important parts of the transport system. He is not interested in rail he is not interested in coastal shipping and ports; it is all about roads. Under the system that we have got under the transport system that this Government is perfectly happy with New Zealand Transport Agency is the big road builder. It is the deliverer of our transport policy. That will change under the next Labour Government.DAVID BENNETT (National—Hamilton East):I would like to just congratulate the Minister of Transport on the great work that he has done in this area over the last 3 years. He is an exceptional Minister and always welcome in the Waikato. He can come there any time unlike the Opposition members who never come to the Waikato and when they do come they do not have anything to say of any consequence.Hon Ruth Dyson: You can’t say we never come and then say what we do when we do come.DAVID BENNETT: Oh that member is pretty much a non-event when Labour members do come if they do come.As for Mr Twyford we hear this speech every year from the Labour Party saying how it is going to have a multimodal solution using all the terminology about “we’re investing in roads and rail and maritime and all those things and public transport.” There is all that talk but no actual definite details about what the Labour Party wants to do. Why does it not come out and actually say what it wants to do? There is a reason New Zealanders why Labour members do not come out and say what they want to do. It is because they know that what they want to do is in direct conflict with the Green Party and they cannot afford to have that fight before the election.Who runs transport policy in the left wing? It is the Green Party. It is Julie Anne Genter. Julie Anne runs it not Phil Twyford.The CHAIRPERSON (H V Ross Robertson): Order! Members’ full names.DAVID BENNETT: If you were a betting person you would put your money on Julie Anne Genter to have more power over the transport portfolio than Mr Phil Twyford—the nice guy that he may be. That is the reality of the Labour Party policy. It is all hot air and talk and no commitment. Will it commit to the Waikato Expressway? No it will not commit to the Waikato Expressway. It will not commit to building that because it knows that Julie Anne Genter has gone out and said that she wants to review that project. Julie Anne Genter when asked about that project a mere 2 weeks ago said that the Green Party would review that project.What about other roads of national significance around the country? What about the Pūhoi road which I am sure Mike Sabin will want to know about? What is the Greens’ policy on that? What is the Greens’ policy on Transmission Gully? The Green members will tell us the next time. They will be open and honest and tell you what they think. They will go out there and say that they are not doing them. The Labour Party in effect will not be doing them either. So New Zealanders need to listen to what the Green Party is saying because that is the Labour Party transport policy.Then we have New Zealand First the other arm in the Labour - left-wing attempt to try to get seats in Parliament. It came up with this transport policy that I would love to see rearticulated in this Chamber. We had a transport debate last week and we had the New Zealand First transport policy that was for passenger rail from every city in New Zealand: passenger rail from Wanganui to Wellington passenger rail from Hamilton to Auckland passenger rail from Timaru to Christchurch—passenger rail everywhere and anywhere.Denis O’Rourke: That’s right.DAVID BENNETT: Oh and all these trains would have been built in New Zealand of course under New Zealand First policy. But I want to see New Zealand First come up here and say what it said at that transport conference. Denis O’Rourke has got his chance to come out and say it. How is New Zealand going to afford a train from Wanganui to Wellington? Tell me that. How are we going to afford that? That is what the New Zealand First Policy is. The Green Party policy actually pales in comparison with New Zealand First’s policy. The Green Party used to be the party of trains but now it is New Zealand First that is the party of trains and the Green Party now has to up its game to match that.On this side of the House on the Government side we see a party that has good strong leadership and a Minister who has taken a balanced approach to transport funding. Not only have we invested heavily in the infrastructure of our roads but we have invested heavily in our rail networkWe have invested in the KiwiRail Turnaround Plan. We have invested in public transport options in Auckland and we have a plan for that public transport going forward. That is a balanced approach. We have taken action in the maritime and aviation areas where it has been required as well. That is what transport policy demands not the Julie Anne Genter model of transport policy. Thank you.MIKE SABIN (National—Northland):It is fantastic to follow in the wake of the chair of the Transport and Industrial Relations Committee. It is strong chairmanship that he shows as one would expect with such a strong and high-performing Minister of Transport as Gerry Brownlee of course. What a great team. What a great team the National Party has put together on this side of the House. I just want to pick up on a couple of comments that were made by the new comedic home for evening comedy on the Labour Party Phil Twyford who talks about the comment that it is not just about roads.Phil Twyford: Say that again Mike. I missed it.MIKE SABIN: I forget exactly what I said. We will go back to the Hansard.It is not just about roads; it is actually about transportation on multiple levels. If there is one thing that we can say about the efforts of this Government in terms of transportation what we have actually done is we have unwound decades of under-investment in some of the key areas of our transport infrastructure. Significant money has been put into KiwiRail. A Labour Government that sold off—[Interruption] Sorry what is the member Tracey Martin saying? I cannot quite hear. [Interruption] No Tracey Martin has got that wrong because you will find that Marsden Point is in the Whangarei electorate. But is that an important piece of infrastructure? Absolutely and that is why we are making sure when we have discussions with the councils that are looking at the Ports of Auckland Tauranga and Marsden Point that they understand the needs of the transportation infrastructure there. If the member wants to come up to Whangarei and have a wee discussion on it I am sure the new member in Whangarei would be happy to allude to that.Hon Ruth Dyson: Phil Heatley is still there. Don’t be so horrible.MIKE SABIN: No I am talking post-election of course Ms Dyson.We are a forward-looking party and the reality is that when we look at the Government policy statement—let us take just one little small snippet of the programme of work that has been going on here the Pūhoi to Wellsford road. As David Bennett has mentioned the Greens and Labour have both signalled that road will come out. They say they will get rid of that project. This Government has fast-tracked the consenting process alongside Auckland Council which has also 16 votes to four recognised the importance of that road. It is a trade and economic highway to what is the fastest-growing economy in the country. The Northland economy is the fastest-growing and strongest-growing economy in the country. We know that $800 million of primary industries particularly is trundling down that road on an annual basis. That is a significant contribution to this country’s economic fortunes and this Government is investing in that. In fact this Government is ensuring that that programme is given every opportunity to move forward as quickly as possible.When that was signalled in Northland I can tell members across this House that it was absolutely strongly heralded as a fantastic initiative because of the importance of that road. It is not just about the road in itself. It is about the signals it sends about the economy of Northland and the opportunities that exist for other businesses to be involved in growing that economy and being a part of that economy. The road will take some time to build but already with the interest in activity people are looking north and they are looking north because here is a region that is attached to the nation’s largest economy in Auckland and that is a vital link. If we look across the roads of national significance programme that is exactly what we see. We see the arterial routes—the routes that are so often used by so much of the economy of this country. We are ensuring that the under-investment that has occurred for far too long in this nation is actually being caught up with and we are investing where we are going to free up and ensure that that transportation of our economy is going to move far more effectively.We can talk about public transport all we like but—I do not know; call me old-fashioned—I think buses tend to use roads as well. I have not seen too many “hover-buses”. Perhaps the Green Party might want to introduce some of those into the mix—I am not sure. Whether they are highways motorways freeways or single lane roads anything with wheels on it uses them even cycles which I know the Green Party of course is very very interested in. The point is that what the Government has done is establish a programme of work across many facets of our transportation networks to ensure that where the bottlenecks exist where the challenges in that network exist we are absolutely investing in that and investing ahead of the curve which is taking some investment to catch up on because as I said there has been a consistent under-investment in that. So what we are seeing—Hon GERRY BROWNLEE (Minister of Transport):This is a financial review of the activities of the New Zealand Transport Agency over the past year. Naturally when considering that one might look back and one might look forward. I accept that. But I was particularly distressed today by some of the comments in the speech offered to the House by the Labour spokesperson on transport. What he seems to have missed is that this process is guided—that is the process of the Government policy statement and the work of the New Zealand Transport Agency—by the Land Transport Management Act 2003. I would suggest that if he is to be an effective spokesperson he should go and read that Act so that he does not make some of the extraordinary statements that he made in the House this afternoon.Phil Twyford: Overdue for reform.Hon GERRY BROWNLEE: What I would like to hear from him at some point is that if he thinks that Act needs to be reformed he starts to spell out what it is because all I hear from him is about what Labour is not going to do should the unlikely event of its receiving the opportunity to sit on the Treasury benches occur. Labour is not going to continue with the roads of national significance programme. It is not going to invest in cycle networks as we have. It is not going to invest in pedestrian opportunities as we have and it is not going to have an arrangement that allows local communities to choose where they spend some of the funding that comes from the National Land Transport Fund on their own projects. Anyone can stand in this House and tell people what they are not going to do; to talk about what you are doing and what a Government is doing is a different matter.We have over the last short while since 2012 spent a staggering $945 million—a billion dollars effectively—on public transport. That has been matched by local authorities which have contributed another $770 million. So there you see a huge commitment to public transport for a very small part of the transport task required in New Zealand. We have further said that if we can see that the demand for public transport is on the rise we will be there to fund it. I want to know whether in fact the Labour Party is proposing that it would do away with the $800 million package that we have put together for Auckland to bring forward some of its roading projects. The answer would be yes because Labour does not like roads. It somehow thinks that New Zealand should return to a sort of strange community where we do not make use of roads.When it comes to KiwiRail over a billion dollars so far has been reinvested in that company trying to give it the opportunity to contribute more to the freight task throughout New Zealand. But the reality is that the rails do not run into many of the rural communities in New Zealand where the productivity that comes off our agrarian economy is carried out. So there has to be an ability to move freight by road. What I want to do this afternoon is congratulate the management of KiwiRail on collaborating with road freight companies throughout the country to get a better synergy between the opportunity to move goods over long distances on rail with the capacity to take significant loads by truck to the farm gate and beyond. When Mr Twyford stands up and says there is no big thinking going on here I have got to tell him that out in the wide world people do not necessarily look to the Opposition spokesman’s office to see that big thinking. Thank God they do not because there is none.The reality is that we have a dynamic transport industry in New Zealand and we have a Government that is making investments in the transport infrastructure to ensure that it prospers along with the rest of the economy for years to come. It was the Romans who first worked out that if you want to have a dynamic economy provide roads and that is what we are doing.Report noted.Earthquake CommissionHon NICKY WAGNER (Associate Minister for Canterbury Earthquake Recovery):I am very pleased to speak in this debate on the report on the Earthquake Commission. I speak in this debate as the member of Parliament for Christchurch Central. I want to talk about the operations of the Earthquake Commission in Christchurch. Christchurch people love to hate the Earthquake Commission. We love to hate the Earthquake Commission because in the last 3 years things have been very tough in Christchurch. Nothing has been simple about our earthquakes and the Earthquake Commission has had to work under very difficult circumstances.But we are also very aware that New Zealand is in a unique insurance situation because of the Earthquake Commission. When you look at other similar earthquake-prone countries especially those around the Pacific Rim—the US and Japan—only about 15 to 20 percent of ordinary citizens have their homes insured simply because of the cost and no one’s land is insured at all. I visited San Francisco in 2012 and I was horrified to see properties homes that had been rebuilt on the area of the land that had been very hard hit during the 1989 Loma Prieta earthquake. These homes were mostly uninsured and certainly nobody had land insurance. They were uninsured because of the cost of insurance. If you live in an earthquake-prone country unless it happens to be New Zealand it is prohibitive to pay for insurance for normal families. That situation would be the same here except that the Earthquake Commission takes the very high - risk first $100000 of risk so that supplementary insurance is affordable. So although we love to hate the Earthquake Commission in Christchurch I cannot imagine what it would be like in Christchurch if 80 to 85 percent of our homes were uninsured and our land was also unprotected.I acknowledge that there have been issues with Earthquake Commission claims. The size of the event the number of earthquakes the fact that most people have multiple claims the management structure of multi-unit properties and the tough environment for everyone who works in our communities have made it particularly hard. The Earthquake Commission has had to scale up very fast. But I sincerely believe that everyone in the Earthquake Commission is working hard to settle claims and we are now seeing real progress. Ultimately we have to remember that every last claim will be paid out and that the Earthquake Commission will continue to provide New Zealanders with insurance long after Christchurch homes are restored and our city is rebuilt.Let us now have a look at the Earthquake Commission’s statistics. We can get a good idea of the size of the task in hand and of the progress that has been made. Since February 2011 the Earthquake Commission has had 1.64 million interactions with homeowners. That is equivalent to dealing with every single person who lives in Auckland and in Northland. The assessors have done 750000 assessments or reassessments after multiple earthquakes which is equivalent to two assessments for every single person who lives in Christchurch. The Earthquake Commission has paid out $7.4 billion including GST.Let us have a look at how those claims pan out. Eighty-three percent of cash settlement claims have been completed. Ninety-one percent of all claims under $15000 have been resolved. Seventy-five percent of claims between $15000 and $100000 are settled. And 90 percent of overlapped claims are settled. That means that 90 percent of those claims have moved on to the insurance companies for a rebuild or a repair. On top of that 78 percent of properties in the Canterbury Home Repair Programme are complete.I really do want to focus on vulnerable customers because this is a priority area of the Earthquake Commission and it is an area that concerns us all. Eighty-six percent of the claims of vulnerable customers are complete and the Earthquake Commission is absolutely committed to fixing the homes of the rest of these people. One of the issues that we have had in Christchurch is that it has been very difficult to get to the people who most need our help. If you compare an earthquake like the Christchurch—EUGENIE SAGE (Green):One of the few things that I would agree with Nicky Wagner on is that things have been tough in Christchurch. Research out today from Healthy Christchurch shows that 65 percent of Christchurch residents reported feeling tired in 2014 and that is a 10 percent increase on 2012. Certainly dealing with the Earthquake Commission and with insurance claims has contributed to that feeling of tiredness particularly when often you have got very poor communication by the Earthquake Commission so that at least 5 percent of Christchurch households have had to resort to the Official Information Act to try to get some basic information out of the commission. The commission has got a very ambitious target of completing all repairs on earthquake-damaged homes by the end of this year. That is another more than 25000 full repairs that it is yet to do. The claim that that will be done by the end of this year makes many Christchurch residents laugh out loud when they are still dealing with that dance and interaction with the Earthquake Commission.If we had a Green Party in Government we would have had the Earthquake Commission and Housing New Zealand working alongside each other to tackle the housing crisis. We know that the Minister has denied that there is a housing crisis in Christchurch despite the fact that there are regular reports in the press of people surfing on friends’ couches sleeping in garages and sleeping in cars. We do have a housing crisis because so many people have had to move out of their homes in the red zone or because their homes are uninhabitable because of earthquake damage or flooding vulnerability. If we had more joined-up thinking we would have had Housing New Zealand building more State houses. We would have had a progressive homeownership scheme where people in those homes could progressively buy them from the State during their time in the house without getting a big mortgage and without heavy debt just as many of our parents did using the former family benefits. If we had joined-up thinking we would have had the Warm Up New Zealand: Heat Smart programme going at full strength not being savagely cut as National has done.The Earthquake Commission has a winter wellness programme and that is a response to the fact that many homes in Christchurch have lost their primary heating source through damage to chimneys fireplaces and woodburners. Certainly the Earthquake Commission programme has meant that several thousand homes across Christchurch have had new heat pumps installed.Hon Gerry Brownlee: 20000.EUGENIE SAGE: All right 20000 Minister—thank you. But the Earthquake Commission and the Government have missed the opportunity to substantially improve the housing stock in Christchurch through a full Warm Up New Zealand: Heat Smart programme. It has missed the opportunity to substantially reduce the 600000 homes across New Zealand that are cold that are draughty that contribute to health issues for children and that see kids being sick and off school and their parents taking time off work. We want to ensure that all our homes are warm dry secure and healthy. The Government gave the cold shoulder to Christchurch by making a major cut in the Warm Up New Zealand: Heat Smart programme so it was not working alongside the Earthquake Commission to make the most of the crisis in Christchurch. It could have ensured that there was more subsidy assistance available so that people could insulate their homes at the same time as they were undertaking major earthquake repairs. The Green Party’s Warm Up New Zealand: Heat Smart programme would do that by providing subsidies for wall insulation.Instead what did the Earthquake Commission do? Initially it opposed the betterment of homes and then it allowed it but homeowners have to cover the cost of putting in wall insulation while full repairs are under way. The Green Party would provide assistance to enable that to be more affordable. That whole scheme would cost about $35 million in Christchurch for making sure that we improve our housing stock we build it back better post-earthquake and we do not simply replace like with like and miss the opportunity that we have to create much warmer drier and more healthy homes. The Earthquake Commission has done a bit with the heat pumps but it has not used the opportunity that the earthquakes have provided to provide more insulated homes so that everyone has a warm dry and healthy home.National has significantly reduced the Warm Up New Zealand: Heat Smart scheme. Initially in the first 3 years there were over 200000 houses insulated; now its target is only 46000 homes.Hon RUTH DYSON (Labour—Port Hills):Can I first of all say that it is blindingly obvious to anyone that the Earthquake Commission has faced a big job and it is in no one’s interest to do as the current member for Christchurch Central did and assume that challenges to the current system are a proposal to get rid of the Earthquake Commission. That is a nonsense conclusion that Nicky Wagner reached and I know that nobody is proposing that. But we cannot deny the fact that the level of arrogance bullying and incompetence displayed by the Earthquake Commission is having anything other than a negative impact on residents in Canterbury. I think the same goes for the Minister responsible for the Earthquake Commission actually. Nobody has denied that the Minister who has got several portfolios—perhaps two too many—has got a big job in front of him. Nobody is arguing about that. But it does not mean that when somebody challenges it questions it or says that this is clearly not going right we should be subject to bullying or abuse. That shows a level of being out of touch with what people in Canterbury are going through.I want to touch on just three points briefly. The first is the self-imposed time frame that the Earthquake Commission has set for settling claims. The second is its method of cash settlements and the concerns I have about that. The third is in relation to multi-unit dwellings. I think that people in Canterbury deserve certainty they deserve support and they need to know that the Government and Government departments and agencies of Government are on their side and working for a positive resolution of the huge tragedy that everyone has felt in one way or another. It has affected different people in different ways; everyone in Canterbury has been affected by the earthquakes. What they need now is a Government that is clearly on their side and that can help them move to a positive solution and outcome.Let me go back to the first of the three points—the self-imposed time frame. Ian Simpson has written to us all again. He is the chief executive of the Earthquake Commission. He has just written to us and said: “I’ve made a commitment to you to fix your home or settle your claim by December of this year.” Then he says: “While I’m confident of our 2014 target if we have to run into 2015 we’ll do so.” Well that is hugely reassuring. We are committed to fixing everything by the end of 2014 but if we do not make it we go into next year. Well what a reassurance that is! This is in writing from the chief executive. That gives us no reassurance Minister and I think you should be on his case and on the case of the chair of the Earthquake Commission to give us correspondence and give us time frames that mean something or stop wasting the stamps. This sort of dribble does not help anyone.The second thing I want to talk about is cash settlements. In this same letter Ian Simpson says: “We will not be using large-scale cash settlement to meet our December target. We will continue fixing homes until the job’s done.” That is just untrue. The Earthquake Commission is bullying people including the most vulnerable people into taking cash settlements and I think it is an outrage and it is about time that Minister Gerry Brownlee stood up to its bullying tactics and said that cash settlements should be an offer not a compulsion and people who do not want to opt out should not be bullied into doing it. I have got two examples. One is a 95-year-old constituent of mine who still has plywood cladding on the outside of her home—a well-under-cap multi-unit dwelling—and the house next door is going to be demolished. She has been told in writing that the Earthquake Commission has yet to develop its policy on multi-unit dwelling so she is going into her fourth winter in an unclad home and it is cold Mr Brownlee. It is just cold. She is not blaming you. She is pretty generous but I think that the buck stops with the Minister and she should not have to do that. She has been told she can cash settle or join a very long queue. She is 95 years of age. She is competent. She is able. But it is the Earthquake Commission’s job to fix her house not hers.I have got another example that I will just briefly read out to the Committee. This is from a senior claims manager at the Earthquake Commission who says to a person who does not want to cash settle: “I will again insert our rights to cash settle” and quoting section 29 of the Act. A bullying threat to cash settle not an offer is not good enough Mr Brownlee. The Minister needs to take responsibility for stopping that practice.Hon GERRY BROWNLEE (Minister responsible for the Earthquake Commission):I should respond to some of those comments offered by the Hon Ruth Dyson. The first point I would like to make though is that the Earthquake Commission has to date settled 141000 claims and that is an 83 percent settlement rate. Yes Ruth Dyson is right to say that multi-units present a problem. Part of the problem is that where you have multiple buildings—these are blocks of flats apartment buildings or anything else—then there can be multiple insurers over them. There is also the problem which Ruth Dyson illustrated very well by talking about her constituent whom I would like to know a little bit more about I must say because that does cause me some concern—Hon Ruth Dyson: What so you can abuse me again? No way José.Hon GERRY BROWNLEE: Well you see there is the problem. I genuinely stand in the Committee and say that if you have got that person and they need help I would like to be there to help them and I am told that all that is going to happen is that the member will get abusive. This is ridiculous. Here we are. Here is the deal. That lady clearly has got a problem with her house no doubt about that. But what Ruth Dyson said is that the property next door is going to be demolished so that means that the adjoining house—if we look at this box here with all those boxes that is a multi-unit. I do not know where in the units her house is but if one has to be demolished next to it it is going to cause damage to her house. There is no question about that. So the question has to be who pays where and what insurance gets triggered.The worst we have got is a block of 43 flats or apartments all together where there are 16 insurers. The insurers are all saying: “Well hang on a minute. My responsibility is for this bit over here. If you fix your bit you’re going to cause me more expense.” So behind the scenes there has been a huge effort to get insurers to try to sort this out. In the end guess who is truly responsible for this appalling problem? It is the legal fraternity of Canterbury frankly because there have been body corporate laws in place and repeatedly lawyers have conveyed properties ignoring the body corporate laws—willy nilly ignoring the body corporate laws. So when I see some of these flash lawyers around town start pontificating on what the Earthquake Commission should be doing or what private insurers should be doing I just put it back on them and ask about how many multi-units that particular lawyer has conveyed in their time ignoring those body corporate rules.All I am saying here is that this is a very real problem. It is not something that you can fix by standing up and screaming and yelling at people; it takes a lot of work to get through it. We are making those commitments and we are settling those particular issues bit by bit. I have got to say that coming into the House or going on the TV or getting in the newspaper and having a flick at some of the Earthquake Commission people is far too easy. They are Canterbury residents themselves. Many of them have got damaged houses themselves. They know what the reality of living in the city is and they come to work every day and deal with people’s problems. I admire them for doing that and frankly the statistics show that they are doing a very good job.I want to briefly finish on the comment from Eugenie Sage when she talked about the latest wellness index from Canterbury. Firstly the Canterbury Earthquake Recovery Authority contributed to that cost as did private insurers and I understand that the Earthquake Commission did as well. So we want to know what the situation is. The international literature tells us that the third year after an event is always the hardest. We need to know the extent of that problem and we are not walking away from it. There are services available for people who are suffering those stresses in their lives. We know that getting people through this is going to be settling all of the Earthquake Commission issues and getting people back into as much as possible of the groove that their life used to be. That is the commitment the Government has made through the Earthquake Commission and we have not walked away from any responsibility we have in Canterbury one little bit. It is disappointing that people find a need to misrepresent situations to try to paint the worst picture of them.I say again to Ruth Dyson to tell me what that poor woman’s situation is. I would like to look at it because I think something more should be done for her. To suggest that the member has let her sit for 3 years in a cold house and has not told someone who can do something about it is equally disgraceful.DENIS O’ROURKE (NZ First):The Government’s handling of the whole earthquake recovery in Canterbury has been a test for both the Earthquake Commission and the Government. After more than 3 years the conclusion has to be that although some good things have been done there is still far too much that has not been done and still far too many issues that are unresolved. Neither the commission nor the Government has scored a pass mark and their report cards should read “must do better”. The Budget forecast a surplus of close to half a billion dollars but at the same time the budget for Canterbury earthquake matters was reduced by about half a billion dollars. That indicates that the budget for Canterbury earthquakes was reduced not because that was possible given the progress of recovery projects—or more accurately the lack of progress—but because this part of the Government’s Budget was an easy manipulation to create an artificial surplus for election-year purposes.That has been confirmed within the last few days when the Prime Minister indicated that far from it being possible to spend less the Government will most likely have to face an additional $5 billion or more for the rebuild over coming years as the overall cost has escalated. The Government is simply not being transparent about the real size of the contribution it will need to make. This issue alone makes its claimed Budget projections and the forecast surplus an absolute farce.Most people in Canterbury are concerned about the slowness of so many aspects of the rebuild and the dilatory way the Government and its agencies have handled the needs of the city. Infrastructure repairs are taking far too long. Demolitions are still not done after 3 years or more. Rebuilds are only just getting started. Planning gives little cause for confidence to people who need to make decisions about their investments. Insurers are getting away with blue murder. Decisions on Port Hills properties are still not made and the list goes on.But one of the worst performances by all agencies has been the failure to deal with flooding in one part of Christchurch in particular. This was a problem well known soon after the earthquakes but 3 years later and several floods later there has still been no action on the ground. That is not good enough from the Government and it is not good enough for the Government to blame the city council either. Flooding is clearly an earthquake effect and it is a Government responsibility. The planning should have been completed and the work started by now to relieve those flooding problems. Purchase offers without red zoning for those to whom the work would not be effective or would be too slow should have been made by now. This is a disgraceful absence of action by Government agencies and there will likely be more flooding of homes still to come this winter.Another disgraceful performance has been over compensation for red-zoned uninsured or bare land. The offer of 50 percent of 2007 valuations was never justified or justifiable. The courts have now said so and now the red zone quake outcasts have been given leave to apply to the Supreme Court to have the whole red-zoning process for all of Christchurch deemed illegal. That would be catastrophic as a result for the Government and for New Zealand as a whole. The hearing is in July. The Supreme Court bench will not be easily influenced by political considerations. So not only is the 50 percent offer clearly illegal but we face the prospect that the whole red-zoning concept may be illegal too with all the ramifications that that will have.If that is not bad enough the Port Hills people still waiting for a decision have been told that they will have to wait even longer until the court has made a decision on red zoning. These people are still suffering. They have been suffering for 3 years or more. They are paying mortgages a proportion of rates and rents all at the same time. How would you Mr Chairman like to be in that position? The Government and its agencies should have made better decisions in the first place.Report noted.AgResearchDr DAVID CLARK (Labour—Dunedin North):AgResearch is mismanaging public funds and at the same time it is losing some of our top scientific talent. It is proceeding with a $100 million restructure despite evidence that shows that it is a waste of taxpayer funds. The sheepmeat industry has fallen victim to an ideologically driven board a plan that is off the rails and a lame duck Minister of Science and Innovation who has seen the evidence but proven completely unable or unwilling to hold the board to account.Let us have a look at the history. In October 2012 Mr Joyce received the AgResearch business case. It sat on his desk for 5 months—for 5 months it sat on Mr Joyce’s desk while he considered whether or not this document was worthy for him to sign off. We know he then signed it off and subsequently out came the statement of corporate intent which Mr English also signed off. On 30 July 2013 the proposal was put to staff. Submissions closed in August and subsequently an internal report reviewed the restructure plan and advised on the way forward. That restructure plan said that many of AgResearch’s changes were indeed good ideas but that one part made no sense. That was the part that was about disbanding the Invermay Agricultural Centre about pulling apart a successful hub a successful commercial model that has generated productivity gains that amount to pretty much the doubling of sheepmeat productivity in the last 30 years in order to start from scratch—ditching all the commercial partners shifting cities losing all the scientists and starting from scratch. That is the case. The internal review which received no less than 245 submissions found that the case for shifting Invermay did not stack up if AgResearch wished to achieve its goals of improving science improving productivity and improving on-farm returns.Then we have a number of intervention points that have arisen since then. The Minister Steven Joyce has been aware of all of these. There was a Public Service Association (PSA) survey that found that most members would not shift; that top talent would leave the organisation and would return overseas from whence they came or would go to other institutions in New Zealand. There was a financial review that was held where the senior management was unable to answer questions and was deceitful in its responses about the business case. Subsequently a full business case was released but that was not the impression given early on in the process. There has also been a vote of no confidence from one of the most significant breeding bodies in the industry the Texel breeders of New Zealand. PSA staff at Invermay have unanimously passed a vote of no confidence in the board and senior management. And then we have the industry—92 percent of the top ram breeders in New Zealand have opposed this shift and have said that this makes absolutely no sense at all and 6 percent abstained. The industry knows that this is not good for productivity in New Zealand.But Mr Joyce in all of that time has failed. He has failed to intervene on behalf of farmers he has failed to intervene on behalf of science in New Zealand and he has failed in his duty to the taxpayer as he sees hundreds of millions of dollars thrown up in the air for a case that promised only marginal returns. It promised only marginal returns on its original optimistic assumptions but those assumptions as we know have gone by the by. We know that the assumptions were that staff would shift in greater numbers than is currently likely. We know the assumptions were that farms would be sold off; now the timetable has been pushed back by a year. This is a no-hope case and the Minister has failed to intervene on a board that has failed to manage the key risk identified in its own business case which is managing the risk of staff loss of those key scientific staff who are important for productivity improvements of 1 percent per year ongoing into the future.Labour has said that we will save Invermay. It is an easy decision to make. It costs nothing and it improves New Zealand’s on-farm productivity. It improves exports for New Zealand.Hon Michael Woodhouse: I didn’t hear Iain Lees-Galloway say that. You go to Palmerston North and say that.Dr DAVID CLARK: Mr Woodhouse opposite is of course interjecting. He has toed the party line. He has abandoned the case. He has abandoned logic. He has let the economic pace—Hon STEVEN JOYCE (Minister of Science and Innovation):I think the member opposite David Clark first raised the issue of lame ducks and on that note I would first like to say happy birthday to Trevor Mallard. I understand it is a big birthday today. Secondly speaking of lame ducks I see his leader is certainly struggling along in a way that could be described only as a lame duck’s. The member is often guilty of over-egging the story and unfortunately he therefore ends up pretending a case that is not so—in fact he went on this huge conspiracy chat for the last 5 minutes about how it was all some sort of ideological conspiracy which of course it is not. Fundamentally—Dr David Clark: What about staff retention Minister?Hon STEVEN JOYCE: Oh be quiet parrot. Fundamentally—[Interruption] Well Mr Chair I cannot—[Interruption]The CHAIRPERSON (Eric Roy): Order! It is sort of an equal-handed kind of set of events here. The member was perhaps interjecting rather too much and the Minister on his feet should have used appropriate terminology in addressing people. The Minister will continue and let us just keep some decorum.Hon STEVEN JOYCE: I apologise for the avian references Mr Chair. The situation is simply this: as with many of our Crown research institutes we have organisations that have historically had large numbers of assets many of which are old many of which were built around the 1940s or 1950s or inherited from other purposes—Dr David Clark: Invermay are the newest ones; the Minister knows it.Hon STEVEN JOYCE: Shh! You will learn something. Many of them have large amounts of land but they also need to modernise their facilities to attract new staff and that is true of AgResearch it is true of Plant and Food Research it is true of Landcare Research and so on. And so they are all dealing with the challenge of modernising their assets to attract not just the existing generation of scientists but the new generation of scientists that they need to bring into those organisations.So AgResearch has embarked on this process and has proposed $100 million worth of investment in its organisation to bring its facilities up to speed and to be modern facilities. As part of that it has proposed some changes in the configuration of their institutes. It never proposed to close Invermay; it has proposed to move some staff groups. It has been through a long and rigorous process in terms of how it would finalise those particular proposals. It has landed in a space that I think many critics have found to be a significant improvement in terms of what it originally proposed and that is an important part of the process—that you consider and you put forward proposals and you then respond to the feedback on those.AgResearch has proposed at this time to retain the Invermay farms and the Ballantrae Hill Country Research farms. It is going to retain the existing farm systems deer researchers at Invermay which I think makes a lot of sense. It is strengthening the deer team at Invermay. It is retaining the herd obviously at Invermay. It is transferring the sheep flock from Woodlands to Invermay. It is also combining more with Otago University staff which of course was the original promise of the Christie Building—that there would be some Otago University staff located in Invermay. That is now going to happen. AgResearch has invited some of the regional players that have significant science teams of their own in the area of environmental science to co-locate at Invermay as well to build up that. I am hoping that the Southland Regional Council and the Otago Regional Council take AgResearch up on that opportunity because I actually think that would save money for the ratepayers of both regions as well as building a real centre of excellence in this environmental science area. So I think AgResearch has landed positively.I appreciate that Mr Clark will never be happy. Interestingly though we have not had a call from Mr Lees-Galloway who is more than happy about the shifts that advantage the Palmerston North area. That is one of those things where one end of the Labour Party speaks out of one side of its mouth and the other end speaks out of the other side. In fact I think the leader of the Labour Party was in Palmerston North committing to the investment in the Palmerston North campus at the same time as his little friend Mr Clark was down in Dunedin condemning the change. So I think the challenge of all of that is that the Labour Party members are basically saying depending on which part of the country they are in that there will either be no change or lots of change but they do not need any more money. I think that is another circle they are going to struggle to square.The other thing I just note in passing is that this Government is making very big investments in the science sector in Dunedin. There have been two very positive front-page articles in the Otago Daily Times in the last couple of weeks. Two new centres of research excellence are being picked up at Otago University and there is also the doubling—the doubling—of health research that the university has picked up in the current year. These are things that interestingly have not been greeted with great public relations—Report noted.Callaghan InnovationDr MEGAN WOODS (Labour—Wigram):Last week when we had the pleasure of having the Minister of Science and Innovation at the Education and Science Committee for the estimates hearing the Minister told us that he did not see the Government’s investment in Callaghan Innovation as being about creating jobs in the high-value manufacturing sector. He said that he saw this as being about creating jobs in the research sector. Well therein lies the difference between Labour and National and what we see as the purpose of our investment and putting money into science and innovation. This is a Minister of Science and Innovation who I would note in an earlier contribution this afternoon called interest rates one of the laws of physics. But I did think he at least understood innovation and what it takes to translate good ideas and smart thinking into viable products and companies. But when you are divorcing the investment that we make as a country and the commitment of taxpayer money into science and innovation from the creation of high-value jobs in the high-value manufacturing sector we have a problem.National thinks that achieving the Budget surplus is all it is about. But in Labour we have a grander vision of this. We want to make investments that will lead to New Zealanders having higher-paying jobs in the future. That is the reason we invest. If we stop and pause to consider the name of this very new Crown entity Callaghan Innovation we see that it was the vision of Sir Paul Callaghan that the reason we invest was to transform our economy for the good of people—not for the good of companies’ balance sheets but for the good of people and the country as a whole with the purpose being to put more money into people’s pockets. This is not a vision that the Minister shares clearly.But what we do have in Callaghan Innovation is a fledgling Crown entity where really very few people are still sure of exactly what it is what its mandate is or what it is trying to achieve. This is from some of the people who work in the organisation. If we have a look at what could have been if we have a look at the Taiwanese model if we have a look at the Danish model we see two very good organisations that had a clear mandate from their Government and a very well-defined mandate of what it was and what their role was to do. That was the creation of high-value manufacturing to really kickstart advanced technology in those countries.But if we have a look at how we have started out with Callaghan Innovation we see that we have Callaghan Innovation trying to sell important intellectual property in terms of high-value manufacturing through KiwiStar Optics. We saw that last year. This is still something that is bubbling along without resolution. But one of the very fearful things that we have is that this is a Government and a Minister that was willing to sell some of our good ideas offshore and for New Zealand to not realise the benefit of that.But then we have a look at what is happening to many of the companies that are receiving grants from within Callaghan Innovation and actually some of the precursor organisations as well. We ask whether what we have put in place has done anything to turn round the fact that too many of our good ideas get sold and disappear offshore. If we have a look at the figures released in 2012 by Technology Investment Network we see that 32 of our biggest and best high-tech businesses that were created in the last decade have disappeared overseas and Callaghan Innovation is not doing anything to turn that round. We have seen BioDiscovery not being able to receive its full grant because although it would have been awarded it only late last year it has already made a decision to take it offshore. We have had LanzaTech make the decision to go offshore. We have had GreenButton make the decision to go offshore.So what is it that could have averted that and is Callaghan Innovation doing it? And is the Minister pushing along the reason to do it? Well many of these companies have pointed to the fact that the places that they are moving to have research and development tax credits. If we have a look at LanzaTech it pointed specifically to the more positive research environment that it was moving to that would allow its business to flourish. Instead what we have is Callaghan Innovation in its fledgling state and Labour really hopes that Callaghan Innovation succeeds. When we are in Government we will actually put the levers in place to ensure that it can but now we have many in the sector both the science sector and the business sector—GARETH HUGHES (Green):Kia ora. Ngā mihi nui ki a koutou. Kia ora. I rise to take a call in the Crown entities debate to talk about Callaghan Innovation. How we build a smart innovative economy should be one of the key issues we are all talking about in the coming months. At the moment there are some great pockets of excellence happening across Aotearoa. There is some amazing stuff happening by Kiwi firms and I will take my hat off to the Government because there are a few projects that are deserving of public support. But what we see is that despite the pockets of excellence and despite the amazing smart green innovative thinking that is occurring it is happening in a vacuum of Government leadership.We see a Government that is focused on raw logs more oil and fracking and more milk powder exports overseas. We are on a hiding to nothing as a nation economically if we continue to simplify our economy and become more dependent on commodity markets where the buyers are setting the price not us in New Zealand. We risk being stuck at the bottom of the OECD rankings where we have declined year after year over the last three decades if we stay just on raw logs milk powder and oil and this is where the Government is literally throwing tens of millions of dollars of taxpayer subsidies. So although I celebrate and take my hat off to the pockets of excellence and the Government support that is occurring it is tiny compared with the subsidies we see to the fossil fuel industry and to the agricultural sector which is just intensification and raw commodities.If we want to build a richer New Zealand with more Kiwis in employment and more profits staying in New Zealand we need to keep up the focus on a smart green innovative economy. This is where the future is. This is where we can build a richer New Zealand. So although we did not support the initial legislation establishing Callaghan Innovation some of the research has been widely supported. Obviously we did not support it because of the direct ministerial oversight of the Minister sitting in the chair the Minister of Science and Innovation because there is too much control for one person picking winners. What we want to see is a true competitive process where good ideas can flow through not just on the whims of the Minister.We know we have a national problem when it comes to research and development. We spend less than half of the OECD average both at the national and commercial levels. We need to do more. If we look at other nations like Israel and the amount it is investing in research and development we see what we should be striving for that because we can build more jobs—more well-paid jobs—when we focus on innovation.One little policy area in this smart green innovation space that the Green Party will be championing this election is around digital manufacturing additive manufacturing and 3-D printing. This is something that is when you hear from the Government benches more of a border security threat because that is where the officials’ primary focus is going through the Customs Service. What we want to see is a focus on the economic potential. I welcome that Ministry of Business Innovation and Employment has finally supported groups like the Titanium Industry Development Association with some assistance to get a 3-D printer. There is a lot more we can do with the advanced digital manufacturing sector to grow jobs. It is 16 percent of global GDP—an $11 trillion sector—and it will be taking a bigger slice. With other Governments offering substantial support and substantial leadership we cannot miss out. We need more leadership here. We need to set those research and development investment targets much much higher.We need to support those successful Kiwi companies particularly in the green energy space which the Pure Advantage group of successful Kiwi businesspeople says is a $6 trillion opportunity for New Zealand to get a slice of. It is a $6 trillion global market. So a green investment bank would be a great solution in the next term of Government and a good green Government will focus on smart green innovation. We need to not just keep Callaghan Innovation but see a green investment bank established.We need to support our capital markets with things like a capital gains tax because it will focus investment away from the housing speculation market towards the productive economy. What I want to see is Kiwi families and Kiwi investors investing in Kiwi businesses. At the moment under the market we are seeing a signal flowing through to focus on speculation. [Interruption] I am sure that Jami-Lee Ross does not want to see more speculation in the Auckland housing market which is going up and up and up driving the interest rate rises that we see under the Key Government. There are more interest rate rises under the Key Government.What we need to do is see those proper economic signals to invest in productive businesses invest in employing Kiwis and invest in innovation. Ultimately this is where Callaghan Innovation is doing some good things. Where is it failing? It is the Minister in the chair. It is the lack of leadership and the lack of focus on a smart green economy. So this election will be a good opportunity for Kiwis to debate the issues—smart green innovation or more logs and oil.Hon STEVEN JOYCE (Minister of Science and Innovation):May I say that I do not think that the last two speakers get out that much. They really do need to get out some more. I had to laugh at young Gareth Hughes because he literally said that we have to encourage the capital markets and we need a capital gains tax. That is exactly what he said. The answer to encouraging the capital markets is to tax them more! That is obviously the answer; how silly of me! He also suggested that the idea of taxing about a quarter of houses would reduce the investment in housing whereas at the same time taxing 100 percent of businesses with a capital gains tax would increase the investment in businesses. I do not know how that is supposed to work.He also should have gone to Fieldays last week because he acted as if the primary sector does not innovate. He said that the primary sector needs to innovate more and not just sell raw stuff overseas. Well hello! The news is that actually that is what is happening. For those of us who did go to Fieldays I myself was incredibly encouraged by the amount of investment in technology and innovation that is going on there with the assistance of organisations such as Callaghan Innovation. The farming industry is now very much a data-driven industry and the members opposite should get out more and actually learn what is going on out there in the actual market place. But the other thing I would note—Dr Megan Woods: Ask them about a research and development tax credits in the market place while you are out there.Hon STEVEN JOYCE: Oh by the way in terms of the whole LanzaTech rubbish with the greatest respect the research and development grants that it was entitled to in this country were more generous than the ones in the US. The reason it has gone to the US is actually what happened under Labour’s watch when the company was largely sold offshore while Labour was still around. It hired a chief executive based in the Midwest of the US and now she wants to put the company there. That is the extent of it. So actually a little bit of work Megan would be good in terms of before you pick your examples as to why things should happen.What is actually happening is a big increase in private sector research and development supported by Callaghan Innovation. We now have $142 million a year being co-invested alongside private sector companies in research and development growth grants and the Opposition still has not woken up to that because it is still harping on about the policy I think it has announced seven times now and implemented once which is the research and development tax credits. It has got nothing more to say on innovation at all. That is the entire story in innovation since about 2007. Well news—we are in 2014. Something else a little fresh would be helpful.But the other thing I have got to take up with the member opposite Megan Woods is the issue of this whole thing that companies having international investment is somehow bad for them. I can tell her that actually a normal part of the innovation process is that some of the companies are eventually bringing in international investors. The good news about that which Ms Woods has overlooked is that it frees up capital to invest in more companies so people like Sam Morgan and so on who sold their TradeMe shares have now invested in a whole range of other companies and that is part of what encourages the ecosystem in New Zealand.My definition of success in innovation is the increase of innovation that occurs in New Zealand and that is what is happening right now in this country. We have had a big increase in research and development by businesses and it is continuing to grow. We have had a big increase in exports by what is known as the high-tech sector which is the information and communications technology sector high-tech manufacturing and medium high tech manufacturing. That is increasing. That is a factual reality.Dr David Clark: How close to the OECD average?Hon STEVEN JOYCE: Speaking of the OECD Mr Hughes was saying that we are continuing to go down the OECD ladder. Well I have some news for him actually. We stopped going down the OECD ladder as soon as the Labour-Greens crowd went out of office. We stopped. And actually we are now going up. The former Prime Minister Helen Clark talked about being No. 22 in the OECD for years and nothing happened. Now suddenly we are at 20 and going to 19 because of the work done by this Government relative to other countries in the OECD.Here we have a growing high-tech sector that is in really good shape with more and more companies listing publicly and more companies being seeded and growing. We have big support of that from this new entity Callaghan Innovation. If the member Ms Woods is unsure of what it is for I recommend this quite simple page with five bullet points on it. That would be a good summary for her to start with. We are lifting the investment in New Zealand’s technology companies and the Opposition needs to bring itself up to date.Report noted.Tertiary Education CommissionCOLIN KING (National—Kaikōura):It is a pleasure to talk about the achievements of the Government and the Tertiary Education Commission at this particular time. Just for those who are listening we are talking about the Tertiary Education Commission which fundamentally provides the stakeholder funds to the universities the wānangas the private training establishments the industry training organisations and the polytechs. It has been very important to appreciate that on coming into Government National recognised that that area was grossly over-supported but without the products and results coming out. So the Government is to be commended for the wonderful job that it has done in focusing especially the training providers into being accountable to the taxpayer for the dollars that are invested in there—the better part of $2 billion. That has been the work of the Government and the Minister for Tertiary Education Skills and Employment in focusing those particular providers on the job at hand.It is very important that the taxpayer dollars are spent wisely and that the intention of the tertiary education strategy is implemented and we certainly see that over the last two Budgets that has certainly been the case: further improvement. I cast my mind back to when I heard a comment in one of the interviews that we had with the Minister with regard to how much more blood you can screw out of a stone. I thought to myself: “What a wonderful analogy.” That is the difference between the Opposition and the Government. The Government on this side of the Chamber has extracted better value for the taxpayer dollar out of the tertiary education sector—not only in one area but across the whole gambit within the Tertiary Education Commission. It is also focused very much on what the Government can do to pull levers to stimulate and attract people into those areas that are very important for the continual growth in science and innovation of our economy. That is what it has been doing.There has been further investment in those “STEM” subjects—the sciences the technologies the engineering and the mathematics. All those things are certainly opportunities that should not be missed. We have heard a lot of dialogue today about how we are potentially missing opportunities. I would put it to the House that in actual fact the missed opportunities all happened long before National took office in this National-led Government.In respect of innovation we talked about Callaghan Innovation but one of the innovations that is happening inside the Tertiary Education Commission and funded by the Government is the establishment of the information and communications technology graduation schools. These are going to be established in Auckland Wellington and Christchurch. They are really good strong partnerships with business. These will create internships and research with high-tech firms. It is certainly that indication that we are moving into that really connected environment—that digital environment—and as a country it just underlines the principle that for us to maintain our standing in the OECD as was referred to previously every New Zealander needs the best possible education. It is a very long continuum but at the top end of it the Tertiary Education Commission has been greatly improved and refined. The accuracy and the accountability have been improved. We have only to look at the industry training organisations where the Minister has focused on with legislation to add transparency accountability and refinement so that we get better outcomes for those stakeholder tax-funded activities.But just to elaborate one particular area that the Government will be incredibly satisfied with is the apprenticeship reboot situation. It has moved from a provider-based training situation which occurred immediately after the Christchurch earthquakes where there were an amazing number of provisions for people to take up opportunities for training whether at the Christchurch Polytechnic Institute of Technology or with the Southern Institute of Technology or whatever—all of those polytechs. Well what we are now seeing with the growth in the economy with the growth in Auckland with the growth in Christchurch and with the growth in the regions is a far greater uptake of employer-based training. So that is your genuine apprenticeship training model and it is wonderful to see that we have increased that spending by $70 million. This is all very good and it shows that we have got a very appropriately balanced Tertiary Education Commission.HONE HARAWIRA (Mana—Te Tai Tokerau):Kia ora Mr Chairman. The Education and Science Committee’s report on the Tertiary Education Commission made an important point about how the Tertiary Education Commission is having to cope with ongoing cuts to tertiary sector funding rather than manage a stronger budget for the sector. The sector is crying out for support at a time when we have record numbers of young people leaving for Australia record numbers of unemployed young people and a refusal by the Government to properly fund tertiary education for those still living here in Aotearoa.That is why it is important that in considering this report on the Tertiary Education Commission we also consider the research that tells us how the lack of access to tertiary education defines the future for many of our young people. It is research that tells us that high fees stop many from thinking that they can aspire to a tertiary education from even bothering to enrol and from signing on for longer and more costly degree-length courses even though they know that that is the pathway to better employment opportunities. It is research that tells us that many crippled by student debt leave as soon as they graduate to escape a life of indebtedness or drop out early because of the heavy financial commitments of tertiary study. Sadly enough it is research that tells us what most of us already know but many of us refuse to acknowledge and that is that these problems are ever more complex and far more damaging for Māori Pasifika and for those who grow up in communities where poverty is the norm.That is why it is important that we say that if we want New Zealand to become a genuine player in world affairs then instead of trying to bribe our way on to the United Nations Security Council and instead of throwing even more money at Team New Zealand after already blowing $90 million on two failed campaigns to date and instead of constantly cutting funds to what was once a leading international tertiary sector perhaps we should be overhauling our whole education system and rebuilding it based on a full commitment to free education. That would show our young people that we want them to grow here to learn here to live here to work here and to invest here and that we are happy to invest in them because we know that an investment in them is an investment in us all.Of course we know that education is a public right and something that should be paid for from the public purse and that Aotearoa is a better nation with an educated population. We know that student debt is a huge deterrent to people taking up tertiary study and a massive burden in a low-wage economy like ours. We know that we need to be tapping into the nation’s intelligence to become innovators rather than mere consumers for the world’s multinationals and that without a culture of free education we shall become nothing more than the zombies of the world—the dull and dimwitted slaves to a rich powerful and ever greedier elite. That is why we need to increase access to our tertiary institutions to convince parents that their children can get into those places and to get our young people to believe that tertiary education really is available to everyone regardless of the colour of their wallets.That is why one of Mana’s very first policies is free education a position also promoted by our partners in the Internet Party and a position based on our absolute belief that our young people are worth every cent of our investment. That is why we say this. Drop the decision to shut down student associations and let them continue to be voices for change campaigners for student rights and advocates for freethinking. Dump the plan to remove students staff and community members from tertiary governance bodies and let them continue to be the voices of their communities. Write off student debt as the first step in our investment in our own future provide a proper living student allowance for all tertiary students scrap tertiary fees and challenge ourselves to create a world that we want for all of our young people not just those who can afford it. Yes we know that this approach will cost us but in the final analysis Mana still says yes and absolutely yes because we absolutely believe that our young people will be worth every single cent. Kia ora tātou.Hon STEVEN JOYCE (Minister for Tertiary Education Skills and Employment):I just want to make a short contribution in terms of some of the comments made by the honourable member Hone Harawira. Firstly it is important to note that funding has not been cut to the tertiary education sector. In fact the increase in investment in public tertiary institutions since 2008 is 14 percent and the increase in the university sector since 2008 is 18.6 percent. It is also important for him to note that the number of qualifications granted by the New Zealand system has been growing very strongly as a result of our focus on results. We are now up to 162000 qualifications achieved in the 2012 year and also significantly the highest level of qualifications at the degree level and above at around 25000. The other good news given his references to struggles for young Māori and Pasifika is that the numbers of young Māori and Pasifika people studying at university have gone up by around 3000 each from memory. That is good news as well; it is a significant increase.In terms of the cost of student loans to individuals they are currently paying them back if they stay in the country in around 6 to 7 years on average. I think the member pretty much nailed a multibillion-dollar increase in expenditure in the tertiary sector in that short speech including writing off student loans a much larger student allowance and free tertiary education for all so he might need to cuddle up with the Greens and their money-printing machine but at least it will be a 3-D printer and I suppose that is positive.The New Zealand tertiary education system is very high performing. It does a very good job for students. It actually covers 70 percent of the cost of their tuition. It provides student loans which are then written off because there is no interest—of around 40 percent—on student loans if you stay in the country and of course there are also student allowances available for many students as well. It is a very generous student support system given the private benefits that are obtained from tertiary education for example. The slight irony of Mr Harawira commenting about this is that tertiary graduates achieve an income roughly about 50 percent of premium over those who never go to university. The irony of making those who never go to university pay for those who do seems a little bit strange. But of course this is a contest of ideas and that is appropriate.The other point that I would make in closing is that as I say we have a very strongly performing tertiary sector that is delivering great results and we are working to improve it further with a particular interest in some of the skilled areas like information and communications technology engineering science and agriculture where we definitely need more people and that is a programme that is continuing. I think that the Tertiary Education Commission is doing a good job. It is always a work in progress but I think Mr Harawira needs to go and look at some of the facts about the performance that we are achieving in the sector. Thank you.Report noted.Accident Compensation CorporationIAIN LEES-GALLOWAY (Labour—Palmerston North):The Accident Compensation Corporation is a Kiwi treasure. For 40 years now it has been providing no-fault no-liability compensation and treatment for people in New Zealand who are injured. We all pay into it and we all expect it to be there for us when we need it and for the most part it is. There is almost nothing like it elsewhere in the world. It is something that New Zealanders should be immensely proud of. But over the last 5 years under this National Government the faith of Kiwis in ACC has been sorely tested. We know that it has been overcharging people on their levies. We know that it has been finding spurious reasons to avoid paying out compensation to avoid providing treatment and that it has dramatically cut its investment across the board in preventing injuries.We know as well that people have lost their trust in ACC to keep their private details—their medical details—private and available only to the people who really ought to have them. And we know with recent developments that ACC has actually been collecting far too much information. For those people who actually turned round to ACC and said; “I’m sorry but the law does not allow you to collect this much information.” we know that under National they had their compensation cut. That is why people are losing faith in what ought to be an absolute national treasure.But the abuse of the ACC has reached new heights this year as this Government has struggled to prove to New Zealand that it has managed to get the books back into surplus. That was the big goal for the 2014-15 Budget. It was that the National Government would get the Government books back into surplus. My goodness it has stretched the truth in all manner of ways to try to convince New Zealanders of that but the biggest travesty is what it is doing in ACC.ACC came to the Government and said: “You know when you put the fees up when you first came into Government? You know when you racked everybody’s ACC levies up far higher than they needed to be? Well we’ve taken enough money. We’re more than fully funded.” In fact the work account has nearly 140 percent of the funding it needs not just to meet this year’s claims but all the future costs of those claims. It has not just the 100 percent that it needs to meet those claims but another 40 percent on top of that. The earners account is 130 percent funded—Dr David Clark: 130 percent?IAIN LEES-GALLOWAY: —130 percent funded—and yet this Government continues to overcharge Kiwis on their ACC levies. Why? Because the levies that come in go towards the National Government’s supposed made-up phoney surplus. So New Zealanders are paying far too much on their ACC levies and $50 a year too much on their car registration just so that the National Government can pretend that it is doing a good job with the economy and that it has got the books back into surplus. Look getting the books back into surplus was a really positive goal for this Government to have had—we applaud that—but it should have done it through economic growth. It should have done it by getting Kiwis back into work so that it was taking more income tax—so that Kiwis could afford to spend money at the supermarket so they might pay more GST. That is how the Government should have got the income up not by charging people far more than it needed to on its ACC levies.And the Government is not doing it just this year; it is planning to do it next year as well. ACC has said that it can cut levies by $650 million and the corporation would still be sustainable. Is the Government going to do that? No way. No way is it going to cut $650 million from those ACC levies because it still needs that money so that it can pretend that it has got the books back into surplus.New Zealanders love ACC. They love the fact that it is there when they need it. They love the fact that it is more cost-effective than any other insurance scheme anywhere else in the world. They hated the fact that the National Government was going to try to privatise it. Thankfully it has given up on that idea. The National Government needs to give up on overcharging Kiwis on their ACC levies and start giving New Zealanders a fair deal.SIMON O’CONNOR (National—Tāmaki):I am very pleased to be here to speak on ACC in this debate. It is disappointing to have heard Iain Lees-Galloway the last speaker being so angry and frustrated in some ways that the National Government has actually put the ACC books in order and is competently able to actually start returning levies—[Interruption] You see those members are yelling and screaming. They do not like it you see because we know exactly the Labour record on ACC. Like a number of things that we picked up when we came into Government it was in bad shape and in disorder. We know that with the claim costs. I have just got a note here and I was noticing that the cost of claims increased by about 57 percent in 4 years under Labour. It has an inability to actually run ACC properly and appropriately. It is a sort of cash cow approach and it has actually taken the National Government to take the bull by the horns tidy things up fix things up and not only return the books to such a state that we are able to reduce levies in order to return money to Kiwis but to actually line up and put a focus not only on the care that is required through ACC but also on prevention and to have those two line up. So I think we can be very proud of what ACC is doing.I know that over recent weeks actually in the Transport and Industrial Relations Committee we had people from the sensitive claims unit of ACC come in and give us a briefing. It was a really interesting insight into the work that they do. It is really important work. As a constituent MP I often get people coming in on ACC issues. I think it is important to acknowledge that it is a fraught area and more often than not it actually causes difficulty for people. I suppose it is one of the roles as a member of Parliament to try to advocate on those issues. So nothing is perfect by any means but ACC is actually in good shape and in good form.We know that in the most recent Budget we have indicated another total of $480 million worth of levy cuts for Kiwis this year and into next year—really important—and a lot of that is going to actually focus on the motor vehicle account and the levies there on motor vehicles. In fact from next year Kiwis may well find that their registration costs are down by about $130. Why? Once again we have focused on allowing ACC to do its core job and to do it well and therefore to return money to Kiwis where it is due. Unfortunately all we have heard from the Opposition is a lot of angry vitriol that this might be done at all. So that is really important there. The levy cuts though that have been indicated in the Budget are sitting on top of a whole series of levy cuts so far. As of 1 April this year New Zealanders started saving about $387 million in ACC levies over the last year itself. So that has made New Zealand households about $180 better off and actually large employers could have saved up to $6000 a year as well in terms of levies. So when we look at what the Government does it is a broad approach and ACC has been part of that.But a big chunk too is not simply putting the accounts in order. It is not simply trying to provide the best service to Kiwis but also focusing on that preventative side. We know that ACC spends a lot of money in this area because of the old adage that prevention is better than cure and there has been a major reboot in the injury prevention activities of ACC. In fact we have seen a doubling of the investment in this space. We have also seen I think it is important to mention particularly in the light of the report released by Sir Owen Glenn yesterday that a big focus of ACC—and driven by this Government—is on preventing sexual and family violence. There is a lot more work working within the educative space to try to put these messages out. As I said at the start we had the sensitive claims unit come in and talk us through the work that it does. We are also conscious of work that is happening within the integrated services for sensitive claims. This work should go live in November this year. There is really important work in that space.In closing I think one good thing to note in particular around this is the level of care that ACC already provides for people who are seeking assistance because of sexual abuse domestic violence and so forth. They can get 16 hours of immediate support from ACC. A claim has to be lodged but they do not have to wait for the confirmation of that claim to get help. It is just a small example of the activities and the changes that are occurring in this space. So returning to where I was at the start I think we on this side can be rightly proud of the focus of ACC and the work that it is doing and proud that we are returning money to New Zealanders and that they are not having to pay more on their levies than they need to. Thank you.Report noted.Electoral CommissionHon Dr PITA SHARPLES (Minister of Māori Affairs):I take a call on the Electoral Commission including the functions of the Chief Electoral Officer. If one was to look at the 2012-13 financial review that was presented to the Justice and Electoral Committee it would be pretty underwhelming—two sentences in fact—with the emphasis being that there were no matters to bring to the attention of the House. Well I would have thought that the fact that only 58 percent of the indigenous people of this land turned up to vote in the last general election might have been a matter of some concern to the Crown entity charged with promoting public awareness of electoral matters as part of its responsibility for preparing and conducting general elections. In stark number terms although there are 462000 Māori who are of voting age and are eligible to vote fewer than 270000 proceeded to take up that voting opportunity at the ballot box. Forty thousand Māori disappeared at the first hurdle—that is the enrolment table. But when we get to the turnout of the vote the statistics are deplorable.The Electoral Commission is an independent Crown entity. It should operate strategies to increase democratic participation without being accused of a bias towards any political party. In 2012-13 its total revenue was $27 million but here is the irony: in the 2012-13 financial review the Electoral Commission spent only $22 million returning a surplus of close to $5 million—$5 million that could usefully have been spent in investing in the challenge of how to increase Māori electoral turnout and in doing so how to improve the effectiveness of our democracy. I would hasten to say that the issue of low turnout is not only a feature of Māori voting preferences. In a paper by Jack Vowles entitled Down Down Down: Turnout in New Zealand from 1946 to the 2011 Election Mr Vowles reported the views of one commentator who declared the relative absence of voters in the polling booths in 2011 as “the saddest day for democracy in New Zealand”. In fact Mr Vowles concludes that to find a New Zealand election with a lower official turnout than in 2011 one must go back to 1887 well before women attained voting rights.So I am sorry I cannot fathom how the Justice and Electoral Committee found nothing to report on when looking at the financial review of the Electoral Commission. Voting is of paramount importance to the running of a healthy democracy. It is about the people being empowered to take action to cast a vote and to make their voice heard. We need to be out and proud. Casting our vote is our right it is our duty and it is our responsibility. The power of voting is the power of change. It is the power of voicing views and of making a mark in history.The Māori Party has a couple of ideas on how we could make the change our nation needs so clearly in terms of voting participation. We have drafted legislation to enable all Māori to be automatically entered on the Māori roll with an option to transfer to the general roll instead of the other way round. This would take the complexity out of the Māori electoral option campaign given that the majority of Māori are enrolled on the Māori roll. It would make sense to make that roll the default roll and give other individuals a choice to opt out on to the general roll if they see fit. Another key campaign that the Māori Party recommends is encouraging a focus on education for engaged and active citizenship. We need to increase the ease of voting make voting more exciting increase its relevance and make it easier to register to vote.Last week I introduced a new curriculum priority in ensuring Māori history is known taught and promoted in our schools. I am hopeful that with new emphasis on knowing our stories it may well encourage a far stronger reason why all New Zealanders understand the value of the vote and the significance of having a say. Representation in a democracy is not only a basic human right but it is also necessary if we want to make sure our nation moves forward together. I hope that the next time the Electoral Commission comes up for debate before the Committee there will indeed be something to talk about—a new energy and a commitment to making our voices heard. Thank you.Report noted.New Zealand Railways CorporationDENIS O’ROURKE (NZ First):The performance of KiwiRail management has been so poor that it should be fired. This is a company that has spent mega-millions of public money with very little to show for it and this Government has sat back and twiddled its thumbs while things get worse and worse. The Government has seen to it that the New Zealand Railways Corporation gets far too little resources to improve its network. In Auckland the expansion of the city rail network will be far too slow while the Government instead spends more and more billions of dollars on a motorway expansion programme that cannot solve that region’s transport problems.In the Hawke’s Bay the mothballed Napier to Gisborne line has not been repaired for the paltry $4 million required for that purpose despite the Prime Minister’s original statement soon after the slips closing the line occurred that the road would never be enough by itself. The slips that closed the line are one thing but now the slippage by the Government in failing to repair that line is completely another. That is totally unacceptable not only to New Zealand First but also to the majority of people in that region and for good reason. Since those slips occurred that closed that line $4 million—about the same that would be required to repair the line—has been spent on the Gisborne to Napier road on just a few passing lanes. So the Government can find money for that but it cannot find money to keep the line open.But the elephant in the room—or should I say the ship—is the KiwiRail Cook Strait services. Anyone can see that this comedy of errors shows serious mismanagement of this service by an incompetent management and board. We have seen breakdowns and mishaps one after the other in that service resulting from what is best called a floating lemon the Aratere. Then of course it was lengthened and as soon as a laden train was put on it it showed a tendency to flex because the lengthening of that ship was not appropriate for the vessel. Then a series of mishaps followed. Here is a list of just a few of them: the ship bending along the keel and twisting when under load toilets not working properly problems with lifeboats the freight capacity for trucks being reduced the ship breaking down within a few days of arriving back into service the engines not being powerful enough to drive the ship through heavy seas because of the extra weight and length and an infestation of rats. It has had problems with the cargo doors stabiliser ballast and radar and of course with a propeller falling off. And then there are the thousands of litres of fuel that were lost somewhere—a litany of errors as I have said.This company simply does not know what it is doing. KiwiRail’s Cook Strait ferry operation is a chapter of errors and of sheer incompetence and dangerous blunders and the Aratere is now on its way back from Singapore. Let us hope it makes it. What has been the true cost of the ferry? Is it $100 million dollars $150 million or $200 million? It is hard to tell. So it is not just a lemon; it is a longer lemon but not only that it is a very expensive lemon too. When it gets back it will still have restrictions on freight and sailing conditions so it is not just a lemon but a limited lemon as well—all because KiwiRail’s management could not get it right.Now we understand that the company is seriously thinking about buying the Stena Alegra—another lemon a cast-off from another country and not suited to Cook Strait conditions at all. And the price we understand is $8 million—a cheap nasty rust bucket even more prone to breakdowns than the Aratere. This boat uses 20 times the lubricant of other ferries. Why would that be? We all know that a car that is burning oil has a serious engine problem. This rust bucket is at the end of its useful life.Report noted.Solid Energy New ZealandCATHERINE DELAHUNTY (Green):Solid Energy is not a solid story; it is a sad story especially when we know that our environment is our economy. We do need our State-owned enterprises to be solid and no one could describe what has happened to Solid Energy in the last financial term of Parliament as being solid at all. It is a sad story from the failed lignite project through to the recent 170 redundancies at the Stockton mine which is costing families dearly. Solid Energy is in a slump for two reasons: one is mismanagement and the other is that the coal industry globally is in a serious slump. Solid Energy has been badly managed and is wrecking the environment without any employment security for the people of the West Coast. Even coking coal is not holding up as the Chinese steel industry also slows down. We have only to talk to Australia about the state of the coal industry as the basis for your economy to know that it is not a stable basis for a good economy.But as George Monbiot said this week: “An ounce of hope is worth a ton of despair.” There is perhaps not a lot of hope associated with Solid Energy’s current performance and its reliance on fossil fuels. Many people including the Greens recognise that coal is the past and it kills the climate and that clean energy and looking after the environment is our only viable future. We have a beautiful country. We have relied on coal in the past and what we have seen is that the global coal price and environmental damage shows this State-owned asset is in a bad way. I attended the Education and Science Committee when Solid Energy came and spoke about the state of its books and it denied it was thinking of trying to get overseas buyers to take over including some of the Indian State coal people.But whatever is its future its present is very shaky and no one will deny that. Solid Energy like all of us needs to build a future that is based on clean energy renewables and meaningful sustainability. It cannot keep trying to relive the past. If we do what we have always done we will get what we have always gotten and that is a boom-and-bust economy for the mining towns including Huntly and on the West Coast where despite many years of coal extraction there is still severe poverty in those communities. I have driven through those communities and seen the homes. If coal was ever going to deliver it would have. Instead coal has damaged the environment permanently—and Stockton is a dreadful sight—but it has not created the sustainable work that the people deserve. No community should be at the mercy of an international price that can destroy and make the difference between employment and survival or despair.We are for a positive and hopeful view of what companies like Solid Energy could be but in order for them to be that we need change. In a progressive Government the Greens would oppose new coalmines. We are proud to say that we have launched a climate policy that would make polluters like coalminers pay and our climate policy has been well-received. As people would have heard at question time when Russel Norman talked about it there are many commentators from all sides of the political spectrum who do not believe that coal is the future do not believe that fossil fuels can be managed the way they have been managed do not support emissions trading schemes—because they are “clip the ticket” failures—and do support the positive moves that we have made for a transition to a just economy based on a sustainable climate.There is much hope to be had in protecting and valuing our environment. It is a very tough call for coal communities. We can have no illusions about the price of transition but we here in this House have a responsibility to the future and to those communities and we have to build that transition. We can do that. We can innovate. We can set up a Green Investment Bank. We can protect the climate through sensible and fair climate policies that do not hurt people. We can support Solid Energy to change. We can say to Solid Energy that we will support a real genuine investment in those things. We can say to those communities that regional development is a real thing. The Government has a role to play as a partner in supporting the parts of the country that have been dependent on companies like Solid Energy which cannot deliver to them reliable jobs in a clean environment for the future. I am under no illusion how tough that call is. This is not said lightly. This is not said with disrespect to the people who have lost their jobs. I come from a community that was once dependent on mining and we have built our way out of it. We are fortunate to have done that because we can survive on ecotourism. We can survive on—Report noted.Bay of Plenty District Health BoardHon ANNE TOLLEY (Minister of Police):It gives me great pleasure to stand and talk about the wonderful job that the Bay of Plenty District Health Board has done. If you look at the statistics I think they speak for themselves and they deserve to be heard in this House. First of all can I congratulate the Minister of Health because he has overseen a funding increase to this district health board over the last 5 years of an extra $127 million.Dr Cam Calder: How much?Hon ANNE TOLLEY: It is $127 million extra to the Bay of Plenty District Health Board. That has then enabled that health board to deliver some of the most amazing results. We have seen that it has employed more staff. We have had 67 more doctors and 132 more nurses employed by this district health board—again over the last 5 years. More important than even the staff and in any district health board I do not want to underestimate the effect and the work that the staff do but actually health care is all about patients. What we have seen through the extra funding and the extra staff is that over 11000 more patients have been treated for electives than were treated under Labour. That is an increase of 11215 more patients treated than were treated under the Labour Government—over 11000. The particular one that affects many many people particularly in my electorate is orthopaedic surgery and we have seen a 52 percent increase in orthopaedic surgeries carried out by the Bay of Plenty District Health Board. That is people’s hips knees and all the other bits and pieces that they have replaced and I think that that is something to thank all those staff working in the health board for. They have delivered it across quite a big area. It goes right up to the tip of the East Cape so they are large rural areas.The most exciting event I think in the last year was the opening by the Minister of Health last week of the rebuilt Whakatāne Hospital and $67 million was contributed by this National-led Government to rebuild the Whakatāne Hospital. A great deal of planning and hard work went into that. It is quite interesting that when I became the MP for the East Coast electorate there was a lot of talk around what was going to happen to the Whakatāne Hospital. It had severe asbestos and seismic problems and under the previous Labour Government consultation meetings were held and all sorts were talked about the replacement of the Whakatāne Hospital. But when we came into Government when National came into Government what do you think we found? There had been a lot of talk but actually the money cupboard was bare. There was no money allocated. In fact despite all the community consultation and all the discussions that the health board had had with the community the Whakatāne Hospital was not even on the list for capital improvements.I went to work and fortunately the Minister of Health was sympathetic because this Whakatāne area serves an enormous rural area. It is an area that takes in many many small communities that are very low in the social deprivation scales. People have severe transport difficulties but they also have severe health issues. The thought of having to go from the tip of the East Cape to Tauranga Hospital was just ridiculous. The health care of the people of that Eastern Bay of Plenty area would have severely suffered if this National Government had not stepped in and spent $67 million on rebuilding the Whakatāne Hospital. To the Minister of Health I want to say I know that my constituents are exceedingly grateful for the work that this John Key - led National Government has done because we put our money where our mouth is. We did not just talk about it; we got out there and we rebuilt it. The hospital had an open day that attracted over 2000 people to come and have a look through the rebuilt hospital and last week Minister Ryall and I officially opened the hospital. That means our region has high-quality health care.Hon TONY RYALL (Minister of Health):I would like to associate myself with the comments of the MP for the East Coast Anne Tolley on this financial review of the Bay of Plenty District Health Board. Health boards in New Zealand can pretty much be divided into three groups. One is a group that has fast-growing populations another has very stable populations and a third group has depopulations. Each of those groups presents significant challenges.The most significant challenge or strategic issue that the Bay of Plenty District Health Board has faced is actually keeping up with a rapidly growing population and also a growing older population. That is why the district health board together with the almost $130 million of extra funding that our Government has given has been able to invest in significant numbers of extra doctors significant numbers of extra nurses and I think a 52 percent increase in hips knees and other orthopaedic procedures to reflect the ageing population. But at the same time it has not only dealt with that fast-growing population in the west—and there have been significant investments in the new east wing at the Tauranga Hospital and the purchase of the RSA land which is now the clinical school so there have been big investments there in the west—there has also been a need to invest in the east which is a predominantly lower-income community. It has a much higher Māori population than the west. So there are a whole lot of issues that have happened there.Our Government has not only been investing very strongly in primary care. You cannot have strong primary-care developments in isolation from good hospital services. That is the reason why with the very strong advocacy of the MP for the East Coast Mrs Anne Tolley the Government has put $67 million into a new state-of-the-art hospital in Whakatāne. It is a tremendous investment. I had the opportunity to tour the facilities there on Friday. It is fantastic how well that facility integrates with the primary care services in that community. It is very important for the Bay of Plenty.But what makes it more exciting is that the people at the Bay of Plenty District Health Board are recognising that health care changes. Mrs Tolley talked about the people who live way up at the top of the cape. Transport issues are very significant in the Bay of Plenty because of the isolation of the people of Te Whānau-a-Apanui and also of the people of Ngāti Manawa in the Murupara area. There are also issues around Kawerau where there are a lot of low-income people. The Bay of Plenty District Health Board is actually at the forefront of telehealth in New Zealand. A significant investment has gone into providing telehealth. By way of example in Ōpōtiki up the coast and in Kawerau and Murupara patients can go into their general practitioner’s clinic and have an online Skype-type conversation—but higher quality than Skype—with a specialist either from Whakatāne Hospital or from Tauranga Hospital. You can see the significant benefits that they have.Similarly in Ōpōtiki the rest homes are now linked in too. So there was a patient who was a resident in a rest home who had a turn. They were able to use the telehealth Skype-based technology for the general practitioner to be in his home and consulting with the rest home resident in her home over the telecommunication network and similarly with patients up the coast. We are investing very strongly not only in the bricks and mortar but also in the new technology that allows people to have much faster and more convenient access to all this expertise around the health service.Similarly the Bay of Plenty District Health Board has entered into a public-private partnership with the development of private radiotherapy services that will be available there from the end of September. This is a very significant investment. What it means is that cancer patients in the Bay of Plenty who would previously have had to travel to Hamilton for their radiotherapy will be able to receive that treatment at private facilities integrated into Tauranga Hospital. That is really the next big step in services for people of the Bay of Plenty—this really significant investment that has been made by private investors who will be able to treat not only private patients but also public patients and there will be the opportunity over time to have neighbouring district health board patients treated there as well. There are very very good public hospital cancer services in the oncology area there but this radiation treatment will provide just that extra suite of services to benefit patients. It is a pretty smart public-private partnership that enjoys the support of the wider population in that area.So I just acknowledge the tremendous work of the people of the Bay of Plenty District Health Board. With my 24 years as a member of Parliament I can say that I think the service being provided is sterling. There is a real dedication and commitment there and I think we can be very proud of the clinicians there.Report noted.Southern District Health BoardHon ANNETTE KING (Labour—Rongotai):I am very pleased for the people of Whakatāne that they have now got a new hospital. Some may recall that there was a march and a “hands around the hospital” event in 1999 because the then National Government looked to close it. I think it is really important that you do put your money where your mouth is when it comes to building hospitals. I would like to say that when in Government we rebuilt Kaitāia; that was to be closed. We rebuilt Thames; that was to be closed. We rebuilt the new Auckland Hospital and the new Wellington Regional Hospital. We did work on Waikato Hospital. We rebuilt the Wairarapa Hospital. The Wairau Hospital in Blenheim the Invercargill hospital the Dunstan Hospital the refurbishment of the Timaru Hospital the Christchurch Women’s Hospital Murchison Nelson—this was under a Labour Government. So when we get the great applause from members over there for their wonderful work it would be nice if sometimes they recognised that there was a lot of capital work that went on under Labour. Many of those hospitals were in threat of closure under a National Government.I want to talk about the Southern District Health Board. I am glad that the Minister of Health is in the chair because he has been incredibly evasive and elusive of late. He has not been to a single political forum in the last 18 months so it would be nice to actually have him in front of a real crowd where he could be questioned—like the doctors on Friday when he failed to turn up. But the people of Dunedin the people of the south have been I believe neglected by this Government. Six years on this is the worst hospital in terms of need of improvement in New Zealand. We hear about how big the geographic area is in the Bay of Plenty but the biggest geographic area trying to provide health services is the Otago-Southland area.All the Minister has answered with is: “Oh you didn’t do anything when you were Minister.” Well I have to say Minister you were told that this hospital was leaking. I asked you a question Minister about the leaking of this hospital and you gave me an answer claiming that there had been one leak in this hospital. I have the answer. It is to written question No. 1699. You said there had been one leak a one-off leak experienced in 2012 in this hospital. That was your knowledge Minister of this hospital. In fact there had been many leaks in this hospital. There were leaks in theatres—leaking into the electrical cords in the theatre. They said about this leak: “Urgent please come and fix it. Water is dripping through the light fittings in theatre 4. This is urgent. We are undergoing an operation.” There have been leaks dripping through the corridor windows. The Minister overlooked the fact that there had been numerous leaks in this hospital in the operating theatre on their sterile equipment. He said there had been one. When asked if he would help provide some money to fix the leaks he said no he did not intend to give them any money. He said: “I’ve given them $124 million since we became the Government.”So why should the people of Otago have to put up with theatres that are dripping and leaking and he will provide no assistance in terms of fixing them? In fact the district health board has estimated that the rebuild of this hospital is 7 years away—7 years. That will make it 13 years if National is still in Government.Then if that was not bad enough the district health board has such a poor IT system that it lost 3000 mammograms. Three thousand mammograms were lost as a result of IT failure in the Southern District Health Board. That is a travesty. So many women were worried about what had happened to them and there was a very very poor response from the board. I would have thought that the Minister would step in at that point and ask for the report on the IT failure to be released. That report has not been released to the public of Otago and like many things in that area it has been covered up. So I would like the Minister when he takes his call in his skite sheet to tell us about the colonoscopy problem down there and tell us the truth about the number of colonoscopies that have not been done in that region.Hon TONY RYALL (Minister of Health):I would like to thank that member Annette King for her reminiscences from last century. It is so nice to hear about what she was doing when she was Minister of Health last century. She spent all this money when there was more money than the Government knew what to do with and she never did a thing for Dunedin Hospital. All she and her cronies ever did for 9 years was mine the asset replace nothing do no maintenance and run the facilities down. It was so bad that in her last year as Minister of Health she was berating her own Labour appointees for running deficits of over $9 million for years on end. So when the money was raining out of the sky how much money did Annette King give to Dunedin Hospital to fix its buildings? Nothing. She just mined the asset and did nothing. But wait for it—the Budget went up and did it get money for buildings? No.But look at her record on operations for the people of the south. In her first year as Minister of Health 8800 people got elective surgery—8800. When she left office 8400 had got elective surgery so fewer people got elective surgery when she finished being Minister of Health than when she started being Minister of Health. When Annette King left as Minister of Health 8400 operations were done that year at Dunedin Hospital. This last year under review there were 10270 elective operations. She left with 8400; today it is 10270 in 2012-13. She had 6 years and fewer people got operations. I have had 6 years and we have increased the number massively from when she was Minister of Health. We have put an extra $124 million in there 82 more doctors 116 more nurses and an emergency department that Dunedin can be proud of because there are not people lying around the corridors unsafe for hours and hours and hours which I inherited.Hon Michael Woodhouse: What happened to the neonatal unit?Hon TONY RYALL: Oh the neonatal unit—shameful! The neonatal unit—shameful! This was for the most vulnerable babies born at Dunedin Hospital stuck into the smallest footprint you could possibly find. It was not a good service. In 9 years of a Labour Government nothing happened and we put the money in and our Prime Minister was there opening a state-of-the-art neonatal intensive care unit at Dunedin Hospital an investment by this Government when the money was tight. When the money was tight we found the money to put in a new neonatal intensive care unit.I have to say that I get fantastic feedback from Dunedin for the investment that our Government has made in that neonatal intensive care unit. I get amazing feedback from Dunedin on the massive improvements at the emergency department. People in Dunedin now know—Hon Annette King: Tell us about the colonoscopies.Hon TONY RYALL: I will tell you about the colonoscopies. Under Labour people who had a family history of colorectal cancer were denied the ability to go and have a surveillance colonoscopy. Labour stopped surveillance colonoscopy at Dunedin; National has started it again. Labour stopped surveillance colonoscopy; we have started it.Hon Annette King: Where?Hon TONY RYALL: We have started it at Dunedin. So that is the truth of that member’s failure.I am not going to harp on about last century because it is so different now from when that member came in in 1984. The Dunedin Hospital is a much better place. The services are improving. More patients are getting elective surgery. Remember that between 1999 and 2005 fewer patients got elective surgery—fewer patients got elective surgery—and now under our Government record numbers of patients are getting elective surgery at Dunedin Hospital the emergency department is working better the cancer services are fantastic and working faster and we are getting more preventive care for the children of the Otago-Southland region. Right across the board this district health board is delivering on service and this Government is giving it the money and the staff to improve care for people in Dunedin.Hon ANNETTE KING (Labour—Rongotai):I wish to table an Official Information Act request on the number of leaks at Dunedin Hospital—The CHAIRPERSON (Lindsay Tisch): Leave is sought for that purpose. Is there any objection? There is no objection. It can be tabled.Document by leave laid on the Table of the House.Report noted.New Zealand Teachers CouncilCHRIS HIPKINS (Labour—Rimutaka):There are not many clearer examples of the mismanagement of the education portfolio than the way the current Government is handling issues around the New Zealand Teachers Council. Those following along at home—and I am sure there are many people avidly following this debate at home and reading along with the volumes of the report—will note that there is only a relatively short somewhat pro forma report on the New Zealand Teachers Council in this particular volume of reviews. That is because the Education and Science Committee is currently dealing with major legislative change relating to the Teachers Council and so it was decided not to do a more comprehensive report back to the House on the current state of the Teachers Council.However there are significant issues—significant issues at least in part because although on the one hand the Government talked about wanting to raise the status of the teaching profession on the other hand it has proposed legislative change to the New Zealand Teachers Council that will completely remove all teacher representation from the governing body of that organisation. So on the one hand it says it wants teaching to be a high-trust profession and it wants the best and brightest going into teaching but then on the other hand it says it does not trust them to actually make any decisions about their own profession.I think that is somewhat ironic coming from this National Government because this National Government seems to have a higher view of real estate agents than it does of the New Zealand teaching workforce. So for example we had the debate in the House on regulating real estate agents where we got quotes from the National Government along the lines of: “We trusted the lawyers to come up with suggestions that would make their industry more user-friendly.” I suggest that the rational calm approach adopted in that instance would have been a good model to use in this instance. Those were comments it made in defence of real estate agents. So it thought that real estate agents should be trusted to regulate their own affairs but it was not willing to offer the teaching profession that same degree of trust and support.Actually there was a comment by Simon Power that I thought was very interesting when it came to real estate agents. He said “we are not in favour”—and of course the royal “we” he is talking about is the National Party—“of the vilification of an entire industry off the back of some scattered examples …”. Well the same thing can apply to the teaching profession. So often when we talk about the Teachers Council and the very difficult job it deals with the entire teaching profession gets marred by a few bad apples a few bad examples. Actually by and large those in the teaching profession in New Zealand are absolutely top-notch. They are trustworthy and dependable and we should place a very high value on them.It is going to be very interesting to see how this legislation progresses because of course the critical vote in this legislation may well be the vote of the Hon Peter Dunne. Peter Dunne made some comments on the real estate agents. He said: “In this instance this bill effectively nationalises the real estate industry because it says ‘We do not trust you to regulate your affairs and the conduct of your members in a way that is appropriate. We will therefore put in place a statutory environment that you will not have control over but that will be independent’—and that is a double-edged word at the best of times—‘so that we can ensure’ allegedly ‘a standard of public performance.’ ”That was Peter Dunne talking about real estate agents in defence of the real estate industry and their ability to have a say in the regulation of their own profession. I am going to be very interested in seeing where Peter Dunne lands on the legislation relating to the Teachers Council because the Teachers Council legislation that the current Government has proposed does the same thing to the teaching profession that Peter Dunne opposed being done to the real estate agents industry. So if he adopts that same position and I hope he does I look forward to his opposing that legislation along with the Labour Party and I am sure the other Opposition parties in the House.We do believe that teaching should be a high-trust profession. It should be one of the most respected professions in the country. We want the best and brightest to go into teaching and that means we should have some trust in them to regulate their own industry their own profession and that is what is not going to happen if the legislative changes that are proposed to the Teachers Council are enacted when that bill is reported back to the House. It will take away from the teaching profession the ability to appoint its own governing body. What is more it is not even guaranteed in the current drafting of the legislation that there will be any teachers on the body of the new Teachers Council which is being called EDUCANZ or the Education Council of Aotearoa New Zealand. There is no guarantee whatsoever that in fact teachers will have any control over that body. I do not think that is right. I think that when the time comes we should put a great degree of trust in teachers. We should recognise that teachers are the best people to be making the decisions about the regulation of their profession and we should trust in them to run their own profession.Dr CAM CALDER (National):It is a great pleasure to take a call on the Teachers Council. Delivering changes to meet the needs of 21st century children and young people and a system that focuses on lifting achievement and getting the best outcomes for our young people is a crucial part of this Government’s concentration on the education field. Of course it is also an important part of any Crown entity such as Careers New Zealand the New Zealand Qualifications Authority and the Teachers Council that is involved in the education space. What does the future hold? All our entities need to be aware. They need to be flexible in their thinking and shift their thinking in response to the changing global and digital environments we are working in.The Ministry of Education has been working with the Crown entities to make sure they are doing the right things in the right way to support the system that exists and to get the best outcomes for our young people. There does have to be change. That is clear. The Government has a relentless focus on raising achievement for all children and young people. It has been said in this House before but it is worth repeating again that if we keep on doing the same old things then we will get the same old results. That is not what we in this Government are prepared to do. We want to lift achievement for all New Zealanders.With our Better Public Services target we have nailed our colours to the mast. We want to have 85 percent of all 18-year-olds with a National Certificate of Educational Achievement level 2 or better or an equal qualification to ensure that our young people have the qualifications they need to be successful. At the secondary school level we have invested in a number of flexibilities around funding and timetabling to support students to make choices of pathways. Careers New Zealand helps students plan and guide themselves through their learning work journey so that every child can achieve educational success. The other Crown entity if I just briefly mention the New Zealand Qualifications Authority is ensuring that New Zealand qualifications are valued as credible and robust both nationally and internationally.But let us concentrate on the Teachers Council. A key part of the Government’s plan to raise achievement for all is our commitment to strengthen and value the teaching profession in the 21st century—to strengthen and increase the way the teaching profession is valued in the 21st century. As my colleague Chris Hipkins observed currently before the Education and Science Committee we have got the Education Amendment Bill (No 2) on which we have heard many hundreds of submissions over previous months in Christchurch Wellington and Auckland. This committee often sat three four or five times during a particular week to ensure that we could hear the submitters who wished to be heard. Currently we are considering the Education Amendment Bill (No 2) and this will make a number of legislative changes to the profession including transforming the Teachers Council into the Education Council of Aotearoa New Zealand or EDUCANZ.There is overwhelming international evidence of the critical role that teachers play in educating children and young people. We know it is a tripod: you have got the school you have got the child and you have got the home. It is a tripod: the school with all the teachers in it; the home and we are doing an inquiry into parental engagement; and of course the child. So we are aiming to strengthen the teaching profession to give it the support it is needing. That is what the select committee is currently considering: legislation to transform the New Zealand Teachers Council into being a hallmark professional body for teachers—a hallmark professional body for teachers. This is the cornerstone of the Government’s work to raise improve and strengthen the value we place on our teachers and to back them to win. There are a number of strands in this cable that we have to lift student achievement and doing this valuing our teaching profession is one of them.It is too early to discuss at this stage what the format of EDUCANZ—the new renamed Teachers Council—will be because it is still before the select committee. But what we are aiming to do is ensure that the body that results after the committee has deliberated will be in a position to improve outcomes for our students and also improve the esteem with which our teachers are held. So as part of the consideration of the bill—Report noted.Children’s CommissionerBRENDAN HORAN (Brendan Horan):Thank you for allowing me a call on the performance and current operations of the Children’s Commissioner. The commissioner Dr Russell Wills in his annual report reminds us that his office has four priorities: one for more children to grow up healthy; two for children to grow up with access to adequate resources; three for more children to achieve their educational potential; and four for more children to be free from all forms of neglect. I would go further and say that each of these priorities should be for every child in New Zealand and should be a spur to action for this Government. But as I learnt from the Social Services Committee report on the financial review of the Children’s Commissioner although Dr Wills has done sterling work on child poverty the Government has failed to take any action on 55 of 78 recommendations.Rather than address the symptoms of poverty we must act on the cause. Let us take an example and look at something as simple as weaning. If a child is on the correct milk the next stage is being weaned on to solid food. If that solid food is highly artificial sweet or preservative-laden food then that sets the template for life—the scourge of obesity and associated disease.Poverty seems to be increasing. In the United States 145000 workers at Kodak were put out of a job because of their industry’s digitising of manufacturing and the industrial internet. Companies such as Instagram which employs 30 people take the role in production consumption and distribution that Kodak previously did. We are having a hollowing-out of the world’s middle class’s ability to earn money. The industrial internet ushers in a completely new economic model. Where are the systems in place to serve middle-income families as they lose their occupations due to digitalisation robotics and the industrial internet? Poverty is not just about money. Surely the issue is about creating pathways to prosperity not just for children but for existing workforces.As an independent member of Parliament I believe in safe children safe whānau safe society. When we drill that mantra down it is three pairs of words with one commonality: safe. Safe is the name of the game—emotional safety occupational safety family or whānau safety vocational safety societal safety. Good responsible governance and sustainability are paramount. People recognise that the only mobility out of poverty is education.So where are our educational systems? Intergenerational learning starts pre-birth with the mother to be. Let us not hide behind the word “poverty” as many politicians and parliamentarians do. Poverty does not mean that you are unhappy. Poverty does not mean that you do not care for your children. Poverty does not mean that you cannot feed your children. But as a country we need to provide ladders and pathways to prosperity—clear vocational pathways clear educational pathways and clear health pathways. Life is about learning. We are on the brink of the greatest industrial revolution the world has seen. If we have a safe society then we have safe families and therefore our children cannot be impoverished. But we need to plan and operate with open and transparent processes. When we empower the Children’s Commissioner to report surely we should heed those warnings. Surely we should adopt more than the 29 percent of the commissioner’s recommendations that were adopted by the Government.But most important let us be the safety net at the top of the cliff rather than the ambulance at the bottom. Let us tackle the cause. Let us set up ecosystems for healthy children. Free medical care for children under 13 is a great initiative but it needs to start now not in a year’s time. Education in being a parent is critical and needs action now. Educational upgrades of parents teachers seniors children young people and existing workforces must become a priority. New skills and competencies give preparedness to existing workforces. We cannot continue to walk and stumble blindly into 2020. We need to prepare. As an independent member of Parliament I call on—Report noted.Housing New Zealand CorporationPOTO WILLIAMS (Labour—Christchurch East):Just to bring everyone in the Chamber up to speed with what is currently happening in Christchurch around housing I just want to kind of set the scene for those of us in Canterbury who are experiencing some pressure around housing issues at the moment and the Government’s response to that. There is an overwhelming need to get vulnerable people into homes that are warm and dry. We have got huge pressures on our housing stock. As people are leaving their homes for them to be repaired and rebuilt it puts pressure on the rental stock. Insurance money is coming into play as well which is adding pressure to the rates being charged on rental properties. People are getting payouts that are insufficient to rebuild their homes which means that they are putting more pressure on the rental market as well. People are being put in difficult financial positions. We have got pressures on our resources. We have got pressures on our land pressures on our construction workers and pressures on materials that have pushed up the costs of construction. We are pushing people who are unable to afford housing out of the market.Homeownership in Canterbury which was one of the highest in the country is now slipping way down. Canterbury needs 12000 to 15000 new homes to meet its pre-quake levels. We have had 1000 built—1000—according to Deloitte’s estimates. The Minister of Housing has stated quite clearly that it will take until 2016 to return to pre-quake levels and until 2018 for the housing market to cease being under pressure. Given the Minister’s overpromising and under delivery these deadlines are at risk of being viewed as ridiculous. Frankly they are ambitious. But let us look at the social housing component to this because we have divested social housing in the guise of adding more social housing providers to the mix with minimal addition to the housing stock. So we have a Social Housing Unit where we are looking not just to the Government but to other people to provide housing as well. We have looked quite clearly to the Canterbury Community Trust to partner with social housing providers and the Government to do that. That is not a bad thing.However I believe that it is the Government’s responsibility to take a firm hold of the social housing crisis in Canterbury and in this regard it appears that we are failing. Resources from the community are already woefully underfunded and stretched. Housing New Zealand stopped providing social support some years ago. There are benefits to having property managers closely connected with the tenants in more ways than just social support. Your housing stock is being viewed often. You have got a relationship with your tenants which is important to the overall look and cost of maintenance because you are there visiting your folk and because you are there more than just to check the property; you are there to have a relationship with the people who are ultimately going to care for that property.Housing New Zealand’s priority waiting list has also become a bit of disgrace. Let me just quote you some of the latest figures on the waiting list. In March Housing New Zealand had a record 5204 priority applicants on the waiting list. This is 1049 higher than when National took office in December 2008. In Canterbury it is particularly bad with 495 priority applicants on the waiting list up from 288 in December 2008 when National took office. So there is no market lever that you can pull that will change this situation. It requires intervention. Examples from our particular office in Christchurch East show that in one week the number of people who had come to us to request emergency accommodation went up from 48 to 63. We are also providing hats and scarves and sending them to the blanket bank so that they are warm when they are sleeping in their cars.At the same time the regions have been pillaged of their housing stock. Let us just have a look at what has been happening in our regions. In almost every town and city in regional New Zealand there are dozens of empty State houses—MIKE SABIN (National—Northland):I very much appreciate the opportunity to take a call and knock back on a couple of statements made by the previous speaker Poto Williams. The work that is being done in Christchurch on behalf of Housing New Zealand has been outstanding.Sitting suspended from 6 p.m. to 7.30 p.m.MIKE SABIN: I am happy to close out this debate. It is actually quite appropriate that we do it on this particular area of the Government’s business because if we look at the housing stock that this Government took over it pretty much personifies what we saw from the Labour Government which was not a lot of investment not a lot of effort and a derelict State house stock essentially that needed a whole lot of work and a whole lot of investment. There has been some significant work that has gone on in the course of the last 12 months. I will just rattle over a few points of interest. There were 6960 applicants of which 96 were of high priority. There were 18000 needs assessments and over 1.4 million calls through the customer service centre. There were 282 properties freed up for investigations where tenants had been behaving in a fraudulent manner. It actually dovetails into many other areas of work that this Government has done to reflect to people who deserve the support of the State that if they are receiving that they have certain obligations. Certainly the taxpayer does not expect to be ripped off by people whom the State is happy to support in a time of their need. In this portfolio we have seen some good work carried on there and that obviously frees up houses for people who are in genuine need and are not there simply to rip off their fellow taxpayer.There has been some significant work in improving the turn-round time from a house becoming vacant. Certainly in a previous life I saw some Housing New Zealand homes that were left in a disgraceful state to be quite honest and the amount of repair that was required to bring them up to standard was significant. But what we do know is that if we take a Broken Windows approach to coin a phrase from Rudi Giuliani—if we maintain a good standard and we have expectations that that standard is maintained—then in the main that is exactly what we get. I think we can be very proud of the work that has gone on from the chief executive of Housing New Zealand in terms of his leadership and the way in which areas that have needed improvement have shown improvement. The turn-round times are actually above target in terms of reoccupying houses that have been vacated. Some 390000 maintenance actions have been completed which is a substantial investment. In fact this Government’s investment in that housing stock has been substantial but it is to meet need—it is to meet need.The CHAIRPERSON (Eric Roy): The time for the debate has expired. The debate on the performance in the 2012/13 and current operations of Crown entities public organisations and State enterprises has therefore concluded. I will report the debate to the House presently.Debate to be reported presently.