Wagner Nicky: Border Processing (Arrivals and Departures) Levy Bill — First Reading Second Reading In CommitteeText is incorporated into the Bound VolumeWagner Nicky: Border Processing (Arrivals and Departures) Levy Bill — First Reading Second Reading In Committee[Sitting date: 21 May 2015. Volume:705;Page:3882. Text is incorporated into the Bound Volume.]Hon NICKY WAGNER (Minister of Customs):I support this first reading of the Border Processing (Arrivals and Departures) Levy Bill simply because it will amend the Biosecurity Act 1993 and the Customs and Excise Act 1996 and will put in place a border clearance levy for arriving and departing passengers. I would just like to assure the member Rino Tirikatene that this money is only for cost recovery for border services and the money will be paid into a trust account ring-fenced only for border services.I would also like to point out to the member Rino Tirikatene that the Joint Border Management System is actually progressing very well that increasing numbers of exporters are using it that it has been well and truly supported by the industry and that we have just recently renewed—[Interruption]The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I apologise for interrupting the member but the member—[Interruption] Who was that?Hon Nathan Guy: Me.The ASSISTANT SPEAKER (Hon Trevor Mallard): Stand up and withdraw and apologise.Hon Nathan Guy: I withdraw and apologise.The ASSISTANT SPEAKER (Hon Trevor Mallard): I will now indicate to Rino Tirikatene that he must not wander around the Chamber interjecting. He can interject from his seat.Hon NICKY WAGNER: I just wanted to draw to the attention of the member Rino Tirikatene that the Joint Border Management System is doing very well that it is well supported by the export industries and that we have recently signed a renewed contract with IBM because it is doing an excellent job for us.Let me get back to the levy though. It is what this bill is all about. The levy will fund the costs of border processing—only border processing—incurred by the Ministry for Primary Industries and the New Zealand Customs Service. It will ensure that border services are sustainable. I think if we reflect that over recent months many of the Opposition members have been talking about increased security at our border and have been talking about increased biosecurity at our border I expect that members of the Opposition will be supporting this bill because this will make our border safer. As the Minister for Primary Industries has just said our success as a trading nation is about making sure that the risks at our borders are controlled and managed so that our economy can grow and prosper. As our travel and trade links expand and travellers entering New Zealand become more numerous and more diverse with them they bring increased risks. More passengers arriving and departing New Zealand from more locations means more risk—more risk to our security and to our biosecurity. The interesting thing here of course is that higher-risk passengers require higher levels of intervention which increases passenger clearing costs. If we cannot manage that growing risk the frequency of biosecurity incursions and harm from prohibited goods and persons will increase. New Zealanders do not want that.Demand for the Ministry for Primary Industries and customs border clearance activities has been steadily increasing over recent years. International passenger numbers have been rising at about 3.5 percent every year and forecasts are for even more than that. It is an increasing upward trend. What is more the numbers of people who are coming through our borders are increasingly international people. Whereas in the past large numbers of people coming through were New Zealanders now just over 40 percent of people coming through our borders are New Zealanders. The vast majority are international passengers. About 95 percent of the travellers cleared at the border are crew and passengers from commercial airlines. About 4 percent are crew and passengers from passenger ships—cruise liners and they are increasing—and the remaining 1 percent are from private aircrafts yachts cargo ships or the military.Up until now the New Zealand taxpayer has been covering the costs of all these services even though many of those travellers are not New Zealanders. In fact as I have just said significantly more are international travellers and many of them are coming on luxury cruises and on pleasure trips. It does not seem right to me that every New Zealander—man woman and child—is paying $23 whether they cross the border or not. That is a tax whereas this is a levy that the people requiring the use of the services and the people bringing the risk will be paying. The levy will be funded to maintain existing service levels and the current high level of risk management. Many other countries have a passenger levy. They have got it; it is international best practice now to do that. In our case ours will be about $20 give or take and it is really on the low side. What we are seeing is that overseas countries have much more. Australia has A$55 or NZ$58. The UK’s long-haul fee is £71 or about NZ$150 and Canada and the US are similar.This Border Processing (Arrivals and Departures) Levy Bill makes important amendments as we have said to the Customs and Excise Act 1996 and the Biosecurity Act 1993. The reason we have to do that is that the Customs and Excise Act does not currently have a suitable provision to authorise a levy and the Biosecurity Act provides for only general levy-making provision. Amending these Acts will make sure that we get a consistent approach to consultation implementation and administration of the levy.Carmel Sepuloni: Consultation?Hon NICKY WAGNER: Implementation and administration of the levy.The Border Processing (Arrivals and Departures) Levy Bill also includes provisions that allow Orders in Council to be made for the levy’s administration including the rate of the levy the basis on which it is set and how the levy is to be paid. The levy will take effect on 1 January 2016 and it will be applied to tickets purchased on or after that date. It is proposed that the border clearance levy will be set at different rates for arriving and departing passengers. That reflects the differences in clearance costs because I remind you this recovers only the clearing costs and what happens at the border. So this will reflect the differences in clearing costs between people arriving and people departing. The total costs for passengers arriving and departing will be about $20 inclusive of GST—about $16 on arrival and up to about $6 on departure—but this will be teased out during the consultation phase. The cost of processing arriving passengers is higher because there is no biosecurity screening at departure and the level of customs resources and intervention at departure is less.Stakeholders and the general public will get a chance to have their say about this levy about its design and about its implementation and the details will be consulted on. Officials are already preparing a discussion document that will outline proposed options and that will be released for public feedback in June.The intention is to make the border clearance levy simple and easy to collect. It is proposed that the existing payment systems are used to collect the levy. The airlines will make a monthly lump-sum payment to the Civil Aviation Authority and cruise ship operators will pay the Customs Service. The funds will then be allocated to the Customs Service by the Ministry for Primary Industries. For other travellers such as people on private yachts and airlines the levy will be collected from them directly as they enter and depart New Zealand. The border clearance levy is less than 1 percent of the international airfare so it is a very small component of people’s overall travel costs. The additional charge of about $20 is very unlikely to have any bearing on the traveller’s choice of destination.The people of New Zealand told us that they want a safe and secure border. This bill will protect New Zealanders and will protect our environment. I commend the bill to the House.