Mallard Trevor: International Finance Agreements Amendment Bill — In Committee 
Text is incorporated into the Bound Volume 
Mallard Trevor: International Finance Agreements Amendment Bill — In Committee 
[Sitting date: 19 February 2013. Volume:687;Page:7981. Text is incorporated into the Bound Volume.] 
Hon TREVOR MALLARD (Labour—Hutt South) 
: 
 This sort of looks like a relatively minor clause but clause 7 does in fact repeal the entire International Finance Agreements Amendment Act which is quite extensive and runs through—I am just looking at this relatively carefully—about 20 pages of statute. So although this is a tiny couple of lines it is something that takes out an entire Act and I want a level of assurance that this is necessary and that the financing and commitment arrangements that are in the 1975 Act have in fact been picked up somewhere else in the International Finance Agreements Amendment Bill. 
I have had a quick look through this bill. I cannot see the financing commitments that are in article 7 of the schedule of the 1975 legislation that we are currently repealing where the fund can use calls on members “to provide individual commitment in the form at their option of … direct financing; or … an individual undertaking for borrowing by the Fund; and calls on all members to provide a collective undertaking for borrowing by the Fund.” I cannot see where that core method of financing methodology is picked up and replicated elsewhere in the bill. Of course I did not sit on the Finance and Expenditure Committee and I am not entirely familiar with it. I am pretty sure that members opposite did and I would be happy for them to explain where in the legislation that we are currently contemplating that in fact does occur. 
The next question goes to the issue of prepayments which were previously in section 4 of article 5 of the 1975 legislation. The question I have of the Minister of Finance—and colleagues can continue to ask it—is how prepayments are treated now in the legislation. Are they treated differently? Are they treated the same as they were in the 1975 legislation and if there is a change where are prepayments picked up in this area? I am unable to see it. It might be that there has been a decision not to have prepayments any more. It might be that everyone is so cash-strapped that they pay on the due date and there is not a prepayment arrangement or an allowance for that. But if there is a system change then I think it is important. 
Section 2 of article 5 of the 1975 legislation also goes to the eligibility for loans. A member who requests a loan from the IMF has to make it clear “to the Governing Committee that it: … is encountering serious external financial difficulties;”—that is many countries in the world at the moment—“has made the fullest appropriate use of its reserves and has made its best efforts to obtain capital on reasonable terms from other sources; and … has made the fullest use of other multilateral facilities.” That is a pretty important set of conditions. Again as with the question of prepayments I ask the Minister and he can clear it up pretty quickly to indicate where these 1975 rules are replicated or whether we are in fact transferring to the IMF itself—to the governing board or to the executive board—a set of powers that it does not currently have and having something that is less regulated. 
Again if that is the case I would like to know. That could be a very good reason for my colleagues voting against the legislation. I see eyebrows going up and someone else shaking their head so I cannot quite work out amongst my Green colleagues what the story is and what the reason is for them voting against it. 
I am sure my colleague the Hon Lianne Dalziel will want to look even more carefully at the 1975 legislation that is being repealed. My understanding is that this was legislation that was put through the House by the Rt Hon Bob Tizard one of the longer-serving members of Parliament although not necessarily the longest-serving Minister. In fact he was a member of Parliament during quite an unfortunate period from our perspective. He was not quite as unfortunate as Bill Rowling who I think was a member for 24 years of which he was in Government for only 3 years. 
 That was not a good time for the Labour Party—[ 
Interruption 
] I am sorry? 
David Bennett 
: A good Labour Party member. 
Hon TREVOR MALLARD 
: Bill Rowling was a good member of Parliament. In fact he launched a very good campaign in Hamilton West—a successful campaign—against Mike Minogue who at that stage was running I think at 4 percent for preferred Prime Minister and he lost. It was one of the indications that personal popularity especially under a first-past-the-post system did not guarantee very much at all. 
But the point I am making is that this is legislation that appears to have stood the test of time for the last 38 years. What I would ask of the Government is whether the 1975 amendment Act is being replicated elsewhere by this legislation or whether this is just a gross and irresponsible transfer of power within the IMF.