Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill — In Committee 
Text is incorporated into the Bound Volume 
Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill — In Committee 
[Sitting date: 22 August 2012. Volume:683;Page:4646. Text is incorporated into the Bound Volume.] 
Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill 
In Committee 
Debate resumed from 21 August. 
Part 3 Objections appeals and enforcement ( 
continued 
)  
The CHAIRPERSON (H V Ross Robertson) 
: Kia ora tatou no reira e te Whare. Tena koutou tena koutou tena koutou katoa. Good afternoon honourable members. The House is in Committee on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill also the Regulatory Reform Bill the Trade (Safeguard Measures) Bill and the Taxation (Annual Rates Returns Filing and Remedial Matters) Bill. When the Committee last considered the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill we had reached Part 3. The question is therefore that Part 3 stand part. I call the honourable member Jacqui Dean.  
JACQUI DEAN (National—Waitaki) 
: 
 Good choice. Good choice Mr Chair. Thank you very much for the opportunity to speak on Part 3 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. 
Chris Hipkins 
: I raise a point of order Mr Chairperson. I am sorry to interrupt the member who I think genuinely believed that she had the call but my understanding is that when this debate was last interrupted there was a member in the middle of a call or getting towards the end of their call but had not concluded. 
The CHAIRPERSON (H V Ross Robertson) 
: Well all I can say to the honourable member is that according to the drill sheet that I have here it said that we had reached Part 3 and the question is that Part 3 stand part. 
Grant Robertson 
: I raise a point of order Mr Chairperson. I may be able to clarify. 
The CHAIRPERSON (H V Ross Robertson) 
: Please do Mr Robertson. 
Grant Robertson 
: I was the member on my feet at that time. I understand that I had 5 seconds remaining on my call during which time I would have asked the Government to support Charles Chauvel’s Supplementary Order Paper 95. Thank you. 
The CHAIRPERSON (H V Ross Robertson) 
: Well I guess that that is a good one. 
JACQUI DEAN 
: The Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill Part 3 is where the rubber effectively hits the road with this piece of legislation because it is the part that deals with or provides for objections to the Environmental Protection Authority and also appeals to the High Court on questions of law. Subpart 2 of Part 3 provides for enforcement of the bill by providing for the Environment Court to issue enforcement orders and that is under clause 113 and also—and I am about to refer to the Minister’s Supplementary Order Paper 100 here—offences and penalties under clause 124 and clause 125 which of course with the Minister’s Supplementary Order Paper have increased from $600000 through to $10 million. It also deals with the appointment of enforcement officers under clause 129. So it is a really important portion of the exclusive economic zone legislation because it provides the backstop. It provides the accountability for any activities that are consented under this new regime in the exclusive economic zone and the extended continental shelf. 
Just for a bit of context about why this is so necessary I think it is probably good for the Committee to remember that the current regulatory regime has got some significant gaps in it which means that there are a number of activities that are currently occurring inside the exclusive economic zone that are in effect unregulated. So the assessment of the effects of activities—that is other than fishing in the exclusive economic zone—on seafloor habitats and on biodiversity which might be as a result of seabed mining is lacking. There is a gap in the assessment of the effects of activities on biodiversity in the water column. That refers to the effects of seismic surveys on marine life. None of those considerations are currently taken account of in legislation. 
Also there is a gap in the assessment of the effects of new activities on existing interests—for example the effects of a petroleum platform on surrounding fishing and shipping—and of the management of the cumulative effects of all activities in the exclusive economic zone and the continental shelf as they are regulated under different and multiple regimes with a differing and variable ability to take into account the sorts of activities in decision making. So there is a gap there. In fact I would argue that there is quite a yawning gap. This Government took action back in 2006 when Cabinet proceeded to the development of a legislative framework to tidy up the gaps in the regulations around activities in the exclusive economic zone. 
Why are these gaps a problem? There is not terribly much that happens in the exclusive economic zone and we have been told that and we understand that. So why are these gaps a problem and why is it so necessary to have inserted in this bill parts like Part 3? This part provides for objections to the Environmental Protection Authority which is the determining body of activities along with appeals to the High Court on points of law and also provides for and describes offences and penalties. Why is that so important and why is it a critical part of this exclusive economic zone bill? Well there is of course the potential for unregulated activities such as we have now could have in the future and did have during the term of the previous Labour Government to cause environmental harm. That environmental harm could impact on a lot of things: on marine life on marine habitats and also on marine biodiversity. Because of the nature of some of the activities that occurred occur and might occur in the exclusive economic zone some of those impacts could be quite severe—for example oil spills and the destruction due to dredging of the seabed of significant benthic communities. 
There is also—and I think this is pretty critical and germane to this bill—no mechanism for ensuring public participation in decision making around these activities. So it is beyond me why Labour and Greens are opposing this bill. I can only come to the conclusion that Labour and the Greens in this House and in this Parliament are quite satisfied with the 9 years of the previous Labour Government and the state of affairs where there are yawning regulatory gaps in this legislation. They are opposing this exclusive economic zone bill and I can only conclude that they actually do not care that much about what is happening in the exclusive economic zone. Maybe because it is so far out to sea they do not particularly care about what happens out in the exclusive economic zone. Well I can assure the Committee that this party does and that is why this party has brought this exclusive economic zone bill to the House. 
Just briefly on Part 3 the enforcement of offences and penalties is very closely described in some detail. If members would have a look at clause 113 they would see that it is quite explicit in what it requires people who are undertaking activities in the exclusive economic zone to do. For example if there is “an order made by the Environment Court or an Environment Judge” it has the effect of requiring the person “to stop doing something”. That is just a few words in this bill but what that might mean is quite a significant penalty and impact on some activity in the exclusive economic zone. Part 3 is a significant and substantive part of this bill. Thank you. 
MOANA MACKEY (Labour) 
: 
 I think it says more about the member who just taken her seat Jacqui Dean than it does about members of the Opposition if after all the time we spent together on the Local Government and Environment Committee and all the speeches in this Chamber she still does not understand why Labour and the Greens oppose this piece of legislation the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. She said that it is because the exclusive economic zone is far away—it is far away. This was someone of course who did ask a submitter whether the ocean could be described as a deep-water marine environment at the select committee so I have to say that Jacqui Dean is being very disingenuous when she says she does not understand why we oppose this legislation. We oppose this legislation because it simply is not consistent with our international obligations and it does not provide the level of environmental protection that the community wants and that we should be expecting in an environment as precious as our marine environment which so much of our economy relies on. We contacted the Minister for the Environment Amy Adams and we tried to work with her to find a compromise where we could get a settled cross-party agreement so that there would be certainty for everyone. We were rebuffed on that. That is the reality of what happened instead of the fiction that we have just heard from Jacqui Dean. 
Part 3 of this piece of legislation is around appeals enforcement orders and abatement notices. One of our big concerns about this part is that unlike under the Resource Management Act where submitters or opponents are able to take a case to the Environment Court on points of fact where they disagree with an issue where new information has come to light or where they do not think the decision was right they can take it only on points of law to the High Court under this exclusive economic zone legislation. As I said in my speech yesterday a jurisdictional line has been drawn between our territorial waters and the exclusive economic zone. It is only jurisdictional. Many many other pieces of legislation in New Zealand operate across both perfectly adequately. Whether that be fisheries legislation whether that be health and safety legislation or whether that be maritime legislation they do not have any problems differentiating between our exclusive economic zone and our territorial waters. 
Apparently this is one piece of legislation where it is absolutely impossible to get consistency between the two. We disagree with that and one area where we do disagree is in the taking away of the rights of people to access the Environment Court on points of substance. I think it is a false economy to think that you are going to save a lot of time and money by doing this. One of the things the Environment Court has done—and there are plenty of protections in there to avoid vexatious claimants—is taken a lot of that negotiation and a lot of that mediation offline and out of that process. Because all parties know that there is potential for that to happen and there is that recourse a lot more effort is put into making sure that obvious issues are dealt with up front and that obvious stakeholders are consulted unlike what we saw up on the East Coast with Petrobras where local iwi heard about it on the 6 o’clock news. That is not adequate. What we know is that under Resource Management Act legislation it does provide an incentive for people to try to sort out as many of those issues as they possibly can before they get to the actual legal process. We note of course with some concern that the Government is now moving to remove that ability under the Resource Management Act as well and talking about these plans of regional significance which will no longer be able to go through that full court process. We are concerned about that as well. To parties who are voting for this bill because they like more alignment with the Resource Management Act just be aware of where the Resource Management Act is going. Suddenly being aligned with the Resource Management Act may not be as flash a thing as it used to be in the past. 
We have Supplementary Order Paper 95 in the name of Charles Chauvel to delete the clause that states you can take an appeal only on points of law and also to replace “High Court” with “Environment Court”. One of the interesting things about this is that when we come to the issue of enforcement orders which the member Jacqui Dean was talking about because of the experience and the knowledge held there it is actually the Environment Court that deals with that. It is actually the Environment Court that issues the notice. It is the Environment Court that upholds it. The Environment Court of course has a lot of expertise in this area and we just think that perhaps it should also be the court that is dealing with appeals when people have concerns about marine consents that have been granted or indeed where an applicant has concerns that the requirements that the Environmental Protection Authority has put upon them are too stringent. So it should be there for all parties. To create this kind of new set of goalposts just because we have crossed over an invisible line in the ocean which has nothing to do with resource management allocation has nothing to do with science and has nothing to do with environmental integrity—it has nothing to do with any of that; it is just an invisible jurisdictional line—and to suddenly say that the goalposts are a lot further away once you step over that line to us does not really make an awful lot of policy sense unless what you are trying to do is streamline these projects and make it harder for communities to raise concerns. 
I want to put that into context of the reality that a lot of communities face. We are already looking at local government which is struggling to make a lot of these decisions. It may be the first port of call in some instances for communities that have concerns about applications that are going to the Environmental Protection Authority where it might want its local authority to submit on behalf of the community. I look at the Gisborne District Council. It is a unitary authority with a low rating base. It does not have a lot of money to access the kind of research that these companies can access. There is not a lot of money in my community to access that research particularly within some of the time frames that have been given. Because it will be up to the Environmental Protection Authority as to how it sets the timing of the hearings there is a concern again that that timing could be so short so that these communities will not be able to even access those organisations that would be able to provide them with some help and with some assistance. The reality is that everything is weighed against communities that have concerns right from the beginning. We would like to have seen this legislation actually try to incentivise engaging with communities not a piece of legislation that essentially could see stuff being pushed through against a community’s will when it does not have the resources to access the kind of research that some of these companies—which remember go all around the world doing these projects and have big research teams because this is what they do on a regular basis—are able to access. They have access to vast amounts of money to produce that research. We would just like to see a little bit of a level playing field so that communities are not completely left out of the loop and are given a much higher threshold to jump over than the applicants that are applying to carry out the activity. 
I just want to quickly touch on the issue of penalties. We are very very pleased to see the dramatic increase in penalty. I really wish it could have been done at the select committee and we would not have had to bash our heads against the wall asking why the penalties were so low. It would have been nice to have been done at the select committee but it is great that it is being done here and I want to thank the officials for all their work on this part as well. 
I come back to a core point as well which we will address in Part 4 which is the ability to actually collect the money and to ensure that it is there. We could have a penalty of $1 billion but if these companies are simply going to fold or if we are unable to require bonds and insurance up front to ensure that that liability can be met then it really does not matter what the penalty is. There were concerns again at the select committee about that but we will come to that in Part 4. We have a Supplementary Order Paper in my name and there is also a Supplementary Order Paper in Gareth Hughes’ name to increase the rest of the penalties because of course there are a range of penalties under the bill. We are only increasing one of them here. As we have said we absolutely welcome that increase in penalty. It will provide a much bigger disincentive than the previous penalty but again we really would question—and I am not sure whether the Minister in the chair is able to have the answer to this; she is the Minister of Conservation so I am sure she is taking an active active interest in the exclusive economic zone legislation—why none of the other penalties are being increased because we also felt that they were inadequate. But we are not going to be churlish around the issue of the main penalty as $10 million is a very very very drastic improvement on what was in the bill as it came to the select committee. Thank you. 
EUGENIE SAGE (Green) 
: 
 I would like to correct some of the statements that Jacqui Dean made. I think she was more than mischievous in not accurately characterising the Green Party’s position on this bill the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. We supported the bill at its introduction because there is a huge gap in the environmental management of our oceans—the fact that we do not have legislation that provides for a consenting regime. But we have opposed it and continue to oppose it because of the major shortcomings of the bill: the fact that there is no hierarchy for matters of national importance the fact that Treaty obligations are not well dealt with and the failure to adequately provide for the protection and preservation of the marine environment in line with the United Nations Convention on the Law of the Sea. 
In relation to this part Part 3 of the bill is about what can happen after the Environmental Protection Authority makes a decision. It relates to objections to the Environmental Protection Authority’s decisions appeals to the High Court and beyond on points of law and enforcement. It is this fact that there are no appeals to the Environment Court and that submitters and applicants can appeal only to the High Court against a whole or part of an Environmental Protection Authority decision that is a major issue because that is constraining access to justice—not having the full scope of appeal rights to the Environment Court. This was a deliberate policy decision by Cabinet and we understand that it was made because Cabinet believed that the Environmental Protection Authority was already making decisions at the national level and was seen as being an expert body. 
But as the Royal Forest and Bird Protection Society noted in its submission clause 97 of the bill provides for applications that deal with nationally significant cross-boundary issues—that is across the 12-nautical-mile limit—to be dealt with by a board of inquiry not by the Environmental Protection Authority. So surely this is already signalling that the Environmental Protection Authority does not have the same standing and expertise as other decision makers—the fact that you get this delegated to a board of inquiry. The Green Party supports Supplementary Order Paper 95 in the name of Charles Chauvel because it would provide for appeals to the Environment Court instead of restricting it to the High Court. 
The experience with the Environment Canterbury (Temporary Commissioners and Improved Water Management) Act is instructive because that legislation has disallowed appeals to the Environment Court and restricted them to points of law appeals to the High Court. Environment Canterbury has just notified decisions on the Canterbury Regional Policy Statement. There has been a slew of appeals from various parties technically on points of law but a lot of those appeals actually raise substantive issues of public policy around environmental management and in that case the appropriateness of policies in the regional policy statement about whether they are adequate to control the allocation of water. Those sorts of public policy and public interest issues are much better dealt with by the Environment Court given its specialist expertise given the substantial technical skills of the commissioners who sit alongside the judiciary and given the court’s experience with mediation such that a lot of cases are resolved before going to a formal court hearing. 
I think the downplaying and setting aside of the role of the Environment Court in this bill is very short-sighted because it means that the focus is going to be very legalistic in the High Court where you do not have that specialist expertise that the Environment Court has. I think we need to reflect on the fact that the Environment Court succeeded the Planning Tribunal. It has dealt with and been fundamental in developing the case law around particular bits of the Resource Management Act—the meaning of particular clauses and the legislation there. Similarly this bill and the substantive issues about how our oceans should be managed would benefit from the Environment Court’s expertise and from allowing appeals to be taken there. 
The Environment Court is also much more accessible than the High Court to lay people so by restricting it to the High Court you are again constraining the ability of communities to engage. 
The Environment Court is not bound by strict rules of evidence. It has powers of inquiry which when you are dealing with public policy issues like resource management and management of the oceans are very useful. Given the substantive public interest issues that will come up in appeals in our view Charles Chauvel’sSupplementary Order Paper should proceed because it reinstates those appeals to the Environment Court. I think doing away with the Environment Court is incredibly short-sighted. I think it reflects this Government’s focus on pushing development through as quickly as possible without taking significant account of environmental impacts. 
The other matter I would like to comment on is clause 125 and the proposals in Supplementary Order Papers from Labour and from my colleague Gareth Hughes to increase those penalties. Like Moana Mackey said it would have been good to see that done in the Local Government and Environment Committee because Opposition members certainly raised this several times but we were defeated there. The problem with the bill as it is currently drafted is that the penalties are the same as the maximum fines in the Resource Management Act—$600000 for corporations and $30000 for natural persons plus there is a provision for continuing fines. But here we are dealing with major corporations with significant financial clout getting involved in activities that are very risky. There is an obvious need to substantially increase the penalties. 
The Minister for the Environment’s Supplementary Order Paper 100 is a very useful step in the right direction because it would increase the fines to $10 million for any offence involving a corporation. But that should be higher and Gareth Hughes’ Supplementary Order Paper 102 provides for a more realistic penalty of $12 million because we are dealing with oil and gas prospecting companies and the potential consequences of something like an oil well blowout are catastrophic. So it is very appropriate that the fine should be $12 million rather than $10 million. We recognise that even when you set fines at this level of course they cannot compensate for the ecological consequences and the economic consequences of such a catastrophe. We will be supporting the Minister’s Supplementary Order Paper 100 on Part 3 if Supplementary Order Paper 102 does not get the support of the Committee. Thank you. 
NIKKI KAYE (National—Auckland Central) 
: 
 I am pleased to take a call on Part 3 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. I just want to start by making a couple of comments. The first is to acknowledge why we are here. We know that there is a regulatory gap. We know that our exclusive economic zone and continental shelf offer significant opportunities. The question is after a significant period when Governments did not move to fulfil this regulatory gap whether here today parties in Parliament will support legislation to be able to do that. I am very pleased that we have seen the Maori Party and the New Zealand First Party shift to support this legislation and I think one of the key reasons for that was there has been a Supplementary Order Paper. 
One of the key aspects of our Supplementary Order Paper 100 addresses this issue this Part 3 of the bill. If we look at Supplementary Order Paper 100 which has been put to the Committee it has been supported by the Parliamentary Commissioner for the Environment. In fact the Parliamentary Commissioner for the Environment has been very clear that she now supports this bill. One of the key aspects of Supplementary Order Paper 100 is to significantly increase the penalties. When you look through all of Part 3 everything that this part is about is saying that we want to decrease risk to our environment and ensure that there are adequate enforcement powers and adequate penalties to be able to do that. This Supplementary Order Paper massively strengthens that by taking it from $600000 for the maximum penalty to $10 million. 
Additionally if you look through some of these clauses we have had a great contribution from the community and we have really strengthened the law as a result of that. I want to make a special mention of one of the submitters that came to the Local Government and Environment Committee and I think had a real impact on the committee. That was the Taranaki Regional Council. It has been undertaking activity in terms of marine consents in coastal waters for years. It came to our select committee with a very practical suggestion around the fact that there needed to be greater enforcement in terms of abatement notices and our select committee acted. When you look at the provisions in the bill that deal with this—clause 122A right through to clause 122D—it really shows that we are serious about enforcement. But we are also serious about when the system might see that something is going wrong—about there being an ability for people to ask questions or to ask for activity to be looked at or stopped. That really shows right throughout this part whether it is the penalties the abatement notices or even if we turn to some sections around enforcement and the powers of enforcement officers—clauses 129 130 and 131. They show a huge amount of power in terms of being able to search vessels and get information. 
So what I think this part is actually about is giving a lot of confidence in terms of our environmental management regime to say: “Yes we do believe in exploring greater economic opportunities but we want to ensure that there are some powers in there to prevent and mitigate risk.” That is a very sensible piece of legislation for this House to be passing. I want to acknowledge those parties that have realised that the changes through Supplementary Order Paper 100 are significant and that have seen that the Parliamentary Commissioner for the Environment supports them. The Maori Party and the New Zealand First Party have taken practical measures to show their support for addressing this regulatory gap and ultimately making our environmental regime stronger. Thank you. 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 I want to take just a brief call on the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill partly to respond to that speech we have just heard from Nikki Kaye and partly to ask the Minister in the chair the Hon Kate Wilkinson a question. I think in fairness to the previous speaker everybody in this House throughout the debate has acknowledged the importance of filling the regulatory gap that there is. There has been some disagreement among parties about how we do that about the extent to which we need to have consistency with our international obligations and about the extent to which we need to have consistency with our domestic law such as the Resource Management Act. There has been a shift from the Government in that regard which we welcome on this side of the Chamber. 
If we are going to use Part 3 as the example of what Nikki Kaye has just said—she mentioned the importance of the community and the importance of people having confidence in the system—that is the very reason why we have got an amendment in place around the question of appeals and whether or not appeals can go to the Environment Court because that is exactly the point of giving people the opportunity to have a say. Remember under this law appeals can be only on points of law. They cannot be on facts and they cannot be on new information. If the member is serious about wanting to create a law that gives the community a say and that ensures there is community confidence I do not see how opposing the Supplementary Order Paper that we have tabled to bring the Environment Court back in Supplementary Order Paper 95 would do that. 
I think it would be good for the Government to stop and think and to listen to for instance the contribution from Eugenie Sage just now on what role the Environment Court can actually play in helping develop law in this area because it is quite clear to anyone who has been following this debate that there will be significant dispute around some of the things that have been raised in this bill—for instance the meaning of the phrase “favour caution” or whatever you want to look at. There will be issues here. The Environment Court has actually played a very constructive role in establishing the body of law in practice with the Resource Management Act— 
Nikki Kaye 
: There are appeals around to the Environment Court around abatement notices. 
GRANT ROBERTSON 
: That is the point. But specifically in clause 103 on the question of appeals that is why we have made that change. I mean this is a genuine thing. I am not saying that the Government does not care about this; I am just saying that there is a better alternative which we know about as a result of the Resource Management Act that would facilitate the thing that the member just told us she was concerned about which is the involvement of the community and the ability to build up that body of law that will give people confidence. 
I appeal to the Government to have a look at the Supplementary Order Paper that exists on this and to consider whether or not it could support both broadening the scope of appeals to be able to be on matters of fact as well as on matters of law and bringing the Environment Court back into that phase because I do believe that that will make for better law in the long run in this area. 
The other matter I wanted to just quickly raise was around the question of penalties contained in clause 125. As I think I said in my earlier contribution on this matter we welcome the fact that the Government has increased the penalty for someone committing an offence under this bill to the large figure of $10 million. That is great but there is now an inconsistency created in the law because the following provisions of clause 125 cover what happens in the event of a continuing offence when somebody continues to break the law. That is defined quite clearly under clause 125(6) where it says: “The continued existence of anything or the intermittent repetition of any actions contrary to any provision of this Act is a continuing offence.”—so there is a very clear definition of what a continuing offence is—the Government has rightly said that this is such a significant area that it has to set a proper deterrent in place. It has to set something that is commensurate with the scale of what will be going on in the exclusive economic zone. It is $10 million for an offence—that is great. 
But then we come down to clause 125(2) (3) and (4) and we have fines of $10000 a day for a continuing offence. It is now completely out of whack. It is $10 million when you break the law and then we drop all the way down to $10000 a day. If it is a company—and these are large companies that are involved in this—that is hardly a consistent or commensurate penalty for a continuing offence. So I welcome the fact that the Government has decided to amend clause 125(1). It has done exactly the right thing which as my colleagues in the Local Government and Environment Committee have noted was something that Opposition parties said often much to the concern of the Government members who did not seem at that point to agree with us. They do now. So why then not back Supplementary Order Paper 103 in Moana Mackey’s name or indeed the Supplementary Order Paper in Gareth Hughes’ name Supplementary Order Paper 102 which actually make those penalties for a continuing offence more appropriate? They are out of whack at the moment and I would like the Minister in the chair or a Government member to be able to rise now and tell us why the Government will not make changes to the continuing offence penalties given that it has made those changes under clause 125(1). It just does not make logical sense. The Committee is in agreement here that we need to have penalties that fit the crime—as it were—and have a deterrent effect. That is happening in one part of clause 125 but then it completely fails in the rest. 
In clause 125(2) at the moment the first stage of what happens with a continuing offence is a fine not exceeding $10000 for every day. We are proposing in Supplementary Order Paper 103 that that becomes $100000 every day from thereon. After that when it is a summary conviction and it carries on the penalty is $1000 per day under clause 125(3). We would like to see that go up to $100000 and if the offence is a continuing one to a further fine not exceeding $10000. 
Finally under clause 125(4) where it says: “A person who commits an offence … is liable on summary conviction to a fine not exceeding $1500.” we would like to see that go to $15000. This is simply consistent with where the Government has now reached on clause 125(1) and if the Government is not going to support that Supplementary Order Paper this Committee deserves to know why because it is completely inconsistent and illogical. We end up with a penalty regime that does not fit the magnitude of what may be taking place inside the exclusive economic zone. That is our big concern with Part 3 of this bill. 
We do want to support the Government in raising these penalties. Everybody in this Chamber wants to support the Government but I just urge some consistency in this particular part. 
RINO TIRIKATENE (Labour—Te Tai Tonga) 
: 
Tena koe Mr Chair. I am pleased to make a contribution on Part 3 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill and I would like to pick up on Mr Robertson’s contribution in regard to Supplementary Order Paper 95 in the name of Charles Chauvel in terms of clause 103. It is interesting. I have just looked at the departmental report as reported back from the Local Government and Environment Committee in regard to clause 103. There were some 22 submissions covering clause 103 and all of them were universally opposed to restricting rights of appeal to the High Court and purely on points of law. So there were strong submissions being made that rights of appeal go to the Environment Court and that they follow the standard practice of appeals under the Resource Management Act which provides full rights of de novo appeals on questions of fact and law to the Environment Court. 
We had submissions from the likes of our main listed fishing company Sanford. We had submissions from Sanford and I read that there were submissions from the likes of the Royal Forest and Bird Protection Society—all saying the same thing. So it is disappointing then that the submissions—22 of them in total all universally saying that we need to make sure that we change these rights of appeal so we can actually go to the Environment Court and cover questions of fact and law—were not adopted. 
It seems that the departmental officials toeing the line of the Government said that there is some degree of alignment with the Resource Management Act. Because of the regime that has now been imposed in the Resource Management Act—the fact that nationally significant projects can be basically applied and ticked off very quickly by a technical committee and appeals go only to the High Court on points of law—there is some consistency with the Resource Management Act. Well that is not good enough. We know that there are a lot of concerns around activities in the exclusive economic zone and we want to make sure that there is confidence in the whole process for applicants and for those who are concerned and are opposing such applications so I do support Supplementary Order Paper 95. 
I will just go through the other clauses in Part 3 point by point. Clause 114 deals with the enforcement orders. Obviously this has had “or any other person” added before “may apply to the Environment Court for an enforcement order.” Originally it was limited to the Environmental Protection Authority and now it has been extended out to any person so we support that amendment which came through the select committee. Likewise the inclusion of abatement notices in clause 122A was an important addition; it gives another option in terms of enforcement or remedies in Part 3 of the Act. Likewise the insertion in clause 122F: it is a useful tool for the Environmental Protection Authority in dealing with urgent matters. There are little technical things around procedural aspects for abatement notices and the like which were tidied up and have been included in the bill as it has been reported back. 
I would like to move on to clause 125 which we have been talking about this afternoon and which deals with the penalty provisions and Supplementary Order Paper 103 in the name of my colleague Moana Mackey. Certainly if there are breaches of the Act or breaches of provisions in terms of clause 124 we want to make sure that there are penalties that provide a good disincentive for breaches of the Act. It is commendable that Supplementary Order Paper 100 in the name of the Minister for the Environment does include amendments that increase the penalties up to $10 million. That is commendable and we do support that. But as we go through all of the other penalties and fines throughout clause 125 we see that it is incongruent in terms of having a $6 million fine and then going down to some $10000 fines—some very petty fines which are not real deterrents. So we want to make sure that there is consistency right across those fines hence Ms Mackey’s Supplementary Order Paper 103 which basically increases all of those fines tenfold. There are tenfold increases in those fines proposed to make sure that there is a nice balance across the fines in clause 125 but also to make sure that there is sufficient disincentive for breaches of the Act by those who may want to do so in regard to their activities. 
Part 3 as a whole deals with objections appeals and enforcements but I think critically there are the two Supplementary Order Papers that deal with creating the right of appeal to the Environment Court on points of law—in fact appeals de novo—and we would ask the Government to support Supplementary Order Paper 95. Likewise Supplementary Order Paper 103 which extends increases and provides more balance and grunt to the fine provisions in clause 125. Thank you. 
ANDREW WILLIAMS (NZ First) 
: 
 I will take a call on Part 3 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill just to perhaps make a few points of clarification. I thank the prior speaker Rino Tirikatene for his comments but I just wanted to raise a few issues in regard to some of the comments he made. 
When this came to the Local Government and Environment Committee there were some concerns that possibly there was no recourse to the Environment Court and that was a question—I was one of the ones who questioned it. But we were assured by the officials and by the counsel who was in attendance that the actual Environmental Protection Authority itself had Environment Court judges who were now with the authority and were in effect fulfilling the role within the Environmental Protection Authority of providing that aspect. In other words instead of having to go off to the Environment Court the Environmental Protection Authority itself had learned judges within its own body who would be considering the applications for projects and consents within the exclusive economic zone. I was very pleased to hear that basically this agency was not just reliant on officials to do the work but did have High Court judges involved in the agency itself which took away much of the concern in relation to not having that appeal to the Environment Court. We still also heard that there are of course opportunities for appeals on points of law to both the High Court and the Court of Appeal. 
In relation to the fines—and again we did lobby to get the fines increased—we are very pleased that it did go to $10 million from what was $600000. It is a very hefty and sizeable increase. I do believe that New Zealand First would have difficulties with some of the other incremental fines going up to the order of $100000 per day because on a daily basis those sorts of figures become incredibly difficult to manage in that some of the breaches could be relatively minor or could actually have little consequence but would need the parties to take action. On the basis of $100000 per day where there might simply be some technical matters that need to be remedied that would be a very very onerous figure to impose on any organisation that was trying to bring itself into line with its particular consent. 
But having said that at the end of the day were that organisation to continue to breach the basis of its consents and if it were incurring $10000 a day and continuing to do so for a period of time to the point where it was not actually sorting the problem out or where it was unable or unwilling to solve the issue then there is that final situation where the organisation can be taken to court and fined up to $10 million. That would be the ultimate penalty—to do that. But in the meantime it certainly would make it very very difficult for many organisations to operate in New Zealand to undertake development exercises and to undertake important economic development within our exclusive economic zone if they were going to be subject to possibly $100000 in fines on a daily basis. 
So I would just repeat the comments that we made. It is most important—and we do support Part 3 of this bill and the rest of the bill in its total for the exclusive economic zone—that we do require economic development in this country. This is a huge potential resource. I will give one example which quite staggered me at the Local Government and Environment Committee where it was said that the Chatham Rise had one of the largest deposits of phosphate in the world and that currently New Zealand imports very very large volumes of phosphate from Morocco and Algeria. We are very dependant on sources of phosphate for our agricultural sector from countries that are not always necessarily that stable. We could as an agricultural nation find ourselves in great difficulty if our sources of phosphate came a bit unstuck. What is projected for the Chatham Rise would have an impact in the order of something like 1 percent of the total area of the Chatham Rise and to secure phosphate in the future from there for the New Zealand agricultural sector would make us 100 percent self-sufficient in this country for our agricultural needs. You can imagine what impact that would have on our economy whereby this country which is so dependent on agriculture could be basically self-sufficient for phosphate for the next 100 years 200 years 300 years or more. 
Hon Craig Foss 
: All “phos” is good Foss. 
ANDREW WILLIAMS 
: Yes yes Mr Foss. You are a very good “Fossfate”. But your fate might be quite different in the future Mr Foss. 
But anyway to go back to the phosphate on the Chatham Rise that was one small example that came to the select committee of the importance of the exclusive economic zone to New Zealand and of the potential impact it would have on this economy if it is managed well if it is done in a sustainable manner and if the likes of extraction of that phosphate from the Chatham Rise is done in an environmentally friendly manner that will assist the New Zealand economy and not have any great impact on the Chathams. 
So I have just taken this call on behalf of New Zealand First to say that we will not be supporting the Supplementary Order Papers that are suggested and we feel that in this instance we support the Government through the Committee stage of the bill. 
The question was put that the amendments set out on Supplementary Order Paper 95 in the name of Charles Chauvel to clause 103 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Noes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendments not agreed to. 
The question was put that the amendment set out on Supplementary Order Paper 102 in the name of Gareth Hughes to clause 125 be agreed to. 
A party vote was called for on the question  
That the amendment be agreed to. 
Ayes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Noes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendment not agreed to. 
The question was put that the amendments set out on Supplementary Order Paper 103 in the name of Moana Mackey to clause 125 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Noes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Amendments not agreed to. 
The question was put that the amendments set out on Supplementary Order Paper 100 in the name of the Hon Amy Adams to Part 3 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 117 
New Zealand National 59; New Zealand Labour 34; Green Party 11; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 1 
Mana 1. 
Amendments agreed to. 
A party vote was called for on the question  
That Part 3 as amended be agreed to. 
Ayes 106 
New Zealand National 59; New Zealand Labour 34; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 12 
Green Party 11; Mana 1. 
Part 3 as amended agreed to. 
Part 4 Miscellaneous transitional provisions and consequential amendments 
The CHAIRPERSON (H V Ross Robertson) 
: Now honourable members we need to focus our minds on Part 4. The debate on Part 4 is clauses 133 through to 149A clause 16 and clauses 150 to 157. 
MOANA MACKEY (Labour) 
: 
 Part 4 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill is very important because it contains the transitional provisions for the legislation which is how we deal with those activities that are currently under way and now need to be brought into this scheme and those who have been granted consents under the Crown Minerals Act but have not yet started that activity. It also deals with future transitional provisions for the changes in regulations that might occur under future Governments and under the next Labour Government obviously there will be changes. 
I just want to start by saying these are significant changes from what we saw at the Local Government and Environment Committee—significant. And it is actually very very difficult to fully understand the impact of these changes when we are not able to sit down with officials and talk through what the various changes mean. It is again very disappointing that this was not dealt with at the select committee. The advantage of delaying this bill by just a couple of weeks bearing in mind that there was quite a generous period between it leaving the select committee and coming back to the House for it second reading would have been that the regulations would be available so that we could take a more holistic view of the bill—the legislation alongside the regulations—and deal with these transitional provisions if there were significant problems with them which there must have been because we are making quite drastic changes and quite large changes compared with what the select committee finally decided upon. In the reading of these changes it appears that in tightening up the purpose clause—and I reiterate that we do no think that goes far enough in meeting our international obligations—there has been a lot of loosening up in other areas to avoid a backlash from industry. That would be my reading of what has happened in the transitional provisions here. 
When I say it is really difficult to fully comprehend whether some of the changes are minor or significant I am talking about changes like that in clause 149A. If we look at subclause (4) of that it used to say in the existing bill that came back from the select committee that the impact assessment had to comply with clause 40. When we look at clause 40 we see that it describes what an impact assessment must contain. It goes through everything that assessment has to do and what it has to contain. It goes into great detail. Well that requirement to comply has just been removed from the legislation completely and replaced with something else about incomplete applications. I am not sure why clause 149A(4) relating to clause 40 was removed given that these are people who do not have to go through the full process but instead have to provide an impact assessment and we are now saying that the clause that describes what has to be in an impact assessment no longer applies. That may be something that is minor. It does not seem like something that is minor. It seems like something fairly significant. And it is the same when you look at new clause 149A(7) which states that subclause (5) overrides clause 15. When you go back and look at clause 15 you see that clause 15 is actually one of the most important parts of the bill. It is in Part 1A “Duties and restrictions” and it is the restrictions on activities in the exclusive economic zone and in or on the continental shelf. It goes through in some detail what must not happen in the exclusive economic zone about the environmental damage that could occur. It is a very important clause. Subclause (7) of this new clause might just be something that is technical. It might be that these are transitional provisions so that part no longer applies but this was not raised with us at the select committee and whenever I see something overriding a significant part of the legislation I would like to know why. The other disturbing thing is that the Minister’s explanatory note is completely silent on this. It does not explain why this is happening. So I would like the Minister in the chair the Minister for Courts—who was actually a member of the select committee for some of this—to take a call on this. 
Grant Robertson 
: The former Minister could take a call. 
MOANA MACKEY 
: Yes the former Minister could take a call and explain if he knows the answer to that because these are wholesale changes to what we decided at the select committee. 
 We are now no longer saying that when you are providing an impact assessment you have to have reference to the clause that says what has to be in that impact assessment and we are overriding a very serious clause about the duties and responsibilities and what cannot happen under the exclusive economic zone. I think it is only fair to ask what the practical impact of that is going to be why we are doing it and why this was not raised as an issue at the select committee. 
We had the clauses for existing activities and again as I said these changes have been made and we would like to know the answer to that. But now we have a whole new set of transitional provisions for planned activities. We went through the clauses in the select committee around existing activities and these are things that are already happening out there so that is fine. You have got to transition them in. You cannot just say well on the day that this legislation passes you have to stop doing what you are doing until you get a marine consent. I absolutely understand that. We have concerns around how far that might extend where people have not really already started or where people might rush to hurry up and get in. We were assured that no this was just existing activities. This is where people are already doing it and it would be unreasonable to expect them to stop just because we pass a law given that everything was consented and everything was approved under the previous legislative situation. 
Then the Minister’s Supplementary Order Paper came out and suddenly we are talking about planned activities not just existing activities. The definition of planned activities means “an activity involved with the exploration prospecting or mining for petroleum”—and the same occurs with minerals—“if—(a) before the Act comes into force the exploration prospecting or mining for petroleum with which the activity is involved is authorised by a permit that was granted under … the Crown Minerals Act 1991 … and (b) the activity had not commenced before the Act comes into force.” We are no longer dealing with existing activities. We are now dealing with other things. It is a question that I asked of the Minister in Part 1A and she said she would come back to it in Part 4 because she felt that is where the discussion on transitional provisions should occur. What I want to know is if we take the example—because when we are talking about transition activities the problem is we are actually talking about specific cases the public knows about now and is concerned about now. It is not kind of in the theoretical in the future that we might be doing some stuff out here. Actually there are cases and there are permits that have been granted right now that are sitting there. Off the East Coast the Petrobras permit which has been granted is a well-known example. 
Petrobras has carried out only seismic surveying so far. It has said it wants to drill some exploratory wells. We are talking 3000 to 4000 metres deep and that obviously raises significant concerns in the community that I live in about the feasibility of doing that. What happens if something goes wrong? We notice that Anadarko Petroleum Corporation in far less deep waters has recently pulled back because of the inability to get a rig. The rigs for deep water are not that common. They are not like the smaller rigs. But it does beg the question: if it is so hard to get a rig to do the initial drilling how easy is it going to be to get a second rig to drill a relief well which is what you are going to need in waters of that depth because you cannot cap at 3000 to 4000 metres deep? Does this mean that if Petrobras wants to go ahead and drill that well it no longer has to get a marine consent because it was a planned activity? Does it mean that Petrobras can now go ahead with the exploration and mining because it was a planned activity and it has already been granted the permit? I do not know the answer to that question. I am hoping the answer to that question is no. As soon as Petrobras decides it wants to start drilling it is going to have to go through the marine consent process because that activity has not started yet. In fact it is a long way off I suspect particularly given some of the reported financial problems the company is having. But my reading of this is that even if it was not what it was intended it could very easily be interpreted—and again we do not want more legal battles over defining it—as saying that because it has been granted a permit under the Crown Minerals Act that makes it a planned activity. It means that it could go ahead and continue not just a seismic survey which is fine but also exploratory drilling and potentially mining in the Raukumara Basin 3000 to 4000 metres deep without my community getting to have a say and without going through the full marine consent process. If that is the case then that is deeply deeply worrying especially as the Government is issuing a large number of these permits right now. 
Suddenly that issuing of the permit process that is going on now carries a much greater significance if by getting one of those before this legislation passes into law that gives you rights out into perpetuity to be able to go through exploration exploratory drilling and mining without going through any process that examines the environmental impact of those activities. I sincerely hope that the answer is no it cannot in which case the question will be why we are even having to recognise planned activities. If it has not gone ahead why are the existing activities provisions not strong enough to deal with that? If there is some little difficulty that needs to be fixed then why are we not just patching up or strengthening beefing up the existing activities provisions instead of creating this whole new class? I hate to be cynical but I really feel that this was the trade-off with industry that when they saw the word “balance” going which was something they really wanted in the purpose clause they said: “Well what are we going to get in return?”. I suspect that this is what they got in return. 
EUGENIE SAGE (Green) 
: 
 Part 4 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill is entitled “Miscellaneous transitional provisions and consequential amendments”. Some of the consequential amendments like the big slab in the Minister’s Supplementary Order Paper 100 in relation to the Biosecurity Act are not a problem. But the section as Moana Mackey has outlined around planned petroleum activities and some of the provisions as they relate to mineral prospecting and exploration under the Continental Shelf Act are deeply troubling. That is because these amendments have come in now. There has not been an opportunity for the Local Government and Environment Committee to look at them. There has not even been the Minister providing a commentary on them when introducing them. The Supplementary Order Paper has I think a few lines about them but that is all. And because of the detail here and the complexity the full scale of the impacts is not clear. 
But from reading the Supplementary Order Paper and the bill to date there is this whole notion in clause 151AA on the Supplementary Order Paper about “Mineral prospecting and exploration may commence and continue” if the company had a licence granted under the Continental Shelf Act 1964. This licence has been granted but the holder of the licence may not necessarily even have commenced the activity. It is not just that they actually commenced and had some sort of existing use rights. It is allowing a whole class of activity to happen without the requirements for a marine consent because this clause overrides clause 15 which of course is where all the provisions around getting a marine consent are set out and it allows an activity that is not even under way at the moment to go ahead. That seems incredibly permissive particularly around exploration for example for phosphate or activities like that. So that is one clause that we have got quite major problems with. 
Then there is clause 151A about planned petroleum activity. It is very interesting that the Supplementary Order Paper amendment to clause 151A changes the bill to make sure that the activity is planned—and of course there is no definition of “planned” in clause 4 the interpretation clause so it has got very wide scope. What does “planned” mean? Is it just an idea in the strategy section of a big oil exploration corporation? That term is not defined so it has got very wide scope. 
In the Supplementary Order Paper there is quite a significant change. In the bill as introduced the activity could continue without a marine consent until 1 May 2013. The Supplementary Order Paper has extended that for another year. It is interesting that Anadarko Petroleum Corporation is not coming here this summer because it has had difficulties getting a rig. Is this the “Anadarko amendment” that would allow it to go prospecting without getting a marine consent under the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill when it passes? Is this Supplementary Order Paper to allow Andarko just to go through and put in an impact assessment on a voluntary basis but not go through the statutory provisions? 
It would be helpful if the Minister in exile took a call on this to give us some assurance that this has not been the quid pro quo amendment for the industry. It is very troubling that that has been extended by a year and that we have got activities that were given licences under 1964 legislation that predates the whole consideration and assessment of environmental impact that we have had through the Resource Management Act and through this bill and that are allowed to continue even if they have not started yet. That is deeply troubling about this miscellaneous part of the bill. 
NICKY WAGNER (National—Christchurch Central) 
: 
 I rise to speak on Part 4 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. Yes it does cover a series of miscellaneous issues including the transitionary provisions and consequential amendments. It is really the nuts and bolts of how this legislation will work. It covers things like the detail of the cost recovery provisions the servicing of documents the rules and regulations around sensitive information and waivers and exemptions. Finally it includes a schedule relating to inspection powers. 
We know that this legislation is part of a whole suite of Acts that cover the exclusive economic zone and the continental shelf marine environment and that it fills the gaps. This bill provides the legislative framework to manage and monitor activities and protect the environment. There are significant amendments to be made to existing legislation which are also done in Part 4. 
I would just like to focus on the transitional provisions particularly clause 151A. Moana Mackey was saying that she is having difficulty understanding these clauses and I would like to explain. Also Eugenie Sage asked us a question about clause 151A. This clause concerns activities such as prospecting exploration or mining for petroleum that are authorised by a permit. A planned activity is authorised by a permit. That permit is granted under section 25 or section 107 of the Crown Minerals Act 1991. In other words these are activities that are legally permitted before the bill that we are talking about now comes into force. 
The bill requires operators to prepare an impact assessment and provide it to the Environmental Protection Authority. However under the Minister for the Environment’s Supplementary Order Paper 100 this activity may continue without a marine consent after the date that the legislation comes into force for 12 months or to the very latest date of May 2014. That also answers Moana Mackey’s question about Petrobras. As it is Petrobras does not have a mining permit so it cannot mine; it can only prospect. It has an exploration permit. But the transitory provisions last for only 12 months after the regulations become law with a final date of May 2014. So finally whatever happens the end of that happens in 2014. Then it has to go to the marine consenting process. 
It may seem that the Minister’s Supplementary Order Paper gives prospectors more leeway than the original bill but this is not the case. Let me explain. Clause 151A concerns prospecting information. The original bill required an application for marine consent to be made within 6 months—so we had to put the marine consent in within 6 months—but work could continue until the final decision was made on that application which could be 12 months. What the Minister’s Supplementary Order Paper does does not change the outcome. The problem with the timing of the original bill was that the prospecting work would have already been completed before the consent decision was made. Therefore the consent would be redundant which actually would have made a bit of a mockery of the whole process and I do not think it would have been a good way to introduce our new legislation. Prospecting for petroleum takes place only in the summer months so there would be no activity under way while the company was preparing its consent up until November 2013. But while it was waiting for that decision the work would be under way and completed before the consent was issued in May 2014. 
The Supplementary Order Paper no longer requires an interim marine consent application which as you can see would come only after the work had been done so would have been a waste of everybody’s time but it definitely requires a consent before the following prospecting season. So the Minister’s change does not affect the outcome. It is not a softening up of the legislation but it does give more certainty to those who have planned authorised activities during the summer of 2013. I have to say that I think that is a reasonable and rational decision which gives credibility to the legislation. There would be nothing more galling to somebody who was prospecting than to have to go through all the process of applying for a consent and waiting for the decision but by the time the decision came the work had been done. It would be foolish if it was refused and of course it would have no use at all if it was approved. Thank you. 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 Mr Chair I thank you for the call and I thank the member Nicky Wagner for her contribution. I want to make a general comment about the matters on Supplementary Order Paper 100 that cover Part 4 of the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill and then raise some specific questions about those changes. The general comment is to say that there are significant changes in this Supplementary Order Paper as to how the transitional provisions will work. 
The member who has just resumed her seat has given an explanation around one of those—around the Supplementary Order Paper changes to clause 151A—but there are others as well around clause 149A and in particular around new clause 151AA that are major changes. It would have been good to have had select committee consideration of those. I am not doubting the word of the member or anything like that but to understand the impact of this with an Supplementary Order Paper that finds its way to us just a couple of days before we come to debate it is not satisfactory. We have said time and time again in this process that what everyone is after is certainty. What people want is the opportunity to be able to understand what the requirements will be and frankly in this particular part of the Supplementary Order Paper all we have got is uncertainty and questions that remain for us about what the impact of these changes will be. 
The member who has just resumed her seat says this is not about making things easier for those who already have licences to prospect or who have had consents granted. Although that is what she says what is on the paper in front of us looks like a regime that has been designed to make it as easy as possible for those companies that are there. It has some very flexible language inside it. It moves from “existing” activities to “planned” activities and what we on this side of the House want to know is that the scope of any planned activity is limited. When I look at clause 151A I am not certain I get that especially because we have references within clause 151A back to earlier clauses. As Moana Mackey said we were hoping that the Minister for the Environment would be able to get up today and explain to us how clause 151A works in with the earlier clauses around assessments. We have had some comment on that from the member who has resumed her seat but I do find it difficult to accept that this could not have gone back to the Local Government and Environment Committee to clarify it because I suspect that in future years we are going to have to come back and do just that. 
I just want to speak about clause 149A before I come back to new clause 151AA. Clause 149A is around existing petroleum activities becoming discretionary. I want to note particularly that what happens in clause 149A is the overriding of clause 15 of the bill. That is where our concerns start because clause 15 of the bill is a very important clause within the bill. It actually gives the powers to the Environmental Protection Authority around what restrictions there should be. These are the kinds of things that people would like to see in any piece of legislation that comes through to this House where we are actually trying to make sure that we have clear rules and clear guidelines for everybody involved. 
I know we are not supposed to refer back to parts but it is relevant because subclause (5) of the amended clause 149A overrides clause 15 which has already been passed and is around the restrictions on work in the exclusive economic zone. It is around things like the construction placement alteration extension removal or demolition of structures submarine pipelines or submarine cables; the removal of non-living natural material; the disturbance of the seabed or subsoil; the deposit of any thing or organism in the seabed; and the destruction damage or disturbance of the seabed in a manner that is likely to have an adverse effect on marine species or their habitat. That is clause 15. 
Subclause (5) of the amended clause 149A overrides that. That is a very significant thing to be doing within a clause that has just arrived on a Supplementary Order Paper telling us that for existing petroleum activities we do not have to worry about any of that. That will be because there are already restrictions within the permits and the licences that people have but I cannot compare those at the moment. As a member of Parliament expected to look at this bill I cannot compare back with what those existing licences are. All I know is that we are about to pass—if the Government gets its way—a clause within a bill that tells me that none of those things matter any more and that for those activities all of those things are out the door. From our point of view the destruction damage or disturbance of the seabed in a manner that is likely to have an adverse effect on marine species in their habitat is a serious matter. So this is why we have a problem with these new clauses being dropped on the Committee by way of a Supplementary Order Paper because we should be able to go back and look at what the impact of this is. 
The last matter I want to raise is around the new clause 151AA because I think this is an area as my colleague Eugenie Sage has already expressed in this debate where we have got a whole new area around planned activities—not just existing activities—and these are activities with licences granted under the Continental Shelf Act 1964. The issue we have here is firstly that we are not talking about just existing activities. We are talking about planned activities but they may not even be activities as Eugenie Sage has said that have begun. These are licences that potentially have been held for some time yet we are expected to say “Well that’s fine they can just carry on.” That is not an argument about certainty. These activities in many cases have not even started yet and we are saying these activities do not now need to be subject to the new legislation that we are putting in place today. 
Again this was dropped on us at the last minute it was not discussed in the select committee it has not had the scrutiny that people would expect— 
Paul Goldsmith 
: You would never do that would you? 
GRANT ROBERTSON 
: Well Mr Goldsmith says we would never do that. I do not know that we have. Does it make it right Mr Goldsmith? Does it make it the right thing to do to drop something in the Committee in an area where everybody across the Committee wants to create the most robust law that we possibly can? That is the problem we have got—having something dropped on us where we do not know whether we are actually going to be able to create the most robust law that we can. 
So we have a concern now that we are creating two or three different regimes for planned activities under different laws that will not be under the new processes that we have agreed to today. That is inconsistent potentially dangerous and not what we would like to support. Unless the Minister is able or a member of the Government is able to stand and reassure us around new clause 151AA we do not believe that that is a clause that we could possibly support. Overall we think that this is an example of why the Government should send this particular Supplementary Order Paper back to the Local Government and Environment Committee to enable proper scrutiny. 
The question was put that the amendments set out on Supplementary Order Paper 100 in the name of the Hon Amy Adams to Part 4 be agreed to. 
A party vote was called for on the question  
That the amendments be agreed to. 
Ayes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 46 
New Zealand Labour 34; Green Party 11; Mana 1 
Amendments agreed to. 
The result corrected after originally being announced as Ayes 72 Noes 48. 
A party vote was called for on the question  
That Part 4 as amended be agreed to. 
Ayes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Part 4 as amended agreed to. 
The result corrected after originally being announced as Ayes 72 Noes 48. 
Schedule not agreed to.  
Clauses 1 and 2 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 We come to the title and commencement debate and it is interesting when we look at the title of this bill the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. If only that were true—that what this bill was entirely focused on relevant to the title were the environmental effects. What we have heard throughout the debate on this bill particularly in this Committee stage is that there is a willingness on all sides of the House to ensure that we come up with a piece of legislation that manages environmental effects as the title of this bill suggests it should. But the problem we have now got is that the bill that is in front of us today has reached such a point that although it is good it is not good enough. It is good in the sense that we now are managing environmental effects as the title suggests by making for instance the purpose clause more consistent with the Resource Management Act. That is a step towards managing environmental effects as the title would tell us the bill does. But it is a step not far enough in terms of being consistent with our international obligations in terms of making sure that we have a robust regime that reflects the concerns of New Zealanders about the management of the marine environment. 
The game has changed since this bill was given its title and I note that the commencement date in clause 2 has been pushed out by a year of course. What we know is that in the time that has elapsed since this bill originally began life under a previous Labour Government the bill changed in a number of ways when the National Government got hold of it. We know that concerns among the public about how environmental effects should be managed—that is the title of the bill—have changed. People have been through the experience of the Gulf of Mexico people have been through the experience of the  
Rena 
 and they realise that we need to manage environmental effects in a far more robust way. So giving this bill this title would seem on the surface to some people to be acceptable but actually in reality it does not meet properly the goal that it set itself in this title. 
On this side of the Chamber we would have liked the Government to adopt some of the Supplementary Order Papers put up by the Labour and Green parties. We believe that would have given the title of this bill some meaning. But at the moment unfortunately it is mis-titled and it does not deal with the environmental effects of activities in the exclusive economic zone and on the continental shelf in the way that we would like to see. 
We need a more robust regime. We need to be using terminology in the bill that is understood that is clear and that makes sure that where the management of environmental effects is undertaken elsewhere in our legal process—i.e. through the Resources Management Act—that is reflected in the bill. That is reflected now in the purpose clause; it is not reflected in other parts of the bill where Labour and the Greens proposed amendments that would have made it happen that way. So I think the title of this bill is in fact misleading. It does not manage environmental effects in the exclusive economic zone sufficiently to give New Zealanders the confidence that any activity that takes place there will be alongside a robust regime. That is what all parties I believe in this Chamber set out to do. 
The Government has improved the bill that it introduced but it has not taken it far enough for the Labour Party to be able to support this bill. Despite things like the penalty provision being extended which is a good thing what we now have is a piece of law that still is inconsistent with our international obligations still has too much uncertainty inside it has new provisions introduced by way of a Supplementary Order Paper that we do not know the exact meaning of and as a result fails to meet the test of the title that it has been given. 
Hon Dr NICK SMITH (National—Nelson) 
: 
 I am going to take only a short call on the title clause. The title is entirely appropriate for the bill the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. I want to respond briefly to the contribution that was made by Grant Robertson. It can be broadly summarised as that of an Opposition that is desperately exploring for some reason to oppose rather than any sort of principled stand around this being legislation. In fact the member acknowledged that this is good legislation and that this is a bill that is overdue. 
I would take the Opposition back to the fact that the gap in New Zealand’s environmental regime which this Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill fills was identified way back in 2000. Labour made no progress in getting a bill before the House in its 9 years in Government. We have made good progress and have got a robust piece of legislation to bring into effect and with the clause 2 provision it will be fully implemented by 1 July 2014. 
 I do want to point out that when this bill was introduced Labour said that it had two major concerns: inconsistencies with the Resource Management Act and the penalties not being strong enough. The Government worked and addressed those two concerns and Labour still says that it opposes. That in my view just exposes how vacant the Labour Opposition’s true opposition to this bill is. Those members are simply dancing on the head of a pin. If the Government then addressed their latest range of pedantic excuses I am sure that they would find some other set. 
Let me just take the point that Mr Robertson made that he objects to the relatively short I have to say Supplementary Order Paper 100 which has been introduced by Amy Adams. I would remind members of the Committee that 4 weeks prior to the 2008 general election on another very important piece of environmental legislation the Climate Change Response (Emissions Trading) Amendment Bill the Labour Government of the day introduced an 800-page Supplementary Order Paper. It did not refer that back to the select committee at that time yet today it demands that this relatively short Supplementary Order Paper suddenly has to go back to a select committee. We do not accept that on this side of the Chamber. We say that that is grossly inconsistent. The member said that the amendments have been available for only 2 days. Actually it is dated 14 August and that is a great deal more than 2 days ago. In fact it is more like 8 days that members have had to study this Supplementary Order Paper and see— 
Moana Mackey 
: A whole 8 days! 
Hon Dr NICK SMITH 
: Well it is a very short Supplementary Order Paper I would say to the member who is interjecting. They are technical changes to the provision. They make the bill stronger. 
I would simply urge Parliament as has been urged by the Parliamentary Commissioner for the Environment to get on support and pass this good legislation so that we can get this proper piece of environmental effects assessment legislation into place so that the Environmental Protection Authority can get on with this important new area of work. 
The CHAIRPERSON (Lindsay Tisch) 
: Members the last votes on the Minister’s amendments on Supplementary Order Paper 100 to Part 4 and on Part 4 as amended were incorrectly announced. The results should have been Ayes 72 and Noes 46. The record will show the correct results. 
EUGENIE SAGE (Green) 
: 
 Nick Smith in terms of claiming that we are dancing on the head of a pin is misrepresenting the Opposition once again. He has obviously not read the substantive Supplementary Order Papers. There are eight from the Opposition seeking to make quite substantive changes to the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill. That is because yes it is going through because of the Government’s majority but it has a number of defects which the Green Party has highlighted from day one. They are in the purpose clause the gutting of— 
Hon Dr Nick Smith 
: Never satisfied the Green Party. 
EUGENIE SAGE 
: The member says we are never satisfied. No Mr Smith we are not satisfied because we want good robust legislation that will endure that actually talks about sustainable management of the oceans. Yes this legislation does that but it is a whole mix of factors so there is no clear direction to the decision makers about which should be given priority. 
There is no clear emphasis on protection and preservation of the marine environment which is part of our commitment under the United Nations Convention on the Law of the Sea. There are these planned activities. The transitional provisions are very broad and they potentially allow quite a lot to happen in the marine environment without the need to get a marine consent particularly with the commencement date potentially being not until 1 July 2014. The mining industry said to the Local Government and Environment Committee that it was very very happy with this bill. Once again this underlines that there is not enough commitment to environmental protection in the bill if the industry is happy with it. We have throughout the House’s consideration and in the select committee sought constructively to improve the bill. We still have not had clarification around the scope and impact of the transitional provisions and the planned activities and what can be allowed there. There is the potential for some quite serious oil exploration to occur without the need for a marine consent. 
Yes this bill will go through. It certainly is an improvement because we have not got legislation there at the moment but the fact that there is not the ability to appeal to the Environment Court will make it very difficult for the community to engage. The time limits on hearings will again mean that for very complex applications the Environmental Protection Authority will be under substantial pressure to deal with those quickly. Given that applicants will have been able to develop those over several years the bill is actually restricting the ability of the community to get involved in the way that occurs under the Resource Management Act at the moment. So yes it is an improvement on the status quo but there are a number of constructive changes that the Opposition put forward in its Supplementary Order Papers and it is disappointing that those have not been more seriously considered by the Government. 
MOANA MACKEY (Labour) 
: 
 It was interesting hearing the revising of history from the Hon Dr Nick Smith which he is particularly good at doing I have to say because he does it with such gusto that people think surely he could not be making that up. I know the member is reacquainting himself with select committees. What he perhaps is finding is that there is this interesting process called submissions at select committees where people who have expertise in a certain area come along and tell the committee what they believe is wrong with the bill or right with the bill. So when we got to the Local Government and Environment Committee and heard submissions from submitters what we found was that actually there were a lot more problems with the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill than we had realised at the first reading. 
Hon Dr Nick Smith 
: But you opposed its introduction. 
MOANA MACKEY 
: We did because at the first reading we actually thought that it was not good enough and then when we got to the select committee we realised that it was even worse than we had originally thought. The Green Party actually supported it on balance at the first reading and again when we got to the select committee and heard from submitter after submitter saying how weak the bill was how inadequate it was the Green Party changed its position. 
A whole number of other issues were raised at the select committee. That is why the select committee process is so important and that is why when we come back to the Committee stage we see Supplementary Order Papers from Opposition members on a raft of different issues that were raised at the select committee that we had not picked up initially. I was not aware for example at the first reading that the bill was inconsistent with our international obligations. That was not something that I had considered. But that actually became one of the primary concerns as we went through the select committee—that it is not consistent. There is no certainty around it it would be tested in the courts and the Government could have done one very very simple thing. It could have used the language from the international convention that we ratified in the bill. That one thing would have made it clear and beyond doubt. We would not have to fight about it. It would be beyond doubt that the legislation was consistent if we had used the language of “preserve and protect the marine environment”. 
The Hon Dr Nick Smith said that Labour at the first reading was all about consistency with the Resource Management Act. That is true. In fact the one clause that needed to be more than just consistent with the Resource Management Act was that purpose clause. We wanted consistency throughout the bill with all the legal terms that were being used so that we do not use “favour caution” we use the “precautionary approach”. We use language drawn from 20 years of Resource Management Act case law so that people know what they are walking into they know where the goalposts are and they know what the thresholds are. Resource Management Act case law in international law is well understood. 
No one knows what “favour caution” means. It has been made up. It is brand new. It has no precedent. Do you know who will decide what it means? Lawyers and courts. This should be the “Exclusive Economic Zone and Continental Shelf (Boon for Lawyers) Bill” because that is what is going to happen. 
Hon Christopher Finlayson 
: Good. 
MOANA MACKEY 
: Chris Finlayson says that is good. He has a vested interest that he is meant to leave behind when he enters this Chamber. But that is what is going to happen because it will be a court that ultimately decides. We do not need to be here. If the Hon Dr Nick Smith agrees with the United Nations Convention on the Law of the Sea agrees that we have ratified it— 
Hon Dr Nick Smith 
: This is consistent with it. 
MOANA MACKEY 
: It is not consistent with it. 
Hon Dr Nick Smith 
: Yes it is. 
MOANA MACKEY 
: It is not. If you wanted to be sure then why would you not just use the language of the United Nations Convention on the Law of the Sea? Then we do not have to have this fight and we can all just get on Dr Smith. We can all just move on knowing that we are collectively consistent with our international obligations and put that one big argument which actually was the biggest concern that Labour had—that this is going to end up costing New Zealand taxpayers money as litigation happens at international tribunals with people saying that New Zealand has not met its international obligations. 
Hon Dr Nick Smith 
: It is consistent. 
MOANA MACKEY 
: It is not consistent. One of the most telling parts— 
Hon Dr Nick Smith 
: It is. 
MOANA MACKEY 
: Why would you not just make it clear? 
Hon Dr Nick Smith 
: What have the officials said at the select committee? 
MOANA MACKEY 
: They said that they had not had any legal advice which was astonishing; that they had not got any legal advice from the Ministry of Foreign Affairs and Trade that the Minister had not called for that before putting the bill together. 
But I am asking Dr Smith a very important question. Why can we not just use the language of the United Nations Convention on the Law of the Sea and then we are clear? Then we do not have to have this fight; we can all get along. We can all get along. We are consistent we are there we are good. Why? There has to be a reason why. 
 When you look at clause 11 around international obligations the language has been changed from saying that everything in “This Act must be interpreted” as being consistent with our international obligations to a requirement to move us towards and to continue to implement. 
Hon Dr Nick Smith 
: It doesn’t say that. 
MOANA MACKEY 
: It does say that. It says “This Act continues … the implementation” of our international obligations. We are no longer consistent with them; we are just in the process of continuing to implement them. 
I think it is pretty clear that there is a lot of wriggle-room that the Government has left there because it does not want to be consistent with that international convention. That leaves New Zealand taxpayers exposed because they are the ones who are going to have to pay for any litigation that is taken against our Government by anyone who thinks we are not consistent with those obligations. It was a relatively simple thing to fix. The fact is that Dr Smith is getting so wound up about it and did not just say “Well let’s just fix it.” Apparently he is trying to say that we all agree consistency is important and we must be consistent with our international obligations but he is not prepared to do the one thing that would take this issue off the table and leave absolutely no shadow of a doubt that we have consistency. Instead he is going to do what he has done throughout the entire bill which is to use language that is entirely different from any legal language that has legal precedent and which leaves enormous uncertainty. 
People now do not know where the goalposts are and the only reason you would not align the language of 20 years of Resource Management Act case law the language that internationally has been understood and the language of the United Nations Convention on the Law of the Sea is if you did not want it to have to meet that test. That is the only reason you would not do it and that is why it has been done. We know that on this side of the House. I mean the Government does not want to say it. We actually had one energy company that did come to the Local Government and Environment Committee and they were the only ones who said “Yeah we like this because it is way more permissive than the Resource Management Act. We are going to be able to get away with a lot more.” That is what they said to the select committee—and we knew that that was the case. It was nice that someone was honest enough to actually say it for once and say that this bill is going to be less restrictive than the Resource Management Act has been. 
The Resource Management Act of course has allowed the oil and gas industry to go ahead in Taranaki. It has not stopped it. It has not stopped it dead in its tracks. The Taranaki Regional Council came along and said and some of it has been included in the bill: “We like working with the Resource Management Act because we understand it and it gives us the ability to monitor it gives us the ability to enforce and also we understand what the tests are. We are used to dealing with it so we have no issue with those same principles and those same level tests being applied.” This is a part of the country that the Government consistently points to and says “Look they can do it so why can’t everywhere else?”. 
Well you know the council was quite happy with what was being proposed in terms of getting more consistency because that line at 12 miles is jurisdictional only. You jump across an invisible line in the sea and suddenly we have two completely different regimes operating side by side and regulating exactly the same activity. How is that sensible? That line is not environmental. That line is not about science. It is not about resource allocation. It is just jurisdictional and when you jump across it we now have a completely different regime for exactly the same activity. 
As you get further and further out to sea in the really deep waters—3000 metres and 4000 metres deep in the Raukumara Basin off the East Coast—I think that the public want to see that there is definite consistency with the Resource Management Act in terms of their ability to access the process and to appeal to the Environment Court. But on the environmental protection clauses the former Minister made the comment that he did not think the community needed that same level of engagement under the exclusive economic zone bill because what happens in the exclusive economic zone has less of an impact on them. 
I think that when you see the impact of oil washing up on the beaches in the Bay of Plenty—and I know the Minister did because he came to the Bay of Plenty during the  
Rena 
 disaster—you cannot tell me that that does not have an impact on communities and that they do not deserve to be engaged in the process in the same way that they would be if it happened within 12 miles before you jump over an invisible jurisdictional line. It does affect communities—very very deeply. 
I think that this legislation should perhaps be called the “Exclusive Economic Zone and Continental Shelf (Missed Opportunity) Bill”. We went to the Minister for the Environment Amy Adams and said “Let us find a compromise. As many parties as possible but particularly Labour and National can agree that this is how it is going to be. Let us lock down as much as we possibly can.” 
Labour will change this legislation. We will make sure it is consistent with our international obligations and provides the levels of environmental protection that the community would expect. We wanted to find a compromise with the Minister. We tried to do it with the Hon Nick Smith on the emissions trading scheme and then the Maori Party gazumped us. We thought we were actually close to getting bipartisan agreement on the emissions trading scheme and then I heard on the 12 o’clock news that he had gone to the Maori Party instead and done a dirty deal there. So I know that the National Party is not very big on bipartisan agreements but they are important when you have got incredibly important legislation like this. 
I know that a number of the environmental groups also wrote to the Minister and said: “Look obviously we would like it to go a lot further but we think that if you worked together and if you found a compromise we are not that far off.” So we are very disappointed. We met with the Minister and we thought it was a good meeting but then we had Supplementary Order Paper 100 dropped on us. It did not address a lot of the issues that we raised. Some of them we were never going to agree on and that is absolutely fine. That is the nature of politics. But we think that on a piece of legislation this important we could have locked down an awful lot more. 
A lot of the stuff that has been done here in the Committee stage could have been done at the select committee. In fact we asked for it to be done at the select committee and were told no. Government members did not want to discuss that and we were not going to change this and it has been changed. As I said I am very pleased to see the penalties increased. It would have been good to see the penalties increased across the board but that one increase we do support and that is why we voted for that particular part of the Minister’s Supplementary Order Paper and of the bill. But this really was a missed opportunity because we open ourselves to legal challenges. We open industry community and the environmental groups up to enormous uncertainty because this now— 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Clause 1 agreed to. 
A party vote was called for on the question  
That clause 2 be agreed to. 
Ayes 72 
New Zealand National 59; New Zealand First 8; Maori Party 3; ACT New Zealand 1; United Future 1. 
Noes 46 
New Zealand Labour 34; Green Party 11; Mana 1. 
Clause 2 agreed to. 
Bill to be reported with amendment presently.