Estimates Debate — In CommitteeText is incorporated into the Bound VolumeEstimates Debate — In Committee[Sitting date: 31 July 2013. Volume:692;Page:12135. Text is incorporated into the Bound Volume.]Estimates DebateIn CommitteeDebate resumed from 30 July on the Appropriation (2013/14 Estimates) Bill.Vote Social Development(continued )Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First):To pick up from where I was last night on this particular bill—Simon O’Connor: Are your people allowed to buy a house here?Le’aufa’amuliaASENATI LOLE-TAYLOR: No not from the people whom you are buying them from. The welfare reforms now expect all people previously categorised as sickness beneficiaries sole parents and widows with no children under 14 to look for full-time employment as well. That includes the grandparents who are up to 65 years old and if Peter Dunne has it his way it will be 67.I agree that we have to be firm against those who consciously and continuously take advantage of our welfare system but I also acknowledge that things are not always black and white. This is the biggest shake-up of the welfare State since 1938 and such dramatic streamlining of the system may cause many people in genuine need to fall through the cracks. To truly progress social development it would be useful to refocus on poverty education crime family values community structure and other core issues impeding our growth as a society. It is obvious that these reforms are the Government’s way of saving a quick buck here and there without focusing on bigger problems like job creation. Indeed what is the use of forcing job seekers and the unemployed into work when we do not have enough jobs or reasonable wages?The paradox of our time under the National Government is spend more but have less. Have more but enjoy less. There are more medicines but less wellness. The Government claims to have more experts yet there are more problems. National has multiplied its possessions but reduced its values and it has no principles at all. It talks too much and listens too little.The Government seems unhappy—well should I rephrase that? The Government seems happy to push people into low-paid low-security jobs instead of encouraging decent employment and education. This means that those on welfare who are typically the most vulnerable in our society are not likely to improve their situation amid the bureaucratic harassment and social stigmatisation that now comes with it.The Government is focusing on moving people off welfare rather than on providing adequate and secure incomes for families. Other advocacy groups have raised concerns about the detrimental effects on grandparents raising their grandchildren when they are being told to find work despite their age and ignoring the valuable work that they are doing for society in saving children from broken homes and relationships.MELISSA LEE (National):Ahnnyung ha seyo. I would like to start my contribution by saying that the National Party campaigned on these welfare reforms. We actually made a promise to the New Zealand people that we were going to make welfare reforms. We are making sure we keep to the promise we made to the people of New Zealand. The new benefit categories and welfare changes in our reforms that came into effect on July 15 now apply to all beneficiaries. This includes rules around drug testing and outstanding arrest warrants and new social obligations for parents. These are important issues. The obligations are clear and they place a greater focus on moving people off welfare and into work.I would also like to take this opportunity to congratulate the Minister for Social Development the Hon Paula Bennett on the changes that have been made already. We are now seeing the results of these changes with 309782 people currently on benefitsin New Zealand. This is a reduction from some number over 310000 in the previous quarter and down from 320000 in the year prior to that. That is a reduction of more than 10000 people on welfare over the last 12 months and that has to be a great result. Work and Income will be actively working with around 41 percent of beneficiaries and it expects the number of people on benefits to fall between 28000 and 44000 by 2017 resulting in estimated savings of between $992 million and $1.6 billion. When we as a nation are recovering from a global economic crisis that has to be a great thing.The domestic purposes benefit the unemployment benefit and the sickness benefit are now gone and three main benefits have replaced the seven categories that formed the previous benefit types. The three new main benefit categories are jobseeker support sole parent support and supported living payment. This is in addition to the young parent payment and youth payment we implemented last year in 2012. These changes are part of our efforts to simplify benefit categories and put a greater focus on work and new work preparation activities along with reinforcing social obligations. Job seekers will have work expectations set depending on their capacity whether it is full time part time or to be temporarily exempt in certain cases. For example when they have short-term illnesses they may be exempt from these work obligations.I would like to now move on to the Children’s Action Plan which comes from the Government’s white paper and includes more than 40 initiatives to better protect vulnerable children. I think everyone around this House actually agrees that children need to be protected from those who abuse and hurt them. This action plan is a key priority for this Government over the next year. We are driving extensive programme reforms to reduce abuse and neglect and we are already making progress with Children’s Teams active in Whangarei and Rotorua. These Children’s Teams support communities to better protect their children and this Government has set aside $13.7 million in operating funding over 4 years towards the cost of implementing this plan.In this country about 12000 Kiwi children are being cared for by wider family members because of either the death of a parent or family breakdown. Without these carers more children would be under State care so an extra $35 million has been set aside in the Budget this year to support these extended family members. This initiative is also part of the Children’s Action Plan in response to theWhite Paper for Vulnerable Children  and that has to be celebrated.The welfare system will always be there to help people in need. We have always said that. We will ensure that those people who genuinely need help will get the help. But we also believe that long-term welfare dependency can become a trap and we know that the dependency trap leads to limited choices and limited outcomes. We also believe that anyone who can work should be in employment or in training or at least looking for a job. Our changes have fundamentally altered the welfare system.ALFRED NGARO (National):Kia orana Mr Chair. The New Zealand Centre for Political Research and its commentators have said that the welfare reforms that have been introduced by this Government are some of the most significant since the Social Security Act of 1938—the most significant since 1938. Yet despite that what has actually happened is that these reforms have been welcomed and they have been embraced—they have been welcomed and they have been embraced. So what is the point of difference one may ask when listening to these speeches? What is the point of difference about these reforms that is truly making a difference? I want to share this. In 2007 the Rt Hon John Key in a state of the nation address said: “These are tough problems ….”—what we are facing; these welfare reforms—“But I have no intention of being a Prime Minister who tackles only the easy … But I can tell you that dealing with the problems of our growing underclass”—and our vulnerable families and children—“is a priority for [the] National [Government]”. He has kept that promise and these are the things that are making a difference.So here is the point of difference that is making a difference. On Friday I was out there visiting one of my constituents a Mr David Bruce. He has got cerebral palsy and I went to visit him at 54Pah Road in Epsom. He is in the hospital there. As I sat there with him the first thing he said to me was this—he pointed to his watch and he said I was 1 minute late for my appointment. I apologised for being 1 minute late. He could not speak well but then he motioned to me to come and sit down while he was there in his wheelchair. He began to speak to me and communicate with me—here are the things that are really important. In having a lifetime of disability he talked about the vulnerability and the protection of vulnerable adults. He talked about the potential of a member’s bill. What he started to say to me—and here is the point of difference that adds to this debate around social development—and what he was communicating to me was that he was not a problem to be solved but a potential to be realised. I knew at that point in time at that meeting with him—Hon Trevor Mallard: Take his cash to Skycity.ALFRED NGARO: This is what he was saying Mr Mallard. He was communicating this to me: “We are an investment. We are a potential to be realised.” The intent of this welfare policy is about an investment for the future for our children.But here is where it gets really ugly for the Opposition because as political commentators for the New Zealand Centre for Political Research have gone out—[Interruption ] That is right. They do not want to listen to this but here it is. An onlineNew Zealand Heraldpoll of 13450 voters showed that 58 percent of respondents believed that the reforms were—here it goes—sensible and about time. Only 13 percent thought they were totally unjustified. A Stuff poll of 8300 voters found that 52 percent thought that the reforms were needed and interestingly enough 21 percent thought they were not going far enough. What are these reforms telling us and telling the rest of New Zealand? We do not have people marching in the streets. We do not have people protesting. Instead what do we have? We have people who are saying that they welcome these reforms they are needed and they are positive because they are investing in the future of the young people and the families of our communities and of our nation.Here are some of the investments we are making. I have had constituents come to see me in my electorate office. One of the challenging issues is housing but there are also issues around budgeting. The extra funding and support of budgeting services of $1.5 million will help and it is on top of the $8.9 million so that we can ensure that budgeting services are meeting the needs. But that is not all. There ismicrofinancing support for people on low incomes. I sat down with a family with five children. They are struggling with their own finances. They owe money to five different finance companies. As we sat there together working through these issues we realised that the policies and the direction of the reforms will meet these very needs. We got the family to go to theŌtara Budgeting Service. We got them to be able to talk about these issues. In the long run these reforms will truly make a difference as well.The other thing we are doing is getting a better deal on the procurement of whiteware to make sure we do not have second-hand shoddy whiteware. We are going to have the opportunity for them to have whiteware which will make a difference for them. There is an extra $35 million for extended family members raising children. I have been meeting with grandparents with kin carers who have been working and looking after their grandchildren. This is much-needed relief. Often at times when there has been abreakup in the family and they have had some difficult times—MIKE SABIN (National—Northland):I am happy to pick up from where my colleague Alfred Ngaro has left off in the social development area. I want to talk about three important areas of significant change—in fact the biggest change in a generation by far. Those are the work around vulnerable children the focus on youth and the change in the benefit categories and the introduction of social obligations which should one would assume be a mainstay of the welfare system but we have had a welfare system that has got out of control over the years. Arguably although it will always be needed it does not serve the interests of those who need it most when it gets out of control. The bill is around $22 million per week for the taxpayer for some 320000 New Zealanders but the lost potential in those individuals is capital that we can never really put a price on.The changes around youth which we dealt with as a Social Services Committee last year deal with the 14000-odd teenagers who are in that gap between education and training and employment. They have fallen into that gap. What we know for those individuals is that if we do not do something about them the chance of them finding their way on to an adult benefit and staying there for a significant period of time is very very high. It is an unacceptable situation. The wraparound supports the payment card system the mentoring system the interventions that have been put in place there are about upfront investment in those young people who have often had a very challenging upbringing and ensuring that we do as much as possible to make sure that they are in employment in education or in training and that they are ready willing and able to take up the opportunities when they appear—and of course they do.One of the things that we cannot legislate for is attitude. One of the difficulties that we see with young people today is that a lot of them unfortunately do not share the attitude that their parents and grandparents have in that there is some expectation that society the community owes them something. I just want to share a little anecdote concerning my own family. My partner’s daughter left school late last year and is now doing a level 3 course in the sports and recreation area with the hope to go on and do a diploma and degree in that area. She was a 16-year-old girl at the time she left school. She has made her way. She found some accommodation she was boarding and within months had a part-time job to help cover the costs of her new life. She has now found her way into a promotion in that job as a waitress because her front-of-shop attitude her willingness to want to excel and do well needed rewarding. The employer is rewarding her. I can assure members that she is earning well above the minimum wage—considerably above what many others would expect.There is one reason for that and one reason alone. It is because she has got off her backside and has shown the attitude and the determination that says: “If I want something out of life I have got to go and grab it.” When they do employers jump up and say: “Yes I welcome you.” This is particularly relevant in my electorate of Northland where unfortunately we are dogged with a lot of people who think that the world owes them something and they do not have to meet it in the middle.We are doing a lot of work on that focus on youth. The benefit category changes introduce social obligations. Well there are social obligations in every walk of life—in sports clubs in the workplace and in the family. There is no reason why those social obligations should not exist for those who are dependent on the State for welfare because they are not in work. That is why they should be receiving welfare—because they are not in work not because they cannot find a job necessarily. They are not in work. What we need to do is to ensure that the settings are right for them to be in work and often drug use is a barrier to that so introducing drug testing is a positive in that. Ensuring that children are enrolled in early childhood education enrolled with a primary health organisation and of course getting their well child checks is a socialobligation that means everything to those children. Of course we will not be letting those who are on a warrant run around at the taxpayers’ expense to evade justice and to evade the police.But finally in terms of the Children’s Action Plan here is a Government that is doing something. Since 1999 and the inquiry into JamesWhakaruru the Labour Party has sat there and done nothing for year upon year. The Children’s Action Plan is a demonstration of doing not talking.Vote agreed to.Vote DefenceThe CHAIRPERSON (H V Ross Robertson): The question now is that Vote Defence stand part of the schedules.Hon Phil Goff: It’s the Ministry of Defence Mr Chairman is it not?The CHAIRPERSON (H V Ross Robertson): Well it has just got “Defence” here. There is Vote Defence Force coming up though Mr Goff—there is Vote Defence and Vote Defence Force. The question therefore is that Vote Defence stand part of the schedules.Vote agreed to.Vote Defence ForceHon PHIL GOFF (Labour—Mt Roskill):Every day in this Chamber as we look around the walls and at the plaques that are displayed there we can feel and take pride in the courage and the achievements of the New Zealand Defence Force. It is therefore with enormous sorrow that I witnessed at the estimates hearing on defence the enormous damage that has been inflicted on the New Zealand Defence Force by this National Government—by actions contrary to promises made at the 2008 election. I remember the campaign where the National Party was saying that it would strengthen the New Zealand Defence Force. It has done exactly the opposite. It has cut its funding it has weakened it it has demoralised it and people have left in droves. That is a real shame.What we have found—actually in one of the Minister of Defence’s answers to a written question although he denied it—is that the real operating expenditure on New Zealand defence has been cut this year. The Government has cut the operating expenditure for defence. The army and the navy have had $100 million taken out. That is not chicken feed; it is $100 million from the army and the navy. There was a $63 million cut in salary payments. Do you know how it got the salary payment cuts? It got them by cutting the New Zealand Defence Force by 1269 personnel since it became the Government. It never promised that at the 2008 election. It has cut the Defence Force and it has reduced the capacity of the Defence Force to act on our behalf. The Minister in the chair the Minister of Defence denied that last year and he denied it again this year but I have the actual transcript from the Foreign Affairs Defence and Trade Committee hearing. This is what the Chief of Defence Force said: “We’re accepting that that loss of people does degrade capability”. That is what Rhys Jones said. He has fronted up and admitted what the Minister would not—that the cuts have degraded the capability of the New Zealand Defence Force.It is not even just across the board. Anyone who has served in the military here knows that the vital ranks in the military are at the NCO level. The first lieutenant always depends on the sergeant. It goes back a long time in history. It is the warrant officers. Do you know Minister that at the warrant officer level the attrition has increased fivefold since your party became the Government—fivefold attrition at awarrant officer level? It takes 15 years for somebody to get to that level and develop the skill and the experience they need. That is what this Government has done.In 1 year the Government increased the attrition of the New Zealand Defence Force from 8 percent to 21 percent. Between one in four and one in five in that year alone left the New Zealand Defence Force—a level of attrition never seen before. To misquote Churchill never in the history of the New Zealand Defence Force have so many people left in such a short period of time. That has damaged our Defence Force.Forget the party politics; let us have a look at what the Auditor-General says about that because she put out a report in the last year. She said that the Government has damaged the bonds of camaraderie integrity and commitment that are part of the New Zealand Defence Force—damaged those bonds. She said that the Government has chosen “a course that led to a drop in morale and an increase in attrition resulting in reduced capability.” The Chief of Defence Force says there is reduced capability the Auditor-General says there is reduced capability and the Minister says no it has not affected what the Defence Force can do. Who do you believe? Do you believe the Chief of Defence Force or do you believe the Minister of Defence who is making excuses for his Government’s own inadequacy?The Auditor-General said that civilianisation had been a disaster. She said that actually people were treated in a way that was almost a calculated insult. Do you know that the people who were being made redundant got letters? Those letters—I will not take up time but I have got them here and I can table them if you want to read them—told people who were being dumped from the Defence Force to save money that they were being dumped because they lacked commitment they did not have potential and they were not as good as their peers. That is what it said in blunt terms. The Defence Force hung its head in shame and said: “Yes we told good people they were bad.” So Minister you have made hundreds of people redundant and you have told them through the Defence Force that it was their own fault because they lacked commitment and they lacked potential. Come down to the RSA and talk to some of the people who have served for 10 or 20 years who have been made redundant. Your Defence Force leadership Minister said that they were being made redundant because they lacked commitment. These are people who have given their lives to New Zealand and that was the loyalty that was reciprocated to them.I want to say that when you put the Defence Force under pressure that puts lives at risk and well-being at risk. I want to draw on the court of inquiry report into the death of Corporal Douglas Hughes. Do you know what that court of inquiry report told us? You will know this only because I am telling you. The Government will not release the court of inquiry report. The Hughes family wants it released but the Government will not release it. Do you know what it said? It said that it cut the pre-deployment training going into Afghanistan from 5 to 3 weeks. Outcomes were not achieved. The Defence Force rushed through things like stress management and stress identification. The report said that the commanding officer and the warrant officer were not confident that people were adequately trained but they had no choice but to deploy them. It said that the deployment went on for 2 months longer than it should have and that people were exhausted at the end. It said that the forward operating base at Romero did not have enough defibrillators so if there were mass casualties they would not have been able to cope. And the Minister will not admit to those things.Do you know what they did at the select committee? It was really interesting. They got poor Lieutenant Colonel Brett Wellington who was the commanding officer of that crib up to the table to try to rebut what I was saying. But I have got the transcript in my hand of what he said. Here it is. Lieutenant Colonel Wellington said: “I believe the pre-deployment training was reduced and it did put pressure on us in respect to achievingthe competencies that we would ordinarily achieve before deploying overseas.” I asked him whether he was misquoted in the court of inquiry report. He said no. We had Gerry Brownlee in this House speaking on behalf of the Minister and he said I was wrong. Here is the commander of the crib at the select committee saying exactly what he thought. I asked him about the risk of the longer deployment and he said: “Yes. Me and my commanders had to manage that risk and we did that in several ways.” I asked him whether the court of inquiry was right about the Romero operating base and he said: “Absolutely. We would have been challenged if we had mass casualties.” Is that good enough Minister? Is it good enough when we put the lives of our people serving our country at risk in Afghanistan that you cut corners and they cut corners? That court of inquiry said it and that is why the Government continues to suppress it.I want to go on to another aspect of another court of inquiry and the impact of low morale and high attrition because that does create greater potential for mistakes mishaps and things not being done well. Private Michael Ross died in the lake nearWaiōuru last year. The court of inquiry report in this case was released. It said it was not a freak accident. It was not even an accident caused by a couple of errors. It was an accident that was absolutely avoidable. It listed the things that the Defence Force was not doing well that led to his death. There were 12 different things Minister 12 different causes. You have a life jacket where the canister is empty and it does not inflate when you are carrying aminimi machine-gun and it drags you to the bottom. The life jackets were not fit for purpose. They had never been trained in the use of the life jackets. The life jacket was not inflated properly and that caused the accident. The safety boat was not alongside it and when it turned up it had one person not three people. There were 12 major errors. That is a sign Minister of a Defence Force that is dysfunctional. It is dysfunctional because of the pressure that this Government has put on it and that is a disgrace.I am really proud of the men and women who serve in our Defence Force but they are not being treated well. Their loyalty to New Zealand is not being reciprocated by the Government’s loyalty to its men and women in uniform and that simply is not good enough.I want to finish on this point. It came out over the weekend that the defence operating manual said that someone was subversive if they brought the Government into disrepute. I guess I have just been subversive. Worse still it said that journalists were subversive because they did that. How did the Minister of Defence respond? First of all he would not front up and when he did front up—and I heard him onCheckpoint —he wanted to know who had leaked the document. He did not express outrage that this document which has been around for a number of years had that clause in it; he wanted to know who leaked it.Hon Dr JONATHAN COLEMAN (Minister of Defence):I feel very lucky that I have come down to the Chamber and happen to be here because that was a speech that needs knocking back. It was a speech that quoted many things out of context. It was a sad speech actually from a once-good Minister and a once-good member of Parliament who has frankly seen much better days. Frankly it was a shabby—Hon Phil Goff: I am sorry to interrupt the Minister but since he has questioned my integrity and what I quoted I seek leave to table the entire transcript of the estimates hearing before the Foreign Affairs Defence and Trade Committee a couple of weeks ago.The CHAIRPERSON (H V Ross Robertson): Is there any objection to that course of action being taken? There is none.Document by leave laid on the Table of the House.Hon Phil Goff: Secondly I seek leave to table the document from the Auditor-General that makes the points about the drop in morale and increase in attrition resulting in reduced capability.The CHAIRPERSON (H V Ross Robertson): Is there any objection to that course of action being taken? There is none.Document by leave laid on the Table of the House.Hon Dr JONATHAN COLEMAN: It was a sad speech because that member continued to quote selectively from the select committee transcript and he made many points that actually were refuted at the select committee itself.Hon Phil Goff: The Minister said I was correct. It’s in the transcript.Hon Dr JONATHAN COLEMAN: I think what this man is doing is continuing to undermine the morale of our troops.Hon Phil Goff: No no this Government has done that.Hon Dr JONATHAN COLEMAN: The fact that now he will not let me speak and he is determined to try to shout me down actually proves the point. Phil Goff is no longer a member who deals in facts and that is very sad. What he said there was that the Government has cut funding in defence. That is actually incorrect. We had this debate at the select committee. It is absolutely true. If anyone goes away and reads it they will find that Phil Goff was taking figures out of context and he was twisting them. In actual fact there was not a cut.When we talk about the numbers in the Defence Force Phil Goff knows full well that there was a defence white paper in 2010 and that it looked at the priorities that the Government set for defence and it looked at the force configuration that is needed. The number of 8500 people across the three services that we have full time is actually the number that is needed to act on the Government’s priorities so for him to continue to make out that there have been deliberate cuts in numbers to save money is plain wrong.The other thing that he continues to state is that there are issues around the training of troops in Afghanistan. He mentioned specifically Lieutenant Colonel Brett Wellington who took the stand and said that our people were well trained in Afghanistan on that crib mission when he took command. It is a bit sad really that Phil Goff is out there trying to stir up trouble exploiting the deaths of soldiers like Private Ross and Corporal Hughes to make political points because he knows that many of the facts he is quoting—or so-called facts—are absolutely incorrect.He was talking there about the Defence Force order that listed journalists alongside extremist groups and foreign intelligence services but what he forgets to tell you is that for the whole time he was Minister of Defence that order was there and that that order was signed by the Labour Government. So anything you hear from Phil Goff you have to know that he is a sad disillusioned member who frankly at his time of life and at his trajectory in his career should be leaving. What I will tell you here—Darien Fenton: Now he’s started being nasty. Here he comes “Mr Nasty”.Hon Dr JONATHAN COLEMAN: Darien Fenton calls me “Mr Nasty”. Well that is an interesting one. What I will tell you is look all defence forces internationally have faced challenges across the Western World. We have been operating within fixed baselines. We have a plan that has actually moved resources from the back of the office to the front line. We have been funding troops and we have been funding capabilities—just like Tony Ryall has been doing in health—and it has actually been incredibly successful.What are we doing? We are bringing new capabilities to the front line: new helicopters we are opening a new SAS training base—Hon Phil Goff: Oh come on. Come on I ordered and paid for those.Hon Dr JONATHAN COLEMAN: —we are funding the operation of those. Oh it is all Phil Goff again. Here he goes. Phil Goff says he paid for them; it was not the taxpayer. These are the rantings of a sad has-been. He knows it has all gone. He knows he will never be a Minister again. It has all disappeared. But I think it is time that Phil Goff started to back our people because there are two versions of the truth: there is Phil Goff’s version and there is what actually goes on at the front line with our defence people. If you talk to defence people they will tell you that it has been a period of change but they are very focused on the future.It is sad really because there was once a time when Labour took a bipartisan approach with National on defence and security matters but now it seems that Labour members are soelectorally desperate that they will grasp any opportunity to try to make political hay. I am especially disappointed in Phil Goff. When you see the Government Communications Security Bureau legislation Phil Goff knows that that is legislation the Government actually needs to push through for the security of New Zealanders. He has been a Minister of Foreign Affairs and Trade and he has been a defence Minister yet he weakly sits back and chooses to play politics. He plays politics with everything.If you look at the Corporal Hughes case that he quotes which was a very sad case in Afghanistan and which is subject to a suppression order Phil Goff tells Parliament that the Government has suppressed the court of inquiry. I would love to release in public the full text of that court of inquiry but as Phil Goff knows—Hon Phil Goff: Invite me to and I will.Hon Dr JONATHAN COLEMAN: Well I invite you to release it but you will be breaking the suppression order Phil. You will be breaking the law and I very much hope that Phil Goff will be held answerable.Hon Phil Goff: I see but you’d love to release it.Hon Dr JONATHAN COLEMAN: I would love to release it because it would show what really went on. The problem with Phil Goff is that he continues to dance on the graves of our dead soldiers and that is a disgrace.Hon Phil Goff: I raise a point of order Mr Chairperson. For the Minister of Defence to accuse me of dancing on the graves of dead soldiers more particularly since I have lost a member of my family in Afghanistan is disgraceful and despicable. I take offence. I ask you to ask him to withdraw that comment and apologise for making it.The CHAIRPERSON (H V Ross Robertson): Thank you Phil Goff. I understand the situation and I would ask the Minister to withdraw that comment.Hon Dr JONATHAN COLEMAN: I withdraw and apologise. But this is very much the point. Phil Goff can stand there calling me a liar and a person of low integrity. I am happy to accept that from him because this is a robust parliamentary environment. But once you start telling the truth about Phil Goff he gets very upset. He gets very very upset; he cannot handle it. He talks about attrition in the Defence Force. I can tell you that attrition in the Defence Force is lower than it was at its peak under Labour when Phil Goff was defence Minister. Morale in the Defence Force is higher than it was at its worst when Phil Goff was defence Minister.I would be very happy to work with Phil Goff because Phil Goff is actually not a bad guy. You saw him up in Honiara last week. We had a good discussion. To be honest we have robust debates in here but I just wish he would be a bit more bipartisan. I wish he would back our people in Afghanistan. I wish he would not be totally trying to undermine people all the time and undermining the Defence Force. Frankly in the end it does not reflect well on Phil Goff. We know—and Phil Goff secretly will agree—that both of our parties want what is best for the Defence Force. We know that our people do an excellent job. I wish our Labour colleagues wouldactually get behind our people in the Defence Force because personnel tell me that they are sick of hearing of Phil Goff’s rubbish.It has been a time of change in the Defence Force but the Defence Force is going forward. It does not need politicians constantly trying to undermine the very good work our people have done in the Solomon Islands in East Timor in Afghanistan in the Sinai in Korea in South Sudan. We need the Labour Party to actually back the National Government in defence policy and to take a constructive approach looking forward. So Phil Goff my message to you is do not distort the facts and do not quote selectively from that select committee report. Just tell us what your Government would do differently because I know that actually your Government would not respond to these challenges any differently. The fact is that morale now is a lot higher in the Royal New Zealand Air Force than when you cut the Skyhawks and the Strike Wing back in 2000.Hon Phil Goff: Remember you promised to bring them back. Have you?Hon Dr JONATHAN COLEMAN: I have never made any such promise.I can tell you that we have an excellent Defence Force. We have great people. The Labour Opposition needs to shut up and listen during these debates and get up and make some positive contributions when we are talking about defence because we have got very good people there. The future is good for defence. The Government totally backs the New Zealand Defence Force. The feedback I am getting is that our people in defence are looking to the future and looking to make a very strong worthwhile contribution to New Zealand’s future.Vote agreed to.Vote State Servicesagreed to.Vote Foreign Affairs and Tradeagreed to.Vote Official Development Assistanceagreed to.Vote Sport and Recreationagreed to.Vote CorrectionsLe’aufa’amulia ASENATI LOLE-TAYLOR (NZ First):Talofa lavamalo lesoifua. In the 2012-13 Budget for corrections the National Government declared that it would invest $1.5 billion in corrections. This time around the 2013-14 Budget spending on law and order is a deal-breaker for a majority of voters and the Department of Corrections and the Minister in charge are trying to give false assurances to the voting public that criminals will not get just a simple slap on the wrist.Remember the 43 criminal offenders who managed to destroy monitoring services and escape security surveillance by the Department of Corrections in the span of 1 year? I hope members do. These offenders make our security system seem like a joke with reports nearly every week of someone escaping from custody or destroying a monitoring device. We need to send a clear message to these offenders that our prison security devices and surveillance systems are not a joke nor should they be compromised. More important when it becomes potentially dangerous for our local communities the department needs to be made accountable for ensuring public safety. We need to enhance security so that offenders do not escape prison or community service sentences. We should enforce tougher penalties where any offender found to have destroyed a security device is sentenced to a minimum prison sentence and is denied the softer option of home detention.Let us reflect on the recent case of a man who was sentenced to 9 months’ home detention and made to serve 300 community hours for importing class B drugs throughour ports. How is this sending out a message that we are going to get tough on criminal behaviour? How are we going to deter criminal behaviour if we are sentencing men like Manuel Sadler to 9 months’ home detention instead of imposing the maximum penalty of 14 years’ imprisonment? Let me also mention that this man is a repeat offender. More needs to be done to ensure that criminals like this are caught and serve jail time. We cannot afford to give these criminals a slap on the wrist and send them home. What kind of a message is that sending to our community? This sort of behaviour has the potential to destroy lives and encourage further criminal activity.In order to combat criminal activity the Government needs to ensure that it sticks to its promises and makes our police more visible. I find it unacceptable that police numbers have fallen from 8940 in June 2012 to 8721 in February 2013. I wonder what is going on here. Has the Government been cutting back on spending in order to balance its books and put a halt on recruiting new cops? I know that this is about corrections but the people whom the police actually deal with end up in our corrections system. In 2008 the Government committed $18.5 million to recruiting training and employing extra police staff. As police numbers have been falling where has this money been diverted to or hidden?I actually have some grave concerns about the way our corrections system has been managed. I believe that it needs more resources and better funding and we also need to know which areas of corrections the funding is going to be spent in. If the Minister of Corrections wants to ensure that serious domestic violence offenders are monitored 24/7 then we cannot afford to have lower police numbers and to diminish their visibility in our community nor ignore the need for our corrections staff to get better training and sufficient resources. If this is going to work we need to strengthen front-line staff and police numbers instead of weakening their visibility and effectiveness.Crime rates may have fallen but that does not mean that all crimes have been reported or recorded. Criminal activity is not a seasonal thing. It is constant and can occur at any time. In fact the number of sexual assaults has risen. Moreover no one can truly give an exact estimate of the number of domestic violence disputes that occur nationwide. Unreported domestic violence is estimated to be very high which indicates a need to monitor serious domestic violence offenders 24 hours a day 7 days a week in order to save more lives especially for battered women—and for some men—who are not reporting these assaults. We need to be firm but fair.Vote agreed to.Vote PoliceTE URUROA FLAVELL (Co-Leader—Māori Party):Tēnākoe Mr Chair.Tēnātātou katoa. The report of the Law and Order Committee took me by surprise from the opening statements of the Minister of Police. Minister Tolley talking about the aspect of visible policing had this to say: “public confidence has never been higher. So public confidence and trust in the police is the best it’s been.” Unfortunately for Minister Tolley someone in the department forgot to point out to her the recent research released on the New Zealand Police website published just 2 months ago in May 2013. The study in questionBuilding Diversity  was undertaken to explore factors that influenceMāori to apply for and join the New Zealand Police. The researchers NanWehipeihana Elizabeth Fisher KellieSpee andKatarainaPīpī put forth evidence that utterly challenges the basis of MinisterTolley’s hope for public confidence.Let me share some of the comments in the study that reveal poor perceptions of the police withinMāori communities and a lack of trust and confidence in the police in policing and therefore in having a job with the police. People who were going to be recruited and iwi liaison officers at the time both talked in particular around theTūhoeoperations. One recruit said this: “You’d want to haveMāori Police officers on the ground right in there but then I wonder if we could influence the way things were done. Not sure we could have a say or be heard. Think we might just get swept away beneath Police procedure?”. That was one recruit. An iwi liaison officer had this to say: “The perception of Police by our people was not helped by Operation 8—theTuhoe incident. This cast a negative light on Police”. Another iwi liaison officer said this: “There’s a lack of trust and confidence in what is essentially a Pakeha organisation”. So it is no surprise that theMāori Party comes to this debate extremely keen to see how the ongoing issues of a lack ofMāori confidence in police are dealt with in the context of this estimates bill.Just to remind those who may well have forgotten last month the Independent Police Conduct Authority report found that in some areas police acted “unlawfully unjustifiably and unreasonably” during the raids of 2007. The Independent Police Conduct Authority judge David Carruthers said in the report that the detention of the occupants at five properties of 41 properties raided was “unlawful and unreasonable”. Police were also criticised for the unnecessary stopping and searching of vehicles and taking 66 photos of drivers and passengers including children. It left some people feeling “degraded and intimidated”. Just a month ago I raised these issues in the House speaking about the trauma of many people who were raided which had still not actually been heard. I then went to theMāori Affairs Committee and asked its members to consider the opportunity to listen to the voices of those affected by Operation Eight to commission an inquiry into the impact that Operation Eight had onRuātoki andTāneatua residents—no cigar no cigar. Neither National nor Labour would agree.So now here we have an opportunity to expose the New Zealand Police to the scrutiny of the public to see how they are dealing with the longstanding issues of injustice and inequality. So what does the Law and Order Committee report tell us? Three things. Firstly it describes the Australian Police recruiting New Zealand officers in 2012-13. Secondly it reports with great excitement about the use ofiPhones for collecting and communicating information. Thirdly the committee asked questions of Deputy Commissioner of Police Mike Bush regarding his comments at a former police officer’s funeral. Just wait on a minute. This is all supposed to be breaking news in response to the issues of injustice and inequity of unlawful and unreasonable actions by police in respect of Operation Eight which is meant to restore the faith and confidence in police and we are talking about cellphones.In case there is any doubt about whether the police have a very real issue around public confidence and faith then we need to look at the advice of the United Nations and in particular the findings of the United Nations Committee on the Elimination of Racial Discrimination. That committee not just this year but back in 2005 as well has condemned this country for the disproportionately high rates of incarceration and overrepresentation of members of theMāori and Pasifika communities at every stage of the criminal justice system. Just putting that into the context of the policeMāori now comprise more than 40 percent of all police apprehensions despite being only 15 percent of the population. Is anybody actually worried about that? Well it seems that iwiMāori are.Six months ago a plan drawn up by Te ArawaNgāpuhiNgātiWhātua and Tainui and strongly endorsed by iwi leaders around the country was released to the world. For the education of the Committee that plan was called Turning the Tide and I want to share some of the thoughts—perhaps better phrased as the frustrations—of iwi in getting this strategy even off the ground in the first place. One of the members of theMāori Focus Forum is Dr ApiranaMahuika. He said that in 1996 he laid down achallenge to the police on behalf of iwi. He said: “Etū ki te kei o te waka kiapākia koe engāngaru o tewā.”Stand at the stern of the waka and feel the spray of the future biting at your face. What he was referring to in those words was that mostMāori who are victims or who are directly involved in crime are under the age of 25 years. In the words again of DrMahuika: “With our population of young people growing if we do nothing then even more Maori will end up in hospitals police cells courts and prisons.” He closed by saying: “We can’t let that happen.” I share these words with our leaders in the Chamber today because this is very very important. This is about shaping our future. It is about setting the directions for tomorrow. Should we not be interested in that? Surely.What we know is that iwi around the country are serious about working with the police to make a long-term change. What we know also is that the United Nations committee urges New Zealand to intensify its efforts to address the overall representation of members of theMāori and Pasifika communities at every stage of the criminal justice system. The committee even suggested that this can be done best by addressing the existing structural discrimination. So what do the police appropriations estimates say on this critical issue? Well it talks aboutiPhones.I want to remind the Committee that Operation Eight showed the ingrained system-based racial discrimination within the police force. Justice has not been served in the eyes of theMāori Party nor indeed in the eyes of the frightened children andwhānau thehapū and people ofRuātokiTūhoe andTāneatua. The police need to recognise and acknowledge their failings and to take steps to rebuild that broken relationship. TheMāori Party wants to see a system whereMāori do not have to fight for justice where institutional racism is confronted and addressed.For those members and indeed the public listening to this broadcast this afternoon I say that I recently read a book calledThe Prophet and the Policeman  which talks very much about RuaKēnana Te Kooti and a person by the name of Cullen a policeman who was the first New Zealand police commissioner in this country. It is a very good read and would set the scene for I suppose understanding why it would be that the people of theTūhoe nation and indeedMāori feel a little bit disgruntled that there is no admission and no moving forward by the police in respect of what happened in Operation Eight to at least acknowledge that they did not get it right and that they could have done things better. Under those conditions it is a good read about history but it is almost like history repeating itself if you read it today. I hope members of the Committee will be able to take that opportunity. The book is calledThe Prophet and the Policeman . It is out of the Parliamentary Library. I would recommend it as a very good read. Kia oratātou.JACQUI DEAN (Chairperson of the Law and Order Committee):The Minister in the chair Jonathan Coleman was right in his earlier intervention when he noted that it was a strong focus of this Government to move resources out of the back room and on to the front line. It is true in terms of the New Zealand Defence Force but it is also true in terms of the New Zealand Police.The Prevention First strategy is working extremely well in New Zealand. Crime is down. One of the most important features of the Prevention First strategy is that policing is now different. Gone are the days when the police constable sat behind a desk in a small suburban or small rural watch-house waiting for business to come to them using their own cellphones in latter years to take calls if they did happen to be out in the squad car and responding normally after an event had occurred—after a citizen had phoned because they were feeling a bit insecure in their home and then waiting waiting waiting for the police to take a note of it or having to go into the police station and wait for some response after the event.I want to give a couple of examples of how Prevention First is working for New Zealanders. One of them is the example of a lady who came to see me in my electorate office—an older lady. She was cooking her dinner at 6.30 in the evening. It is dark these days and there was a knock on her door. She looked through the curtain to see who was out there and she saw one man there—a large man. She asked him to identify himself. She was not happy with the response he gave so she declined to open the door and told him to go away. She was very upset and worried about this and so she rang her neighbours and yes this man had knocked on their doors as well. She was then advised to ring the police. She did that she noted her concerns that she felt unsafe for herself and her neighbours and she hung up the phone. She went into her sewing room got one of those wooden rulers that older folk will remember and started fitting it into herranchslider to make her house more secure. She looked up and there was a constable looking in through theranchslider at her. He had got the call from the station. He had come directly around to her place and he had got himself in and said “Right let’s have a look at your security in your home.” He did that he visited the neighbours she felt more secure her neighbours felt more secure—that is Prevention First at work.The second example I want to talk about is the use of technologies. There has been a major roll-out ofiPads tablets andiPhones. So the constable from the Geraldine Police Station—another part of my area—no longer sits at his desk waiting for the phone to ring and for business to come to him. He puts hisiPad under one arm he puts his iPod in his top pocket he starts walking down the streets of Geraldine and he talks to people. People come up to him pass the time of day pass comment and you know share their concerns with him. He is out there doing what a good policeman should do and that is Prevention First. It is getting in front of the crime in New Zealand which is why crime numbers are dropping significantly in New Zealand.This change in policing that is having such a good effect on crime in New Zealand and making people feel safer in their homes—which in my view is very important—seems to have escaped some members of the Law and Order Committee who seem to still be of the view that neighbourhood police stations which are visited by a member of the public once or even twice a day or even less should continue to be manned. Let us have a choice here. Should we have neighbourhood police stations which are hardly ever used with the police constable sitting in there waiting for the customer to come to them? Or should we have proactive members of the police out and about armed with the technologies they need to do their work so that they can not only respond immediately as people need them out in the community—they can be visible out in the community—but also do their work out in the community? To me it is a complete nonsense to hang your hat on the number—MARK MITCHELL (National—Rodney):It is a pleasure to take a call today. I would like to talk about police leadership and then I would also like to talk about technology and how that has made our police force as the previous speaker Jacqui Dean said a different police force a more modern police service. But firstly in relation to the leadership as a new member of Parliament sitting on the Law and Order Committee when we had the Minister of Police in front of us Police Commissioner Peter Marshall and his two deputiesViv Rickard and Mike Bush I was extremely disappointed and to be honest with you shocked to see the treatment that was dished out to Deputy Police Commissioner Mike Bush by a Labour Party member Trevor Mallard.I would just like to read a little bit about Deputy Police Commissioner Bush and the service he has provided to New Zealand over a career that began in 1978: “Mike Bush has risen through the ranks after graduating from police college in 1978. He was in Thailand as NZ police liaison officer ... at the time of the 2004 Boxing Day tsunami. ...He’s brought down international drug rings led a desperate race to find a kidnapped five-year-old and solved every murder case he’s ever been assigned. ... After 33 years in the force there isn’t much Bush hasn’t seen—from a $100 million methamphetamine drug bust right through to solving grisly homicides. Beginning his career in Kaitaia he went on to take charge of Interpol in Wellington and headed North Shore CIB and was later crime manager of the Bay of Plenty district. Before becoming district commander for Counties-Manukau in 2008 he was crime services manager forWaitemata district. He solved every murder he’s investigated—including the mystery of what happened to 49-year-old electricianStavrosStavrianos murdered in his Auckland flat in 1999. The case was solved even though all the detectives had to go on was a tiny piece of his skull found in the plumbing of his Green Bay home. ... As an operation commander in 2008 he saw the safe return ofXinXin Ma to her relieved family. The little girl was snatched outside her Albany home. Ninety-nine hours later officers swooped on a property and found her hungry dehydrated and tied up in a wardrobe. Bush was awarded a prestigious silver merit award for the rescue. But he’s bashful about his role praising ‘the commitment of the whole team.’ ” He said that they had 45 staff. “ ‘You’ve never seen a more committed group of people to try and find a little girl and track down a lead.’ … It wasn’t the first time his calm measured approach was called on. Between 2003 and 2007 he was New Zealand’s police liaison officer in Bangkok. Within hours of the 2004 Boxing Day Tsunami he was inPhuket—the first Kiwi cop on the scene. Amid devastation and chaos he took control reassuring anxious families reuniting them with their loved ones or helping identify the dead. Five New Zealanders were lost and when the scale of the disaster became apparent Bush led Disaster Victim Identification teams for nine nations. When it was over he was honoured by the Queen for his role.”Tim Macindoe: Well deserved.MARK MITCHELL: Absolutely. He is a man who has provided extraordinary service and has been willing to risk his own safety for this country. Yet on Wednesday 12 June I sat on a select committee and watched a politician not only criticise and attack him but also threaten his job. I have to say that I was ashamed and disgusted by that behaviour. I am sure that Mr Mallard would like people to recognise the service that he has provided to this country and I can tell you now that what Mr Bush was being accused of was making a eulogy for the family at a dead colleague’s funeral—someone who had served this country for many many years. He was not being accused of punching or assaulting another member of Parliament. He was not being accused of scalping tickets. He was accused of making a eulogy. So I would like everyone just to reflect and think about that for a moment.I would also like to talk about the use of technology. Technology is a huge part of what the police service is embracing and using—Vote agreed to.Vote Serious Fraudagreed to.Vote ConservationNICKY WAGNER (Chairperson of the Local Government and Environment Committee):The Department of Conservation manages 8.5 million hectares of conservation land on behalf of all of us 4.4 million New Zealanders. It also welcomes over a million and a half visitors to its 24 visitors centres 970 huts 1400 kilometres of walking tracks and 1750 toilets. It manages 13000 square kilometres of marine reserves with huge new subantarctic island marine reserves five new West Coast marine reserves and one at Akaroa in the pipeline.The department undertakes some fantastic environmental initiatives and supports over 550 community conservation projects including some that do pest control biodiversity projects the restoration of historic sites and the promotion of New Zealand’s wonderful great outdoors. That is the promotion of walking tramping climbing hunting and in more recent times the promotion of New Zealand’s nine Great Walks on an international scale in partnership with Air New Zealand. It does all this on a budget of just over $444 million and even then it manages to generate $17.5 million of Crown revenue.There have been considerable changes and improvements to the department over the past year. I would really like to start by acknowledging the work of the Director-General Al Morrison who has worked with the department for 11 years and for 7 of those years he has been the Director-General. He resigned in April to take up a job with the State Services Commission and we really want to thank him for the work he has done and for his total commitment to the department in that time and we wish him well in his new position.The department has also completed an extended period of reorganisation to prepare it for the challenges of the future. What it has done is divide the department into two distinct operational groups. One is focused on traditional conservation field work. That is work that the department is particularly good at. It is important work and greatly appreciated by New Zealanders. Despite staffing changes the numbers of the front-line staff will increase in this area from 866 to 915. The other group is working on developing new conservation initiatives in partnership with other organisations. These are exciting new projects that are being developed and they are projects like ones that we know such as the project between Air New Zealand and the Department of Conservation which is a collaboration to support the survival of endangered species. Often species have to be transported from one environment to another if they are going to survive and Air New Zealand is working in partnership with the department to provide the means of that transport transporting threatened birds or wildlife around the country and even sometimes back again for reintroduction.There is another interesting project collaboration with theDulux paint company. This is a partnership to work with the department and volunteer groups to repair and repaint huts throughout the conservation estate and that has really caught the imagination. It was onBreakfast . People are out there having a good time doing some working bees and getting these huts improved. We have got the BNZ kiwi protection programme and we have got the RioTintokākāpō recovery projects. All these projects have a double benefit. They increase the amount of conservation projects that are out there in the environment but they also engage businesses and their staff in supporting our clean green image.Over the past few years the engagement between the department and volunteers has increased dramatically. New Zealanders really do enjoy working with the department and in the last year they donated over 32000 volunteer days. Again it is a win-win situation. New Zealanders get out there in the outdoors and they get involved with the environment and conservation projects. The Department of Conservation has also been working on upgrading and redeveloping many of the department’s camping areas and huts—Vote agreed to.Vote HousingDENIS O’ROURKE (NZ First):I think the National Government’s housing policy is a mess and housing in New Zealand is in deep crisis. There are severe housing shortages especially in Auckland and Christchurch and homebuyers especially first-home buyers cannot afford to buy a house. In a home-owning democracy which New Zealand has always been this is a national disgrace. In Auckland there is a need for at least 10000 new houses per year probably 12000. There is already a housing deficit there of well over 30000 houses and growing and under the Government’s plans there is a probability of no more than 10000 new houses per year. So on that basis the Government’s plan will never catch up. The Government’s plan is obviously a failure but the worst is that young people seeking a first home will not be assisted by this Government to get a home of their own under its “too little too late” policies.To make matters worse it is highly likely that the Reserve Bank will shortly limit the quantum of high loan-to-value ratio mortgages that the trading banks can make. High loan-to-value ratio loans will typically cover 80 percent or more of the total property value. The Reserve Bank seems to be arguing that the purpose of this is to improve overall financial stability. The higher borrowers are leveraged the greater the risk that a property downturn could trigger a major economic meltdown echoing the subprime mortgage crisis that generated the global financial crisis. So the Reserve Bank wants to restrict high loan-to-value ratio mortgages to avert the dangers of risky lending but I think this is a flawed policy.Firstly it is a second-best strategy. Normally the Reserve Bank would raise interest rates but it cannot do that without raising an already overvalued dollar and inflicting all sorts of damage on the economy. Secondly it will not actually work in practice because people can resort to all sorts of subterfuge to circumvent this restriction by shuffling money around. This has all of course happened before. Thirdly the Reserve Bank’s housing policy is Auckland-centric. Christchurch and elsewhere in New Zealand face different issues and the results are therefore likely to be patchy and inappropriate for much of New Zealand. Fourthly it will do nothing to deter property investors and speculators who have been buying up Auckland property and who also have ample equity. Fifthly it does nothing about the migrant flows which have been concentrated in Auckland. It does nothing to tighten immigration policy in areas such as parental reunion which have added significantly to housing demand in Auckland by we think something like 10 percent. That is a significant portion. Lastly and most important its impact will fall most directly on first-home buyers. It is not the first-home buyers who are driving this bubble but they will be the sector most heavily penalised by limits on loan-to-value ratio lending. Perversely the policy may encourage them to seek the extra equity they will now need from potentially risky sources such as finance companies and this would of course add even more financial risk to the system.We in New Zealand First think the Government’s policies are overall to blame. The Government has acted far too late. Over the last 4 years the Government has allowed a housing price bubble to emerge in Auckland by its inept immigration and housing policies. Only a comprehensive housing strategy designed to address both demand and supply factors as advocated by New Zealand First will make housing affordable for first-home buyers. New Zealand First supports a broadly based housing policy that will make homeownership a reality again rather than a dream for working New Zealanders.New Zealand First’s policy to assist first-home seekers is to establish a new State agency to acquire land to create a land bank in areas where demand clearly exceeds supply and those of course are currently Auckland and Christchurch. The agency would sell residential sections of a modest size on the basis of long-term agreements for sale and purchase of up to 25 years to first-home buyers. This reduces the upfront capital cost of a new home by we think something like a third. Interest rates would be highly concessionary at 2 percent for an initial period of at least 3 years. Purchasers would build their own homes using normal bank financing and would have title to thesection transferred to them with the amount owing to the agency secured by way of a second priority land charge. The Government’s special housing areas are not enough—HOLLY WALKER (Green):Well there can be no doubt that we are experiencing a housing crisis in New Zealand at the moment. In my contribution I would like to start with some statistics that illustrate the scale of this crisis particularly in Auckland and Christchurch. In May the average house price in Auckland was $735000. It now takes 70 percent of the average income to service the mortgage on a lower quartile - priced house in Auckland and that is in a context in which unaffordability is understood to be when you have to spend more than 30 percent of your income on housing.We know that there is a major shortage of affordable housing in Auckland with an estimated 13000 new homes needed each year and only 3000 to 4000 being built hardly any of which fall into the affordable category. In Christchurch the situation is just as pronounced although more concentrated in the private rental market. TradeMe statistics show that the average rent in Christchurch was up 26 percent in the May to June period compared with the same time last year and demand for rental properties was up 47 percent.According to the Tenants Protection Association survey 70 percent of respondents had had a rent increase post the earthquake and 88 percent reported paying more than 25 percent of their income on rent. Christchurch homes we know are cold and mouldy with 48 percent reporting mould in their homes. Nationwide we know that 70 percent of the children who live in poverty in New Zealand are living in private rental homes and very few of these are insulated. Although these problems are most pronounced in Auckland and Christchurch housing affordability and quality are major challenges all over the country.So what did the Government propose to do about it in Budget 2013? Well we got the Housing Accords and Special Housing Areas Bill—reported back to the House today—and the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill. The former is an unimaginative and ideological attempt to increase land supply and fast track new housing developments by running roughshod over local democracy and the Resource Management Act. The latter is the beginning of the dismantling of Housing New Zealand as a social agency.There is no guarantee under the Housing Accords and Special Housing Areas Bill that any new affordable houses will actually be built as a result and the one positive element of the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill—the extension of the income-related rent subsidy to community housing providers—is undermined by the lack of adequate funding for the Social Housing Fund and the lack of Government support for capacity-building in that sector.Meanwhile you will hear the Minister of Housing crow about how Housing New Zealand is building more homes than ever—2000 new homes a year for the next 2 years if we are to believe the Prime Minister. But what he will not tell you is that Housing New Zealand is busy demolishing and selling houses as fast as it can build them. So those 2000 new houses will not result in any net increase in its stock of affordable housing and that is if it can even build them because it managed to build only 154 houses in the last financial year. We have got a long way to go before we start building 1000 a year in the next 2 years.I want to talk about what a smart Green solution to this housing crisis would look like. First of all we would start by building affordable houses as a matter of urgent priority both social and community houses and homes that are available for families to rent to buy as part of a progressive ownership proposal. This would see the Government building affordable homes for families with children to move into immediately. They could start paying a basic weekly rent to cover the cost of the investment while anythingthey paid in addition to that would go towards purchasing equity in that home. It is a way to help families into homeownership without the need for a conventional bank mortgage or deposit and it directly addresses the lack of supply of affordable housing.Secondly we would introduce a warrant of fitness for all rental properties—not only for State houses but also for the private rental market in which 70 percent of the children living in poverty are currently housed. This would have to include minimum insulation standards as well as other standards of liveability and weathertightness. We would help landlords to meet these standards by extending the Warm Up New Zealand: Healthy Homes insulation scheme and better targeting it towards landlords with low-income tenants.Thirdly we would amend the Residential Tenancies Act to ensure more secure rental tenure for tenants in order to stop the social economic and health damage that is done when frequent evictions require families to move sometimes dozens of times a year.PHIL TWYFORD (Labour—TeAtatū):Housing has definitely become a political headache for the Government but it is a nightmare for most New Zealanders who all around the country are saying: “Why don’t we have a Government that actually does something? Why doesn’t the Government that was elected in 2011 actually roll up its sleeves and build some affordable houses? Why doesn’t it actually protect the interests of New Zealand citizens?”. People are wondering why that is happening. We have after 4½ years of inaction by this National Government some of the most unaffordable housing in the world. Generation X and Y are locked out of homeownership. The most vulnerable people in this country are about to be booted off State house tenancies by this Government as a deliberate matter of policy. In Christchurch by the Government’s own reckoning up to 7500 people are officially homeless because this Government has taken a hands-off do-nothing approach to the post-quake housing crisis in Christchurch.What is National’s response to the housing crisis? What is its response? It has set a target of 39000 consents in Auckland and it has set up a mechanism to fast track new greenfields land in Auckland. Every single credible submitter who came to the Social Services Committee on the Housing Accords and Special Housing Areas Bill said to the select committee that this bill would not result in any more affordable housing being built. What a failure. What an absolute loss of credibility.National’s response such that it is is based on a trickle-down theory of housing. It thinks that if it simply encourages the building of more housing no matter what price those houses are somehow that will make housing more affordable. Well it is a pipedream. We do not buy it. All of the Opposition parties do not buy it. The Government’s approach to housing its philosophy to this housing crisis is basically to blame councils and trust the market. Well I think people see through that. People can see that that is simply not a credible response to a crisis on which New Zealanders are desperately wanting some bold and decisive action.It just does not have to be this way. It does not have to be the case that we have the most unaffordable housing in the world. It does not have to be the case that in Christchurch people are facing another winter of whole families sleeping in uninsulatedsleepouts or paying hundreds of dollars a week to rent a caravan in someone’s backyard. It does not have to be that way. We have choices. We have a choice between a do-nothing Government that wants to trust a failed housing market or an alternative Government that will actually roll up its sleeves and build affordable houses a Government that will change the economic settings that got us into this crazy housing mess that we are in now. The National Government refuses to contemplate adjusting the very economic settings that it has presided over for the last 4½ years. It refuses to tax speculators through a capital gains tax in a way that would take much of the speculative heat out of the housing market.We have an alternative. With ourKiwiBuild policy we will build 100000 affordable starter homes over 10 years with fine New Zealand building companies like Fletcher Building likeStonewood Homes and I could rattle off half a dozen others. We will build homes that people will be proud to live in for generations to come not as Bill English said yesterday in the House slandering the work of some of our construction companies describing their houses as being like the back end of Moscow.Labour in Government will tax the speculators. A capital gains tax that excludes the family home will go a long way to channelling investment into more productive economic development and away from overheating the housing market. We will restrict offshore speculators and stop them driving up the prices of New Zealand homes and outbidding New Zealand’s first-home buyers at auction. We will put a stop to it because unlike this National Government which stands on the side of speculators we stand for ordinary Kiwi home buyers and especially first-home buyers. We are determined to do something about the declining rates of homeownership in this country because we believe that homeownership is a good thing. We will adopt policies and we will change the economic settings that will make a difference and get Kiwi first-home buyers into their first homes. Singapore Hong Kong the UK and Switzerland have all recently adopted policies that restrict the activities of offshore speculators and Australia has had the very same policy in place since 1987. It is a good policy and it puts the interests of New Zealanders first.The Government has got itself into a terrible mess with the housing crisis. The controversy around loan-to-value ratio limits on home mortgage lending is a perfect illustration of this. John Key negotiated only a few months ago a memorandum of understanding with the Reserve Bank that gave the Reserve Bank the power to implement these limits on home mortgage lending. He gave the Reserve Bank those powers and now he stands there and cries crocodile tears for first-home buyers pretending to be surprised that the Reserve Bank actually wants to do something about the overheating of the Auckland housing market which is a risk to the macro economy.That is because this Government has refused to do anything about the forces that are overheating the Auckland housing market. The Reserve Bank quite correctly says that they are a threat to financial stability. It does not want homeowners to lose their shirts when the housing bubble bursts so of course it is going to use these loan-to-value ratio limits. If the Government was actually willing to do something serious about the housing crisis then these so-called loan-to-value ratio limits would not have such a huge impact on first-home buyers. That is why Labour is calling for a temporary exemption for first-home buyers while the capital gains tax kicks in and whileKiwiBuild delivers the affordable homes that will ease the supply crisis.National has mismanaged and run down Housing New Zealand—it has. Its restructuring of Housing New Zealand has been a fiasco. It has closed 24 offices. It has sacked 121 full-time workers. It changed the eligibility criteria so at the stroke of a pen thousands and thousands of the poorest New Zealanders suddenly became ineligible for a State house. In places like Gisborne on the East Coast and in Napier there are dozens and dozens of perfectly good Housing New Zealand houses lying vacant—lying vacant—while people who would have been eligible for a State house have been forced into the private rental market into overcrowded and substandard accommodation. That is a disaster. Housing New Zealand under this Government’s watch has botched the redevelopment in MaraenuiPōmare and northern Glen Innes. The Government has been running Housing New Zealand into the ground.Today at the Social Services Committee the internationally acclaimed team of researchers from Otago University’s health and housing research programme came along and told the select committee that the Government’s plan to impose reviewabletenancies on all 69000 Housing New Zealand tenants will create a public health risk. They have the data to prove it unlike this Government which has no evidence base for its policy of imposing reviewable tenancies on Housing New Zealand tenants.The Otago University academics made that point. Dr Michael Baker made an excellent submission showing the data and saying that Housing New Zealand tenants are some of the most vulnerable people in our society. They have very high health needs. State housing and social housing have a demonstrated positive impact on those people. They reduce hospitalisation rates. The children of families who live in Housing New Zealand houses are healthier and safer and better off than kids in families who are not in Housing New Zealand houses. Their research clearly shows that. By creating insecurity for some of the most vulnerable people in our society National is creating a public health risk. It will lead to increased hospitalisation. It will undoubtedly cause unnecessary deaths. This thoughtless negligent policy by National forcing reviewable tenancies on Housing New Zealand tenants will create social harm and social damage. It is forcing people out of State houses into the private rental market in the middle of the worst housing shortage in a generation.Otago University academics came along to the select committee today and they said that they could not see any evidence base for the Government’s Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill. Actually those very academics came along and presented an evidence base for the opposite of the Government’s policy of making Housing New Zealand tenants even more vulnerable and more insecure. I think that was a huge wake-up call and an indictment of this Government’s housing policy.MELISSA LEE (National):It is a pleasure to rise to contribute in this estimates debate. I would like to begin by saying that it is very rich for that member Phil Twyford to actually comment about this Government’s housing policy. When National came into Government back in 2008 the previous 9 years of Labour Government were known as the slum landlords’ years for the condition of the houses that people were living in. They were run down they were in the wrong place they were cold and people were getting sick. We know that good housing is important for the health and well-being of families. We know that and we had to put money into it—$347 million was spent on home insulation because those homes were run down. Labour mismanaged.The National Government is legislating right now to build more houses because we know for a fact that the single biggest influence on housing affordability is the lack of supply of new houses. Local councils actually play a big role in freeing up available land for housing across New Zealand. I think earlier some member talked about how we are legislating to consent 39000 new homes. They thought that was a bad thing and they were actually opposing it. Currently we consent only about 3600 homes. I would have thought that making more new houses available in order to reduce the cost was a good thing for new-home buyers—that having more available would actually create a situation where they might possibly pay less. The Labour Party in the meantime came out with that notion that cashed-up foreign buyers coming to New Zealand to buy our properties are bumping up prices. How very original—let us blame the foreigners! This is the kind of divisive politics where Labour really shows that it is in fact desperate. How pathetic and how offensive. I do really find that offensive because I often get mistaken for a foreigner because of the way I look. I think it is awful that Labour is playing these politics.There is very little evidence that shows that foreign buyers are the cause of house prices being bid higher. History has shown that we are pretty good at doing that ourselves actually. A BNZ survey shows that only around 3 or 4 percent of house sales are to foreign buyers. Unlike what Mr Phil Twyford tried to say overseas buyers couldalso get round Labour’s policy simply by finding someone else to buy the house for them and hold it in trust. It is absolutely ridiculous to blame foreign buyers when the biggest chunk of overseas buyers are actually Australians—but wait hang on they are exempt from the Labour policy. That is right. I could go on and on but I will stop by saying that Labour’s policy would also possibly clash with a number of free-trade agreements. Considering that Labour actually supports free-trade agreements I think that is ridiculous.The National Government is focusing on making a real difference to house prices. Take a look at Auckland for example. I know that Phil Twyford talked aboutKiwiBuild—“Phil Twyford Build”—saying that it can provide 100000 homes under $300000. I mean that is ridiculous considering that the average land price in Auckland is more than $350000. If you look at Auckland for example the housing market needs about 300 percent more new houses than we currently have which means that over 12000 new homes a year need to be built. The new Auckland Housing Accord will see 39000 new homes and that will go a long way in addressing that lack of housing supply.We are streamlining the Resource Management Act to reduce the red tape around building new homes introducing a 6-month consenting limit for medium projects and we have launched an inquiry into building material costs which often go towards the higher cost of building and higher price of homes. We want to keep interest rates low making savings for Kiwi families especially those moving into their first home. At the moment this Government has made sure that our interest rates are very very low. Comparing the rate that I currently pay which is the average price now with the rate that I paid when I first bought a house going back quite a long time ago—JAMI-LEE ROSS (National—Botany):The last group of people who should be lecturing this Parliament on housing affordability is the Labour Party because in the 9 years that Labour was in Government house prices increased around the country by 100 percent. In the time that this Government has been in office house prices have increased by 12 percent. If anyone knows about housing affordability it is members of the Labour Party.I want to take the opportunity to stand up for the 28000 people living in my electorate of Botany who were born outside of New Zealand because 28000 people in my electorate—49 percent of my electorate—are the type of people whom the Labour members opposite are saying are not welcome to buy houses in New Zealand. The Labour Party has taken a xenophobic attitude to housing. It is saying that foreigners who wish to move to this country invest in this country bring skills bring investment and by the way purchase a house are not welcome. I find that view—The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.Sitting suspended from 6 p.m. to 7.30 p.m.JAMI-LEE ROSS: Before the dinner break I was telling the Committee why the Labour Party has absolutely no credibility when it comes to housing—no credibility. When Labour was in Government it saw house prices increase by 100 percent whereas they have gone up by only 2 percent in the time we have been in Government. Labour has got no credibility. Its xenophobic approach to housing offends the 28000 people in my electorate who were born overseas.Dr Rajen Prasad: That’s a lie.JAMI-LEE ROSS: It should offend Rajen Prasad and it should offend the 49 percent of my electorate who were born overseas. But actually we know that experts in this area do not agree that Labour’s approach would do anything. They know that itwould be poor policy that would achieve nothing. Economists know it will achieve nothing. Real estate leaders know it will achieve nothing. People out there who are trying to buy houses know it would achieve nothing.But I thought the most interesting comment heard in the last 24 hours on this topic actually came from Len Brown someone whom David Shearer tries to say is a Labour mayor and one of theirs. I was onBack Benches recently with David Shearer and he was claiming Len Brown as one of their own. Actually Len Brown was on Radio Live today rubbishing the policy and telling Duncan Garner that the policy would do very little because Len Brown—the Labour mayor as Labour likes to call him—agrees with us. He agrees with us that it is about ensuring that land supply is increased because the problem in Auckland is a supply and demand issue. It is not an issue of foreigners coming into the country and trying to buy land.Le’aufa’amuliaAsenati Lole-Taylor: Yes it is.JAMI-LEE ROSS: The number of people wanting to do that is very small. Asenati Lole-Taylor was allowed to buy land. Why should not other people who are coming into the country be allowed to buy land? It is about ensuring more land is made available. The Labour Party wants to talk about another policy it has which is to get 100000 houses built over 10 years at a cost of $300000 a section.Hon Members: How much?JAMI-LEE ROSS: At a cost of $300000 a section. Guess what though? The average cost of land in Auckland is $325000 a section. So unless Labour is going to all of a sudden reduce the price of land it will not work. Unless it is going to absolutely subsidise the cost of these housing areas with taxpayers’ money it is simply not going to work. Here is another point: the Labour Party policy of 100000 houses over 10 years equates to 10000 houses a year—30000 houses over 3 years. This Government has promised 39000 houses over 3 years—9000 more than Labour has promised. Labour reckons it has all the big solutions. We have already got 39000 houses about to be built in Auckland. That is in Auckland alone and there will be even more across the rest of the country.The Labour Party has no credibility. House prices soared when it was in office. The Labour Party has a xenophobic policy that offends many many people out there in New Zealand who have come to this country brought skills brought investment and want to reside here and make this place their home. The Labour Party’s promise to build more houses actually pales in comparison with what this Government is already talking about. David Shearer wants to say that this Government does not walk the walk. Actually this Government does. We are increasing land supply we have got agreements with councils and we are working intensively to ensure that more housing will be made available in Auckland and around New Zealand. The Mayor of Auckland Len Brown agrees with us that Labour is wrong.MOANA MACKEY (Labour):One question forJami-Lee Ross: how many of those 39000 houses are going to be affordable? Not one. Not a single house—not a single house. National’s policy is to build 39000 “McMansions” that no one will be able to get into. First-home owners will be locked out of that market. That is National’s approach to affordable housing—affordable mansions for people who can buy them without any other support apart from maybe their families who can put their houses up as collateral. That is not a solution.Everything the National members have mentioned in this housing debate has failed spectacularly overseas. But the reality is that they do not care. They do not care that first-home owners are struggling to get into their first house in New Zealand. They do not care and that is why they have no intention of doing anything about it. Well Labour will. I say to Mr Ross: keep repeating the Labour Party policies over and over again likehe did in that speech because New Zealanders love them. New Zealanders want to see a Government that is going to take housing affordability seriously and Labour will. There will be 10000 affordable homes a year—that is 10000 young couples and young families getting on to the housing ladder the homeownership ladder in this country. That is a massive step forward for young families who are currently struggling and who are shut out of the housing market particularly in areas like Auckland where housing inaffordability is on a par with cities like New York. That is a policy that is actually going to make a difference unlike the rhetoric from over there which was a panicked reaction.When Labour released an actual housing policy the National Government suddenly thought: “Well we’d better put something out that shows that we’re even thinking about it.” But what it has put out will not work and it certainly will not deliver for those young homeowners who want to get on the housing ladder who currently cannot do that.It has been interesting sitting through this debate being lectured about housing by the National Government. I want to talk about social housing as well and about the role of State housing in this country. When we came into Government in 1999 we inherited a decimated Housing New Zealand stock. The National Government had hocked off nearly 14000 State homes to its developer mates. It had completely thrown those tenants out on to the streets. It carried out no maintenance whatsoever during its entire time in Government. It was a Labour Government under Helen Clark the last Labour Government that despite one of the biggest housing booms we had seen in New Zealand’s history managed to rebuild 8000 of those 14000 homes that had been hocked off. We started renovating and doing the maintenance that had not been done during the 1990s. Did we finish it? No because it was such an incredibly huge job at a time when it was difficult to get a builder for love or money. But still we managed to rebuild 8000 State houses. We started a maintenance programme.The National Government likes to brag about the home insulation scheme. That was actually started under Labour with the Green Party. It was the Green Party that called for that scheme in State homes not National. So it is very well that it tries to take credit for it now but let us not rewrite history here. So what have we had since National has come into Government? What have we seen from the National Government? Well again it is kicking tenants out of State homes. We thought that this Budget the last Budget was going to be about getting families into homes; apparently it is more about kicking families out of homes. That was a reality of this year’s Budget for Housing New Zealand tenants and those in social housing. From our perspective as the Labour Party we are dealing with these people every day in our offices—people who cannot find somewhere to live and who can no longer access State housing because National has said: “I’m sorry those category C and D tenants who are in provincial New Zealand did used to be housed by Housing New Zealand”—nearly 80 percent of the waiting list in Gisborne was category C and D. These are not wealthy people at all.The reality is though that in the provinces rental accommodation is very very scarce. It is often unaffordable. Housing New Zealand is one of the largest landlords not only in the country but particularly in provincial New Zealand. Well we have families living in garages and living in their cars on the East Coast at the moment—we saw this during the Ikaroa-Rāwhiti by-election—while 68 State houses sit vacant in Gisborne being readied for sale. It is the same thing in Hawke’s Bay the same thing in Wairarapa the same thing in the Hutt Valley and it will be the same thing across the country.How can this Government sit there with State houses empty? And Todd McClay who is in the chair should know this because he is from Kawerau another part of the country where we have people living in appallingly overcrowded conditions where thereis a real need for State housing. We have State houses sitting empty because the Government wants to sell them—the Government wants to sell them. Well that is appalling. It is not only appalling it is actually cruel. I think if you asked any New Zealander what we should do with those empty State houses that are sitting there being vandalised because there is no one living in them and sitting there falling into ruin because there is no one living in them the answer would be to tenant those houses.CHRIS HIPKINS (Labour—Rimutaka):I want to pick up where Moana Mackey left off and talk a little bit about some State houses in my electorate. This National Government came into office and it completely destroyed the community atPōmare. It came into office and it decided that there was antisocial behaviour atPōmare so it threw everyone out. It then closed up those houses. It boarded them all up. Then once they had been boarded up of course they got vandalised because they were left empty. Once they had been vandalised what did National do? Well it demolished them. Did it then rebuild any new houses on that empty land? No it did not. It said: “Oh we haven’t got any money to build any new houses on this land. We were quite happy to demolish the houses that were there.” So it went ahead and demolished the houses. The land now sits empty and now National is trying to hock it off—now it is trying to hock it off.I am watching that repeating now all throughout the Hutt Valley because all throughout the Hutt Valley we have boarded-up State houses. The Government has used the excuse of earthquake risk to board up a whole lot of State houses in many cases where the risk is only a very minor one. It might be that they have a chimney that needs to be rebuilt or some minor piece of capital work that needs to be done in order to make the house tenantable. What they have done instead is board up the whole thing. Of course those houses will be vandalised because if you leave a whole lot of empty houses boarded up they will be vandalised and then the Government will turn round and say: “Oh gosh these houses are now no longer habitable. We’re going to demolish them.” And then it will turn round and say: “We’ve got this empty land but we haven’t got any money to build any new houses on it so we’d better hock that off as well.”Then of course we are going to find ourselves in the position that we were in at the end of the 1990s when the National Government had been in power for 6 years and suddenly the number of State houses we had in New Zealand dramatically declined. National is quite happy to board them up to demolish them and to hock off the land but it is not prepared to invest in building more State houses which is what we actually need in New Zealand.I am very very proud of the moves that the Labour Party has been making under the leadership of David Shearer to actually deal with many of the big housing challenges that we have in this country. We have a major problem with housing affordability. People desperately want to get on to the homeownership ladder and they cannot. David Shearer and the Labour Party absolutely recognise that and we are absolutely committed to doing something about it. We will build 10000 affordable houses every year over 10 years. That is going to make an enormous difference for all of those New Zealand families who will get into homeownership mostly for the first time. That will be huge. It means that the dream of homeownership is not just for those who come from means or who have high-paying jobs. It is for everyday New Zealanders who go out there work hard and want to be able to buy their first home. We think that is a dream that every New Zealander should be able to realise so we will build 100000 new affordable houses over 10 years to make sure that New Zealanders can achieve that dream.David Shearer announced over the weekend that we will also restrict the purchase of existing New Zealand houses by overseas speculators. There has been this hysteria that we have heard from the National Government about this—from the same NationalGovernment that of course brought us the legislation about boat people and all of the other Draconian things that it has been doing in the immigration area. Suddenly it is hugely concerned about overseas speculators being able to buy New Zealand houses. Overseas speculators are not the people who want to move here and buy a house and create a life here. They are not going to be covered by that policy because if they are coming to New Zealand they have got to be resident in New Zealand and they will be able to buy a house in New Zealand. No one is saying that they will not be able to. What we are saying is that people living overseas who have no interest in living here no interest in contributing to the New Zealand economy and New Zealand society should not be able to make massive profits by buying up the available houses pushing them out of reach of New Zealand families who want to buy them charging them rent and then expatriating the profits from doing so offshore. That is fundamentally wrong.What we are saying is we acknowledge that so we are going to place some sensible restrictions on who can buy existing houses. If people overseas want to invest in the property market in New Zealand they can build more houses—they can build more houses—and that will leave New Zealand better off because it will increase the number of houses that we have. We have a housing shortage in New Zealand. That is something that this Government is not willing to acknowledge. In my electorate in the Hutt Valley area we have waiting lists of people trying to get into State housing. We have so many families jammed into houses because they cannot afford to buy their own house. We have a housing supply problem in New Zealand but the National Government keeps turning away from it. National is quite happy to pick holes in every solution that is being offered by the Labour Party—every solution that is being offered by the Labour Party—and it cannot come up with any solutions itself.It is going to commission another report.Vote agreed to.Vote Communicationsagreed to.Vote EnvironmentNICKY WAGNER (Chairperson of the Local Government and Environment Committee):The Ministry for the Environment administers Vote Environment and the Minister for Climate Change Issues and the Minister for the Environment are responsible for that vote. The 2013-14 Vote Environment appropriation is $326.5 million and the Minister for the Environment is responsible for approximately 40 percent of that vote and the Minister for Climate Change Issues is responsible for the other 60 percent. Funding for Vote Environment tends to fluctuate from year to year depending on the work streams or the roles of the ministry. In 2013-14 the appropriation is approximately double that of 2010-11 and slightly less than the 2012-13 appropriation.The priorities for the Ministry for the Environment for 2013-14 are reforms in freshwater management and resource management and also a new focus on environmental reporting. Ten percent of the vote a total of $33.7 million is for policy work and projects to improve water quality and that is to follow up on the work done by the Land and Water Forum and also the National Policy Statement on Freshwater Management 2011 and for clean-ups of historically contaminated water bodies. The work streams in 2013-14 will focus on collaborative planning processes for water. They will also establish a national objectives framework. The idea of that framework is to set freshwater quality objectives and limits and find ways to manage and allocate water within quality and quantity limits.Almost $14 million is targeted to clean up waterways. It is great to see restoration projects in places like Lake Te Waihora which is Lake Ellesmere in Canterbury and also theManawatū River the Wairarapa Moana theWainoni Lagoon in South Canterbury and the Waituna Lagoon.The Minister for the Environment has also prioritised resource management reform. We need to maintain the quality of our resource management decisions but we need to streamline the process so that we can be more consistent and more predictable and we can reduce costs and get more timely decisions. We are already making progress on this. We passed the streamlining and simplification legislation and we have had some very pleasing results from everybody who has been using that and there is more legislation on the way.Funding has increased under the appropriation for the Community Environment Fund. This time it is $6.4 million and that is up from the $2.4 million that was spent in 2012-13. That appropriation is made to strengthen partnerships to raise environmental awareness and to encourage participation in environmental initiatives. There has also been an increase in funding for the Contaminated Sites Remediation Fund and that increases to $5.4 million which is over $5 million more than was spent in 2012-13. I think it is really important to see theTūī Mine site. That was one of the worst-contaminated sites in New Zealand and it has been successfullyremediated. With the success of the work there and the increased funding I think that will encourage other clean-ups in contaminated sites across the country.New Zealanders are very aware that we want and we need to keep our environment clean and green. We really look forward to the results of this work being done on fresh water and the work that is also being done on resource management and on environmental clean-ups and particularly there is an increasing interest with state of the nation environmental reporting.EUGENIE SAGE (Green):In this brief call on the estimates for Vote Environment I would like to continue from the previous speaker Nicky Wagner and talk about state of the environment reporting. This National Government has failed to implement its election promise to put in place independent state of the environment reporting. That was promised by the previous Minister for the Environment in about 2011 or before that in the manifesto. The current Minister told the Local Government and Environment Committee that she preferred indicative reporting in the meantime rather than consolidated reporting. That means we get the information only in dribs and drabs.But this week we got two quite significant indicator reports: the suitability for swimming indicator and the river condition indicator from the Ministry for the Environment. Certainly the Government and Federated Farmers are spinning these Ministry for the Environment reports to try to hide the seriousness of our water crisis. The first of the reports on swimming suitability shows that 61 percent of the monitored sites on rivers are unsafe for swimming. In the House yesterday the Minister tried to argue that it was safe to swim in rivers that were graded “fair”. The Minister might want to swim there. I certainly would not because in relation to those sites with a “fair” grading her ministry notes “the presence of significant sources of faecal contamination” and the ministry encourages people to avoid swimming there during or after rain or when the water is discoloured. For anyone who has swum in a waterway that is contaminated with faeces whether human or bovine it is a very unpleasant experience to get sick. I certainly would not want to swim there even if the Minister does.Within a generation we are losing the right to be able to swim in our local river or stream without the fear of getting sick. We have a freshwater crisis on our hands and what the National Government is doing is going to make that worse. That is because itis opposed to smart regulation it is gutting the Resource Management Act of its environmental principles it is not putting a resource rental on the commercial use of water and it is subsidising irrigation.The Minister can talk—and the previous speaker Nicky Wagner did as well—about how much the Government is spending on cleaning up waterways. Of course that is continuing programmes by the previous Labour Government in relation to the Rotorua lakes and LakeTaupō. Certainly the Ministry for the Environment is proposing to spend about $9 million on the Rotorua lakes this year but at the same time as that money is going for clean-up the Minister’s colleagues by subsidising irrigation to the tune of $80 million in this Budget and potentially another $400 million from the proceeds of asset sales are making the problem worse. That is because irrigation leads to land-use intensification. The science is very clear. The more animals and the more fertiliser you put on land the more water pollution you get.Although the Minister and Federated Farmers President Bruce Wills might want to deny the seriousness of our water crisis and might want to put the focus on urban streams again that is spin. Urban streams although they might have the highest concentrations of nutrients and bacteria comprise only 1 percent of the total length of waterways in New Zealand. It is the 99 percent of rivers in our rural hinterland that we should be most concerned with.We need to heed the warning in the Ministry for the Environment’s river condition report about the increase in nitrate levels at a quarter of the sites that were monitored in the 10 years to 2010. How do we get nitrate in our waterways? It is because of animal urine. The soil bacteria break down the ammonia in the urine and convert it to nitrate. What happens when we get nitrate? We have for example the medical officer of health in Canterbury issuing warnings about the increasing levels of nitrate in Canterbury aquifers and talking about that putting newborn babies at risk of blue baby syndrome. The effect that nitrate has is in compromising uptake of oxygen.The Green Party wants to protect Kiwis’ right to swim in our local rivers. We would refocus the Ministry for the Environment back on sustainability. We would ensure that crucial environmental laws like the Resource Management Act and like the exclusive economic zone legislation really promoted sustainable management had a precautionary principle at their hearts and looked more closely at cumulative effects. We would focus on sustainability rather than the exploitation of nature. The Green Party would keep our energy companies.MAGGIE BARRY (National—North Shore):We are looking at the proud record in terms of the environment some of which my colleague Nicky Wagner alluded to earlier and I will pick up on that in a moment. But first I will look at the environment appropriation itself. It is interesting when you look at the breakdown because when we look at the environmental side we spend about $130 million or 40 percent of Vote Environment on the environment and climate change takes up about 60 percent which is $195 million. So when you look at the way it is spread across and you look at the reforms that we are bringing in the Resource Management Act is certainly very much central to our initiatives and our policies around protecting the environment and growing the economy at the same time.The Resource Management Act is certainly very important. Once this debate on the Appropriation (2013/14 Estimates) Bill is finished of course the Resource Management Reform Bill will be going into the Committee stage; it is progressing at a great rate. We have already introduced a couple of pieces of legislation around it and there is going to be another bigger tranche coming through later this year.But let us look at the key components of the bill that we are dealing with at the moment because I think that when you look at what this Government is trying to dowith protecting and enhancing our environment the key does remain within the Resource Management Act reforms. We are looking to further improve the resource consent regime. For those of us who have electorates and have people coming to see us it has been a source of great complaint—the delays the costs the unnecessary nonsense and you know just the impossibility of getting a job done. So we are continuing on with those reforms.We are also streamlining the delivery of Auckland’s first combined plan. Within the Auckland Unitary Plan there are a number of complexities and they are being carefully and slowly worked through with the cooperation of Auckland City and the various agencies there. We are improving the quality of local decision-making and also improving the workability of the Resource Management Act through some minor and technical amendments.So those are the four main components of the bill that we are looking at. As I said there are going to be even larger-scale Resource Management Act reforms which will include substantive improvements for freshwater management and planning systems more generally and they will be coming in a little bit later in the year. Water management and the protection of our waterways are what my colleague the chair of the Local Government and Environment Committee alluded to earlier and went into some detail on so I will not traverse that again.When we look at what we are doing with direct referral we see that these are the kinds of changes where the rubber really does hit the road and where people will notice a difference in their day-to-day lives—the DIY people and the people who actually want to get a fairly small project done. Decisions being made through the Environment Court rather than through relevant councils are going to improve and streamline that.Six-month consenting is an excellent thing. We are going to allow medium-sized projects to get going without the red tape. Around about 1600 medium-sized projects are processed each year and that includes new subdivisions supermarkets industrial developments and infrastructure projects. Those are the kinds of things where putting a time limit of around 6 months focuses people’s attention and gets the job done. The sorts of delays that we saw in my area the North Shore and Albany where a supermarket was held up for an inordinate length of time by an appeal process that was driven by a commercial competitor are the kind of stuff we want to do away with.The select committee process as you will gather from the discussions that have gone on around the Resource Management Act has been robust. People have come to us with submissions—genuinely felt genuinely held submissions—and they have been debated at length and with some passion rigour and conviction within the committee itself and we have made some changes. We have introduced a new approach as a result of the select committee recommendations to express time frames. The time frames were considered overly complex. We listened to that and made adjustments accordingly.The Minister for the Environment Amy Adams has done what very few Ministers have done—that is she has called all parties of the select committee together in her office and gone through in some detail their concerns in an effort to address them and in an effort to come up with a level of sensible consensus that we can all work with. I think that is the measure of the Minister and the reason why these Resource Management Act reforms are going through in the way that they are. They are big reforms. They need that level of consultation they need the submissions that we have had and then it is discussed and moved on. But it must be moved on. We are not going to follow the old Labour way of paralysis by analysis where nothing much ever happens because there is no political willingness to make it happen. We make it happen and we make it happen in ways that really do work for the public as well.The subject of trees has been very contentious. There is not really enough time in the call I have now to go into the detail of that and to do it justice but we have made significant amendments to the blanket protection of trees in urban areas which was a pretty lazy way of doing it. Individual homeowners and landowners have the right to know and to plan with what they have.Dr KENNEDY GRAHAM (Green):It has been interesting to listen to Nicky Wagner and Maggie Barry in their analysis of Vote Environment. Of course we do not dispute the statistics: 40 percent or so on the environment itself and 60 percent or so on climate change which works out in the case of climate change to something like $195 million. But let us analyse that and ask ourselves what that money that $195 million is spent on. The short answer is that most of it has been spent on the allocation of New Zealand Units which amounts to little more than generational theft—generational theft. The emissions trading scheme as it is currently fashioned by this Government amounts to a fiscal time bomb that will explode on the next generation and not us. That is quite shameful. That needs to be scrutinised with greater transparency greater honesty and greater candour and this Government needs to respond with greater creativity to get this right.The deforestation that we are anticipating in the next 5 to 10 years is phenomenal. We have got through the first commitment period of the Kyoto Protocol by the skin of our teeth not because we brought down gross emissions—they went up—but by the fact that our forestry went up through plantings 15 years ago in the early 1990s and the mid-1990s for tax policy reasons totally unrelated to climate change. Then we have completely messed up our climate change policy in the last 5 years such that we are facing a massive amount of deforestation over the next 10 years. There is zero money under these estimates for the Permanent Forest Sink Initiative but $171 million to the allocation of units to polluters.Let me ask the Minister in the chair a number of questions about our emissions trading scheme policy. Just to pick up on the question that my colleague Eugenie Sage asked him earlier about how he will enjoy swimming with his children through faecal-contaminated rivers my questions pertaining to climate change are the following. With regard to the UN target—if the Government can remember back that far to the 2007 Intergovernmental Panel on Climate Change fourth assessment report—the prescription for annex 1 countries to keep within the 2 degrees Celsius and to play our share in reducing global emissions from 49 to 44gigatonnes is a reduction off 1990 from gross to net of 25 to 40 percent. This Government in the form of Treasury and Cabinet papers says it does not follow that New Zealand has to be within that range. Question No. 1 to the Minister: which countries does he wish to nominate from the annex 1 countries to make up the shortfall when we are not doing our share?My second question follows. The Government has in its ineffable wisdom turned away from the second Kyoto commitment period because that is a legally binding obligation. It says it will “elect to take its commitment under the framework convention”. Why? Well especially because it cannot afford a legal obligation because of the wall of wood coming down the track but particularly because it insists on looking forward and alluding to the 87 percent of emissions that are coming out of the developing countries. This Government like those of other annex 1 Kyoto countries is obliged to acknowledge the 77 percent of historical responsibility acknowledge the continuing relevance of the common but differentiated responsibilities acknowledge the difference that still obtains in per capita emissions and acknowledge that it has a responsibility to be in Kyoto II. That is the second question.The third question follows. The Government in the form of Treasury still bases its policy on the notion of global least cost. Does the Minister wish to acknowledge thatthere is no such thing as a global price or a global market on the carbon economy yet and that there will not be for probably at least 10 years? There is a chaotic regional market coming out of Europe from which incidentally Australia and the European Union protect themselves. But not this country. In its overzealous approach to an open global economy based on neo-liberal principles it allows itself vulnerability to that.Vote agreed to.Vote Primary IndustriesRICHARD PROSSER (NZ First):I am pleased to rise on behalf of New Zealand First to take a call in this Committee of the whole House as we examine the Appropriation (2013/14 Estimates) Bill. Vote Primary Industries is a crucial appropriation. The primary sector underpins the entire economy and in areas such as fisheries it overlaps into our very way of life. Going fishing is synonymous with the development of New Zealand society and the New Zealand nation itself. From our first-nation’s peoples and their canoes to the earliest European discoverers from the sealers and the whalers to the surveyors and the settlers and the colonists anybody and everybody who came to these islands since time immemorial has had the ability indeed the right to throw a line over the side and catch a fish. For many if not most of them fishing was a matter of pure survival. The ocean provided dependable sustenance where the bounty of the land was a far more frugal affair.Today that reality remains for literally hundreds of thousands of New Zealanders. Ordinary people up and down the length and breadth of this country enjoy nothing more than the opportunity to take to the sea and bring home a feed for themselves their family and their friends. It is a birthright the stamp of egalitarianism that set us apart from the feudal restrictions of class and ownership that so many of our forebears experienced in the older countries of a previous world. New Zealanders cherish that birthright. Everyone is equal in our society and everyone is equal where the baited hook hits the water—the doctor the lawyer the accountant the farmer the labourer and the truck driver. Anyone and everyone can throw a line in the water and anyone and everyone can catch a fish. The rules are the same for everybody. Or are they? I ask because many people could be forgiven for thinking that under this Government some have become more equal than others.Every New Zealander who fishes in the sea knows the importance of the fisheries resource everyone knows that this resource is finite and everyone knows that it must be harvested sustainably and that all other users must be treated with mutual respect. The nation charges the Government with the responsibility of managing that harvest managing the sustainability of that harvest and setting the rules that will ensure that mutual respect and the preservation of everyone’s rights are upheld. We put in place a system of rules and laws of quota and catch limits for the purpose of ensuring that there will always be fish in the sea—fish that our egalitarian people can catch to feed their families sustainable populations of fish that will still be there in years to come so that the children of our egalitarian people and their children and grandchildren will still be able to go down to the sea and fish to catch the food that is their birthright and their inheritance.We task the Ministry for Primary Industries with the responsibility of administering those rules and we fund its activities through Vote Primary Industries. We hope and trust that the ministry will get things more or less right and we hope and trust that the Government will fund it adequately and give it the direction and the tools that it needs in order to ensure that the fisheries resource is properly and sustainably managed and that the right of all New Zealanders to go down to the sea and fish is preserved. Wehope and trust that they will get it right. When they get it wrong we are given cause to question in whose interests they are working.The old saying goes: “Give a man a fish and he will eat for a day. Teach him how to fish and he will eat for a lifetime.” But teach a man to fish and then cut his daily catch limit in the snapper 1 fishery from nine fish down to three and I have to ask what will he do then? Will he be able to justify putting petrol in his boat let alone paying for his gear if the number of fish he is permitted to bring home is worth less than the cost of going to get them? Why I ask is the bag limit for ordinary recreational fishers being cut in this arbitrary and pointless fashion? If the fishery is under pressure if the fish stocks are being mined unsustainably and if the populations need time to recover then why are the ministry and the Government not looking to reduce commercial catch limits when it is the overfishing and the unsustainable practices of some in the commercial sector that have been the cause of decline in our fish stocks in the first place? Why should the recreational fisher be forced to bear the cost of a problem that is not his fault?And how much will it cost? How much of Vote Primary Industries will be spent on hiring fisheries officers and equipping them with vehicles boats pepper spray handcuffs and whatever other tools they are going to be given to allow them to focus on chasing ordinary citizens for the crime of catching more than three fish from their little tin boats when the trawler operating right alongside them is allowed to carry on business as usual with no reduced limits adding insult to injury by dumping tonnes of fish made useless as they are crushed in a trawl net? It is an unspeakable injustice and a pointlessly wasteful mismanagement of a precious and finite resource.New Zealand First when in a position of influence over the Government will reverse this focus. We will give priority to the needs of ordinary people and permit the commercial harvest of only that portion of the fishery that is surplus to those needs. We will prioritise Vote Primary Industries accordingly and manage its appropriation properly and responsibly unlike this dreadful administration whose dreadful Appropriation (Estimates 2013/14) Bill we unequivocally oppose. Thank you.BRENDAN HORAN (Independent):Vote Primary Industries includes what was until 2 years ago the stand-alone Ministry of Fisheries. This vote includes appropriations of over $86 million for fisheries policy advice and operational advice on sustainability fisheries management and enforcement and monitoring—$86 million. It is interesting because if we spent only $20 million a year on buying back commercial quota from the large operators such as say Sanford then within 3 years the 15 percent improvement target would be reached and it would all be very very simple. But I must say that that was not in the options that were in the discussion paper that the Minister alluded to today when I was questioning the Minister.What is the Minister for Primary Industries Nathan Guy doing instead? Well he is snatching snapper off the plates of New Zealanders. It is not just a few recreational fishers who are affected because everyone is affected. The Minister’s answers to my questions today were entirely unsatisfactory. I wonder how that member could have got it so wrong. How can it be that this Government has not considered the possibility that the biggest maritime environmental disaster to ever hit New Zealand—and that is theRena —would not warrant a scientific investigation into its effect on the reproductive and growth cycles of our most valuable and dominant coastal fish the snapper?Today I was also told that I should get along to one of the Ministry for Primary Industries’ meetings. In Parnell tonight approximately 300 people listened and they went along to the Quality Hotel—and there is some irony here because there was absolutely no quality in that meeting. What was there tonight was absolutely embarrassing but a fair indication of that Government. What was there was a handful ofMinistry for Primary Industries representatives with posters and they were speaking to the different small groups that came along. There was no microphone there was no measured debate and there was no intellectual discussion. The people of Parnell went there hoping for intellectual discussion but there was none of that. Actually it is interesting because the Quality Hotel is on Gladstone Road and that is just down the road from where the Prime Minister lives. They would have snared a big fish if the Prime Minister had been there but alas that did not happen either.So I ask where is the science in this report? Where is the cost-benefit analysis of recreational fishing to New Zealand? The petrol taxes the diesel taxes bait tackle motors boats books videos food drink—the list goes on. Did you know that one-third of all kayaks sold in New Zealand are fishing kayaks? Where is the cost-benefit analysis of recreational and charter fishing with tourism and accommodation and other benefits? It is simply not in here. This is a devious document. It is a dishonest document. I ask where the basic thought is of seagrass areas snapper habitats and the most basic of options—that is the possibility of growing and seeding baby snapper into certain areas.Where in this document is the effect that the explosion of snapper would have on the mussel industry the mussel farms if there is a reduction in the recreational fishers’ catch? More snapper means more mussel spat being eaten on the mussel lines. That is probably $100000 a line. Can the mussel industry sustain the extra loss that would undoubtedly follow? At the moment snapper costs around about $39 to $40 a kilo for fillets. What would happen to that price—which is already beyond many Kiwis’ budgets—if this Government is successful in its effort to cut the catch limit to two or three snapper and thereby create a scarcity in the market? Well if you do the maths and you cut the catch from nine to three then we are looking at snapper going from $39 a kilo for fillets to $120 a kilo. Who will benefit from that? The big players—the big players just like Sanford. [Bell rung ] This bill will destroy—The CHAIRPERSON (Eric Roy): Order! Your time has expired.Brendan Horan: Mr Chair—The CHAIRPERSON (Eric Roy): Sorry?Brendan Horan: I’m trying for another call. Nobody else is calling. Surely—The CHAIRPERSON (Eric Roy): Just wait until I check the schedule. The member has only one call by the schedule.Brendan Horan: Yes but I was taking a call from all those other people who haven’t called.The CHAIRPERSON (Eric Roy): No. The member has only one call.Brendan Horan: Thank you.The CHAIRPERSON (Eric Roy): Thank you.Vote agreed to.Vote Commerceagreed to.Vote Consumer Affairsagreed to.Vote Internal Affairsagreed to.Vote EnergyMOANA MACKEY (Labour):New Zealanders are paying too much for their power bills. The next Labour-led Government will do something about this very serious issue which the current National Government is refusing to acknowledge even exists. What we have seen since the global financial crisis hit is that in every other developed country power prices have dropped as demand has flattened and as protections for consumers have kicked in. New Zealand is one of the few countries in the developedworld where power prices have continued to increase at twice the rate of inflation despite flattening demand a surplus of generation and a collapsed carbon price.In 1 year we have seen an increase of 10000 in disconnections—in 1 year. That is 10000 households that no longer have power because they cannot afford to pay the power bills. We have flattening demand in this country. We have an oversupply of generation. If power prices are not going down now then they are never going to go down. It shows what the Labour Party has been saying which is that the Bradford reforms have failed. We do not have the kind of competition in our retail market that would ensure that retail margins and prices are driven down in times of low demand. A Labour-led Government will do something about it.We have a Minister of Energy and Resources who says that New Zealanders are not paying too much for their power prices. But he does not know what too much would be. So I think that is a zero credibility fail for the Minister of Energy and Resources. You cannot say that New Zealanders are not paying too much if you do not know what too much is and the Minister of Energy and Resources does not know. I suspect that too much would be when the Minister of Energy and Resources cannot afford to pay his power bills on his ministerial salary. Then power prices will be too high. But until then the rest of New Zealand can suffer with power prices continuing to increase at twice the rate of inflation and the Government refusing to do anything about it.We have the second-biggest gap in the OECD between residential and industrial tariffs. So when the Minister stands up and says that the market is working really well what he is saying is that it is working well for the big end of town. That is being offset by residential consumers who are paying far more for their electricity than they should be given the fact that New Zealand is blessed with an abundance of cheap renewable energy. More than 60 percent of our electricity comes from hydro generation—from assets that were built by the taxpayers of New Zealand which have been paid for time and time again—from a free public resource: water. We should have some of the cheapest energy in the world and yet we do not because of the way we price electricity in this country.I would like to see the next National Government speaker Mr Jonathan Young actually explain why hydro producers should be being paid the marginal price set by gas when they have not done anything—when they have not done anything—to deserve that windfall and profit from assets that were built by generations of New Zealanders and taxpayers. A Labour Government will change the way we price electricity because we do not have competition in our retail market.I recently went to the launch of a new retailer in Dunedin called Payless Energy. The National Government rhetoric was: “Here’s another retailer. That means we must have competition.” Well the reality is that there are 10 retailers now in Dunedin and yet the market is still overwhelmingly dominated by the four big generator-retailers. They are happy to let those small companies pop up and have a handful of installation control points but the minute they come to scale that is when they will no longer be tolerated. Just because you have a number of different companies does not mean you have competition in pricing Mr Young. It does not mean you have competition in pricing.So the first thing the National Government did was try to blame transmission charges and lines companies for the increases in power prices since the Bradford reforms. Let us be clear about the cost of the Transpower upgrade. Yes it had to go ahead. Yes it is billions of dollars. Yes both Labour and National have agreed that the upgrade should go ahead. Here is the difference. A Labour Government said to Transpower: “You do not have to pay us a dividend so you can pay for that transmission upgrade out of what you would have been paying to Government and then there will be no pass-on cost to the consumer through the retailers because that’s howyou can pay for it.” When National came in not only did it say to Transpower: “We want that dividend back right now by the way.” but it said: “Can you backdate it.” And now we have a Government that claims to care about the rising cost of electricity on businesses and households saying to Transpower: “Actually you need to charge consumers for what Government was paying for when Labour started that transmission upgrade work.”So Mr Young why is your Government requiring Transpower to now supply a dividend and to backdate the payment of that dividend when all it is going to do is impact on those transmission charges which will now be passed on to consumers through the retailers? I have been going around visiting lines companies and they have been very frustrated. In fact in the case of one lines company which is publicly owned as most lines companies are it wanted to pay a dividend back to its consumers. It wanted to pay a dividend back to its consumers so it had to pass that through the retailers because that is the way that it charges. None of that dividend was passed through to the end consumers. So here we have a lines company which National likes to blame for putting up increases on households—[Interruption ] Jonathan Young says: “True lines companies are doing that.” Here we have a lines company that was actually trying to give some money back and the retailer refused to pass it on. It pocketed it Mr Young. How is that a system that is good for consumers?Let us have a look at what has happened up in Auckland because what I think Mr Young does not understand is that actually lines companies are incredibly tightly regulated—thanks to the last Labour Government which regulated lines companies. They are very tightly regulated as to what they can charge their consumers. They have a pricing path that is set by the Commerce Commission. They have to provide a certain return. They are not able to go out there and just charge whatever they want like the retailers can with a retail margin. They have to provide a return that is based on their actual costs and then a fair return as well. So that is what they charge. The Commerce Commission did a reset last year which came into force in April this year where it actually said that Vector which is our biggest lines company based in Auckland needed to drop its prices. So Vector did that and only two of the 11 retailers in Auckland have passed that cost saving on to consumers—only two.The lines companies which actually have no control over what they charge because they are so tightly regulated which charge based on their actual costs and which have tried to give money back to consumers but have not had that money passed through in some cases by the retailers are apparently causing all the problems according to the National Government. Well that is not true. None of the research backs it up. The increase in prices since the Bradford reforms has been in the wholesale electricity market the retail margin. It has not been in transmission charges it has not been in the lines charges. It is utterly dishonest for National to claim that that is the case when it is not.What the National Government likes to point to is the What’s My Number campaign and to the fact that that has been so successful which it says shows that we have competition. Well actually there is no research that has been done as to why people change power companies. The UK had a similar campaign. It has actually researched why people change power companies. One-third of the people who changed changed to a tariff that was cheaper; one-third of the people who changed changed to a tariff that was exactly the same; and one third of the people who changed changed to a tariff that was more expensive. What that shows is that there is a range of reasons why people change electricity retailer and price is only one of them. One of the questions we have been asking the Government is how many of those people who have gone on the What’s My Number website were people who have shifted house people who had just moved.They were not looking for competition; they had just simply shifted and wanted to find out who was out there. Well the Government is not collecting those kinds of statistics either.The reality is that when you look at that gap in price that is offered on the What’s My Number campaign often the difference is an early payment discount. That is the difference in the power prices that are being offered. Well if you cannot afford to pay the power bill in the first place then an early payment discount is completely hopeless. The reality is that for the poorest families they are lucky if they can find one power company to pick them up. This kind of fantasy idea that the National Government has in this “La-La Land” that it lives in that the poorest people out there actually have a choice of retailer when they are lucky if they can find one to pick them up and keep them on shows just out of touch it is. We spent 9 years in Government trying to make the system work and it does not. The system is broken.Mr Bridges said that the Bradford reforms just need time to bed in. They do not. They have utterly and completely failed. Fifteen years—it is time to actually do something about the fact that despite having some of the cheapest electricity being generated—Hon Tau Henare: Tell me why we’re 51 percent in the polls tonight. How do you work that one out?MOANA MACKEY: I wish we could hook Mr Henare up to the national grid. All our power problems would be solved if we could hook his mouth up to the national grid. That is one big energy source over there. The reality is that tinkering is not going to make a difference. If we want genuine—genuine—competition in the retail market and that is what we want we need to change the way we price electricity. That is what the New Zealand power policy does. We are not regulating the retail market or the generation market. We are simply ensuring that retailers who want to come into the market are able to compete with the four big generation-retailers who up until now have been able to squash any real competition that comes into play.New Zealanders know that they are paying too much for power prices. The model that we have selected is one that is commonly used overseas. It is not something that New Zealanders need to be scared about. What they need to be scared about is what is in that next power bill when it lands in their letterbox and when they have to open it wondering whether they are going to be able to keep the lights on for the next month. That is what New Zealanders are scared of and a Labour-led Government is—JONATHAN YOUNG (Chairperson of the Commerce Committee):I am very pleased to speak after the last speaker Moana Mackey and just answer some of the questions that she has put forward. Moana Mackey contended that the line charges are not to do with the increase in power that it is all to do with retailers. For her information and for her betterment I have researched the last 10 years of power charges in New Plymouth. If she will look over this way she will see on this graph that the rate of increase for line rates has increased over the last decade and the rate of increase for retail is actually trending downwards.I have gone through Ministry of Economic Development spreadsheets for every quarter of the last 10 years looked at every—Moana Mackey: It’s dishonest.JONATHAN YOUNG: It is not dishonest. That is the truth. These are facts—these are facts. I can show them to you if you would care to have a look.The Labour Party and the Green Party of course are presenting to New Zealand the concept of a single-buyer market and a person whom they are quoting is Professor FrankWolak. They used his comments a number of years ago—4 to 5 years ago—to claim that generators have been taking super-profits out of the New Zealand electricitymarket of something around about $4.3 billion. Well he was in Wellington this week and let me quote fromEnergy News . It says: “ ‘Moving to a single-buyer market for power generation would do nothing to improve competition while a cost-based approach to pricing output also runs the risk of undervaluing water resources.’ a visiting US academic says. Stanford University’s Professor FrankWolak says he can’t see why New Zealand would want to turn its back on the electricity market structure it has now.” That is what their expert has said this week in Wellington.We do need to understand what has affected the increase in the prices of power. A number of these increases have happened through regulation increase in terms of the emissions trading system charge which has increased the cost of electricity by around about 4 to 5 percent and secondly the emissions trading scheme increase as well. If you take out those two regulatory increases that have happened if you look at the increase that has happened over the last number of years you will see that the increase in electricity cost for New Zealand consumers is around about the rate of inflation maybe a fraction above certainly within the rate that the Reserve Bank has to monitor and we can be very confident about that.We also know that Transpower has been upgrading the national grid. Over this decade starting in 2012 it is going to be expending around about $5 billion. In June 2008 Transpower commissioned an independent review of its maintenance practices and spending. This report by the Auditor-General which came to the Commerce Committee said: “Discussions with staff from both Transpower and the contractors revealed a workforce that has an innovative approach to solving problems. This has been driven mainly by a need to keep operational an aged asset base as little asset replacement has been undertaken on a broad basis in the last decade.” So under Labour’s watch the national grid became aged with very little replacement of that infrastructure. Some 39 percent of the switchgear assets are of the old technology with an average age of around 37 years.The Auditor-General in a reportTranspower New Zealand Limited: Managing risks to transmission assets  states: “We found that Transpower knew that the grid was becoming less reliable and performing worse. While it was still building staff capability Transpower could not focus on both grid reliability and capacity so it made the strategic decision in 2003 and 2004 to focus on addressing the grid’s capacity issues. The issues of age and necessary replacing and refurbishing of grid assets were given a lower priority.”Who was the Minister of Energy at that particular point in time who signed that off? Because we are right now spending $5 billion catch-up money to ensure that our national grid is robust and gives security of supply to New Zealanders in their households and in their industries. We know in New Zealand what happened when theMāui Gas pipeline sprung a leak.GARETH HUGHES (Green):Kia ora Mr Chairperson.Ngā mihi nui ki a koutou. Kia ora. In this Vote Energy debate I would like to talk as part of the estimates report around the issues contained in this report which is the National Government’s power price rises and the National Government’s fossil fuel extraction agenda. I guess you can summarise the Government’s agenda as being more power price rises more excuses more blame game across the Chamber more fossil fuels being dug up more drilling more mining and more fracking Aotearoa. What we have heard in this debate is a whole bunch of excuses. We have heard a whole bunch of blame between the two successive Governments. What we have not heard a lot of is a lot of vision a lot of plans or a lot of going forward. We have heard a lot of going backward.So what I want to talk about is what my vision is for energy in New Zealand: cheaper cleaner smarter energy. It is a strategy that focuses on New Zealand’sadvantages our strengths it goes forward it builds the economy it grows jobs it is about putting the power and the profits back to the people of New Zealand; it is not this blame and excuses we hear from the two old parties. So the Government’s dirty old agenda which we have heard over and over again in this debate is all about subsidising polluters by over a billion dollars a year in emissions trading scheme credits. It is about handing out $46 million a year in tax breaks to deep-sea oil drillers—already one of the largest and most profitable industries in the world—and it is about telling Kiwis this winter as they open up the envelope with their power bill in it and see their power prices rise that all they have to do is wait for Max Bradford’s reforms to finally bed in.What we see from the National Party in its vision—or lack of vision—and in its agenda is an age of 19th century fossil fuel and crony capitalist inspiration. That is where it is looking whereas the Greens are looking to the future. So what I want to talk about is three things: cheaper cleaner smarter energy. The first is New Zealand power. What we have seen since the Bradford reforms is that New Zealand power prices have increased 72 percent in real terms while across the OECD they have seen a 6 percent reduction on average. We have now had the fifth-highest power price rises in the entire developed world and under National what we have seen is our bills going up 400 bucks a year for Kiwi families. So the so-called market clearly is not working for New Zealand consumers and the long-run marginal pricing model for electricity sees cheap hydro paid for decades ago being charged at the most expensive unit. It is at $700 million a year in excessive profits being taken out of Kiwi businesses being taken out of Kiwi consumers’ wallets which is a serious drag on our economy.It has got real world impacts too because what we know is that a quarter of our New Zealand families are in energy poverty spending more than 12 percent of their weekly income just to stay warm. We know Kiwis elderly and renters are going without power they are going without food to get power they are getting cold they are getting sick and it is a serious drag on the New Zealand economy. So that is why we propose New Zealand Power as a smart cost-effective efficacious solution to sit between the generators and the retailers. Like Pharmac New Zealand Power will drive down the price of electricity encourage competition and encourage energy efficiency.So I guess what I tell people around the country is that at this election they are going to get a real choice when it comes to energy because Labour is on the same card as the Greens. What we are going to get is a real choice. Under National what we are going to get is more excuses more power price rises and more of our assets being sold off. Under the Greens what Kiwis are going to see is 300 bucks a year in savings for the average family.The second thing I want to talk about is clean energy because in New Zealand we have got a wealth of clean energy options but you would not know about it by listening to the Government benches. In fact you would not know about it looking at the statistics because we are not on track to meet the 90 percent renewables by 2025 target. In fact we are doing worse than we have ever done before. We have got a lower percentage of renewables as a total percentage than we had in 1980. We have got a lower percentage than we had in 1990. So while all the Government’s attention is being lavished on foreign oil drilling companies we are missing out. The smart money internationally is looking at clean energy. In 2011 net international capital investment in renewables was larger than all the fossil fuels all the nuclear energy combined. That is where the smart money is going yet National is spending all its time talking to major foreign oil-drilling companies.The PricewaterhouseCoopers report says there is a $22 billion economic opportunity in clean energy for New Zealand. The Pure Advantage group of successful business people said there is a $6 trillion clean energy green-tech sector our country should begetting a slice of. It is a business opportunity that is staring us in the face yet the Prime Minister is going round opening up fossil fuel power peaking stations and getting international media attention for wanting to drill Middle Earth.I want to give the Government a bit of credit where it is due. It is doing something about solar power. The problem is that the only thing it is doing about solar power is in Tokelau and Tonga and it is putting up all these barriers for New Zealanders who want to be able to produce their own power and export it.KANWALJIT SINGH BAKSHI (National):Thank you for the opportunity to speak on Vote Energy. This Government under the able leadership of Prime Minister John Key has taken many pragmatic steps to ensure that New Zealanders remain healthy while the cost that they pay remains low. All the previous speakers from the Opposition speaking on this vote did not touch on that area which is of concern to many people. I would like to touch on the area of keeping people warmer and healthier in their homes. The Government is investing in a new 3-year insulation programme that will deliver warmer drier and healthier homes to the communities in most need. I am based in an electorate that has people of low socio-economic means living in great numbers.Budget 2013 allocates $100 million of operating funds over 3 years to the Warm Up New Zealand: Healthy Homes programme targeting low-income households for home insulation particularly those families with children and high health needs. It is expected to insulate around 46000 additional homes over the period of 3 years. The Government is investing this money which will be matched by private funders and trusts to make sure that people live in insulated homes which makes them healthier. The project is budgeted at $93 million for the upcoming financial year. Sixty percent of the funding will be provided by the Government through the Energy Efficiency and Conservation Authority and 40 percent will be provided by the third party groups such as iwi trusts who will determine who will receive funding.Warmer drier homes provide real benefits to New Zealanders. New Zealand is a developed country yet we still have rheumatic fever in our society. As well as the energy efficiency gains insulating homes reduces health risks such as respiratory illnesses and serious diseases like rheumatic fever. Warm Up New Zealand: Healthy Homes will help boost the health and well-being of New Zealanders living in poor households and it is part of the Government’s response to child poverty. The new programme will follow the success of the Warm Up New Zealand: Heat Smart scheme which has seen around 215000 homes insulated since 2009. The final $11 million of this programme is sought in this Budget. Funding expires at the end of the 2013-14 financial year which will mean that by the end of September 230000 homes will have been insulated and will benefit people.Over the past 4 years the National-led Government has changed the thinking in relation to home insulation in New Zealand. Now when people buy or rent homes they normally ask whether a house is insulated or not. That means that people are aware that insulation makes them healthier and it saves on power bills. With these words I support Vote Energy.Vote agreed to.Vote LabourDARIEN FENTON (Labour):The estimates debate on Vote Labour provides a really good opportunity to do a performance review of the work in the labour portfolio and the work of the Minister of Labour who is now 6 months into the job. He may be new and he has certainly learnt his lines extremely well but there is something deeply antiquated about the Minister’s approach to labour relations and the labour portfolio. In 6 months he has delivered a 25c an hour increase in the minimum wage—a miserable25c an hour. He has also cut young workers’ pay and brought back youth rates for the first time since last century. He has revived a stupid piece of legislation that has languished on the Order Paper for 3 years because it was so hopeless and is so mean that it will cut basic rights to meal and rest breaks. And now he has sent to the Transport and Industrial Relations Committee the nastiest piece of proposed labour law that we have seen since Jim Bolger was the Prime Minister.This is going to be a very testing time for employment relations in New Zealand. It is going to be a testing time for the Minister as opposition to his employment law ramps up and as everyday Kiwi workers begin to understand exactly what the agenda of this National Government is about. It is hard enough to get a job let alone one that pays the bills but employment law changes that are being proposed by Simon Bridges and this National Government will have a knock-on effect to every wage and salary earner in New Zealand and they will entrench Kiwis in a low-wage economy. By taking away workers’ rights to fair wage bargaining and standard setting Kiwi workers across the board are going to see their wages fall.What did we see this week? We saw an Australian company that is bringing a call centre to New Zealand. Do you know why it is coming here? Because wages here are 30 percent cheaper. Kiwi workers are 30 percent cheaper. Australian companies are bringing jobs here—Hon Tau Henare: How many jobs will there be?DARIEN FENTON: —and at what price? So does Tau Henare think Kiwi workers are not worth as much as Australian workers? We have the maddest situation at the moment where New Zealanders are going to Australia to get better pay and Australian employers are coming to New Zealand to get lower pay. That is a crazy situation.Every change that this Government is proposing—from allowing employers to walk away from negotiations into why people have been sacked to taking away the right to a tea break—is taking us backwards to those ideas that we saw last century that were tried and miserably failed. We should not be feeling proud and Tau Henare should not be feeling proud that we are attracting Australian business on the basis of being a cheap economy on the basis of being a low-wage destination. That is shameful—that is shameful. It is interesting to me that we never ever hear any mention now of closing the wage gap with Australia. That goal has gone. That has disappeared. The Government has given up on it. Instead it is actually increasing the wage gap with Australia. That is the way Steven Joyce thinks we create job opportunities.But back to the Minister of Labour’s performance. I am very generous so I am going to give him a five out of 10 for health and safety. He has got a bill in front of the select committee now and there is going to be another one coming. But his department has badly botched the change process from moving the old Department of Labour to the new agency—it is a change process called Lifting Our Game and the health and safety inspectors are so disillusioned with it that they call it “Shifting the Blame”—and in the process the department has lost numerous experienced health and safety experts. We cannot afford to do that with our health and safety record.The Minister too I have to say kindly has exhibited some stubbornness and a tendency to think he has all the answers especially in forestry where the death toll this year is now at six. It is now at six. The families who have lost those loved ones are desperate. They are calling on the Minister and they are calling on the Transport and Industrial Relations Committee for an independent inquiry. In fact even the forestry owners are now asking for help. But of course this Minister says he has all the answers.I give him a four out of 10 for responding to concerns—[Bell rung ]The CHAIRPERSON (H V Ross Robertson): The member has run out of calls. I call the honourable—DARIEN FENTON: I raise a point of order Mr Chairperson. No we have not.The CHAIRPERSON (H V Ross Robertson): You have not?DARIEN FENTON: No I think we have got one more call.The CHAIRPERSON (H V Ross Robertson): OK. I have got a record here that says 26 calls.DARIEN FENTON: I thought we had 27. We get 27.The CHAIRPERSON (H V Ross Robertson): Well we need to get this sorted because if the member has another call I am happy to give her the call. I need to find out what is right. I am sorry but the information that the Clerk’s Office has is 26.Chris Hipkins: I raise a point of order Mr Chairperson. The allocation that we were given by the Government whips’ office shows that this being an 8-hour debate—I can run through the numbers for you if you wish to be assured—the Labour Party gets 28.09 percent of the calls which in raw minutes is 134.83 raw minutes and when rounded to number of minutes is 134 raw minutes. Therefore that equates to 27 calls.The CHAIRPERSON (H V Ross Robertson): Well all members are honourable and the member’s word will be accepted. I call the honourable member Darien Fenton.DARIEN FENTON: As I was saying I was about to give the Minister four out of 10 for his response to concerns about the exploitation of migrant workers. Yes he is making the right noises along with the Minister of Immigration Michael Woodhouse but he has still failed to explain how he is going to deal with the increasing exploitation of migrant workers where they are being employed on sub-minimum wages with just 35 labour inspectors throughout the whole country. The Minister of Labour told us during the estimates process that the way he will do that is to free up inspector time by not enforcing Easter shop trading legislation. That would free up just three inspectors when inspectors are actually spending 54 percent of their time on migrant worker exploitation. So that is not going to cut it.Also I do have to ask the Committee why we pass laws. The Easter shop trading legislation has been subject to conscience votes. Seven times I think since I have been in Parliament members have used their conscience to pass a law to say that there should not be shop trading on Easter Sunday. And this is a law that I have supported because I do not want to see workers forced to work on Easter Sunday. Why have a law if the Minister can then just decide that he has got the right to ignore it?I do have to get to the bottom end when I am talking about scoring the Minister. It is a two out of 10 for the employment law changes. I know he is doing the bidding of his political masters I know he is the puppet or the king of the rebirth of the right-wing branch of the National Party but he does have to watch it. This Minister is getting a reputation for being a little bit economical with the truth. First of all there was the thing about the ILO where he said he was going off to the ILO to ask it about his law. When he got there he bottled it and refused to meet with the Secretary-General of the ILO.Dr Rajen Prasad: Really?DARIEN FENTON: Yes. Then there was the story about the forestry workers where he claimed that the forestry workers were completely on side with his revised code of practice when in fact Helen Kelly was there and was able to say that that was not true. The bottom line is that the Minister has been warned and warned again about the severity of his changes to employment law. He has been warned by his officials by the ILO and by numerous organisations that they will result in workers’ wages being cut that collective bargaining will be undermined and diminished as a result that litigation will increase over the petty changes to partial strikes and notice periods and that vulnerable workers such as the cleaners who work in this Parliament and clean hisoffice will be exposed once again to being the meat in the sandwich between voracious tendering processes where the cost of labour is the only competition. He has been warned that these changes will expose New Zealand—Hon Tau Henare: By who? Oh that’s right by you.DARIEN FENTON: —in Cabinet papers by his officials and by the ILO—to international embarrassment through a complaint of breaches to ILO Conventions 87 and 98. This is a Government that is trying to secure a place on the United Nations Security Council—we are supporting that—but it has to do it on the grounds of being a good international citizen. You cannot stand up in international fora and say that you support something and then break the laws at home. Interestingly in the free-trade agreement signed with Taiwan just a couple of weeks ago right in the body of the document it talks about complying with ILO Conventions 87 and 98 as a core part of our commitment to that free-trade agreement. But here we are planning to breach those very conventions in our own country.I think the financial year 2013-14 will be very interesting. It will be an interesting year for Vote Labour and for the Minister. It will become pretty rocky. Can I assure you that we in Labour will be taking the message out to workers and their families up and down the country that Labour is standing up for them. We will do everything we can to defeat these backward-looking changes that the Minister and this Government are proposing. They are backward-looking changes because they will do nothing to grow our economy. They will do nothing to create jobs. They will take us back to a low wage. They will increase the low wages in this country. They are tried and failed policies.MIKE SABIN (National—Northland):“They will do nothing to grow the economy.” Well I have got some good news for that member Darien Fenton because the economy is growing at more than 3 percent. In fact the New Zealand economy is growing at a greater rate than the Australian economy and they are all coming back Darien. They are all coming back Darien.The CHAIRPERSON (H V Ross Robertson): Order! Order!MIKE SABIN: Sorry Mr Chair. They are all coming back so that is why we do not hear too much about the people leaving for Australia because that is right they have all worked out that they should be coming back here and so they are.The Government’s priorities in particular around growing the economy have centred on managing the Government’s finances and building a more productive and competitive economy. If we look at “New Zealand Inc.” what we know as a nation is that we have so much to offer but we need to offer it to the world in a competitive manner and in a way that people want to get hold of our products and so that we are the go-to country. That actually is something that has been heralded by many around the world includingObama’s previous financial adviser who said that the New Zealand economy is the one economy in the world in these challenging environments that is getting it right paying down debt and investing for infrastructure and investing for growth.What we know about business is that ultimately New Zealand is made up largely of a multitude of small businesses. What we know from a macro perspective is that getting the Government’s finances in order and managing the country in a manner that grows a competitive and more productive economy is something that will flow through to the small businesses out there which will then take the risk to invest and grow their businesses. When they grow their businesses they employ people. They will employ people when the settings are right.The secret ingredient to growing a business and to growing the economy—something that the Labour Party is not too up to spec on and certainly members from the Green Party have got absolutely no idea about it—is to be able to produce a product that eitherno one else is producing is a better product than someone else’s is at a more competitive price than someone else’s or is provided in a way that is better than someone else’s out there in the market. It is about being able to do that for less than what it costs to procure that product or deliver that service.When we get those settings right the companies make profits and the ability exists for them to then invest take a risk and grow. That is the quintessential nature of business whether it be in a micro perspective of the economy from a small business employing two three or four people or right through to what we are trying to do as a nation. Those settings are right. As much as this country has been through some enormous challenges in recent times the economy is growing because the settings are right in the labour market for employers to invest and employ. That is the crux of the matter.What are we doing around that? In this vote we talk about the 90-day trial period. Well there have been 13000 jobs come into the market as a result of that. We see the starting out wage for the 16 to 19-year-olds. One thing we know is that many employers will want to employ youngsters but when they are lined up in a situation where you have got someone very low-skilled or possibly someone with even no skills and has never been in the workforce versus someone who has been in the workforce for many years and has experience and the employer has to make a decision about whom they will employ for the given dollar unfortunately a lot of those youths will miss out. We have to make sure that the settings are right to employ those young people. That will bring about 2000 jobs over the next 2 years. Actually I believe it will do a lot more than that because this economy is starting to move and employees out there are starting to realise that they need to hop on. They need to get out there and get working because otherwise they will be left behind. That is exactly what they are doing.We are unravelling the red tape of the Employment Relations Act. We are doing a lot and we will be completely reforming the health and safety side of the workplace. In short what we are doing is “we are doing”. There are three sorts of people in this world: there are the “never do’s” there are the “gonna do’s” and there are the “do’s”. My question to the members on the Opposition benches is what are they doing? They talk about “gonna do” something from time to time but mostly it is just to criticise what we are doing and to offer no alternative vision.Vote agreed to.The CHAIRPERSON (H V Ross Robertson): Honourable members the time for this debate has expired. Given that 8 hours were allowed there are still a number of votes that I will have to put the question on but of course there is no debate on them.The question was put that Vote Food Safety Vote Courts Vote Customs Vote Lands Vote Statistics Vote Senior Citizens Vote Women’s Affairs Vote Immigration Vote Veterans’ Affairs - Social Development Vote Revenue and VoteMāori Affairs stand part of the schedules and that the preamble clauses 1 to 12 and schedules 1 to 7 be agreed to.A party vote was called for on the questionThat the votes the preamble clauses 1 to 12 and schedules 1 to 7 be agreed to.Ayes63New Zealand National 59;Māori Party 2; ACT New Zealand 1; Independent: Dunne.Noes57New Zealand Labour 34; Green Party 14; New Zealand First 7; Mana 1; Independent: Horan.Votes preamble clauses 1 to 12 and schedules 1 to 7 agreed to.Bill to be reported without amendment presently.The result corrected after originally being announced as Ayes 64 Noes 57.