Watts SimonSIMON WATTS (National—North Shore): Thank you very much Madam Speaker. I rise to talk on the second reading of the Annual Reporting and Audit Time Frames Extensions Legislation Bill. Gosh it's tiresome listening to the other side of the House talk about this being a minor change—Don't worry; it's just a simple thing that we need to push through." What that demonstrates is a complete lack of understanding of what we are talking about here this evening and the fact that actually this is a very serious matter.I refer to the department disclosure statement part one where it refers to the key issue and I quote: "to mitigate the impacts of a severe shortage of auditors on obtaining robust audit opinions on end-of-year reporting." I could change the word "auditor" to pretty much any other role in this country and that would still have the same impact. The reality is these auditors are symptomatic of a much broader problem around workforce and a problem that this Government is failing to take action to deliver the results required. Why I guess is an important issue. Why do we have a significant shortage of auditors? Well I'll tell you why: the workforce vacancies for—ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! The member won't tell me why. The member will keep the Speaker out of the debate.SIMON WATTS: The workforce vacancies for auditors in New Zealand is a result of stopping of immigration for normal secondees from overseas. In terms of the audit workforce within this country a huge element of that is new secondees coming from overseas to fill the junior roles. Those taps for that workforce pipeline have basically been turned off.What's happening when the auditors reach two to three years of experience is they are then transitioning rapidly into industry and other jobs. Basically if you imagine the audit workforce as a sieve the sieve is leaking workforce with no flow of new workforce coming in the top. And guess who has their hands firmly on the tap of workforce: this Government. So this Government right here this evening could make a change to immigration numbers to increase audit secondees into New Zealand to be on the ground within weeks. They could take that action right here right now. But what have this Government done this evening? They have announced 50000 offshore visa applications have been cancelled. So they have taken action this evening while we've been sitting in this House to make the severe workforce shortage for auditors and other roles worse and that is absolutely disgraceful. Looking at the bill this basically gives us a flavour—the consequence I think—of a failure to plan and to act.The bill refers to an extension of eight weeks. Well if you look at local government—which I think is a key area which benefits from the value that is added by auditors to identify areas of risk of issue of fiscal risk particularly—the absence of audit particularly around where they don't have the capability within their own teams to do that is going to be extended. So does anyone understand what the implication is of delaying an audit on a business that has significant fiscal problems? Well you delay highlighting that issue. You delay the ability or the escalation of that issue being raised to management to governance and to Government. And what is the result of that? Potentially fiscal losses increase and significantly grow and that is because action could have been taken earlier to mitigate that fiscal risk. So that is quite clearly a simple consequence of the shortage of workforce but more particularly the significant implication of this extension by eight weeks.What is worse is that the audit workforce as I understand are leaving the sector not just for money but also for work-life balance issues. The workload is significant for those few people that are working within the audit sector. The public sector Audit New Zealand get paid less than the private sector and that is very similar in terms of the workforce challenges."