Volume 662 Week 41 - Tuesday 4 May 2010 
Volume 662 Week 41 - Tuesday 4 May 2010 
[Volume:662;Page:10653] 
Tuesday 4 May 2010 
Mr Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Questions to Ministers 
Financial Crisis Greece—Lessons for New Zealand Economy 
1. 
AMY ADAMS (National—Selwyn) 
 to the  
Minister of Finance 
: What lessons can the Government take for New Zealand’s economy from the current Greek financial crisis? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The lesson we can take is that in a world where many Governments are borrowing large amounts of money it is very important to focus on having sound finances. The adjustments in Greece are going to be harsh. It is looking at large tax increases 14 percent cuts to State pay followed by a multi-year pay freeze the closure of many agencies and reductions in pensions. This is somewhere we do not want to go to and we can keep away from it if we focus on having sound Government finances. 
Amy Adams 
: What implications does this episode have for New Zealand? 
Hon BILL ENGLISH 
: The Greek situation is a more extreme version of the position that New Zealand faced about a year ago with a deep recession rising debt and a credit rating that was perhaps in jeopardy. In such a crisis prevention is better than cure. Most observers agree that the two best preventive mechanisms are to have a flexible exchange rate and to keep debt at prudent levels. That is what we want to do. 
Hon David Cunliffe 
: Despite the fact that both Crown debt and unemployment have grown markedly under his administration does the Minister not think that he is being just a little too hard on himself comparing his management to that of Greece? 
Hon BILL ENGLISH 
: I think unlike that member that we have to be aware of where things could go wrong and the fact is that the forecasts we inherited from that member’s Government when we became the Government were sending us in the same direction as Greece. 
Amy Adams 
: What light does the Greek situation cast on alternative proposals for managing the New Zealand economy? 
Hon BILL ENGLISH 
: If the Government had continued to manage the economy in the manner that the previous Labour Government was managing it we would have ended up with ever-increasing public debt and question marks over our credit rating and we probably would have ended up with some kind of major adjustment programme. Unfortunately Labour has not learnt any lessons from that and the policies it is advocating now would make things much worse— 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. I seek your considered ruling on this matter. Standing Order 377(2) requires answers to be “concise and confined to the subject-matter of the question asked” and to avoid “arguments … imputations … [and] discreditable references”. It is established that Ministers can refer to the historical record as the Minister of Finance has done including the record of former Governments. However you have previously ruled that hypothetical references to another party’s policies are not within the Standing Orders. Speaker’s ruling 145/4 defines tightly the area of a Minister’s responsibility Speaker’s ruling 145/7 specifically excludes Opposition policy from that Speaker’s ruling 153/3 underlines the need for content to be factual Speaker’s /ruling 164/7 rules out hypothetical references to another party’s policies and so on. Taken together the intention of the Standing Orders and the Speakers’ rulings is clear on this matter. It is to facilitate the accountability of the Government to the Opposition’s questions rather than to allow the Government an opportunity to make up Opposition policy. The Opposition has no problem with having a debate about the previous Government’s record but we would ask you to consider the matter of whether the Minister has on this occasion stepped across the line into hypothetical Opposition policy. 
Mr SPEAKER 
: I say to the Hon Dr Nick Smith that a point of order is being considered so he must not interject. Had the Hon Bill English gone on at some length about Labour Party policies I would have agreed with the Hon David Cunliffe’s point of order. But there was only the briefest possible reference at the end of his answer. In relation to this whole issue I would say that if Opposition members do not want Ministers to comment on Opposition positions they need to be a little more cautious about their interjections. I heard all sorts of interjections as the Minister started to answer his questions today about his having been lucky to inherit good things from the previous Government and all that kind of thing. So if Opposition members do not want Ministers to comment on either past policy or current policy of the Opposition they need to be more careful with regard to their interjections. I believe today that the Minister has not transgressed. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. To clarify that point of order—I am not trying to relitigate your ruling but for future guidance—can we be clear that historical references to a former Government’s policy or performance are within bounds but at least extended references to hypothetical positions that an Opposition might take are out of bounds? 
Mr SPEAKER 
: I accept the general point that the member is making. But on this particular occasion if I recollect what the Minister said he said something along the lines of the policies that Labour is continuing to espouse would have a similar effect. I do not think there is enough detail in that to argue that the Minister is ascribing hypothetical policies to the Opposition. But I sympathise with the fundamental issue that the member is making. 
Hon David Cunliffe 
: Can the Minister explain why when Greek public debt is around 115 percent of GDP and New Zealand’s net debt is around one-tenth of that amount he is running down his country and putting New Zealanders’ exports and jobs at risk? 
Hon BILL ENGLISH 
: I am simply drawing attention to the fact that when the Government came into office it faced forecasts in the December 2008 Economic and Fiscal Update that showed net debt soaring to 50 percent of GDP and permanent deficits—that is never-ending deficits and ever-rising debt. That certainly would have been a path to the Greek kind of crisis. 
Mining in Conservation Areas—Minister’s Recommendation in Cabinet Paper 
2. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Minister of Energy and Resources 
: Does he stand by his recommendation in his Cabinet paper of 10 February 2010 that 467517 hectares of national park land and protected conservation land be considered for opening up to exploration and mining? 
Hon GERRY BROWNLEE (Minister of Energy and Resources) 
: 
 I stand by the subsequent Cabinet decision of 22 March 2010 which proposed a net addition of 5000 hectares to schedule 4 land. So quite patently my answer is no. 
Hon Phil Goff 
: Is it correct that in the paper he and the Minister of Conservation signed off he proposed removing protection from mining in nearly half of Kahurangi National Park near Nelson and that he proposed mining in most of Rakiura National Park covering almost all of Stewart Island and also a big part of Mount Aspiring National Park; and why was he advocating in that paper that those areas be opened up for mining? 
Hon GERRY BROWNLEE 
: I am quite sure that if the member read the paper he would see that we were proposing that those areas might be better prospected which is prevented at the present time. We had previously made it very clear that we were conducting a stocktake of minerals in the conservation estate. Those areas are minerally prospective and that is why the recommendation was there. But of course Cabinet rejected that. Cabinet has said no to mining in those areas and that is the end of the story. 
Hon Phil Goff 
: Did Cabinet reject the recommendations that he and the Minister of Conservation made because they were ill-considered and totally unrealistic or did Cabinet actually decide that it was better to take the first 7000 hectares leading up to the full implementation of what he recommended? 
Hon GERRY BROWNLEE 
: The discussion centred on the stocktake of minerals in the Crown conservation estate—in particular on minerals that were known to be deposited in schedule 4 land. Cabinet made— 
Hon Darren Hughes 
: How does that add to an answer? 
Hon GERRY BROWNLEE 
: Through historic information that was available. There was not sufficient information to back that quite frankly so there was a decision which stands that we will not be mining in those national park areas or in the conservation areas. I cannot bind the Labour Party in terms of what it may do in the future. All I can do is look to the past and look at Labour’s record—and Labour was the only Government in history to allow mining on schedule 4 land. 
Chris Auchinvole 
: Has he seen any statements of support for mining in areas of high conservation value by members of this House? 
Hon GERRY BROWNLEE 
: I have seen some very visual statements of support from members of this House. The picture I am holding shows a number of Labour Party members visiting the Pike River coalmine on the West Coast. I can only assume that they were there to tell the workers that if Labour ever becomes Government again it will be shutting them down. This mine is underneath schedule 4 land; one accesses conservation land to get there. Does Phil Goff support this or not? 
Hon Phil Goff 
: Contrary to what the Minister has just alleged can he confirm that the Labour Government never mined in protected schedule 4 land that there was a consensus between National and Labour for more than a decade that these areas were too important to be mined and desecrated in that way and that it is this Minister and the so-called Minister of Conservation who recommended breaking that consensus? 
Hon GERRY BROWNLEE 
: No I cannot confirm that. I refer the member to a parliamentary question I answered from Mr David Garrett. The question listed two permits on schedule 4 land that were granted by the previous Labour Government in its term of office. 
Hon Phil Goff 
: When does the Government intend to bail out from its proposal to mine Great Barrier Island and the Coromandel or does it intend to ignore public opinion which is running at three to one against mining those very important areas for Aucklanders and people in the Waikato Bay of Plenty? 
Hon GERRY BROWNLEE 
: I make the simple point that the Labour Party has been ignoring public opinion running three to one against it for a very long time. However we are engaged in a process of consultation at the moment and we will see that through to the end. I will not prejudice that result today much as the Leader of the Opposition may want to. But I do ask this question: why is it that the Labour Party can go to Blackball one year to celebrate May Day with the miners and can march against them down Queen Street the following year? That is a confused position. 
Hon Phil Goff 
: Does he intend to ignore the 40000 people who marched down Queen Street in the biggest protest in a generation who tried to tell him that his proposal to mine the most precious areas of New Zealand is wrong? 
Hon GERRY BROWNLEE 
: I would argue that the biggest protest in a generation was the hikoi out the front of Parliament over the foreshore and seabed. That did not stop Labour from doing exactly what it wanted and leaving this country with an absolute mess. 
Hon Phil Goff 
: Is it correct that the mining industry was in discussion with the National Party long before National declared that it was intending to mine protected areas; if so why was that kept a secret rather than trying to seek a mandate from the public before the election and not imposing National’s views on it after the election against public opinion? 
Hon GERRY BROWNLEE 
: That is a completely untrue statement but it is typical of the conspiratorial approach that Labour takes to most things when it does not have any decent facts to mount an argument on. 
“Three Strikes” Legislation—Reasons for Government Support 
3. 
DAVID GARRETT (ACT) 
 to the  
Minister of Police 
: Why has the Government agreed to support ACT’s “three strikes” policy passing into law? 
Hon JUDITH COLLINS (Minister of Police) 
: 
 The Sentencing and Parole Reform Bill delivers on National’s pre-election promise to deny parole to the worst repeat violent offenders. Parole is not a right for prisoners; it is a privilege. This privilege is earned and it should not be granted to those who demonstrate total disregard for the law by continuing to commit serious violent offences despite warnings. The bill will put the interests of victims and the wider community ahead of the interests of our worst serious violent offenders. 
David Garrett 
: What is the level of public support for the “three strikes” policy? 
Hon JUDITH COLLINS 
: Of the submissions received 94 percent supported the Sentencing and Parole Reform Bill. They stated concerns about violent crime public safety and the need to hold offenders to account. Many supporters wanted to redress what they described as the disparity between the rights of the offenders and those of victims and to spare victims the stress associated with repeat parole hearings. I am also aware that an independent poll commissioned by that member’s party showed 75 percent public support for this regime. 
Hon Rick Barker 
: Has she read the official advice that National-ACT’s “three strikes” policy is unlikely to have a deterrent effect and will result in fewer guilty pleas more appeals against convictions and sentences and possibly an increased rate of homicide; if so why is the Government proceeding with a policy that will not prevent crime may lead to increased violent crime and clearly will make things worse for victims? 
Hon JUDITH COLLINS 
: We have received an awful lot of advice and some of it the Labour Party would enjoy because of the soft approach it takes to criminals. However I believe that it is very important to note that we received some very good advice on this issue particularly from victims and their families. I remind that member that most offenders get a set period of sentence but unfortunately all victims get a life sentence every time. 
David Garrett 
: What impact will this bill have on the victims and families of victims of repeat offenders? 
Hon JUDITH COLLINS 
: This bill will ensure that the victims and families of repeat offenders will not have to undergo the additional stress of attending regular parole hearings. This regime will also help stop people becoming victims. It is a sad fact that some high-profile murders would not have been committed if the perpetrators had been serving full sentences for their crimes. This Government is serious about better meeting the needs of victims and putting victims at the heart of our justice system something the previous Labour Government did not care about. 
Rahui Katene 
: Is she concerned about claims from Peter Williams QC that the “three strikes” policy is “hysterical” legalisation that taking away parole means that there is no deterrent for crime and there is also no incentive for people to rehabilitate and is this a direction she thinks the police should be promoting? 
Hon JUDITH COLLINS 
: No. Mr Williams has spent a lifetime defending the worst repeat violent offenders in this country. 
Unemployment—Minister’s Statement 
4. 
Hon ANNETTE KING (Deputy Leader—Labour) 
 to the  
Minister for Social Development and Employment 
: Does she stand by her statement “We absolutely believe that work is the best way out of poverty for people and we are going to back them and support them into those jobs every time”? 
Hon PAULA BENNETT (Minister for Social Development and Employment) 
: 
 Yes and I also stand by the rest of the quote: “It’s going to be done with fairness it’s going to be done with a level of support that I think beneficiaries haven’t seen before. But there are going to be mutual obligations and expectations as well.” 
Hon Annette King 
: What confidence can parents have in her when she promised before the election that National in Government would retain all existing subsidies and fee controls and would deliver cheaper childcare to parents but within months of becoming Minister she breaks that promise and is taking away childcare assistance aimed at helping families to get ahead? 
Hon PAULA BENNETT 
: It is quite good that months later members of the Labour Party have read the papers that identify the changes— 
Mr SPEAKER 
: That is not an appropriate way to start answering a question. The Minister was asked a question about the Government’s position. She should not start her answer by talking about the Opposition saying that it is quite good that the Labour Party might have done something. That is not the way to start answering a question. 
Hon PAULA BENNETT 
: Currently families on incomes of nearly $100000 can get childcare assistance via Work and Income. We are raising the abatement thresholds as the member might have known if she had read the papers. The papers say that beneficiaries can have their assistance increased from $80 to $100 a week. Approximately 28000 parents will be better off. We are taking those abatement thresholds back to the 2008 levels. That is something I support. 
Hon Annette King 
: When she said at the weekend that she makes “informed decisions” who informed her that a family with three children with both parents working and both parents earning around the average wage of $49000 are high-income earners and therefore should have their childcare assistance cut? Is that the new definition of a high-income earner under a National Government? 
Hon PAULA BENNETT 
: To deal with actual numbers I point out that those households were earning $99320 and could get childcare assistance. We are taking that level down to $93600. As I said previously more than 28000 people will gain from the abatement thresholds this Government is bringing in. 
Katrina Shanks 
: Can the Minister comment on policies that have tried to address long-term dependency? 
Hon PAULA BENNETT 
: The last 10 years have been marked by feeble half-hearted attempts to tackle welfare dependency. In fact the Auditor-General’s report said that the changes the previous Labour Government made did not go far enough to have a real impact. We certainly saw that in the numbers of both sickness and invalids beneficiaries which went up by 50 percent in that 9-year period. 
Sue Moroney 
: Did the Minister receive official advice that her proposal to retarget childcare assistance income thresholds would reduce the income of childcare providers and reduce children’s participation in early childhood education? 
Hon PAULA BENNETT 
: I received a high level of advice on this policy because we looked at it really closely. To be clear I point out that it has been grandparented for 3 years. Approximately 2137 people will not be eligible for the assistance but others will be and we believe that that is fair and reasonable. More than 28000 people will gain from the increased abatement thresholds. 
Sue Moroney 
: I raise a point of order Mr Speaker. I seek your assistance. I asked a very specific question of the Minister and she failed to address it at any level. The question was about whether she had received official advice on two issues. One issue was that the income of childcare providers would be reduced and the second was that children’s participation in early childhood education would be reduced. She failed to address either of those questions. 
Mr SPEAKER 
: If the member wants me to assist with obtaining an answer she has to choose which question she is going to ask. I listened to the member’s question and I listened to the Minister’s answer and it seemed to me that the Minister did try to answer the question. The member has admitted that she asked two questions in a supplementary question. Members are not meant to do that. I can be of more assistance if only one clear question is asked. 
Sue Moroney 
: Does the Minister accept that her proposal reduces the funding for childcare by $57 million over 4 years and will affect more than 11000 families thereby increasing the childcare costs of those families by more than $5000 on average? 
Hon PAULA BENNETT 
: Yes I take into account that the initiative will save $57 million over 4 years. We have decided that we will put that money into abatement thresholds so that it goes to those who need it most those who can get out there and earn a bit of money for their own pockets gain a work ethic gain a job and get further ahead. I will back them every time. 
Sue Moroney 
: I seek leave of the House to table a document. It is a Cabinet social policy committee document on the Future Focus programme outlining the official advice the Minister received that children’s participation in early childhood education would reduce and so would the income of childcare providers. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Hon PAULA BENNETT 
: I seek leave to table the document that states quite clearly at the top of it that there were changes to childcare assistance—something the Labour Party said was hidden. 
Mr SPEAKER 
: What is the document? 
Hon PAULA BENNETT 
: It is an official document on Future Focus and benefit changes. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Mr SPEAKER 
: I have called Rahui Katene for a supplementary question. I ask members to please show her some courtesy. [ 
Interruption 
] I apologise to the member; the Hon Annette King and the Hon Paula Bennett will cease their exchange and show some courtesy to Rahui Katene. 
Rahui Katene 
: Has the Minister seen the recommendation from the Child Poverty Action Group that the Government could use the opportunity of the tax reforms to improve incomes for beneficiaries with children by immediately extending the in-work tax credit to all low-income children and will she stand up for these children and support them to get out of poverty by advocating with the Minister of Finance for this to happen? 
Hon PAULA BENNETT 
: Shivers! I am so sorry Mr Speaker; I was a little distracted by the front-bench member on the other side. I do apologise. 
Mr SPEAKER 
: What has been demonstrated here is what I was concerned about. The exchange across the House between the Hon Annette King and the Hon Paula Bennett was distracting the House it was unfair to Rahui Katene who was not being shown courtesy and the Minister did not listen to her question. I invite Rahui Katene to repeat the question. 
Rahui Katene 
: Has the Minister seen the recommendation from the Child Poverty Action Group that the Government could use the opportunity of the tax reforms to improve incomes for beneficiaries with children by immediately extending the in-work tax credit to all low-income children and will she stand up for these children and support them to get out of poverty by advocating with the Minister of Finance for this to happen? 
Hon PAULA BENNETT 
: My apologies to the member for not listening to her previously. Yes I have seen the report and I suppose this is where we stand quite differently. I certainly stand by families that are getting into work and are earning more money and having children live in those sorts of households. I do not want just to increase those benefits making people become even more benefit-dependent. 
Mining in Conservation Areas—March Protesting Mining Proposals 
5. 
METIRIA TUREI (Co-Leader—Green) 
 to the  
Minister of Energy and Resources 
: Does he agree with Minerals Industry Association chief executive Doug Gordon that the estimated 40000 New Zealanders who marched against Government mining proposals last weekend were misled by the organisers? 
Hon GERRY BROWNLEE (Minister of Energy and Resources) 
: 
 I have no responsibility for statements by Mr Gordon and I am very conscious of the fact that many of those people who marched last weekend were motivated by their very genuine concerns. However I think it is worth noting that there were a number of signs present at that rally ranging from “GE free” right through to “ETS” which makes me think that a number of people may have decided to use May Day just as a general day of protest. 
Metiria Turei 
: Is it misleading to say no one is talking about mining in national parks then release a proposal to mine in our national parks? 
Hon GERRY BROWNLEE 
: The proposal that has been released looks at the removal of 3000 hectares that are discontiguous with Paparoa National Park but which were made part of it in 2008 by the previous Government against the advice of the local conservation board and against the advice of the Department of Conservation at the time. All that the removal of schedule 4 protection does is to enable exploration—one step further than what is enabled now. It does not necessarily lead to mining nor does it change the underlying status of the land. 
Metiria Turei 
: Was it misleading to tell New Zealanders that schedule 4 “says to the mining industries of New Zealand: ‘These are no-go areas’ ” as Nick Smith did when the schedule 4 land was set aside? 
Hon GERRY BROWNLEE 
: No because that is exactly what schedule 4 provides at the present time. That is why we are having a discussion with New Zealanders about whether that protection should continue on some very discrete parts of the estate—about 2 percent of all of the schedule 4 land in fact. 
Peseta Sam Lotu-Iiga 
: Does he believe that it is possible to balance the economic concerns of miners and the conservation concerns of protecting endangered species in such a way that all parties are happy? 
Hon GERRY BROWNLEE 
: Yes I do. It is possible to balance the economic concerns of miners and the conservation concerns of protecting endangered species in such a way that all parties are happy. I know that the member who asked the primary question agrees with that. 
Metiria Turei 
: Is it misleading to indicate in one Government document that a national park is a no-go area for mining and in another Government document issued on the same day to state that the same national park is being considered for competitive tender for mineral exploration? 
Hon GERRY BROWNLEE 
: On the face of that I would say no but without giving the context of what is being proposed to New Zealanders I think it is misleading. 
Metiria Turei 
: Is it misleading to say on television: “I have a great love for the conservation estate in this country. I don’t want to see it destroyed” while at the same time investigating the entirety of Rakiura—Stewart Island—all of Paparoa National Park and all of Mount Aspiring National Park for mineral exploration? 
Hon GERRY BROWNLEE 
: It is abundantly evident and clearly stated that the Government has no further interest in any mineral prospectivity in the Mount Aspiring National Park. 
Hon David Parker 
: What about Kahurangi? 
Hon GERRY BROWNLEE 
: Nor Kahurangi National Park nor any number of other national parks. The member is being simply mischievous in making that statement. 
Metiria Turei 
: Is it misleading to suggest that coal is sexy? 
Hon GERRY BROWNLEE 
: Not according to two of New Zealand’s leading actresses who have got themselves extremely lathered up over my simple statement—“sexy coal”. 
Metiria Turei 
: Who understands the real story: the National-led Government which says one thing to the public on one day and something completely different to the mining industry on the same day or the 40000 New Zealanders who took to the streets in the weekend to show very clearly where they stand on protecting our most treasured places? 
Hon GERRY BROWNLEE 
: There are three parts to that question so I will answer them one after the other in reverse sequence. First I do not have anything other than respect for those people who marched on the weekend and who have genuine concerns. I make that very very clear. Second we have not given one message to one group and another message to another. Third all of the information relating to these decisions has been released and is in the public arena. We are hiding nothing. We will go through this consultation process because that is what would be expected of us. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. Just to make it clear to the House the Labour Opposition will have no objection to Nikki Kaye taking a supplementary question. 
Mr SPEAKER 
: The member knows that that is outside the Standing Orders but I trust it was done in good humour so we will choose to ignore it. 
Budget 2010—Job Creation and Reduction of Cost of Living 
6. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: How will Budget 2010 create jobs and reduce the cost of living for hard-working New Zealanders? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 In many ways it will support growth by getting the economy back to saving exporting and investing rather than relying on borrowing and Government spending. It will provide better front-line public services particularly in health and education. It will continue the Government’s multibillion-dollar investment in infrastructure supporting jobs and growth. It will control public debt and it will deliver a fairer and more incentivised tax system. 
Hon David Cunliffe 
: Why did his Government gut KiwiSaver and defer New Zealand Superannuation Fund savings when the Australian Government has further increased its rate of compulsory savings; and why does he not follow Australia’s example and increase Government contributions to KiwiSaver? 
Hon BILL ENGLISH 
: In respect of the Australian decision on its superannuation contributions it is talking about a 3 percent increase over 10 years. We expect to do much better than that. We expect New Zealand wage earners to have a bigger increment in their hands much sooner than that and they will have a choice as to whether they save it in KiwiSaver or in some other way. 
Chris Tremain 
: How will the Budget 2010 outlook compare with that of 18 months earlier? 
Hon BILL ENGLISH 
: Fortunately this Budget will be prepared against a background of 12 months of sound management by this Government rather than 9 years of mismanagement by the previous Government. In October 2008 the pre-election forecast showed net debt climbing rapidly; by December 2008 the forecast showed net debt soaring past 50 percent of GDP and permanent deficits. In this Budget we will not have to take action to improve that kind of mismanagement. 
Hon David Cunliffe 
: Why when New Zealand’s unemployment is rising and Australia’s is falling is he still doing the opposite of Australia: raising GST cutting contributions to the Superannuation Fund and removing incentives to save? 
Hon BILL ENGLISH 
: The member is wrong about some of those things. We are putting together a Budget and a tax package that will be suitable for the needs of the New Zealand economy. Unfortunately the New Zealand economy was managed badly for 9 years. The previous Government squandered the best opportunity for economic growth in a generation and we have to fix it. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: Point of order the Hon David Cunliffe. 
Hon BILL ENGLISH 
: Mr Speaker I am still on my feet. 
Mr SPEAKER 
: But he has raised a point of order. 
Hon BILL ENGLISH 
: He has not Mr Speaker; he simply stood up. 
Mr SPEAKER 
: No he has called a point of order and I must hear it. The Hon David Cunliffe. 
Hon David Cunliffe 
: Sit down Bill. 
Mr SPEAKER 
: The member had better have a good point of order. 
Hon David Cunliffe 
: I recall the preceding point of order with the same Minister in question No. 1. Mr Speaker you have ruled that historical references to a former Government are in bounds where they are succinct and related to the question asked. You have further ruled that hypothetical references to another party’s policies are out of bounds. This Minister has in his reply to this question tried to reinterpret the historical record making up stories about the previous Government’s performance and that would be out of the bounds of the ruling you made earlier Mr Speaker. 
Mr SPEAKER 
: If the member thinks back to his question he will see that he asked the Minister for his opinion about something asking why the Government was doing this or that. The Minister has to have some licence in answering a question asking for his opinion. I cannot rule that the Minister give a particular opinion; he will give his opinion. Sometimes when Ministers are asked for their opinions members may get answers that are not exactly what they want to hear. I believe the reference he has made so far was not ascribing any particular policies to Labour; he was giving his opinion about previous policies. I think the Minister is entitled to do that when he is asked for his opinion. 
Hon David Cunliffe 
: Why unlike in Australia will this Minister not roll out a real plan for jobs and growth such as creating more than 1200 jobs by building train carriages for Auckland’s electrification project? 
Hon BILL ENGLISH 
: As has been explained the business of building those trains is reasonably sophisticated. One would not expect a taxi company to suddenly decide to manufacture its own cars in New Zealand. In the end the KiwiRail board will make that decision. It is clear that KiwiRail will need to renew its rolling stock. It has the capacity to do that and perhaps its workshop should focus on something that is within its capacity where it can be competitive. 
Chris Tremain 
: What economic recipe would see hard-working New Zealanders lose their jobs and increase their cost of living? 
Hon BILL ENGLISH 
: The kind of recipe that would have that effect for New Zealanders would be promulgated by a Government that set out to borrow a whole lot more money spend it on low-effectiveness public services raise taxes and leave a lot of debt for future workers to pay back. That recipe is the one promulgated by Phil Goff and his finance spokesperson. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I do not think that we could have had a clearer example of a breach of your ruling from earlier in the day than that. Not one part of that reply as he finished it and made it clear was within the areas of responsibility of the Minister of Finance. 
Mr SPEAKER 
: The great bulk of the Minister’s answer was absolutely within the Standing Orders. It was the last bit that he should not have ascribed. But this is a political Chamber. If he had gone on I would have absolutely cut him off but for goodness’ sake he added only about five words there that were what I would consider to be in breach. But most of his answer was describing policies that he believed would be the wrong recipe. OK; then he did transgress in suggesting that those policies are what Labour is promoting. But we cannot divorce this place from political exchange. I have heard several Ministers and members particularly Labour’s spokesperson on finance asking questions where they have inserted their views about things into the question. That is the dilemma but I do not think I should try to stop that. After all this Chamber is a political debating chamber and I try to make sure that transgressions do not go over the top. But if the Minister had continued to ascribe a whole lot of particular policies to Labour I would have stopped him because the Minister has no right to do that. 
Water Management—Water Take Consents and Metering Regulations 
7. 
COLIN KING (National—Kaikoura) 
 to the  
Minister for the Environment 
: What proportion of New Zealand water take consents are currently measured and how will the Government’s regulations to require metering improve this? 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 Mr Speaker— 
Hon Shane Jones 
: Privatisation; privatisation.  
Hon Dr NICK SMITH 
: Ha ha! If we meter the water they cry “privatisation” eh? Only 31 percent of water by volume is currently measured. New regulations announced on Friday will progressively improve that to 92 percent by 2012 and to 98 percent by 2016. The regulations apply to larger takes of over 5 litres per second which is the equivalent of the use of about 250 homes. Although 39 percent of consents are smaller than that they take only 2 percent of the water by volume so the metering costs for those cannot be justified. 
Colin King 
: Why is the Government proposing to use national regulations to require metering rather than using the national environmental standard or leaving it to regional councils? 
Hon Dr NICK SMITH 
: If we left it until water consents come up for renewal under a national environmental standard it would take more than 20 years before we would get reliable information on water extractions. That is far too slow. The alternative is to leave it to regional councils to review all individual consents which is estimated to cost many millions of dollars in paperwork. The national regulation approach is the most efficient and the least costly way in which we can get reliable information on water takes and as a consequence deliver a step change in freshwater management. 
Brendon Burns 
: If consent holders’ water meters show unused allocation does the Minister believe that they should be able to sell those surpluses at whatever price they can command; and is that not privatising the common right all of us have as New Zealanders to our water? 
Hon Dr NICK SMITH 
: No not at all. I do not agree with that. I say to the member that if we are to improve the management of water—something I think every member of this House would agree we need to do—surely we need to measure it and that is exactly what this Government is doing. 
Colin King 
: What number of water meters will need to be installed to meet the new requirements and what is the likely cost? 
Hon Dr NICK SMITH 
: The regulations will affect 11000 resource consents that take water. Large consents—over 20 litres per second—will be required to have meters by 2012. Consents for 10 litres per second will require meters by 2014 and the smaller 5-litre consents will require meters by 2016. The initiative is expected to come at an overall cost of about $40 million but that needs to be considered in the context of water being worth over $5 billion a year to the New Zealand economy. The regulations contain pragmatic exemptions to ensure that metering is required only where it is necessary and where its cost will help us to improve water management. 
Health Services—Minister’s Statements 
8. 
Hon RUTH DYSON (Labour—Port Hills) 
 to the  
Minister of Health 
: Does he stand by all his recent statements on health services? 
Hon TONY RYALL (Minister of Health) 
: 
 Yes including the statement that the issues the member raises are clearly not the result of this Government reducing funding in health because it has provided the district health boards with $536 million extra funding this year. One of the major reasons for individual district health boards looking carefully at their service priorities is that the last Government set them on a track to delivering towards $200 million of unfunded services and we are endeavouring to fill that gap. 
Mr SPEAKER 
: The Minister should not go on too long in that vein. He was just asked whether he stood by his statement. 
Hon Ruth Dyson 
: Given the $536 million extra in the health budget what does he say to Age Concern elder abuse coordinator— 
Mr SPEAKER 
: I have called the Hon Ruth Dyson and her question should be heard. 
Hon Ruth Dyson 
: What does he say to Age Concern— 
Mr SPEAKER 
: I apologise to the Hon Ruth Dyson but there is so much noise I cannot hear her question and that is unreasonable. [ 
Interruption 
] I say to all members that while I am on my feet they must not interject. 
Hon Ruth Dyson 
: What does he say to Age Concern elder abuse coordinator Jenny Michelle from Auckland’s North Shore who says that more elderly people who are trying to live safely in their own homes are now being denied Meals on Wheels help in an effort to save his health budget $5.13 per person per day? 
Hon TONY RYALL 
: If those facts are correct and the member wants to make that information available to me I will look into the case. But I will tell members opposite that we are putting more money into health services and more and more New Zealanders are receiving better front-line services. 
Hon Ruth Dyson 
: With 3000 elderly and frail people in the Southland District Health Board area 1500 in Canterbury and hundreds in Kapiti having their home support cut or reduced Horowhenua proposing to close its rehabilitation beds for older people and eye surgery at Nelson Hospital being reduced how many more cuts in health services for the elderly can be expected over the coming few months? 
Hon TONY RYALL 
: First of all those numbers the member quotes are quite incorrect. 
Hon Ruth Dyson 
: I raise a point of order Mr Speaker. The Minister is implying that I am misleading the House and I take exception— 
Mr SPEAKER 
: The member will resume her seat immediately. The member inserted a string of what she claims are facts into her question. The Minister has disputed those figures and he is perfectly at liberty to do that. He is not saying that the member is misleading the House; he is just saying that his figures do not agree with the member’s figures and he is perfectly at liberty to do that. 
Hon TONY RYALL 
: I raise a point of order Mr Speaker. The member made another unparliamentary comment—the same as she made the last time the House sat—and she should apologise. 
Hon Ruth Dyson 
: I withdraw and apologise. 
Hon TONY RYALL 
: I say to those members to remember the history. That member’s Government stopped home support cleaning for 700 people in Otago-Southland. Ruth Dyson was the Minister for Disability Issues when that Government cut home cleaning for 300 people in Wanganui and she never said a word. 
Dr Paul Hutchison 
: What reports has he received on improving front-line services? 
Hon TONY RYALL 
: I have received reports indicating improved front-line services at the Counties Manukau District Health Board in South Auckland. Last year it delivered a record 15200 elective surgeries an increase of 14 percent. It made almost 30000 surgical first specialist assessments an increase of around 10 percent. The emergency department there is seeing more people faster. It is seeing around 90000 patients a year and it is meeting the new Government’s 6-hour maximum waiting target. Around 7000 patients attended a nurse-led clinic which is a 16 percent increase on the previous year. If members want to know where the additional money in health is going it is going into improved front-line services in priority areas that the party opposite neglected for years. 
Hon Ruth Dyson 
: Why did he allow the 198 Youth Health Centre to close last Friday after assuring the public of New Zealand that it would give continued services to young people in Canterbury? 
Hon TONY RYALL 
: I am advised that the Waipuna Trust has been contracted to provide mental health services and alcohol and other drug services for young people for 6 months. It has employed the staff from the 198 Youth Health Centre and clients have transferred across. An existing local practice has accepted 198 Youth Health Centre patients. Records are transferred but youth can choose to go elsewhere. Youth sexual health services are available free at all practices across the city. The funding previously used for the 198 Youth Health Centre is supporting these new arrangements of front-line services in Christchurch. 
Prisons—Level of Drug Use 
9. 
JONATHAN YOUNG (National—New Plymouth) 
 to the  
Minister of Corrections 
: Has she received any reports that indicate the level of drug use in the country’s prisons? 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 Yes. Random drug-testing over the last 9 months indicates that the level of drug use in our jails has dropped to its lowest level since 1998. The figures show that positive results have dropped to 10 percent across all prisoners tested throughout the country. Half of New Zealand’s prisons have rates of 10 percent or less with two prisons having no positive results so far this year. Those prisons are Auckland Region Women’s Corrections Facility and Christchurch Women’s Prison. 
Jonathan Young 
: Can she explain the reason for these good results? 
Hon JUDITH COLLINS 
: Yes. One of the main reasons is that legislation passed by this Government has allowed for the monitoring of prisoners’ phone calls and mail. This has enabled the Department of Corrections to more effectively target those responsible for smuggling drugs. Twelve drug-dog teams across New Zealand regularly search visitors and their vehicles prisoners’ cells and incoming mail. I was very impressed by the skills they demonstrated this morning at the national police dog championships. The results also reflect the Government’s commitment to doubling the number of places available for prisoners to undertake treatment for drug and alcohol addiction. 
Rail—Business and Economic Research Ltd Report 
10. 
Hon DARREN HUGHES (Labour) 
 to the  
Minister of Transport 
: What strengths does he see in the Berl Economics report  
Business Case for Building Rolling Stock in New Zealand 
 and what response if any does the Government intend to make to the report? 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 It is difficult to see strengths when the report is based on highly debatable assumptions. For example the cost per electric unit has been compared as if the examples in the report are all the same when quite obviously they are not. The report suggests that the newer Asian manufacturers are having trouble selling trains overseas and then suggests that New Zealand though could somehow be a successful exporter. The economic benefits are calculated by suggesting that the trains will be built mostly by skilled train manufacturers who are currently unemployed which is doubtful. It has also made no allowance for any commercial risk for the trains to be built in this country despite the fact that it has never been done before which frankly is inexplicable. 
Hon Darren Hughes 
: Why did he suggest yesterday that the new electric multiple units are high-tech and much more challenging to manufacture than conventional carriages when the Business and Economic Research Ltd model already has the engines bogies and electronics being sourced from overseas which would leave 70 percent of the work to be done by our skilled Kiwi work force? 
Hon STEVEN JOYCE 
: Because these are highly specialised pieces of equipment. They are very high-end units which have never been built in this country before. I note that a previous Government which the member represented also took that view because it bought the trains for Wellington from Korea rather than having them built— 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: I say specifically to the Government front-benchers that a point of order was clearly called. Members should cease interjecting. 
Hon Darren Hughes 
: My question was free of any political comment or commentary. I asked the Minister specifically about the difficult or high-tech parts that he referred to. Those parts are being sourced from overseas leaving the more elementary aspects of the manufacturing to be done here in New Zealand. I am not sure whether he heard the question or did not respond to that part of it. I particularly separated that part of the manufacturing so that I could get an answer on the point of the more basic aspect of the proposal that has been put forward. 
Hon STEVEN JOYCE 
: In response I was noting that together these are very high-spec pieces of equipment and I was noting by comparison that it has not been done in this country before. That was the reason for noting another example which I think is an entirely fair answer to the question. 
Mr SPEAKER 
: On this occasion I cannot expect the Minister to give a particular answer. The Minister has basically disputed the member’s assertion when he asked the question—that some of the manufacture is fairly simple. The Minister argued that the manufacture is complex and in disagreeing with the fundamental aspect of the member’s question I believe he has answered it. He has not dodged it altogether at all. 
Clare Curran 
: When the Minister told  
Close Up 
 last night that building the new electric trains in New Zealand would be a step too far in terms of capability was he aware that Hillside railway workshops in Dunedin are already building 17 AK class carriages for the Tranz Scenic service and that the quality of those carriages is equal to anything from overseas; if not why not? 
Hon STEVEN JOYCE 
: I absolutely am aware of what is being built in the workshops in Dunedin. They are doing a fantastic job of building carriages and refurbishing and rebuilding rolling stock. I point out to the member that it is quite a different exercise to build electric multiple units which are engines and carriages in the same train the last time I looked. 
Hon Trevor Mallard 
: Has he ever visited either Woburn or Hillside workshops? 
Hon STEVEN JOYCE 
: No I have not. 
Hon Darren Hughes 
: Does the Minister agree with the comments of the Prime Minister to the working party on this project that “We are spending all this money. It would be good if as much of it as possible could come back to New Zealand.”; and if he does agree with the Prime Minister can he not see that this plan increases the country’s GDP increases revenue to the Crown through taxation creates hundreds and hundreds of manufacturing jobs all within the allocated budget for rail and is exactly the kind of step change in economic activity that the Government should be supporting? 
Hon STEVEN JOYCE 
: I indicated in my answer to the primary question that I do not agree with the assumptions and therefore the result of the report but I do agree with the Prime Minister that we absolutely should do as much as we possibly can in this country. It is very important to note that the decision is to be made by KiwiRail which says that it is unlikely to do the work because it does not want to take the commercial risk. I do not think politicians should be placing themselves over the top of KiwiRail. Let us face it: the last time politicians in this country decided that they could make a decision on rail they spent $1 billion for a $388-million asset. 
Criminal Offending—Cooperation in International Criminal Law Proceedings 
11. 
SIMON BRIDGES (National—Tauranga) 
 to the  
Attorney-General 
: What international efforts has the Attorney-General recently participated in to foster increased cooperation in combating transnational criminal offending? 
Hon CHRISTOPHER FINLAYSON (Attorney-General) 
: 
 Last week I attended a meeting in Washington with the Attorneys-General of the United States England and Wales Canada and Australia. This grouping of common law countries seeks to share ideas and deal with issues of mutual concern including countering violent extremism and organised crime and encouraging closer legal cooperation. As part of the meeting I led a discussion on cooperation in international criminal law proceedings. The discussion explored the possibility of improving cooperation in the investigation and prosecution of cases involving genocide crimes against humanity and war crimes. 
Simon Bridges 
: What progress was made during the recent quintet meeting? 
Hon CHRISTOPHER FINLAYSON 
: In November 2009 the Attorneys-General agreed to work together this year on a framework for cooperating in combating organised crime. At last week’s meeting the Attorneys-General discussed a multilateral declaration of understanding to give effect to this objective. The declaration is intended to facilitate better coordination in shaping organised crime policy at both the domestic and international levels the sharing of criminal intelligence and assistance in organising criminal investigations and prosecutions. 
Mining in Conservation Areas—Minister’s Recommendation in Cabinet Paper 
12. 
Hon DAVID PARKER (Labour) 
 to the  
Minister of Conservation 
: Does she stand by her recommendation in her Cabinet paper of 10 February 2010 that 467517 hectares of national park land and protected conservation land be considered for opening up to exploration and mining? 
Hon KATE WILKINSON (Minister of Conservation) 
: 
 No. I stand by the subsequent Cabinet decision of 22 March 2010 that proposes to add 5000 net hectares of land to schedule 4. 
Hon David Parker 
: Does the Minister of Conservation accept that it is her role in Cabinet to advocate for the conservation of public conservation lands? Is it not that her failure to properly do her job is the reason why the Government’s handling of this issue has been panned by the Parliamentary Commissioner for the Environment? 
Hon KATE WILKINSON 
: It is absolutely my job to advocate for conservation of behalf of all New Zealanders. I am quite prepared to allow the public to have their say on what activities can take place on that land. 
Hon David Parker 
: Does the Minister understand that of the 2 million hectares of land in national parks in the North and South Islands zero hectares are in Northland zero hectares are in the Auckland region and zero hectares are in the Waikato and that is why it is all the more important to protect the schedule 4 areas in the Coromandel? 
Hon KATE WILKINSON 
: I understand that the Broken Hills mine which actually was approved under a Labour Government is on schedule 4 land. 
Hon Members 
: Oh no! 
Hon KATE WILKINSON 
: It is. The Pike River coalfield which was approved by Labour is on schedule 4 land— 
Mr SPEAKER 
: I listened to the Hon David Parker’s question and he asked whether the Minister understood that there were zero—I recollect—hectares of conservation land in Northland zero hectares in the Auckland region and zero hectares in the Waikato region from memory. In answer to that the Minister is going on to talk about decisions of the previous Government to approve mining on schedule 4 land which is not what the member asked about. 
Hon Gerry Brownlee 
: Yes he did. 
Mr SPEAKER 
: I see some members are disputing what I heard. To clarify the matter I invite the Hon David Parker to repeat his question. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I apologise but the point I would like to make to you—and I think you acknowledged it in your ruling; your ruling might have even changed part-way through as a result—is about an interjection from the Leader of the House while you were making your ruling. I reflect on what happened to one or two members on this side of the House when they did a similar thing; you treated them a bit more roughly than you treated Mr Brownlee then. 
Mr SPEAKER 
: I note the member’s point. I certainly have not ruled in any way against the Opposition. I have invited the Hon David Parker to repeat his question without penalty. 
Hon David Parker 
: I raise a point of order Mr Speaker. The other point to be made is of course it would have been illegal for any Government to authorise— 
Mr SPEAKER 
: Now the member is litigating issues by way of point of order. That is not acceptable. I have allowed him to repeat his question; he should not abuse that privilege. 
Hon David Parker 
: Does the Minister understand that of the 2 million hectares of land in national parks in the North and South Islands there are zero hectares in the Northland region zero hectares in the Auckland region and zero hectares in the Waikato region making the protection of the Coromandel schedule 4 lands all the more important? 
Hon KATE WILKINSON 
: I am very aware of the importance of protecting our conservation land whether it is in the North Island in the South Island or on Stewart Island. 
Hon David Parker 
: Will the Minister accept the advice of the 40000 protesters in Auckland the thousands of submitters and the tourism industry and head off her Government’s ridiculous plans to mine in national parks and other schedule 4 areas? 
Hon KATE WILKINSON 
: Well I say to that member and I thought he was an intelligent member that— 
Mr SPEAKER 
: Order! 
Hon KATE WILKINSON 
:—this is a discussion document not a decision document. The land is public land and the public have a right to say what activities can take place on it which is the whole point of having a discussion document. 
Motions 
Misuse of Drugs (Classification of Ketamine) Order 2009 and the Misuse of Drugs (Presumption of Supply—Ketamine) Order 2009—Approval 
Hon PETER DUNNE (Associate Minister of Health) 
: 
 I move  
That pursuant to section 4A of the Misuse of Drugs Act 1975 this House approve the Misuse of Drugs (Classification of Ketamine) Order 2009 and the Misuse of Drugs (Presumption of Supply—Ketamine) Order 2009 made under section 4 of that Act. 
 These orders demonstrate the Government’s commitment to prevent and reduce the harm associated with drug use in New Zealand. I am pleased that after considering these orders the Health Committee has recommended that they should be approved. The Health Committee has worked hard in its consideration of these orders in a short time frame. I thank all members of the committee for their valuable work. 
Ketamine is a short-acting dissociative anaesthetic currently listed as a prescription medicine in schedule 1 of the Medicines Regulations 1984. It is commonly and legitimately used by veterinarians primarily as an anaesthetic agent and is becoming increasingly used in human surgery and palliative care. However ketamine is also gaining popularity as a drug used illegally for non-legitimate purposes. When used in this manner ketamine can induce potent hallucinogenic effects including out-of-body - type experiences whereby the user feels numbness and detachment from themselves and others around them. 
The Expert Advisory Committee on Drugs has assessed this substance and noted that its recreational use can induce schizophrenia-like symptoms in healthy adults and that there is growing anecdotal evidence of physical and psychological symptoms of ketamine dependence amongst recreational users. Taking this into account the Expert Advisory Committee on Drugs provided advice that ketamine poses a moderate risk of harm and should be appropriately classified as a class C4 drug in schedule 3 Part 4 of the Misuse of Drugs Act 1975. The Expert Advisory Committee on Drugs further recommended that the presumption for the supply of ketamine be set at 10 grams whether or not it was contained in a substance preparation or mixture. This means that anyone found in possession of 10 grams or more of ketamine will be presumed to be in possession of the substance for the purposes of supply unless it is proven otherwise. 
As the Minister in charge of the National Drug Policy I believe that the classification of drugs should be based on expert medical and scientific advice. To this end I accept completely and commend to the House the recommendations of the Expert Advisory Committee on Drugs that ketamine be scheduled as a class C4 controlled drug and that the presumption of supply for this substance be set at 10 grams whether or not it is contained in a substance a preparation or a mixture. The classification of ketamine as a class C4 controlled drug will not remove the availability of ketamine for legitimate use by health professionals by veterinarians and by researchers who hold a controlled drug licence. But the classification will increase regulatory controls and increase police and customs enforcement powers to control the importation and diversion of ketamine for illegal purposes. 
As the synthesis of ketamine is complex this is not a drug that criminals can manufacture in New Zealand. Rather those who use ketamine for non-legitimate purposes are generally able to obtain the substance only from the theft of legitimate medical and veterinary stocks. Therefore real gains to control the harmful non-legitimate use of ketamine can be made by mandating for the safer storage of the substance in the same manner as other controlled drugs that are also medicines are stored such as morphine. That is what this classification will achieve. 
In regard to the proposed presumption of supply of ketamine I acknowledge that concerns have been raised in the past that presuming any quantity of a substance to be available for supply may be in breach of one’s right to the presumption of innocence. For this reason I support the Law Commission’s review of this matter within the wider review that is under way into the Misuse of Drugs Act and I will take very seriously the Law Commission’s recommendations in regard to the presumption of supply. 
However we also have responsibilities under the current legislation and that legislation mandates that should a specific presumption of supply such as 10 grams in the case of ketamine not be set then a default quantity of 56 grams will take effect. Members will surely agree that for a substance deemed by the experts to pose a moderate risk of harm possession of that particular quantity of ketamine would be excessive. Should the House agree to this motion I will direct the Ministry of Health to consult further with affected parties before setting an enactment date for the classification which will be brought into force with separate commencement orders. This consultation is necessary to ensure that hospitals veterinarians and other legitimate users of ketamine such as researchers are given enough time to prepare for the changing requirements in relation to the storage of the substance. 
These orders are necessary to limit the dangerous non-medical use of ketamine without compromising legitimate access to the substance by medical and veterinary professionals. They will send a message throughout the country that the harmful use of drugs is not acceptable and will not be condoned by this Government. I therefore commend these orders to the House. 
Hon RUTH DYSON (Labour—Port Hills) 
: 
 I start by acknowledging the Associate Minister of Health Peter Dunne and thanking him for his comments in praise of the Health Committee and its consideration of this issue. The only puzzle I have is what triggered the referral of such items to a select committee rather than the Associate Minister being able to sign them off directly. That is an issue that the select committee is yet to receive advice on. It is not a criticism; it is just an interesting difference in process. I also acknowledge the Associate Minister and congratulate him because I understand that earlier this week he was a recipient of a very distinguished award which acknowledged his support of philanthropy in New Zealand. I think that that is a matter of pride. We will all share in his glow from that award. I think it was well deserved. The other recipients are very highly regarded people. Peter Dunne now joins that list and I congratulate him on that. 
As the Associate Minister said in his introductory comments the reclassification of ketamine is not directly comparable to the way that other drugs have been considered by this House. Ketamine is a drug that is legally used but not for recreational purposes. It is a drug that is used by vets but over recent times it has become more prevalent as a recreational drug in New Zealand. The habit has been imported in particular from Asia. It is very commonly used as a recreational drug in Asia particularly in Hong Kong. This drug has some serious consequences. Its use does not cause serious health effects but it can do enough to have a person admitted to hospital and treated. Although those health impacts are not permanent long-lasting or significant the Health Committee nevertheless looked at these orders the Misuse of Drugs (Classification of Ketamine) Order 2009 and the Misuse of Drugs (Presumption of Supply—Ketamine) Order 2009 and decided that approving them was an appropriate step to take. 
One of the more concerning aspects that we were made aware of was that people who use this drug recreationally have a feeling of disassociation with the objects people and activities around them which can be quite dangerous. They literally are not aware of their connection to activities that are going on around them. Obviously that can put them in very vulnerable or dangerous situations rather than it being a case of the drug itself causing some physical effects. 
Another consideration that the Health Committee examined in its process of looking at these recommendations was on the advice it received from the Expert Advisory Committee on Drugs particularly in terms of understanding how the process the advisory committee had followed led it to the conclusion that ketamine needed to be reclassified. The proposed classification of ketamine as a class C4 controlled drug would allow the police and other enforcement agencies greater powers and it would increase deterrent penalties. Obviously one would be able to be convicted for importing ketamine unless it was for the purpose for which it is originally intended—that is as I mentioned earlier for use by a vet. The classification also considers manufacturing ketamine supplying it to a person up to the age of 18 and selling or offering to supply it to a person 18 years or over which would incur a maximum penalty of up to 8 years’ imprisonment. So this is not being considered as a light measure. Further penalties would include up to 7 years’ imprisonment for conspiracy to commit such an offence and up to 3 months’ imprisonment or a fine of $500 or both for possession in breach of section 7 of the Misuse of Drugs Act. 
I think it is a rare moment in this Parliament—which perhaps has not been seen before in the life of this term—when the Associate Minister who is from United Future moves a resolution that Labour supports and I am sure that will be followed by National supporting it. I think that both the Green Party and the ACT Party will support it. If the member representing the Maori Party takes a call in this debate and supports it there would be a break-out of agreement and perhaps we might consider having the House rise early at that point— 
Hone Harawira 
: Hear hear! I’ll second that. 
Hon RUTH DYSON 
: —because it happens so rarely. That has been moved by Peter Dunne and seconded by Hone Harawira! 
To go back to the more serious issue we know that a lot of people put pressure on members of Parliament to have drugs classified in different ways. Certainly it was the view of the select committee that this should not be a response that happened as just a knee-jerk reaction after a single event. This matter has been well considered by people who have expertise in this area and the Health Committee took very serious note of the considerations that those people had taken into account when proposing this recommendation. On that basis Labour is pleased to support this motion. 
Dr PAUL HUTCHISON (National—Hunua) 
: 
 Thank you for the opportunity to speak on this motion on the Misuse of Drugs (Classification of Ketamine) Order 2009 and the Misuse of Drugs (Presumption of Supply—Ketamine) Order 2009. 
The Health Committee considered this matter and as other members of this House do its members feel strongly that it is appropriate to classify the drug accordingly. I note that there are currently no requirements for ketamine to be held securely and that quantities of the drug have recently been stolen from hospital trolleys. Ketamine has potentially harmful effects. It can induce symptoms similar to schizophrenia in healthy adults. There is growing anecdotal evidence of physical and psychological symptoms of ketamine dependence amongst recreational users. Therefore it is highly appropriate that ketamine is scheduled accordingly as a class C4 controlled drug. I too commend this motion to the House.  
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Tena koe. When this notice motion came up for classification of ketamine under the Misuse of Drugs Act I was hoping that maybe ketamine was a chemical agent used in cigarettes effectively making tobacco an illegal drug. That would have been a great idea supported by the Maori Party and all other parties in the House as well as overseas where a couple of years ago the Commons Science and Technology Committee of the UK Parliament called for a major rethink on the classification of alcohol and tobacco based on the fact that together they account for 90 percent of all drug-related deaths in the UK and are among the top ten most dangerous substances in society. Its report was backed up by research in  
The Lancet 
 and the  
British Medical Journal 
 in 2007 that said that based on physical harm dependence and social harm alcohol and tobacco were ranked among the top 10 most dangerous substances—higher indeed than both cannabis and Ecstasy. But when I read the motion I see that ketamine is something different from tobacco—something altogether milder and way less dangerous—but reclassification of ketamine as a controlled drug will now mean that general practitioners district health boards and vets etc. will have to put it under lock and key and track and record its use which is what the sector has been after for some time so we will support the motion. 
Apparently this ketamine—also known as “special K” and “vitamin K”—is not widely used but the experts tell us that there may be a rise in recreational use with some speculation that its use is growing amongst young people. But in truth the evidence is fairly limited and it makes us wonder what all the fuss is about—only two customs seizures at the border two or three cases of low-level harm each year and no deaths at all. It reminds me of the debate about party pills a couple of years ago. That was the same thing—a big hullabaloo about nothing. There were no deaths no crime no nothing yet we banned that too. 
Ketamine is hardly worth a mention in comparison to tobacco which kills more than 5000 New Zealanders every year—more in fact than any other single product or disease in Aotearoa. Those deaths are preventable. Tobacco is a known cause of lung bladder mouth pancreatic kidney and stomach cancer and is linked to significant causes of heart disease emphysema and other respiratory diseases known to society. We will support this motion but we urge Associate Minister of Health the Hon Peter Dunne to seriously consider alcohol and tobacco use as also worthy of review. Tena koe. 
Hon DAMIEN O’CONNOR (Labour) 
: 
 I am led to believe that the Associate Minister of Health the Hon Peter Dunne who moved this motion in the House should be congratulated on an award that was made last night. I am not quite sure what it was but I am sure that he received something. I have been informed of that by my colleagues. 
Labour will of course support this motion to approve the Misuse of Drugs (Classification of Ketamine) Order 2009 and the Misuse of Drugs (Presumption of Supply—Ketamine) Order 2009. How could any party object to the wiser use of a drug that potentially could be misused by young people in this country? It is important to specify as previous speakers have done the harm that is currently caused in this country by ketamine. That harm is at a very low level at this point. So I applaud the Associate Minister for moving this motion which is clearly making the case that prevention is better than cure. If we had done this with other drugs this country would be a whole lot better off. The previous speaker made reference to both nicotine and alcohol. If we were starting from a different place I am sure we would have a similar amendment to regulations and legislation. 
When I read through the effects on recreational users of this drug ketamine I see that it delivers a short duration of hallucinogenic effects—as I guess a very good cup of coffee might do. I am not trying to make light of it but I think we do have to keep certain things in mind. It is usually snorted as a powder so I guess some people might pretend they are having cocaine. Well if they stick to this drug it might be a good alternative way to get their hits. 
It is a sad reality that young people and older people resort to drug use and that no matter what we block or make illegal smart people around the world will come up with a new kind of drug. This drug to be fair is used at higher levels in Asian countries. That is why I think it is very fair for the Associate Minister and the whole House to assume that its prevalence could increase in this country. I think it is logical that we put in place some provisions that secure its storage. Vets and pharmacists will have to protect their supplies so it cannot be lifted easily and there will be some penalties for illegal supply. 
Let us look at those changes and at what will happen when we have reclassified the drug. There are some fairly severe penalties here and that leads to a question that I am sure will be asked by many intelligent young people. As was said earlier the effects of the use of this drug are not that severe. They are short term. In emergency departments across this country there have been in the last year two or three cases of hospitalisation through ketamine misuse but there have been hundreds of cases of alcohol misuse. 
In supporting this motion I challenge to the Government to take up the package of recommendations from the Law Commission on alcohol use. When doctors specialists and nurses tell us every week that hundreds of people are in emergency departments because of alcohol misuse the careful considerations of the Law Commission must be taken up by the Associate Minister and his colleagues in Cabinet. The Government should bring to this House comprehensive proposals and legislation that address alcohol-related harm. 
We will look like a bunch of idiots and I have to say like a bunch hypocrites if we do not move on alcohol which affects thousands of people every weekend when we bring to this House a perfectly sound reasonable proposition to reclassify ketamine which puts two to three people each year into emergency departments. So let us be consistent. We have moved on tobacco and I applaud the Government for that. I think it was a good move but we have yet to see just how committed this Government really is to reducing the harm caused by alcohol. 
The penalties in the case of ketamine are very severe. Supplying this drug to anyone under the age of 18 years carries a maximum penalty of up to 8 years’ imprisonment. That is a severe penalty for a drug that puts two to three people into the emergency department each year and I again compare that with alcohol. Let us get real here. Let us take the bull by the horns and take the opportunity to address drug harm in this country. It is upon this Minister and all Ministers to bring comprehensive recommendations back to the House. 
Labour supports this reclassification on the basis that we want to reduce harm from the misuse of any drug in New Zealand. We think that this is a good move at this time and we will be supporting it. 
Motion agreed to. 
Sentencing and Parole Reform Bill 
Second Reading 
Hon JUDITH COLLINS (Minister of Corrections) 
: 
 I move  
That the Sentencing and Parole Reform Bill be now read a second time 
. This bill has two main purposes: to deny parole to repeat serious violent offenders and to offenders who are guilty of committing the worst murders and to impose maximum terms of imprisonment on persistent repeat offenders who continue to commit serious and violent offences. 
This bill is specifically focused on offenders who show no regard for victims their families or the community and who are repeatedly convicted of serious violent and sexual offending. Parole is not a right for prisoners; it is a privilege. This privilege is earned and it should not be granted to those who demonstrate total disregard for the law by continuing to commit serious violent offences despite being warned of the consequences. This bill ensures that the victims of repeat offenders and their families do not have to experience the additional stress of attending regular parole hearings or worry that an offender may be released on parole. 
I thank the members of the Law and Order Committee and in particular the chair of the committee Sandra Goudie for returning this bill to the House in good time. The committee has recommended by majority that the Sentencing and Parole Reform Bill as amended be passed. I also thank the ACT Party for its continued commitment to this bill. 
In February 2010 the New Zealand Police became the lead advisers on the bill with the Department of Corrections assisting. It was particularly important for New Zealand Police officials to advise the select committee. That was because the threshold for the regime was to be changed from a qualifying sentence to a conviction for a relevant offence. That meant that police discretion as to what charges were laid and the charging process itself would be critical to the operational elements of the new legislation. Under the new regime all prosecutions involving charges that qualify for stage three of the regime will be referred to the Crown solicitor for peer review either pre-charge where circumstances allow or by the second appearance. This provides an assurance that the appropriate charges will be laid in those cases. 
I would also like to thank all those members of the public who took the time to make submissions on the bill. Ninety-four percent of submitters supported the bill. They stated their concerns about violent crime public safety and the need to hold offenders to account. Many supporters wanted to address what they described as the disparity between the rights of offenders and those of victims and to spare victims the stress associated with repeated parole hearings. In addition to that concerns were expressed about how violent crime impacts negatively on the reputation of this country. 
Only 3 percent of submitters opposed the bill. Many of those submitters considered that the Government should be focusing on addressing the causes of offending and/or reoffending. Let me assure those people that this Government has a strong focus on addressing the causes of offending and it views that as a vital component of our efforts to create a safer community. 
The Labour Party did not support this bill. Labour members say that it could result in disproportionate sentences for offenders at stage three. I make no apology for that. By stage three an offender has been convicted of two previous serious violent offences and has been warned on two occasions both orally and in writing of the consequences of further convictions for serious violent offences. This legislation recognises the repeat nature of offending by those few who fail to heed the warnings and continue to offend regardless of the consequences. The community can rightly expect to be protected from these serious recidivist offenders for a lengthy period. 
In January this year the Government proposed a number of changes to the bill as introduced in February 2009 to better reflect the purpose of the bill. The Law and Order Committee agreed by majority that the bill be passed with those changes. The first change is that the threshold for each of the three stages of the regime has been changed to a conviction for a qualifying serious violent offence rather than a determinant prison sentence of 5 years or more or an indeterminate sentence of imprisonment. Secondly the sentence for a conviction for a qualifying offence at stage three has been changed to the maximum sentence for that offence and unless it would be manifestly unjust the court must order that the offender serve the sentence without parole. That replaces the sentence of life imprisonment with a minimum non-parole period of 25 years at stage three as in the bill as introduced. Section 86 of the Parole Act 2002 is to be amended so that an offender serving a short-term sentence of imprisonment at stage two serves the sentence in full rather than being released after serving half the sentence as is currently the case. 
Other changes have been made to ensure consistency in the definition of what constitutes a qualifying serious violent offence. This includes five further offences being added to the list of qualifying serious violent offences. All of these offences carry maximum penalties of more than 7 years’ imprisonment which is a defining characteristic of the offences in the bill as introduced. The offences are all closely related to the existing offences contained in the definition of “serious violent offence”. In addition all cases involving offenders on a final warning who are subsequently charged with committing a serious violent offence will have their cases heard in the High Court. Only the High Court Court of Appeal or Supreme Court will be able to sentence an offender for a stage three offence. 
This bill creates a three-stage regime that will improve public safety by imprisoning the worst repeat violent and sexual offenders for longer periods and under stricter regimes if they continue to offend. At stage one offenders who are convicted of a serious violent offence will be sentenced as normal but will be warned both verbally and in writing that they are on the first rung of the regime and what will happen if they are convicted of another serious violent offence in the future. 
At stage two an offender who is convicted for a second time of a serious violent offence and has previously received a warning will be sentenced as normal but will be required to serve any sentence of imprisonment imposed by the court without parole. Such offenders will also be warned both verbally and in writing of the consequences of a further conviction for a serious violent offence. 
At stage three an offender who is convicted for a third time of a serious violent offence and has previously received a final warning at stage two must receive the maximum prison sentence for that offence and serve that sentence in full without parole. The exception to this is a conviction for manslaughter for which an offender will be required to serve a life sentence with a minimum non-parole period of at least 20 years. The minimum non-parole period recognises the difference in seriousness between manslaughter and murder. The court also has the option at stage three of imposing a sentence of preventive detention in which case the minimum non-parole period must not be less than the maximum finite term of imprisonment for the offence. 
The bill makes specific provision for those convicted of murder at either stage two or three of the regime. At either stage an offender convicted of murder will be required to serve a life sentence without parole. However this bill also recognises that in some very rare cases the circumstances of the offender and the offence will be such that a sentence served without parole would be manifestly unjust. The bill takes that into account and makes provision for the court where it is satisfied that a non-parole order would be manifestly unjust to not make such an order at stage three when imposing the maximum term for a serious violent offence or when imposing a sentence of life imprisonment for murder at stage two or three. In the case of murder the court can instead direct that a substantial minimum term of imprisonment be served before parole eligibility. 
In addition to the three-stage regime the bill makes special provision for offenders who are convicted of the worst murders. In these cases offenders can be sentenced to imprisonment for life without parole even if they do not have a record of previous violent offending. 
This bill is tangible evidence that the Government is delivering on its election promise to toughen up on criminals. I am proud that this bill puts the victim’s and the wider community’s interests ahead of the interests of our worst serious violent offenders. 
This bill may appear harsh to some but I make no apologies for it. The bill is aimed at the minority of offenders who even after receiving two previous warnings continue to offend in a serious violent way. These people have demonstrated that they will not change and for those few people there is no alternative but to prevent them from offending in such a way that they no longer present a danger to law-abiding New Zealanders and visitors to this country. I commend this bill to the House. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 In the 16 December 2009 Cabinet paper from the Minister of Police who is also the Minister of Corrections which is entitled  
Changes to the Sentencing and Parole Reform Bill 
 the Ministry of Justice noted: “… the deterrence effect of the three stage regime is uncertain. The proposals will add substantial direct costs to the justice system without creating any significantly improved outcomes in terms of reducing the drivers of crimes improving social outcomes or reducing reoffending and victimisation.” The Department of Corrections also said in its report to the Law and Order Committee: “Further information requested by the Law and Order Committee regarding prison bed forecasts”—which was received on 5 March 2010—indicates “… there is an implicit assumption that the Bill will have no deterrent impact.” 
I think that those reports from the two departments that are now advising on this matter are of significance for the quality of the debate that we now have to have. Obviously the Government challenges the Opposition on the basis of saying that this measure proves that the Government is tougher on crime than Labour is. I say to this House that it is not a competition. I am deeply concerned about a Government that proceeds with a measure such as this when the Minister of Justice and the Minister of Maori Affairs are attempting to engage with the broader community which has an interest in these matters. Those Ministers are trying to find some way of addressing the underlying drivers of crime in an environment where we actually can have a debate about the things that will make a difference in the long term without having to be challenged on something that we know is not an effective deterrent and that the Government knows is not an effective deterrent. 
The other problem I have with debating this measure before we have had a response from the Government on the ministerial meeting on the Drivers of Crime which the Government held just over a year ago last month is that we still have not seen the fruit of the work that people put into that meeting nor the subsequent work that has been done ever since. I know that one of the areas of work is on reoffending because our reoffending rates are pretty pretty appalling. I think one of the reasons our reoffending rates are so appalling is that there is a lack of work being done on rehabilitating and directing people away from the prison system at a very early stage. There are people ending up in our prison system too early and without the level of intervention that one would expect. 
So let us go through the circumstances of one gentleman who ended up in the category that was defined by Minister Collins. He was brought up here in New Zealand and although I am not sure of his age now we are going back into the 1950s. His stepfather saw fit to tie him to the dog kennel in the backyard as a punishment for his constant bad behaviour inside the house. He thought that tying him to the dog kennel would be a good way to get him to behave well when he was inside the house. This young boy this child ended up with an entirely— 
David Garrett 
: What’s his name? 
Hon LIANNE DALZIEL 
: I accept the fact that that member is the driver behind this bill but— 
David Garrett 
: Let’s hear the name of this person. 
Hon LIANNE DALZIEL 
: I am not going to name an individual in this House. I will just have to ignore the barrage of interjections from somebody who does not want to hear the example that I want to use. 
I wanted to say that when people have been brought up in an environment where they do not learn empathy or any of the behaviours that we would take to be normal and where they do not have the capacity to form close relationships because they have not bonded with a significant adult at any stage since they were born then we as a society are responsible for growing monsters not for growing healthy young men with healthy attitudes and the capacity to form loving relationships. When a male child has only ever seen his father beat his mother to a pulp it is really hard to think about how he is going to have a good relationship with a woman in the future. We have an intergenerational problem in this country. We do not fix that just by saying: “Here is the mess the disaster that has been created in the lives of some people. Let’s just lock them up for what they’ve done. Let’s not try to see whether there is some degree of humanity left within these individuals or some potential for redemption and rehabilitation.” I think what is missing from this debate completely is that there are people who have the capacity to change. 
All I am saying is that removing the discretion that sits with the judiciary and allowing the judicial system simply to impose a sentence because certain previous offences have occurred will not do anything to reduce the drivers of crime. It will not improve social outcomes it will not reduce reoffending and it will not reduce re-victimisation. That was identified in the departmental report to the Minister of Police the Minister of Corrections and the select committee. 
As we know this bill was subject to a report from the Attorney-General because it is questionable in terms of our obligations under the New Zealand Bill of Rights Act. The reason that was the case was that it was found to provide for disproportionately severe punishment. Of course there are different messages that can be taken from the legislation. It really will depend on the order in which certain offences are committed in order to get a disproportionate impact. 
The regulatory impact statement that accompanied the original bill stated that the bill would be disproportionate expensive and impact most severely on Maori. I know that the Maori Party has a very strong view on this matter. It is very well accepted that a Maori is much more likely to be stopped by police. A Maori is much more likely to be arrested if stopped. A Maori is much more likely to be charged if arrested. He or she is much more likely to be charged with a more significant offence if he or she is charged. He or she is much more likely to be convicted if he or she is charged and he or she is much more likely to get a longer sentence than an equivalent individual who is not Maori if he or she is found guilty of that offence. The evidence is out there for everyone to see. This bill will make that situation worse. This bill is about putting more Maori in prisons when we really ought to be addressing why we have so many of them there now. Maori are disproportionately represented in our statistics as we all know. 
The trouble is that this is one of those bills that is designed to send a message about what the Government is doing. Unfortunately the message it sends is not backed up by any evidence anywhere in the world. It is not an effective way of addressing the issues the Government says it is trying to address. I think that is unfair not only on this House and the people of New Zealand but also on those who have been working very hard to try to address those underlying drivers of crime. That is where we know we can make the most substantial difference over the long term. Short-term quick fixes never work. This approach has never worked in any jurisdiction internationally. All of the evidence that has been put up in relation to the “three strikes” policies in the American jurisdictions does not stack up when it is actually investigated. Unfortunately this bill is predicated on a flawed foundation and I do not believe that it should proceed any further. 
SANDRA GOUDIE (National—Coromandel) 
: 
 I am delighted to talk to the Sentencing and Parole Reform Bill in the debate on its second reading. I acknowledge my Law and Order Committee colleagues for the excellent work that they did on this bill. I also acknowledge the Minister advisers the Parliamentary Counsel Office and the committee staff who also did an excellent job of assisting in the process on the bill. 
I point out to the previous speaker Lianne Dalziel that in January 2010 the Minister of Police who is also the Minister of Corrections took over responsibility for the bill for its remaining parliamentary stages due to the significant roles that the New Zealand Police and the Department of Corrections will have in implementing the changes that are made in this legislation. So I correct the previous speaker: the Police were the advisers on the bill not Ministry of Justice staff and the comments about the Department of Corrections were also incorrect. 
It was particularly important for New Zealand Police officials to advise the select committee on whether we should change the threshold at which the new regime applies from a qualifying sentence to a conviction for a relevant offence. This change meant that police discretion as to which charges were laid and the charging process itself would be critical to the operational elements of the new legislation. Under the new regime all prosecutions involving charges that qualify for stage three of the regime will be referred to the Crown solicitor for peer review either prior to any charge being laid where circumstances allow or by the time of the person’s second court appearance. This provides an assurance that the appropriate charges will be laid in that case. I thought it was pertinent to actually point out those things to the previous speaker because she seems to have been somewhat incorrect in some of the things she was saying. 
Lianne Dalziel also spoke about the New Zealand Bill of Rights Act. I recall that when she spoke to another bill she mentioned the New Zealand Bill of Rights Act and suggested that we have a moral obligation to allow prisoners in that case to vote. I suggest that in the first instance the moral obligation is on the individual not to commit a crime. Yes this Government is taking action to find the drivers of crime and address them but also it is taking action to deal to the perpetrators of crime who fail to take responsibility for not committing crime. 
I will also talk about how many offenders are likely to be affected which was an issue raised by the previous speaker. The impact on the New Zealand prison population is estimated at 56 beds after 5 years 142 beds after 10 years and 288 beds after 20 years at the most. These figures are based on 1980-2008 figures and do not factor in the deterrent effect of the new policy. One must remember that there is a deterrent effect in a policy such as this and as such the estimate is conservative so the actual figure may indeed be much lower than that. One must also remember the victims in all of these crimes; this policy goes some way towards meeting the needs of victims. 
How much will this policy cost? Again this issue was mentioned by the previous speaker. After 5 years the operating cost is estimated to be $5.1 million per year with a total capital cost of $22.4 million. The previous speaker may like to be cognisant of that. We are certainly not soft on crime unlike the previous speaker from the Opposition. We believe that people have a moral obligation not to commit crime in the first place because once they commit a crime they give up their rights. That is a consequence of committing a crime: they give up those rights and they are subject to the full effect of the law. 
How will the bill work? This bill creates a three-stage regime that will improve public safety. That is the primary objective. Sentencing parole and bail should be driven by the need to put public safety first—that is the primary driver—and by giving some consideration to victims. I love to hear the comments from the Opposition members who did nothing in 9 long years and now start to get all soft and “touchy-feely”. We are committed to taking the tough steps needed in order to tackle violent crime and make people feel safer in their homes and on the streets. I think that is incredibly important. Do members know that the public are feeling that already? It is exactly what they asked for and that is what we are giving them. We are serious about better meeting the needs of victims and putting victims at the heart of our justice system rather than putting criminals at the heart of the justice system as the previous speaker seemed to do when she was in Government. We believe that there is a moral obligation on people not to commit crime and that once they relinquish that moral obligation they relinquish their rights. 
At stage one offenders who are convicted of a serious violent offence will be sentenced as normal but will be warned—as has been previously said—both verbally and in writing that they are on the first rung of the regime. They will also be warned about what will happen if they are convicted of another serious violent offence in the future. At offence one—at the first strike—they are told about the likely consequences if they do not take control of themselves and take some responsibility for their behaviours. 
At stage two an offender who is convicted for a second time of a serious violent offence—this is all about serious violent offences—and who has previously received a warning will be sentenced as normal but will be required to serve any sentence of imprisonment imposed by the court without parole. The sentence for that second offence will be served without parole. 
Melissa Lee 
: Good job. 
SANDRA GOUDIE 
: Good job—absolutely. My colleague says: “Good job.” and I am sure most people out there will also be saying: “Good job.” Why should those offenders get parole? They have already been warned at the first offence and they have been told what the consequences of further offending will be. Why should they suddenly get parole on the second offence? They did not take responsibility for their actions so they must wear the consequences of that. 
At stage three an offender who is convicted for a third time of a serious violent offence and who has previously received a final warning at stage two must receive the maximum prison sentence for that offence and serve that sentence in full without parole. That is as it should be. If offenders are going to do the crime they need to do the time. They need to think more about their behaviours. 
Hon PAREKURA HOROMIA (Labour—Ikaroa-Rawhiti) 
: 
 The Labour Party is very clear in its support of victims— 
David Garrett 
: Oh yeah! 
Hon PAREKURA HOROMIA 
: Our period of time in Government proved that as our learned friend down here would understand if he had followed us over that period of time. But the Sentencing and Parole Reform Bill is an outrageous bill. Enough international research says that lengthy prison sentences do not correct behaviour or get people on a better plane. I hope the Maori Party is voting against this bill because there is no evidence to suggest that this will reduce crime. Regarding recidivism in Maoridom it is common knowledge that young Maori who commit a crime under the age of 22 or 23 will appear in court six times. 
I remind the Government about that great public servant Margaret Bazley who recently let a report come out that suggested that the process of legal aid had a lot to answer for. I am appalled about that and I relish the speech that my fine whanaunga Hekia gave apparently out at the marae about people’s attitudes to how we should manage crime. She said that when the subject is Maori the articles are splashed all over the front pages of the  
Dominion Post 
 or something like that anyway. And that is a fact—for example if it is about a kohanga reo misusing $20000. But I remind members that a lot of those quick deliverers of profit and finance companies have gone down the gurgler—it is outrageous—yet we hear hardly anything about that. We hear hardly anything about that at the time; that is terrible. Small businesses are struggling at the moment; that will not help it. 
We can already hear the Government complaining about the lack of bed space in prisons. It is amazing. So the Government has a policy of “three strikes and you’re out”. If we listen to previous speakers we can get that hint of “Bash ’em over lock ’em up and everybody will know that we’re tough! This is about tough love.” But that is a whole lot of rubbish. If we go back to the time of the previous National Government we heard them say time and time again that in correcting the insidiousness of crime longer sentences were not the way to go. We recognise that and that Government did say that and meant it. But all of a sudden now we have this huge flip-flop. 
The Minister of Justice Simon Power has slowly and carefully distanced himself from this legislation. Everybody knows that. The commentaries from some of the senior judges of this country are saying the same thing. I could stand and hypothesise about history and cite the facts about being colonised but I will not. But if people were working-class people I tell Mr Garrett like those in the 1950s 1960s and 1970s and all those people were used as factory fodder and the landed gentry and the upper class managed all the wealth what would that member say about that? Of course there would be trouble. And the working-class Pakeha were no different. 
Now we get to this supposedly great time and we ask how this will attract the vote. How will this attract the vote? We will sting them with it. It is unreal. It is said that this bill is good for victims. Well if we read the writings about victims we find that one of the real fears is how they broach it—how they manage it. Of course our families having been victims know that it is a horrendous experience. But there is all the essence for prolonging that hurt that agony in this long period of sentencing. 
The previous speaker Sandra Goudie was really trying to play stand-over tactics. Yet the Attorney-General Chris Finlayson has found that the bill as introduced has an apparent inconsistency. So we can see that the gap in the Government is widening is splitting over the section of the New Zealand Bill of Rights Act protecting New Zealanders against “cruel degrading or disproportionately severe … punishment”. We had Hone Harawira and his colleagues huffing and puffing and celebrating about signing up to a United Nations declaration. That process will evolve and history will tell us how it can help us. But that was about rights so how can people in the Government support this bill? How can they do that? Where I come from people still line up in the courts in Hastings and so on. There are huge queues of them. Can we blame them if they are trying to feed their kids? Can we blame them if they are getting nicked for everything they are getting into? 
It is all very well to be clean and clear and to pontificate about how well the world should work but we were sent to Parliament—some of us anyway—to protect and support those people. In my case they are a whole lot of Maori but they have not been recharged and counted up again through no fault of their own. 
This party believes in being tough on crime but it is quite clear that some people have taken just a single line in legislation and are making tougher sentences and bringing down crimes to benchmark something that is really academic. Experts say that. Mr Bolger was great in the sense of trying to push for and have people understand that there were different ways of correcting and penalising people for crime. We are supportive of the rights of victims and we are supportive of those who are victims of people who are consistently committing horrendous crimes but this is spreading the blanket so far that it is catching the people who are being penalised through no fault of their own. 
When young Maori of 16 or 17 years of age go to court the legal aid lawyers—who have guaranteed payment—say to them that they had better plead guilty till the lawyers work it out. They go to court again in 3 months’ time and the lawyers tell them again they had better plead guilty but the lawyers get paid. Those young men go back the next time and the lawyers tell them that they might get a deal for them. The young people say they will consider it and then the lawyers try to bargain. So those lawyers are getting paid four times but at the end of the day the Maori get locked up. Why should they be punished for minor issues and other such crimes? “Three strikes and you’re out”—the only place that that is fit for is the softball paddock. We have the Minister here pitching the ball down to a whole lot of other fancy-footed academics but the Minister is being unkind and trying to make out that this legislation is about getting tough. 
Then Government members are squealing because it is about beds. What about the 15 staff who are being put off in Gisborne at the moment? What about the 47 percent unemployed in Wairoa? That is how crime busts out but it has to be managed. I heard the Minister one day or someone over there today saying it was about being intelligent. If this is how the Government wants to be perceived as being intelligent then God forbid what will happen in our prison system as we go forward. Thank you. 
DAVID CLENDON (Green) 
: 
 Kia ora koutou. The Sentencing and Parole Reform Bill purports to improve public safety and increase confidence in the justice system by imposing longer sentences and making certain offenders ineligible for parole. Those are admirable intentions. We would all like to practically increase both public safety and people’s perception of safety which is equally important. Unfortunately nothing in this bill will contribute to either of those things—confidence or safety. In fact all the evidence points to exactly the opposite conclusion—that these sorts of regimes do nothing for public safety and will probably make our societies more dangerous more unequal and more divided. 
This bill is a very punitive and reactive approach a very reactive proposal and for a host of reasons that have been alluded to it is unlikely to have any real effect. It cannot have any effect for at least another 10 years even if it were imposed in legislation and that is something that has not been made clear to people. The Ministry of Justice has said that the deterrent effect of the regime is uncertain which I think is very polite language. The Department of Corrections has also demonstrated real scepticism that there will be any deterrent impact from this bill. Again in relation to their language one does not have to read very carefully between the lines to see that the expertise in those two key departments is telling us that this legislation simply will not work. 
The provisions in the bill will not reduce offending and after having heard so many promises and so many assurances the public expectation will be disappointed. The bill will serve to diminish people’s confidence in our justice system. They again will ask: “Why has it failed? Why do we not feel safe? Why are the crime numbers not telling us we are in a better situation?”. 
This bill is a classic example of an end-of-pipe solution. The Government is attempting to tidy up the mess. It is dealing with the symptoms at the end of a process rather than going to the root cause to the beginning of whatever process is causing the mess in the first place. Putting the focus on locking offenders away for longer and giving them a tougher time while they are in prison is simply an exercise in storing up trouble. 
Eventually those offenders will be released into society be it after 5 10 or 20 years—however long. With very few exceptions offenders will come back into society so alienated and so brutalised that they will be almost impossible to reintegrate. We are literally storing up trouble for ourselves by putting serious offenders in prison for longer and treating them in the way that is proposed in the bill. 
The time and effort that has been frittered away on this non-solution this attempt to put a band-aid on a gaping wound would have been much better spent on some real solutions. There are some truly sensible people in this country who despair of us breaking the cycle of offending and reoffending of people entering jail for the first time as offenders and coming out as very skilled criminals. 
The Greens agree with the many in the community who do not share the obsession with retribution and punishment for its own sake. We look for evidence-based solutions and we look for solutions that will work for the community. The legislation being debated today simply fails to meet those simple tests of value. 
We know there are numerous changes that could be made to lower the incidence of violent offending and to reduce offending. A study done by the Department of Corrections 10 years ago into the prevalence of mental illness revealed that of the total prison population some 90 percent had a current substance abuse or dependence diagnosis and that only 35 of those were receiving adequate treatment at that time. The report also noted that substance abuse disorders are known to contribute to reoffending among offender populations. It is almost taken as a given. 
Ten years on the recent Law Commission paper on liquor includes a summary of the relationship between crime alcohol and other drug abuse and dependence. It estimates that something like 76000 people are currently in need of intervention. These are people who come into the justice system either as accused or as offenders and they are in need of some sort of drug or alcohol treatment. Of those 76000 in need of help in the last 12 months or so judges were able to order scarcely more than 6000 only about 7 percent of that number to attend a substance abuse programme simply because those programmes are not there. They are not funded; they do not exist. 
There is a massive need for more drug and alcohol abuse prevention programmes. Without more such programmes people will stay on the treadmill of repeated and increasingly serious offending. The National Committee for Addiction Treatment suggests that at least a doubling of funding would increase the number of people able to be treated to perhaps 50000 which still leaves a significant gap between those needing help and those in front of the justice system. Until we begin to adequately address some of the primary causes like drug and alcohol abuse and dependence these longer sentences and other make-believe solutions are just window dressing. 
The second area where the investment of relatively small sums of money could have a real and positive effect on reducing the number of offenders is the provision of better support and assistance to the families of offenders. This can improve prisoners’ behaviour while they are serving their sentences and it will certainly increase the likelihood of their keeping out of trouble when they come out of jail. On occasion family backgrounds are part of the root cause of offending but in many more cases positive family relationships and maintaining those relationships will go a long way towards breaking the reoffending cycle. 
Comparative studies in Europe demonstrate that a combination of shorter sentences—not longer sentences; shorter sentences—and family-oriented prison policies and practice is a major factor in protecting children from the harmful effects of parental imprisonment and in breaking the intergenerational cycle. If families are adequately supported then the children are much less likely to become offenders during an offender’s term in jail. 
The relevant research in New Zealand around the relationship between imprisonment and the effect on families is some 10 or 20 years old. No decent work has been done for nearly two decades. All the work that has been done points to the fact that some really simple strategies could help us to reduce offending such as small amounts of financial assistance for travel improving prison visiting conditions and facilities and information on prison protocols being made available to families. There is no current research but there is overwhelming anecdotal evidence from the base organisations the voluntary and community organisations that work in this area that very little has changed in the last two decades. 
I have spoken personally to families of inmates as I am sure other members have and we hear the same stories again and again. It is incredibly difficult for people even for educated people to get basic information about where a family member is what ways they can assist their family member and how they can maintain a relationship with him or her. It is difficult even for people who are confident in dealing with bureaucracies and Government departments who are resourced and who have jobs and incomes. 
It is exponentially more difficult for someone from a disadvantaged background somebody without an education and without an income or someone on a benefit with dependent children. It is almost impossible for those people to break through those barriers. I have heard that from the families of inmates and I have heard acceptance of that point from officers in the Department of Corrections the people who work in the prisons. It is time we put some real resource into those areas because those are the real solutions. Locking offenders up and throwing away the key is a 19th century approach. It is not even worthy of our attention and it should not come before this House. 
My final comments are I am sure ones that have been made elsewhere. The process of getting this bill to this stage has been suboptimal to say the least. Despite very significant and substantive changes to the original bill there was completely inadequate opportunity for a second round of submissions and a highly prescriptive approach to engaging with the communities of interest and that begs the question: what were the proponents of the bill afraid of? Why would they not allow a decent and comprehensive second round of submissions to a significantly changed bill? 
As members may have gathered from my comments the Greens will continue to oppose this legislation and we hope that significantly better and more intelligent proposals will come to this House. Kia ora. 
Hon RODNEY HIDE (Leader—ACT) 
: 
 This is a very proud day for the ACT Party and for our members and supporters who have campaigned for many many years for the better protection of law-abiding citizens. It shows that those people who have supported the ACT Party and voted for it have made a difference to our country and will make our country a safer place in which to live. The ACT Party as part of its constitution has the view that the primary role of any Government is to keep citizens safe in their communities in their places of work and at home. We are also aware as a party that keeping our communities safe is part of the wider set of policies that are needed in order to deal with disadvantage in our society. 
I take on board the comments made by the Labour Party and the Green Party. The way that the ACT Party looks at the wider issues is that in order to address poverty and economic and social disadvantage we must reform welfare keep our communities safe from crime improve education through providing a choice of schools and stop taxing low-income people as punitively as we do. Instead our taxation system punishes enterprise and hard work our welfare system encourages attitudes that destroy personal responsibility self-reliance and self-confidence and our schooling system fails up to a third of our children. Out of all these failures has come a crime rate particularly a rate of violent crime that should shame us all. Our poorest communities suffer the most from criminal offending—from petty offences through to the most violent offences. Murder rape and aggravated robbery have become all too common. I say to Mr Horomia that it is from amongst Maori that the ACT Party in comments has received the most support because Maori suffer so badly from violent crime. 
Our sentencing system is weak and the parole system has clearly failed us. Offenders who are released on parole all too often commit further violent crime. These criminals have torn apart the lives of their victims. Their victims must live with the effects of the crime—the pain the fear the anguish—for the rest of their lives. For victims the crime is just the beginning. ACT campaigned hard for tougher sentencing with the “three strikes” policy at the 2008 election. After the election we negotiated an agreement with National to give ACT’s “three strikes” policy a fair hearing at the Law and Order Committee and throughout the past year ACT and National have worked constructively together to agree on a “three strikes” policy designed to keep Kiwis safe. I particularly single out the Minister of Justice Simon Power; the Minister of Police Judith Collins; the Prime Minister; and the entire National caucus as those with whom we have had many discussions over the past year. 
The Sentencing and Parole Reform Bill is a huge step towards getting the most violent repeat offenders off our streets and keeping law-abiding citizens safe. The “three strikes” policy that it implements is focused on a small subset of criminal activity. It is not by any means a policy that addresses the wider set of issues surrounding effective policing or that gets younger people off a pathway towards committing crime. Those issues are of course of the utmost importance but the “three strikes” policy is an essential part of the full mix of policies that are needed. It is focused solely on the worst violent crimes; it is focused on the few offenders who repeatedly commit violent crime. Unlike the Californian law people will not receive severe sentences under this law from conviction for relatively trivial offences. The offences on the qualifying list all represent serious crimes. This policy is about protecting our citizens from violent repeat offenders. It will keep our communities safe by deterring those criminals who are rational enough to see that their repeat violent offending will be met with an escalating level of punishment. Those who are not rational will be locked away which is as it should be. 
On strike one the offender will receive a sentence with parole as determined by a judge as at present. Nothing will change except this: the judge will tell the offender that that is strike one. At strike two the offender will receive a sentence as determined by a judge but now with no parole. Again the judge will tell the offender that that is strike two. At strike three the offender will receive the maximum sentence for that crime with no parole. That is strike three: the maximum sentence with no parole. An essential element of the “three strikes” policy is that it deliberately escalates the punishment for repeat violent offenders. Most offenders will not want to risk a second strike so when they are told about their first strike they will have to think very very hard about whether to amend their ways or carry on with a life of violent crime. Is it not a good thing to send a signal to young male violent offenders that it is a good idea to stop their violent offending? Is that not the sort of signal that we would want to send to Maori Pacific Islanders Europeans or whoever else commits that crime in our community? That is what this bill will do. Most offenders will not want to risk a second strike and they certainly will not want to risk a third strike. 
The evidence demonstrates that these policies work. Some offenders modify their behaviour and I ask again whether that is not a good thing. No longer will they hurt people but more particularly they will improve the way that they live their lives. Those who do not modify their behaviour will be locked away for longer than is the case currently—and so they should be because as I said the ACT Party has the view that our first priority is to protect people from violent crime. If people cannot modify their behaviour and if they are going to come out and kill rape and maim people then we say our first priority is to keep our citizens safe. That is what the “three strikes” policy is all about. 
This policy is about making New Zealand a safer place in which to live work and raise our children. It is about sending the very powerful signal to repeat violent offenders that their repeat violent offending will no longer be tolerated. I say it is about time that we all stood up as New Zealanders and said no to violent crime. It is time that all of us in this House stood up and said we will not tolerate repeat violent crime and we will not make excuses for it. I am astonished to be sitting here and listening to members of the Labour Party and the Green Party excuse it. I think that that might be OK for those people who are protected and safe from violent crime and who do not live amongst it on a day-by-day basis. But I say that for the first time ever we have a Government that hears the message of New Zealanders. It is responding to the concern of New Zealanders and is saying “Halt enough!” to violent crime. We will not tolerate repeat violent crime. I say to New Zealanders that everyone can see on this day in this Parliament that the ACT Party has made a difference that people’s support for the ACT Party has made a difference and that their vote for the ACT Party has made a difference. I think it is a shame that more MPs have not heard the concerns of their communities that it is now well past the time when we should have said no to repeat violent offending. This is a good bill and I commend it to the House. 
Dr CAM CALDER (National) 
: 
 It is a privilege to stand and speak—somewhat huskily—on the Sentencing and Parole Reform Bill. 
John Key’s National-led Government as we know is principled and pragmatic and it is seeking solutions to the many challenges facing our country. We in National are keeping our promises. We promised action and we are taking action on combating violent crime. We are making families safer in their homes and communities. 
This bill is part of a raft of legislation that we have brought to the House: legislation to toughen sentences and parole and bail conditions for violent offenders to crack down on gangs and on P and to support the victims of crime. We have also initiated Fresh Start programmes. Almost 3000 young offenders benefited last year from interventions to turn them away from a life of crime. 
We in National recognise that drug and alcohol addiction is the root cause of much crime and we have increased the access to drug and alcohol rehabilitation programmes. We have recognised the woeful undermanning of the police under the previous lacklustre lackadaisical unlamented Labour administration. We have already deployed over 200 more police in the Manukau-Manurewa area where I have the privilege of being based. A hundred more police will be deployed by the end of 2010 and 300 more police will be deployed nationwide by the end of next year. Along with initiatives in health social policy and education and initiatives addressing the drivers of crime those are some of the areas of the previous Government’s mesh that we will be reshaping in our effort to make our communities more secure. 
We have heard some criticism from Opposition members. But I ask how useful its policies were in reducing crime when it was last in Government. In fact some might ask whether it had any policy in this area. We may well ask. I believe that it did but how useful was that in reducing crime and making New Zealanders feel safer in their homes and on their streets? Judging by what I saw when walking the streets of Manurewa in 2008 I would say that it was not very useful. People had three locks on their doors and they had two more locks on the screen outside. Labour’s policy was not very useful. People might ask how useful it was. It was perhaps as useful as a cricketer’s box to a ballerina. It was as useful as a drink of water to a drowning man. It was as useful as a sunhat at midnight. 
The Sentencing and Parole Reform Bill is part of the National-led Government’s raft of measures to make our communities safer. Let us not ignore the fact that it puts the interests of victims and the wider community ahead of the interests of our worst and most serious violent offenders. This bill is aimed at the minority of offenders who even after receiving two previous warnings continue to offend in a serious and violent way. Those people have demonstrated that they will not change and for those few people there is no alternative but to prevent them from reoffending in such a way that they no longer present a danger to law-abiding men and women living in our communities. 
Not one of the 41 qualifying offences for the “three strikes” is a relatively minor offence. All offences involve serious violence or sexual offending and all have a maximum penalty of at least 7 years in prison. In defending the rights of offenders critics of “three strikes” downplay the goal of the legislation which is to protect the public from criminals who have a track record of serious offending. This bill does not focus on the poor or innocent who are unfortunately dealt with by the State; it focuses on the repeat nature of offending rather than just the offence itself. Critics of “three strikes” may also argue that offenders do not consider the consequences of their actions when they commit crime. Critics say that the offenders did not know what they were doing when they committed their crimes and that longer sentences are not an effective deterrent. 
The road to a third strike is a long one involving clear warnings delivered by a judge about the consequences of further serious offending and considerable time in prison where it is hoped that they will reflect on their actions. When making a choice of whether to commit a third serious crime offenders will have a very good idea of what is in store for them. I comment this bill to the House. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
:  
A tena koe Mr Assistant Speaker. Huri rauna kia ora tatou katoa e te Whare. When we want to look at prison statistics and prison programmes at programmes that work and programmes that do not we do not have to look any further than the good old USA where dingbat sheriffs think they are clever to march prisoners around in pink uniforms and idiots sign laws allowing police to arrest and jail anyone who looks like they might be an illegal immigrant—people like Parekura Horomia and Mita Ririnui sitting over there! The USA is also where Governor Arnold “The Terminator” Schwarzenegger oversees California’s penal system which is facing a crisis of overcrowding with more than 167000 inmates often triple-bunked angry fearful and exploding into violence across our screens every week on  
America’s Hardest Prisons 
. California’s penal system costs $8 billion which is 11 percent of the state budget—and blowing out of control as we speak. 
Arnie might be a muscle freak but he did not get to be the governor of one of the world’s top ten economies without having some smarts. It occurred to him that there had to be a better way to deal with prisoners than the philosophy of locking them up and throwing away the key which the “three strikes” morons of the overseas and domestic variety would use to deal with crime. So he proposed a simple solution. He divided criminals into two categories: those who pose little or no risk and those who need regular supervision. The idea was to take all the less threatening prisoners out of jail and put them into other programmes. It was a simple solution but it was a seismic shift in reform and it has been long sought by independent analysts and commissions into penal reform. That brings us back to Aotearoa where instead of trying to learn from the mistakes of the Californian penal system we seem hell-bent on following it down the deep dark hole that Arnie is struggling to get out of. 
The Sentencing and Parole Reform Bill is scary. It ignores even the advice of the Government’s own Attorney-General that the “three strikes and you’re out” law could be in breach of our fundamental human rights and in particular in breach of the section of the New Zealand Bill of Rights Act that protects New Zealanders against cruel degrading or disproportionately severe punishment such as having to face a sentence of life imprisonment for perhaps a third charge involving the unlawful discharging of a firearm which is a common occurrence at Tuhoe and Ngapuhi tangihanga and Tuhoe Treaty settlements for that matter. Unlawfully discharging a firearm could mean using granddad’s rifle when one is out hunting having never even thought to get it registered. 
Experts like Dr John Pratt Professor of Criminology at Victoria University will tell us what I told the House last week about a similar “kick them while they’re down” bill which is that without a sound philosophical base penal measures are nothing more than the nasty vicious form of vengeance that we thought had died out in Europe before Pakeha even came here. Just 5 years ago a Cabinet paper entitled  
Effective Interventions 
 concluded that there are smarter ways than prison to prevent crime and make criminals accountable to their victims and to society and that prison is not the most effective or efficient approach to reducing crime. 
That same paper noted than even the practice of remanding people in custody was being influenced by growing public political and media pressure for change. In fact in the 10 years from 1997 to 2007 prison sentences went up by 37 percent but cases of remand in custody went up by 214 percent. All of that of course saw the Department of Corrections’ budget blow out to $900 million for 2007-08 and if we carry on the way we are going the budget blowout will be $2 billion by 2020. 
The silly thing is that this mania about building more and more prisons and filling them even before they are built and at a cost that this country cannot sustain is not only illogical but also unnecessary. International research out of Washington confirms that there are excellent alternatives to prison which reduce not only the demand for prison beds but also crime. The problem though is that although all our resources are being siphoned off into building prisons doubling up the bunks in cells putting prisoners in containers and locking inmates down for 16 hours to cope with overcrowding the positive programmes for prisoner rehabilitation like work training and education are being closed off. We cannot even provide for 500 drug rehab places a year in a system with 6500 prisoners who are currently drug or alcohol dependent. 
International evidence tells us that “three strikes” has led to a massive increase in prison populations and jailhouse homicides. It has had a major negative impact on non-violent offenders their families and their poor communities. It has resulted in a blowout in cost for society and the problem is getting worse. The evidence also shows that imprisonment does not deter crime and that harsher prison conditions and longer sentences do not reduce reoffending. The evidence shows that reductions in crime usually come about through better drug and alcohol programmes greater employment and education opportunities stronger families and stronger communities. 
For the last few years we have seen a “build ’em and we will fill ’em” philosophy in terms of our prisons to the point where prisons targeted to be completed in 2011 are already filled in 2010 before building has been finished. That philosophy will be exacerbated by the “three strikes and you’re out” rule because it means we will be locking them up in rugby clubs and moving them around the country in buses at night time because there are no other beds for them to sleep in. We will be filling up the day rooms at police stations. We will run out of places to put people in jail. We will simply not be able to sustain that because at the end of the day we either lock them up for life—and we pay for it for life; we pay for it through the nose for life—or they will get out. And when they get out they will be seriously upset people and they will take that out on a whole lot of other people. 
There is no rehabilitation in this proposal. There is no intent to use the opportunity to change the nature of some of these people. I hear people asking how many chances they need. They do not even need one chance—it is about giving them the right chance the first time. The threat of heavier and heavier punishment does not change people. All it does is piss them off. It makes them angrier so when they come out they will be worse than when they went in. We have to try to turn this round and the “bash ’em and bash ’em again” philosophy has been proven not to work overseas. We would be foolish to go down that track. 
If the evidence was different I would say to give it a try. But the evidence is not different. It suggests that the best opportunity to turn people’s lives round is to try to get to them before they get to prison to improve their lot to address the causes of crime rather than the effects of crime and to attack poverty in the home. Whanau Ora provides the opportunity for Maori on this side of the House and on the other side of the House to put our hands up and say we think we can do better and then to challenge ourselves to do better so that we do not need Draconian legislation like this. This bill will simply take our country backwards into a time of vengeance and nasty mean-spirited viciousness; the kind of punishment meted out to people in 16th century England. Koina no mo tenei wa. Thank you very much. Kia ora tatou katoa. 
LYNNE PILLAY (Labour) 
: 
 I start my speech on the Sentencing and Parole Reform Bill by congratulating the member from the Maori Party Hone Harawira on a fantastic speech. On this side of the House we agree with the member and that is not always the case. For its key platform this Government said—if I can remind members in the House—that there would be 100 days of action. Enough was enough there was blood on the streets and this Government was going to get tough on crime and fix things! Eighteen months later we see that that is simply not the case. The National Government has brought in that legislation which is very similar to the legislation we see before the House today and what have we seen? What are the results of that legislation? Violent crime has escalated dramatically under the National Government. Now we are seeing the highest homicide rates in New Zealand in decades under a Government that said it would fix it. It said it had the remedies and its 100 days of action would get tough on crime and fix it. Well it simply has not. This Government should hold its head in shame for the record that it has. 
I would be very interested to hear the Minister of Justice Simon Power to take a call on this. I would be very interested for Chris Finlayson the Attorney-General to take a call. They know that this legislation will not fix things. If anything this legislation will make things worse. 
I pause for a moment because this week is Rape Awareness Week and it is important in this House that we acknowledge the victims of sexual assault and their courage in terms of what they have been through and what they go through with re-victimisation during the court process. It is also important to acknowledge the agencies that advocate for victims of serious crime and to acknowledge the support they give. 
When Rodney Hide gave his speech he spoke about keeping New Zealand safe—that was the key focus of this legislation; it was about keeping New Zealand safe. I say to this Government and to the ACT Party that one of the key principles should be about supporting victims and ensuring that they are treated fairly through the system. It is about crime prevention. It is about ensuring that agencies have the funding they need to work with people to cut the cycle of crime. It is about ensuring that police have the funding and support they need. All we are seeing is the funding for those very services that would actually have an impact on violent crime in this country being cut. The results speak for themselves. The escalating violent crime rates are an absolutely clear picture of what this Government through its policies has brought about. 
One of the consequences in terms of the victims of crime and I will talk about it in terms of the “three strikes” policy is that this will result in fewer guilty pleas. If an offender is on stage three or even on stage two that offender will not think “Oh goodness I must not be naughty any more.” At this point these people will think they cannot possibly admit it they cannot plead guilty because all that will happen is that they will get the worst-case scenario so they have no choice. Whereas an offender could possibly be in a position where he or she thinks “Right I will be accountable for what I have done.” and will plead guilty. But where is the incentive when they know that if they do that they will get the toughest sentence possible? There is no logic to that. 
What does that mean for victims? It means they are re-victimised. So many victims say that that is exactly what the court process does when they have to go through the lengthy trial because there is no incentive at all for offenders to plead guilty. 
I also remind this House that Labour tried to bring in sentencing guidelines. The recommendation from the Law Commission was to introduce sentencing guidelines so there would be consistency in sentencing and a steer in terms of serious crime. That would have been a really good initiative and it was strongly supported but not by National and not by ACT. If we did have that consistency then that would go a long way to addressing many of the concerns that have been raised by victims. 
I also will talk about the research that—as the previous speaker said—found that imprisonment has little if any deterrent effect. There is a great deal of evidence saying that it does exactly the opposite. This “three strikes” legislation due to its cost—and I will talk about the cost in a moment—will not achieve anything except a sweetheart deal with the ACT Party to keep it sweet in order to keep National in Government. 
Hon Steve Chadwick 
: Cynical. 
LYNNE PILLAY 
: It is very cynical. We on this side of the House are very cynical about the motivation behind that. If this were good legislation then we would see the Minister of Justice standing up— 
Hon Steve Chadwick 
: And the Attorney-General. 
LYNNE PILLAY 
: —and the Attorney-General standing up in support of it. Do we see that? No we do not. 
I will talk about the financial cost. We all know the financial cost and that every cost—every cent let alone dollar—that is put into prisons is money that is not spent in preventing crime or in supporting victims. I will explain for the other side of the House—I do not know that National members know the figures—that this policy requires an extra 50 prison beds after 5 years 142 prison beds after 10 years and that increases to 725 prison beds after 50 years. After 5 years the operating cost is estimated to be $5.1 million a year with a total capital cost of $22.4 million. After 20 years the operating cost will be $26.2 million with a total capital cost over $115 million; and after 50 years the operating cost will be $66 million per year and the capital cost will be a total of $290 million. 
We are not saying that there are no offenders who would get the maximum penalties; indeed they do. We on this side of the House are not saying that. We are saying that to have that as the cost for everybody found guilty on his or her third offence irrespective of what has happened or irrespective of the case is absolutely ludicrous. There is no evidence at all in summary that longer sentences reduce crime—none whatsoever. If we look at the US we see that the evidence is exactly the opposite. Therefore the policy is absolutely ineffective. 
There is no parole for good behaviour so what is the incentive for prisoners to go into rehabilitation schemes and address what they have done? What is the incentive when they know that no matter how impeccably behaved they are—and we know that that is not the case in prison—there is no parole even if they face up to their crimes and try to fix their problems so that when they are back in the community they will not reoffend again? There is absolutely no incentive whatsoever. This legislation is absolutely flawed. It does nothing. It does nothing for victims and it does nothing to halt crime. The previous Labour Government was not soft on crime; as people know we brought in tougher sentences when we were in Government. There is no incentive whatsoever for criminals to plead guilty or to improve themselves when in prison. 
JONATHAN YOUNG (National—New Plymouth) 
: 
 Let us get it right: there is a punitive element to prison. It is punishment as well as a covering of many other bases. Let us get it right that the Sentencing and Parole Reform Bill is talking about the protection of citizens in our society. It is addressing not only the issue of wanting to reduce crime but also the issue of wanting to make our society safer on the outside for our citizens. 
It is easy to rail against the Government because of recent increases in crime statistics but we know and members opposite understand that this issue is endemic that the problem is often generational and that turning the tide takes more than 18 months. But we are putting in policies and processes that will do exactly that. Labour says that the Sentencing and Parole Acts of 2002 achieved the same purpose as the “three strikes” legislation but we say that those Acts did not go nearly far enough in protecting the community from the worst repeat violent offenders. 
As a background I tell members that under the Parole Act 2002 offenders sentenced to prison for 2 years or less are automatically released after serving half their sentences and those with sentences longer than 2 years are eligible for parole after serving only one-third of their sentences. The public has been concerned about the number of serious offences committed by people who have been released on parole and concerned that sentences of home detention have been given to violent criminals. Home detention was designed as an option for non-violent offenders. Under the previous Government it was given to too many violent sex and drug offenders who posed a serious threat to the community. The figures are these: in 2006 and 2007 more that 50 percent of offenders on home detention had convictions for violent sexual and drug offences compared with 39 percent in 2001 and 2002. That is an unacceptable relaxation of attitude but it also speaks of the increase in crime through that decade. 
Our Minister of Corrections the Hon Judith Collins recently said: “In the 18 months that I have been police minister I have been shocked at the level of violent and anti-social behaviour in our society. There is a section of our community that has no respect for other people and no respect for the law. We are seeing it in the frequent attacks on police and innocent members of the public.” I take that on board and I have listened to the comments regarding the wider issues. As a Government we are committed to long-term comprehensive measures by dealing with the drivers of crime. They are just as important as responding to the aftermath of crime. The Hon Simon Power has said: “As you will be aware most of the government’s agenda for law and order since the last election has been dominated by measures to improve the immediate safety of the public.” and so it should be but we also need to get serious about how we stop crime from happening in the first place. So we are approaching this issue from both directions—that of the drivers of crime and that of the protection of society today. 
These are some of the questions that our political leaders are confronted with and that we are confronted with as a Parliament. We want lasting solutions but today we are forced to draw a firmer line. It is a line meaning that should people continually choose not to be law-abiding members of our society but to be persistent repeat offenders of violent crime then the constraint of the law which seeks to bring freedom and protection for its citizens will deny freedom to those who abscond from that responsibility. The law causes constraints to curtail their behaviour in order to ensure that the rights of others are protected so that they can live in freedom. When people refuse to live under such reasonable constraints of law the law constrains them until those persistent repeat offenders come to the ultimate constraint where for the sake of the freedom of others their freedom must be denied. 
This bill is about freedom. It is about who deserves freedom most. The Prime Minister has said: “Where there is a balancing of rights to be done between criminals and victims … I will take a side. And that side will be the side of the victim.” However there is a discretionary measure in this bill. It recognises that in some very rare cases the circumstances of the offender and the offence will be such that a sentence served without parole would be manifestly unjust. The bill takes this into account and it makes provisions for the court where the court is satisfied that a no-parole order would be manifestly unjust at stage three when imposing the maximum term for a serious violent offence. Thank you. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 As with all debates on law and order the rhetoric is the easy part. It is easy to stand up and say that we will be tough on crime by locking up more criminals for longer and that we will make communities safer by locking up more people for longer. The reality is somewhat different. I find it totally offensive that any member of the House would label another member or group of members based on their support or opposition to this particular measure as being soft on crime or tough on crime. It is a lot more complicated than that and the public of New Zealand deserve better than the type of hollow rhetoric that so often characterises the debates we have on law and order. 
People are not stupid. People are smart enough to know that we have one of the highest incarceration rates in the developed world and that doing more of the same simply leads to more of the same. For the last couple of decades we have been on a trajectory that has seen us exponentially increase the number of people we have put into prison but has that made our community safer? No it has not. It has not made our community safer and it will not make our community safer. 
I absolutely abhor violent crime and I think yes those who commit violent crime should be held to account for their actions—absolutely. But I think that we as an entire community should also be held to account for the moves that we take to prevent crime from happening in the first place and should get serious about addressing the drivers of crime. I congratulate Simon Power on having the gumption to hold a ministerial meeting on the drivers of crime and on getting serious about some discussion around those things. 
We as a society cannot keep turning our backs on the people who commit crimes suggesting that only they are responsible. There is the old saying that it takes a village to raise a child and it is absolutely true. We cannot simply turn our backs on the ones who get into trouble. We all have to accept responsibility for them. We have to accept the fact that in many cases offenders have themselves been victims before they were offenders. Often they have lived in households where little love was shown towards them where they were abused and where the love they knew was actually violence. We cannot turn our backs on them and simply say we will lock them up and throw away the key. We must look seriously at the causes of criminal offending including the causes of violent crime. The rhetoric is the easy part; the solutions are a lot harder. I for one will not label members on any side of the House as soft or tough on crime based on whether they support or oppose this bill. 
I will talk about a number of serious concerns I have about this bill as it stands and suggest that there are other better ways that we can deal with the issues. I believe that this bill removes some of the motivations for offenders to reform and better themselves and increases in some cases the likelihood of reoffending and the seriousness of the reoffending should it occur. We can keep people in prison for longer but there is no evidence from anywhere that suggests it makes them less likely to reoffend. 
This bill is bad for victims and the Ministry of Justice has advised that it will lead to fewer guilty pleas and more appeals which means the victims of crime will be dragged through lengthy and painful trials and appeals processes. That is one of the key questions that we should always ask in a law and order debate on any issue: what will this measure do for victims? Will it make them better off will it help them or will it simply provide them with an outlet for their anger? 
I can understand why victims of crime often have so much anger towards those who commit criminal offences. That is one of the reasons that victims of crime are not on juries and are not the judges—they cannot make objective judgments. It is why we have an independent judiciary. That practice goes back hundreds of years and it is absolutely right for us to have an independent judiciary and independent juries so that proper decisions can be made free from the emotion of being directly involved in something. I understand the anger that so many victims have. That does not mean we should necessarily be locking people up for longer and resorting to a much more primal instinct of retribution. It is not the right way to go. 
There are many problems with this bill as it is drafted. It removes judicial discretion. As I said we have to trust judges. Only on the first qualifying offence will the court solely determine the sentence. For the second offence the offender will serve any prison sentence that is imposed in full without parole. For the third offence the judge will have no discretion whatsoever. The judge will be required to impose the maximum sentence with no parole regardless of any extenuating circumstances. What I ask then is the point of having an independent judiciary if judges do not get to make independent judgments? We have to trust judges. We have to give them discretion. 
We also have to ask what the bill will do in terms of the discretion that it provides to the police and the pressures that it may place on the police. For example the bill removes all judicial discretion at the third strike and severely limits it at strike two but the police on the other hand will have much greater discretion. Under this legislation the police could for example lay a charge of aggravated injury against an offender which is a “three strikes” offence but then plea-bargain with the offender and reduce the charge to aggravated assault which is not a “three strikes” offence. They could do that on the condition that the offender pleaded guilty to the lesser charge. So the police discretion to prevent something getting into a court of law is greater than the discretion that judges have once the matter reaches the courts. How can that be fair? How can that be consistent with an open transparent and fair judicial system? It simply cannot be. 
The bill potentially leads to punishments not fitting the crime. Under this bill it is no longer just about the most serious offenders as the Government claims because some of the qualifying offences can cover conduct ranging from serious to relatively minor. This bill could lead to situations where the punishment does not fit the crime. 
It potentially reduces the incentives or ability to gain guilty pleas from those who have committed an offence. Studies in the United States have found that the rate of guilty pleas decreased after the “three strikes” law came into force because there was no incentive to plead guilty and defendants hoped that juries would find them not guilty when they discovered what the penalty would be. That is the other challenge to the judicial system and to those who serve on a jury. Will a jury find somebody guilty if its members know that the consequence of doing so is that the person may well never ever be released from jail? So we put more pressure on the judiciary. 
It places more pressure on victims of domestic violence because they may be less likely to report abuse if it is more likely to result in a lengthy term for the abuser. That is something we should think very long and hard about. 
Of course tremendous pressure is placed on those who work in the prisons. If prisoners are never to be released where is the incentive for them to behave appropriately in prison and make any effort whatsoever to reform their ways? If they know that they will go to prison if they get caught for a crime it will create more of an incentive for them to go further with that crime. Someone on a third strike who does something wrong may think that he or she could commit another crime—maybe kill the person who saw the crime being committed—knowing that he or she will go to prison anyway. What is the incentive for that offender not to do that? There is no incentive. 
The rhetoric on this issue is easy. The complexities are so much more difficult. We need to step back from the raw emotion of the law and order debate and consider what will work. We need to step back and consider the drivers of crime. We need to look at drug-dependency victimisation within the home family violence and so on. Those are the things we should be looking at. This is a punitive bill and it will not make our communities safer. 
MELISSA LEE (National) 
: 
 It is a pleasure to rise to speak in this debate on the second reading of the Sentencing and Parole Reform Bill. Normally I like to listen to the speeches of the member who has just resumed his seat Chris Hipkins but I am rather disappointed with his speech today. He started off by talking with hollow rhetoric. Let me tell members what has been hollow. The speeches from the Labour Opposition have been rather hollow because none of the speakers were part of the select committee process in the Law and Order Committee. Where were the members who sat through the select committee process on this bill? If members had been at the select committee they would know that 94 percent of the submitters supported this bill. So the hollow rhetoric has come from the Labour Party—let me start by saying that. 
Labour members are very loud in opposing this bill now that they are in Opposition but I wonder what Labour’s stance on violent crime really is. I wonder about its voters and whether they know about its stance on violent crime. It seems that in the 9 long years that Labour was in Government it did absolutely nothing about violent crime. 
Hon Steve Chadwick 
: Oh rubbish. 
MELISSA LEE 
: Well if Labour had done something about it the statistics would show that. It did nothing and we are now trying to fix that problem. I think this bill is wonderful. 
Lots of people have spoken on this bill and as I am the last speaker it does not give me a lot of things to talk about. But let me put a couple of points to the House. This New Zealand legislation is a vast improvement on the USA model which people keep on saying they do not like. This bill confines itself to crimes against the person. In the USA the legislation applies to all crimes including shoplifting but in New Zealand it is about crimes against the person. This bill will not capture low-level offending. It is about serious crimes and serious criminals. The Commissioner of Police or the commissioner’s delegate will make the decision to implement or trigger the “three strikes”. So the commissioner will act as a gatekeeper. This is high-level gatekeeping unlike that in the USA version where the gatekeeping was done at street level. In New Zealand the judicial warning is fair and reasonable. This is not the case in the USA legislation. This legislation will have the effect of taking criminals off the streets without creating a huge increase in the prison population as it did in the USA. We are talking about 50 or so extra beds in 5 years’ time. 
Everyone in the sector including the most liberal person accepts that there are some criminals who should never get out of prison and this legislation will ensure that. To those people who speak in support of preventive detention I can say this legislation complements and does not replace the sentence of preventive detention. 
As I said earlier 94 percent of the submitters supported this bill. Many of them wanted to redress the disparity between the rights of offenders and those of victims. Keeping the public safe is one of the most fundamental obligations of any Government. This Government is focused on and committed to taking the tough steps needed in order to tackle violent crime and make families safer in their homes and communities. 
I also remind members that earlier an Opposition member I think it was Lianne Dalziel began her speech by calling a criminal a “gentleman”. A criminal regardless of his horrid background does not deserve the honour of being called a gentleman as criminals are far from gentle. To me a gentleman is someone like you Mr Deputy Speaker not a criminal. Criminals do not deserve to be called gentlemen but doing that shows how delusional Labour is about violent crime. 
Personally I support any legislation that effects a change that means we are tougher on crime and tougher on criminals. Although we will probably never have a crime-free society this bill reassures me that violent offenders will think twice before deciding to become recidivist offenders and that when they do become recidivist offenders they will be dealt with by a law that will not tolerate belligerent thugs who commit violent crimes over and over again. “Three strikes” and they are out. 
A party vote was called for on the question  
That the amendments recommended by the Law and Order Committee by majority be agreed to. 
Ayes 63 
New Zealand National 58; ACT New Zealand 5. 
Noes 59 
New Zealand Labour 43; Green Party 9; Maori Party 5; Progressive 1; United Future 1. 
Question agreed to. 
A party vote was called for on the question  
That the Sentencing and Parole Reform Bill be now read a second time. 
Ayes 63 
New Zealand National 58; ACT New Zealand 5. 
Noes 59 
New Zealand Labour 43; Green Party 9; Maori Party 5; Progressive 1; United Future 1. 
Bill read a second time. 
Local Government Act 2002 Amendment Bill 
First Reading 
Hon RODNEY HIDE (Minister of Local Government) 
: 
 I move  
That the Local Government Act 2002 Amendment Bill be now read a first time. 
 I intend to move at the appropriate time that this bill be referred to the Local Government and Environment Committee. Local government delivers services vital to the lives of all New Zealanders. For many years ratepayers have expressed concern about rate increases that have well outstripped inflation. The previous Government responded to those concerns by setting up a ministerial inquiry the Local Government Rates Inquiry and then ignoring its recommendations. This Government will not be following up its recommendations either. That is because the objective of the inquiry was to “provide recommendations to the Government for enhancing rating and other funding mechanisms for local authorities”. The inquiry was not permitted to address the real problem which is a failure by councils to control their spending. 
Unlike in many countries New Zealand local government enjoys a high degree of autonomy and locally sourced funding from rates. The main restraint on local government activity in New Zealand is the exercise of local democracy: the control of council activity by ratepayers and electors. That control needs to be strengthened. When I was appointed the Minister of Local Government I said that I considered myself the “Minister for Ratepayers”. This bill is a major step forward in fulfilling the commitment I made to make councils more accountable to their ratepayers. It requires that each council first have particular regard to the contribution that the core services specified in the bill make to their communities; second develop a financial strategy containing quantified limits on council rates and debt and quantified targets for returns on council investments; and third produce a pre-election report to encourage and inform debate at the time of local elections. The bill also removes unnecessary procedural requirements that delay local authority decisions and add to local government bureaucracy. 
Many of those changes have been made specifically at the request of the local government sector. The question of what the core services are that councils should deliver has generated a lot of debate. The bill lists a number of local government core services. They are services that are widely acknowledged to be at the heart of local government’s role in New Zealand. Services such as water supply sewage disposal and roading are essential to the quality of life in our communities as are services like libraries parks and community halls. There is also a core local government responsibility to protect the community from natural hazards and disasters such as flooding. 
The Local Government Act 2002 already states that local government has a role to exercise the regulatory duties required by other statutes. That is why regulatory functions such as those contained in the Resource Management Act and the Building Act have not been listed as core services. It remains equally important that councils carry out those functions with proper consideration for the effect they have on their communities. The bill does not prevent councils from engaging in services outside those listed. However it gives councils a clear indication first that they need to do core services well before they engage in other services and second that they need to get a proper mandate from their community for these services rather than giving away to the demands of small but often vocal pressure groups. 
It may surprise members that we need to legislate to require councils to produce a financial strategy. Some councils have set themselves clear long-term limits on rate increases and debt levels but many—indeed most—have not. The fact that councils set rates each year provides a looser budget constraint on councils than applies to central government where increases in tax rates are rare and subject to intense public scrutiny. Requiring councils to consult on a financial strategy with quantified targets for rates and debt levels will encourage councils to debate with their ratepayers more carefully the trade-offs between additional expenditure and the effect on rates and debt. It is important that ratepayers can understand the financial information that is presented to them by councils and can easily compare the financial statements of their council with those of other councils. The bill therefore provides for greater standardisation in financial reporting by councils. For example officials have identified three substantially different ways in which councils report their rates income in annual plans and reports. That means that ratepayers cannot even compare something as basic as rates income amongst councils. The bill provides for regulations to be made to ensure consistency in financial reporting amongst councils. 
The bill also requires councils to report separately on the major infrastructure services they provide. They are the most expensive of the core services that councils provide and concern the major part of councils’ capital expenditure budgets. To allow ratepayers to compare fully councils’ performance on these essential services the bill also provides for a standard non-financial performance reporting system to be developed for those services. The bill provides for an additional funding statement to be included in council reports. That statement will be more meaningful to ratepayers than present financial reports. This package of measures plus additional other minor enhancements to financial reporting fulfil the commitment to implement plain-English financial reporting for ratepayers. 
I will expand a little on the issue of council investment in companies. Many councils own companies of one sort or another. For example much of New Zealand’s port sector is council-owned. I am concerned that in some cases councils are not managing those investments well and they are not being transparent to their ratepayers about the returns they are getting from those investments. The House has recently had to deal with the governance of Environment Canterbury. Members may not be aware that that council owned a company called Target Pest Enterprises which is reported to have made a profit only once in its 8 years of existence. The company went into receivership in May 2007 owing creditors—many of them just ordinary small businesses—millions of dollars. That is one example of a council making an unwise business investment and there are many more. This bill requires councils to set clear targets for returns on investments. Councils will be required periodically to review the expected returns from those investments against the inherent risks of being involved in business ventures. 
The third major initiative of this bill is the introduction of the pre-election report. There has been concern about the declining voter turn-out in local elections for some time. Simply exhorting people to vote seems unlikely to change that trend. The pre-election report is intended to draw together some key information about the past performance of the incumbent council and the future plans it has for its community. That will enable voters to scrutinise the performance of existing councillors more closely. It will also provide a factual basis against which candidates can state their position on future council plans allowing electors to then vote for candidates whose preferences reflect their own. The pre-election report will be prepared by council officials; it will not be a ratepayer-funded platform for promoting incumbent councillors. 
There is one area that has been of concern to some local authorities and that is the cost of auditing long-term plans. I gave careful consideration to that and the advice I received was that there was limited scope to address it other than to remove the requirement altogether—and I was not prepared to do that. Ratepayers are entitled to the assurance that the plan put before them is soundly based. The bill does remove a significant amount of descriptive and operational material from long-term plans. That will greatly reduce the number of occasions on which local authorities have to pay audit fees for minor amendments to their previous plans. That will reduce audit costs. The bill also merges the present community outcomes planning process with the long-term planning process. I cannot see the sense of having councils run two planning processes. 
Finally the bill removes a number of impediments to the local government sector using the private sector to deliver local government services. As I said at the beginning of my speech local government in New Zealand enjoys a high degree of autonomy from central government. That is a quality that I want to see maintained. To maintain that autonomy requires a high degree of transparency and accountability. That is achieved in this bill. I thank members for their time. 
Hon GEORGE HAWKINS (Labour—Manurewa) 
: 
 I must say from the outset that I was a little disappointed that the Local Government Act 2002 Amendment Bill did not deal with some things. The Hon Rodney Hide promised people that they would have lower rates but he has been a member of the House for quite a while and he has not delivered. I think that really disturbs people because they were looking forward to change. Of course we have people like Owen Pringle and Peter Goldsmith from the Papakura District Council who are putting rates up by 11 percent or more this year whereas someone in a nearby council Daniel Newman of Manukau City Council tells me that that council’s rates are going up by around 3.8 percent. So people were looking for some consistency but did not get it in this bill. I think that is really important. 
It is very easy for members of an Opposition to go around the countryside and say their party would make rates cheaper but perhaps this bill deals with one thing that worries very many people. They are worried that the bill provides that water-owned facilities could be leased out for up to 35 years. When I was a mayor I contracted out a lot of things and we kept the rates down but I say that 35 years is too far into the future. All those people in Grey Power will be 100 before they get a vote again on water services if a council adopts that provision in this bill. I say that 35 years is a long time and young people who are now 30 will be pensioners before they get another say. So 11 or 12 elections could go by before people get another say on this legislation. 
That is what is wrong with this bill and it builds on what has been happening around the country. Environment Canterbury has been skittled. Perhaps it may have deserved to be skittled—but for 3½ years? It should be for the period up to the next election if it is a problem that is so easy to sort out. Then we had the royal commission come up with its master plan for Auckland. Did that go to the public of Auckland for a referendum like everyone thought it would? No it did not. We see that happen again with this bill. People will find out that their water facilities could be set aside from public scrutiny for 35 years. 
Some people say that that is privatisation; I say it is the closest thing one gets to privatisation without selling things. I thought Rodney Hide may have been better spending his time working out who owns water rather than trying to flog off something. They have to make sure that in Auckland as in the rest of New Zealand they take the people with them; they do not get in the ACT-National bulldozer and trample over the rights of ordinary New Zealanders—and that is what has happened. 
I am a reasonably fair person and I can go on to say that some things in the bill are reasonably good. When we have a clause that calls for a pre-election report prepared by the chief executive of a council to say how the finances are without lobbying for certain councillors that is fair. It is well overdue and it is good but although we may find something good in a bill we must have a look at the overall picture. This bill cannot be seen in isolation. The House has dealt with three bills concerning Auckland governance—two of them have been passed. One of them was passed entirely under urgency. It did not have a select committee process and of course lots and lots of amendments were put forward by the Opposition to highlight how democracy was being ridden roughshod over. 
This bill has elements of that in it. It also builds on what is happening in Auckland where 75 to 80 percent of the council business will be put in council-controlled organisations. The Minister in his speech talked about a company owned by Environment Canterbury that went bust. When we have council-controlled organisations that are not open to public scrutiny as a council is we have a very dangerous position. That is what worries many people in the Opposition. It worries many people in Grey Power. It worries people who are sole income earners on a fixed allowance. These people would like to know where their money goes. I agree that it is great to have this report done before an election. I imagine the report will be only as good as the chief executive. In most cases chief executives are extremely competent people who will do the job well but one or two probably will not. 
I have to say that when we look at the bill we see that we will have all sorts of core business—that is what it will all be about. Last year Rodney Hide went around talking about core business. He talked about it so much that his mother had to remind him that libraries are a core business. He had not thought of that. This is one of the problems. I think there needs to be a balance between where Labour went where councils were able to move into areas where they saw need and what is happening here: core business. People see things such as having water supplied to their house having their rubbish picked up at the gate and having roads repaired as core business. 
I think this bill is a wee bit too narrow in that respect. I also think that it is very difficult to write these things into law. When things are written into law we have to take the public with us. I do not think that is happening here. You see when we have councils that are so different from the top of the North Island down to Stewart Island and out in the Chathams there are things that are very very different. New section 11A states: “a local authority must have particular regard to … (a) network infrastructure: (b) public transport services: (c) solid waste collection and disposal: (d) avoidance or mitigation of natural hazards:”—we would not argue about any of these things—and “(e) libraries museums reserves recreation facilities and other community infrastructure.” But is that the whole total? I suggest that it is not. 
I imagine that many people will make submissions because there is no real talk in here about the social needs of communities. There has to be far more awareness of the social needs of ordinary families living in ordinary communities. Although those communities may be vastly different in different parts of the country they need the ability to move into those areas themselves rather than being dictated to by the National-ACT coalition. I have to say that its record in local government is abysmal. I thought we were going to go somewhere but we have not been taken to the promised land; we have been taken to the execution chamber. That is what has happened. This Government has forgotten that ordinary New Zealanders value their democracy and democracy is slowly but surely being snuffed out by John Key and Rodney Hide. 
Hon JOHN CARTER (Associate Minister of Local Government) 
: 
 I quite like George Hawkins the member who has just resumed his seat—I think he is not a bad guy—but I say to him that that was a very sad disappointing speech. I expected at least something positive out of it but unfortunately it was not a great contribution. But of course we have come to expect that from this Opposition. 
I start by saying that I am delighted to stand here to support the Local Government Act 2002 Amendment Bill. When I was appointed as the Associate Minister of Local Government which I am very proud to be I thought it would be an interesting experience to work with Rodney Hide as the Minister of Local Government and I have to say that it has been. 
Hone Harawira 
: That’s not what you said to me last night John. 
Hon JOHN CARTER 
: I tell the member that I am going to say exactly the same words that I said last night but fortunately I was not talking to him last night. It has been fantastic working with Rodney Hide as the Minister of Local Government. He is a guy who will listen he is a guy who makes decisions and he is a guy who is prepared to take things on board. I congratulate the Minister on bringing this bill to the House. 
Hone Harawira 
: That’s enough John. 
Hon JOHN CARTER 
: No it needs to be said. It needs to be said and I want to say it because I am the guy who worked with Rodney Hide. I want to say that I really respect Rodney and I thank him for the work he has done on this bill. I thank him very much for making this contribution. 
I turn to the bill. George Hawkins said that there was anticipation that Rodney Hide and the Government would actually reduce rates. Well this bill is a start and it is where we can expect to take cost out of local government. In that regard it is exactly what local government and the ratepayers in this country have been asking about. I give members an example of one of the things the bill will do—the member who just resumed his seat actually spoke about this and was complimentary about it—and that is the pre-election report that is to be done by the chief executive for the council. 
The local body elections are coming up in Northland of course. A statement was made by one of the mayors that his rate increase would be less than the rate of inflation—about 3 percent. 
Hon Rodney Hide 
: Which mayor? 
Hon JOHN CARTER 
: That was the Mayor of the Far North District Council. It turned out that his statement was not the best of them. The Mayor of Whangarei District Council announced that he would be able to do better and that his ratepayers could expect an increase of about 2 percent. Not to be outdone the Mayor of the Kaipara District Council said that he would have a 0 percent increase. This is all well and good but the problem is of course that none of them have told their ratepayers about their infrastructure deficit. None of them have actually disclosed to their ratepayers what challenges are ahead. The likes of Whangarei particularly has some serious infrastructure issues to address. 
It is not about just the economics of the council; it is about the infrastructure and about what people can expect ahead of them. The pre-election report will contain a declaration about or an exposure of the infrastructure and will actually lay it on the table as to the status and the present position of the council and then ask candidates whether they be for mayors or councillors what they will do to address these issues. I have to say that that will be an amazing step forward for local government and ratepayers in this country. 
Hon Rodney Hide 
: And Labour opposed it. 
Hon JOHN CARTER 
: Well Labour actually complimented us on putting that in. It is the one thing that it actually got right. It is the only thing of course. 
The bill takes away a whole lot of the issues around consultation and the Minister has already spoken about some of the areas where we are making some improvements. But I say to the Minister and to the Local Government and Environment Committee that personally I do not think the bill goes far enough in that regard. I think we can improve on other areas in regard to the demands that we make of local government and what we ask them to go and consult their people on. I ask the select committee members that as they go through the submissions they pay particular attention to the issue of the cost of consultation and whether we can improve the bill further. It already makes some improvements and reduces cost in that regard. I think there is a great opportunity for us to make even more savings and to put fewer costs and difficulties on to ratepayers as we move forward through the select committee process. There are some great opportunities in this bill for the select committee to report back to Parliament on ways in which we can make the bill even stronger. 
I will finish by saying that the issue of core services was raised in regard to allowing private enterprise to be involved in supplying services to councils for a period of up to 35 years. I think that it was a bit rich of the previous speaker George Hawkins to criticise that because he did that in the local authority in which he was involved. He made huge improvements to his credit and to the credit of his council in that regard by introducing the private sector into the delivery of local government. I think nevertheless that it is a bit rich for him now to stand up and criticise. 
The second thing he complained about or criticised was the issue of core services. It seemed to me from the speech the member made that he had not actually read the bill. The bill states that local authorities and their residents are expected to decide what the core services are in their local authority. Those services may be different in the Far North from those in Invercargill but the local authority has to deliver those services first on behalf of the people. The services may be libraries they may be a whole host of things down in Invercargill or they could be something quite different in some other area. But the point that is made—and this is what the bill says—is we expect the leaders of the local authorities to focus first on the core services within their districts before they do things that may be demanded but that are not considered to be core. Again that allows democracy to prevail. It allows the local flavour of the ratepayers to be reflected. It also allows people to understand what costs will be imposed on them when those decisions are made. They will have an understanding of what those costs will be. All that will improve local government in this country. 
I support this bill entirely. As I say I think there is still room for us to make further improvements. I hope that as we go through the process the select committee will come back and report to the Minister and me and to Parliament that there are further opportunities we can take to make local government better in this country. Let it be said that it is a great step forward for local government and for the ratepayers of this country today to have this bill before this House. It means that at last we have a Government that is serious about local government. We have a Minister who is prepared to listen and to represent the views of local government which is to his credit and to the credit of this Government. Thank you very much. 
BRENDON BURNS (Labour—Christchurch Central) 
: 
 I am very pleased to speak on the Local Government Act 2002 Amendment Bill and to follow on from the Associate Minister of Local Government John Carter who effectively is the Minister of Local Government. He is the man who was brought in to rescue the Government from the mess that was created by the Minister in charge of this bill in terms of the Auckland super-city amendments. I will comment in particular on the parts of this bill that relate to what effectively is the privatisation of water services. The provision in this bill is that schemes can be operated for 35 years under the Build Own Operate and Transfer (BOOT) process. It is a Clayton’s privatisation because if we calculate what 35 years is we know that it is 11½ terms of Parliament. It means that people aged 30 now will be in retirement age before they once again get a say on who should be running their water schemes or on who should be looking after their interests. What MP in this House has served 11½ terms? The amount of time is 35 years. It is an increase from 15 years which is the current provision for those who wish to operate BOOT schemes. It is privatisation in drag. 
I can recall in a past life in this House that Sir Roger Douglas in his role in a Labour Government—and I acknowledge that it was a Labour Government—argued the case for State-owned enterprises. I for one supported the argument that we needed to see the efficiencies that State-owned enterprises would bring. But I did not appreciate—and I was not a member of this Parliament at that time—and I suspect that most of the Labour caucus did not appreciate that there was an agenda behind the agenda which was to take State-owned enterprises into privatisation. I believe that we are seeing exactly the same with this process. I think that some members of the National caucus will be supporting this bill on the basis that it will deliver some efficiencies in water delivery but I tell them to look very closely at it. Behind it we are seeing a move towards the privatisation of water services. Three and a half decades is in many people’s terms a lifetime. It is certainly a generation and it is too long a period to entrust water services to private enterprise. I will come to some points about why we cannot trust it for that length of time shortly. 
I acknowledge that there are good people in the water industry who are in support of the idea that 35 years under BOOT schemes is a good time frame to allow schemes to be built and operated and to have returns made. The reason I am mostly suspicious about this provision is that a month ago in this House we saw the disembowelling of Environment Canterbury over issues of water. That was at the core of what happened in this Parliament when in 30 hours flat we saw an elected body a democratic body put out of office. There was an agenda behind that in relation to water because the Prime Minister’s statement to Parliament in February this year said that he wanted to see new water schemes and new irrigation schemes in place in Canterbury next year. There is no way on God’s earth that that can be accompanied by new and much-required environmental tools that will allow water to be delivered in a way that does not add further to the detriment of water quality in Canterbury. It is already in such a state that it is not safe to swim in our lowland streams let alone to drink the water. That is why I have this suspicion about this bill and the time frames of 35 years for BOOT schemes. Just a month ago in this House we saw what happened to Environment Canterbury and the very clear agenda behind that. 
I was very pleased on Friday night to see and speak at a rally in Canterbury about those issues when 400 people gathered to make their voices heard— 
Hone Harawira 
: What was your rally’s name? 
BRENDON BURNS 
: Four hundred people gathered at very short notice to make their concerns known but it was galling to see just around the corner the gloating going on at a National Party fundraiser as people celebrated the demolition of democracy in Canterbury. Since the “Environment Canterbury Disembowelling Act” we have heard the Minister of Agriculture issue a very clear warning to other regional councils to look after farmers with water or else. There was a very explicit warning to other regional councils that they are to deliver what this Government wants in respect of water to farmers. I want to make it very clear that I support irrigation in my province of Canterbury and I want to see the greening of the plains but it must be done in a way that does not add further to the— 
Jo Goodhew 
: What’s the evidence of that? 
BRENDON BURNS 
: The member opposite is from an electorate that has no safe lowland streams to swim in. If she wants to take her kids down to a river she will see the diseases that they are likely to risk getting. She cannot take her dog and let it drink from the rivers of Canterbury because of the water quality. The member for Rangitata is doing nothing to improve river water quality—nothing. There is no way the Government can put this in place in the time frame it has allocated for new projects in Canterbury. 
In the House today we heard the Minister for the Environment’s announcements about water metering. I put this question to him: will it mean that those who have surplus water once their water meter is calculating their flows will be able to trade that for windfall profits? He would not answer that question because that is the trade-off for irrigators. They will have to pay $400 a year for the monitoring of the water metering but the pay-off will be that they can trade the water. They will be able to sell it for an uncapped price and that I say is reprehensible. Water is a common good; it belongs to all New Zealanders. It falls from the skies. It does not belong to any person simply because he or she has a deep pipe down into the earth or can suck it out of a river. Water is a common good that belongs to every New Zealander and it is at the heart of this legislation that we are debating today. I acknowledge that there is a case for water metering for farmers who are using millions sometimes billions of litres of water but there is no case whatsoever for farmers to gain windfall profits. I think that that was the softener for the water meter announcements of last weekend. 
I will comment further on the 35-year term. There is no Government responsibility attached to the quality of water delivered and some members last night might have heard comments on Television One from the Minister of Health and me about the issue of drinking water safety. Currently one in six New Zealanders drink water that cannot be deemed safe according to World Health Organization minimum standards. Sometimes the water is measured but does not meet the standard. The Minister cannot give any assurance on that. In fact he is sitting on $80 million of funding that was put aside by the Labour Government to help small communities to improve their water quality. In terms of those issues the responsibilities still rest with the councils. They are not being transferred to those who operate the BOOT schemes; they are still being held by the councils. They will be responsible not the operators of the BOOT system and not the Government as I read the scheme and that is a failure in terms of water quality. I say that there must be some change in terms of regulatory regime and of getting water quality right if we are to have any improvement in water quality. 
I note the article in today’s  
New Zealand Herald  
from Margaret Devlin a very distinguished woman. She is the former chair of Water UK and the managing director of South East Water in Britain. She comments that New Zealand lacks overall national water regulation rules. Regulation as she acknowledges can play an important and very positive role; it is not simply a negative. When we are dealing with something as important as water this bill should be accompanied by some sense that water will be regulated in terms of quality and there is nothing in this bill that mentions what will happen in respect of pricing. In Britain there is Ofwat the Office of Water Services which sets clear performance parameters there is an environment agency that works on environmental protection and there are drinking-water inspectors who ensure that drinking water is up to standard. The Ministry of Health has virtually no staff in charge of drinking-water standards. A tender had to be advertised recently for contractors to come in and provide the services that the Ministry of Health once had so that we could see the drinking-water standards of the World Health Organization monitored and put into effect in this country. We had to go out for tender for that. 
This bill proposes that there should be a move from 15 to 35 years—35 years—in which a BOOT scheme can be operated without any reference to the quality of the water without any requirement that they meet regulations and without any responsibility yet the councils and the ratepayers will have no say for 11½ terms of this Parliament which is 35 years. This represents a generation of passing it across to somebody else who bears no responsibility for the quality of the water being delivered. There is no regulation to accompany this. It is simply a process of effective privatisation. New Zealanders will rue the day that this bill was introduced. It will do nothing to improve water quality and there are huge question marks about what it will deliver. 
SUE KEDGLEY (Green) 
: 
 This is a terrible bill a dreadful bill that the Green Party will not be supporting. I sincerely hope that people in New Zealand will not be fooled by the soothing words of Mr John Carter and Mr Hide that the bill is all about reducing rates taking the cost out of local government and focusing on core services. Actually this bill is all about further implementation of ACT’s agenda to reduce spending in local government by as much as possible to corporatise and privatise as much of local government as possible and to shrink democracy. 
As Roger Kerr and others have revealed and I think Mr Hide has also referred to it the underlying premise of the bill is based on what happened in a grand experiment in Colorado. A tax and expenditure limit was set in Colorado the aim of which was to reduce spending and of course make us all resent paying rates or taxes. It also has the effect of driving down the resources of local government to the point where it becomes effectively bankrupt. What happened? This year as a result of this grand experiment in Colorado which this bill is trying to implement the Colorado budget will have a shortfall of US$28 million or 10 percent of its whole budget brought about by the strangulating effects of these tax and expenditure limits. One-third of Colorado Springs’ 24000 street lights were turned off earlier this year to save around US$1 million of expenditure. Residents can adopt a street light if they pay US$100 a year. The taxi drivers are trying to do the work of the police force because it is so overstretched by cuts. Park budgets have been slashed by 25 percent. Grass is mown monthly not weekly. Buses were sold and services no longer operate on evenings and in the weekends and the fire and police budgets lost US$5.5 million. 
Is this what we want in New Zealand? Do we want millions of street lights around New Zealand turned off? Do we want there to be no buses at the weekends or in the evenings? Do we want our taxi drivers acting as our police force? This I tell members is what will happen if we continue to be fooled by Rodney Hide and the ACT agenda. There is no question that local government is the new battleground for the agenda of the Government and Rodney Hide to corporatise and privatise as many assets as possible. There are many other concerns about this bill such as its definition of core services. I notice that the environment is not considered a core service. So what about issues like using toxic substances such as methyl bromide? I notice recreational facilities are a core service but what about parks and reserves? What about the Waitakere Ranges etc? 
The other issue I would like to focus on and there are many in this bill that I could focus on is water privatisation. This bill transfers management and decision-making control over water to private corporations and in so doing it transforms the provision of water services from a public good to a source of private profit. It promotes water as a commodity to be traded rather than as something that is essential to human life to health and well-being. 
Once a council has entered into one of these public-private partnerships for 35 years the bottom line the driving influence on all decisions will be the return to the shareholder not the public’s best interests. The water privatisation industry is a trillion-dollar industry aided and abetted by the World Bank and the IMF. Basically they are going around the world seeking new markets for their water privatisation agenda and of course they are turning their eyes to New Zealand and the Minister of Local Government and to the National Government which of course will come to the party. Water privatisation gives multinational corporations control over the necessities of life and of course they are focused on returning money to their shareholders and running the assets into the ground. Why would they not? They are focused on profits. Many of them of course are run by private equity companies. 
I will give an example from the United Kingdom where Margaret Thatcher was one of the first to introduce widespread water privatisation and these kinds of long-term arrangements. The result was excessive pricing. There was a sharp increase in the cost of water over 50 percent in the first 4 years; soaring profits for the shareholders the water companies—142 percent in the first 8 years—while the customers were having continual price rises; and huge underinvestment. The companies cut their investment programmes and used the savings to maintain and increase their dividends just like what happened to our railways under Michael Fay and Mr Richwhite. Huge salaries bonuses and fees were paid to the directors of the water companies. People felt so resentful of the companies which were perceived as greedy and they were not prepared to make the sacrifices to conserve water. 
Following privatisation there was a sharp rise in the number of households having their water supply disconnected or cut off which of course endangered their health. Continuous access to water is an absolute basis of health and well-being. In fact one of the criticisms was that water companies were failing to notify all these cut-offs to local authorities. There were no incentives under the privatisation to improve efficiency or to reduce leakages. Far from conserving water the people in England were so resentful of the companies they did not bother to conserve water nor did the companies. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
SUE KEDGLEY 
: I was explaining what an unmitigated disaster water privatisation had been in England and I was describing the 35-year privatisation contracts such as the one we will have here in New Zealand. The  
Daily Mail 
 a staunch supporter of the Conservative Party had a commentary with the headline “The Great Water Robbery”. It stated: “In recent weeks the penny has been dropping that something has gone horrendously wrong with the privatisation of Britain’s water industry … the water industry has become the biggest rip-off in Britain. Water bills both to households and industry have soared. And the directors and shareholders of Britain’s top ten water companies have been able to use their position as monopoly suppliers to pull off the greatest act of licensed robbery in our history.” That was from the  
Daily Mail 
 and that is what we are opening ourselves up to in New Zealand with this Local Government Act 2002 Amendment Bill. 
Another point I make is that the 35-year contracts entered into are completely secret. The contracts are commercially sensitive and are in confidence so people do not know what is in them. Some of the contracts have a guaranteed rate of return. In Latin America one of the big companies said that it would withdraw from its investments unless the return on capital was 13 percent. It withdrew from most of Latin America because it could not get its guaranteed return. There have been huge revolts against the high prices charged by private operators right throughout Latin America. Domestic water prices went up by 150 percent in Bolivia following privatisation. That led to huge demonstrations and so on and so forth. What happens when these companies go bankrupt in the course of their 35-year contract? Something that we should all be thinking about is the number of bankruptcies. Who takes over then? Is it the bank? I ask what happens. 
In Wellington there is I think a 25-year contract with regard to the wastewater sewage. This contract has changed three times in the past decade. It has gone from one company it has passed to another subsidiary and then it has passed to another. What are the implications for all this? Over 35 years circumstances can change but we are locked into these contracts. Everyone knows that water will be the oil of the 21st century. We will have water wars. That is why all these corporate water companies are scouring the world trying to get hold of publicly owned water companies such as those that we have built up over generations in New Zealand. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 The Local Government Act 2002 Amendment Bill has only just been introduced but we got a heads-up on it from Mr Hide. In his intemperate opposition to the Waikato-Tainui Raupatu Claims (Waikato River) Settlement Bill last month he condemned the notion that the Waikato River could be considered a tupuna with the mana the spiritual authority and power and the mauri the life force of the Waikato-Tainui. He stated: “I do not happen to believe it. I think it is hocus-pocus. But what we are doing is legislating this hocus-pocus”. Then he said: “I oppose it as the Minister of Local Government I oppose it as the leader of the ACT Party and I oppose it as a New Zealander.” Well I have to say to Mr Hide that as a member of Parliament for a Maori electorate as a member of the Maori Party and as a Maori New Zealander I say that the statements that he is making have to jeopardise the credibility of a Government that is working with Waikato-Tainui to settle this matter. They suggest that either Mr Hide is skating on thin ice or the Government is being dragged around by the nose by a party that is struggling to achieve more than the margin of error in the polls. 
The fact is that the relationship between iwi and the Crown requires decision makers to think about Maori values practices and interests in both the Local Government Act 2002 and the Resource Management Act including the need to recognise and provide for the relationship of Maori and their culture and traditions with their ancestral lands water sites wahi tapu and other taonga having particular regard to kaitiakitanga and taking into account the principles of the Treaty of Waitangi. 
I want to establish the status of the Treaty relationship right up front because the bill we are debating today will be of huge importance to Maori. Although the bill aims to amend the Local Government Act 2002 to improve transparency accountability and financial management in reality it is about the control and provision of water services and water infrastructure. That brings me back to the Waikato-Tainui Raupatu Claims (Waikato River) Settlement Bill. In that bill we are told: “The Waikato River is a single indivisible living thing that flows from Te Taheke Hukahuka o Te Puuaha o Waikato … and includes its waters banks and beds (and all minerals under them) and its streams waterways tributaries lakes aquatic fisheries vegetation flood plains wetlands islands springs water column airspace and substratum as well as its metaphysical being.” That is specific concrete terminology spelling out in black and white the relationship that Waikato-Tainui have with their river; it is hardly hocus-pocus. So when the Minister of Local Government comes to the question of water services and water infrastructure in the Waikato rohe he will find himself already offside with at least half of the authority charged with caring for the river and for the water that flows its length and breadth. 
This amendment bill aims to remove unnecessary barriers to water infrastructure development by reducing restrictions on private sector involvement in the delivery of water services. It is the first step towards privatising water in Aotearoa. This bill also aims to remove unnecessary consultation on matters of interest. The effect of this provision is that local bodies will no longer have to consider the views of affected people Maori or otherwise. Consultation will go out of the window even though the Local Government Act 2002 requires councils to ensure that Maori are involved in local body decision-making processes. 
We know that there are some good councils out there that engage with Maori in positive ways but we also know of councils that are deliberately lagging behind. Although the Act emphasises the participation and involvement of Maori it does not direct councils to any particular groups representing Maori interests. We sometimes find that councils deal with their obligations to consult by talking to a Maori staff member rather than to tangata whenua effectively sidestepping their commitment to mana whenua. This is in direct opposition to Maori Party policy which states: “Issues around water must include mana whenua including water rights and privatisation.” 
This bill also takes away the process of consultation between local bodies and the community on water issues reducing those who pay for and use the water to having no say whatsoever over the way in which their most precious resource will be managed. In fact this bill will put private contractors in charge of water services without any accountability for the supply of those services. It reminds me of a comment I saw in a recent article called “Waiting in the wings: Privatisation of your water” by Warwick Taylor of the Wellington Residents’ Coalition. He stated: “Water is protected under law but they are seeking to change that. Why not just do away with democracy altogether if it’s cheaper.” Given the thrust of this bill I shudder to think what this Government’s answer might be to that question. 
This bill is another step down a slippery slope. The memory of democracy is being used as a waterslide to ease the way for the privatisation of critical resources. We oppose the loss of democracy by the Maori community and by the wider community that we saw in the Environment Canterbury legislation last month. We oppose the unaccountability of private contractors. We challenge the right of this Government or any Government to deny Maori their Treaty rights to water and we will do whatever is necessary to establish a process that is truly Treaty-based that recognises the value of local government input and that restores the mana of water all around the country to the status expressed in the Waikato-Tainui Raupatu Claims (Waikato River) Settlement Bill. This bill threatens at a very fundamental level many of the principles that the Maori Party believes in and we oppose it on those grounds. 
CHRIS AUCHINVOLE (National—West Coast - Tasman) 
: 
 It is my pleasure to speak on the Local Government Act 2002 Amendment Bill. The Local Government Act 2002 is the cornerstone of local government and is fundamental to all decisions made by local authorities. As chair of the Local Government and Environment Committee I have regularly paid significant attention to this Act. [ 
Interruption 
] Members opposite should listen. As such it became clear to me that although the Local Government Act 2002 which is the previous Government’s legislation is good legislation albeit a little bit untidy in areas there are aspects that need improving and modernising. This bill does both of those things very well. It will meet the needs and requirements of not only the ratepayers but the general public and all those who interface with councils. 
The significant purpose of this bill is to improve transparency accountability and financial management in local government. The explanatory note of the bill states: “The underlying policy for the Bill is informed by the following principles: that local authorities should operate within a defined fiscal envelope:”. I am sure that all of us who represent our electorates are very aware of the concern amongst constituents that local authorities should operate within a defined fiscal envelope. The last thing constituents want is profligate local authorities. The public expectation is that local authorities must be rigorous with their finances. This is one of the reasons why we are introducing a financial strategy to the long-term plan to help local authorities and their communities debate and resolve the key financial and service delivery trade-offs that local authorities are obliged to make in the transaction of their programmes. The second principle is “that local authorities should focus on core activities:” and the third principle is “that local authority decision-making should be clear transparent and accountable.” 
This bill will provide ratepayers and residents with better information about council costs rates and activities and enable them to understand and influence planning and decision-making processes. The electorate of West Coast - Tasman has four councils with relatively small ratepayer bases. This legislation will be particularly significant to those areas and those councils to enable ratepayers and residents to understand and influence planning and decision-making processes. This will be achieved through introducing pre-election reports to stimulate debate during council elections and through achieving plain English financial reporting so that ratepayers can understand what they are paying for and how. I spoke this afternoon to the Buller District Council one of the councils in the West Coast - Tasman electorate and the councillors say that they are very conscious of the need for a plain English financial statement. 
At an operational level this bill will simplify decision-making processes. This will be achieved by removing unnecessary auditing and that will go down very well. This legislation will remove unnecessary consultation. We have heard previous speakers talk about the complex situation that has resulted from the incredibly tough demands on consultation. Levelling the playing field will enable the private sector to better deliver local authority services. This will improve councils’ flexibility to choose effective and efficient delivery methods for water and other services. 
I have already heard the concerns about water expressed by a number of speakers in this first reading debate but I am sure they will be reassured once they give the legislation full consideration. The horror stories that are already emerging will not be sustained. This bill will remove unnecessary barriers to water infrastructure development. I say to those who are not familiar with the area that water is something we are blessed with on the West Coast. The rainfall in the area where I live is 3 metres a year and further down the valley it is 6 metres a year but we still need potable water and a reticulated water supply. This bill will enable local authorities to enter into contracts for the supply of services for a period of up to 35 years and to delegate aspects of water services management to contractors and lease water assets from the private sector. But it will not allow local authorities to walk away from the responsibility associated with all those things. I have heard criticism already—I have taken note of it and I look forward to it being discussed further at the select committee—concerning the length of time for those contracts but when we consider the amount of capital involved in providing water services we need a fair amount of time to recoup the expenses of putting it all together. 
Good local government is essential for our communities our economy and our environment. The National Government values having an honest and open working relationship with the local government sector and recognises that there cannot be a one-size-fits-all approach to local government. This amendment bill represents significant progress towards better local government and towards easier and more effective participation by ratepayers and residents in the activities and decisions of local councils. The bill strengthens ratepayers’ control of council activity making councils more accountable to their constituents and gives ratepayers clearer and better quality information on the work of local councils. It provides them with the tools required to influence local government decisions. Ratepayers will be pleased that the bill contains measures such as a financial strategy with limits on rates and debt to ensure council costs rates and activities are better controlled. The changes are coherent and necessary and are a great improvement to the Local Government Act 2002. They are welcome changes. I am very happy to speak in support of them. Thank you. 
Debate interrupted. 
Business of the House 
Hon GERRY BROWNLEE (Leader of the House) 
: 
 Following discussions with the Business Committee I seek leave for members’ notice of motion No. 7 in the name of Phil Twyford concerning nuclear disarmament to be set down as members’ order of the day No. 4 on Wednesday 5 May 2010 despite Standing Order 96 and for there to be a debate of seven speeches of up to 5 minutes each on the question that the motion be agreed to. 
The ASSISTANT SPEAKER (Eric Roy) 
: Leave is sought for that purpose. Is there anyone opposed to that course of action? It appears not. Leave is granted. 
Local Government Act 2002 Amendment Bill 
First Reading 
Debate resumed. 
PHIL TWYFORD (Labour) 
: 
 In the lead-up to the Local Government Act 2002 Amendment Bill coming to the House tonight New Zealand was treated to the Minister of Local Government Rodney Hide parading up and down the country all last year with his transparency accountability and financial management agenda. It was a cut-and-paste job from the Business Roundtable’s policy on local government. We saw a number of proposals for the rates-capping of local government for mandatory referenda—Sue Kedgley very well set out that mandatory referenda have brought Colorado’s state Government to its knees—and for Rodney Hide’s agenda for core services. I do not know whether this agenda provoked more horror or more mirth in local government. I am glad to say that not much of Rodney Hide’s nutty agenda from last year has made it through into this bill. 
But this bill does contain some substance: the provisions around encouraging and promoting public-private partnerships and Build Own Operate and Transfer (BOOT) schemes in the municipal water sector. It is significant that Rodney Hide devoted only half a sentence in the final paragraph of his speech to the issue of water privatisation. If he thinks that New Zealanders are so thick that they will not even notice what the real agenda is here he has another think coming. The Government is playing silly semantic games. The explanatory note of the bill says this measure is not about privatisation. The Prime Minister got up in the House last week and said it was not privatisation. Well this bill allows the private ownership of New Zealand’s water infrastructure for periods of up to 35 years. That is privatisation. If it is not privatisation I want to know how long these contracts would have to be before this Government considered them to be privatisation. Would 50 years be long enough? Would 100 years be long enough? It is privatisation whichever way one slices it. 
The argument seems to be that it is not privatisation because it is not the sale of a pre-existing public asset. Well times have changed since Margaret Thatcher and Roger Douglas and Richard Prebble sold off all the assets in the UK and in New Zealand in the 1980s. The public-private partnership is now the dominant mode of privatisation all over the world. Throughout the world public-private partnerships are the dominant mode. That is how it is done. It is widely referred to in all the international literature as privatisation; the World Bank refers to it as privatisation. Why do members on that side of the House not front up have the courage of their convictions and admit to the New Zealand public that this bill allows the privatisation— 
Hon Gerry Brownlee 
: I raise a point of order Mr Speaker. I think you would agree that the member made a very unparliamentary statement in the midst of his speech. It is a serious point and I think he should withdraw it. There is no need to apologise but he should withdraw the statement. It is not appropriate to accuse others of not having the courage of their convictions. 
The ASSISTANT SPEAKER (Eric Roy) 
: I think that is a fair point; I was just trying to identify the part that the member was referring to. All members are honourable members and the member will withdraw that statement and desist from making further inferences. 
PHIL TWYFORD 
: I withdraw. The point I was trying to make was that the members on that side of the House lack intestinal fortitude when it comes to being up front with the New Zealand public about their policies. They decided that the issue of privatisation was off limits for this term of Government but they are not willing to be up front with New Zealanders and acknowledge that this bill kicks away the democratic safeguards against the privatisation of our water system. They are playing silly games. 
I will talk about public-private partnerships specifically. Labour is not against the concept of public-private partnerships. 
Hon Members 
: Oh really! 
PHIL TWYFORD 
: No we are not. We not against public-private partnerships per se. However we believe that public-private partnerships should be carefully considered and subject to the most careful scrutiny in order to determine where the costs benefits and risks are distributed. There is a view on the Government side of the House that public-private partnerships are some kind of panacea and that they deliver free money for public infrastructure. Nothing could be further from the truth. One way or another either the State or user charges pay for the cost of public infrastructure. Public-private partnerships do not deliver free money; they are not a panacea. They can however distribute the cost of infrastructure to particular users and they can postpone that capital expenditure and put the burden on future generations. So let us be honest and let us be clear about that with regard to public-private partnerships. 
Labour is against public-private partnerships in relation to some particular sectors: prisons schools and water. Along with 80 percent of the New Zealand public we believe that having free access to water is a human right. It is a public good and it is the job of the State to hold that public good in trust to ensure that all New Zealanders get equal access to it and it is managed in the public interest. Does the Minister of Local Government think New Zealanders are so thick that they will not realise that this bill is designed to encourage and promote the privatisation of our water system? Thirty-five years of private ownership is privatisation. 
There is a kind of mythology that public-private partnerships are some sort of golden egg that will deliver cheaper and better infrastructure. I look forward to this matter coming before the Local Government and Environment Committee because there is a very high pile of case studies of failed public-private partnerships in the water sector from all over the world. One example is Paris which is the home of water privatisation—public-private partnerships. Paris is the home of Veolia Water which is the parent company of United Water and last year Paris brought its entire municipal water system back into public ownership because of decades of failure and cost overruns. 
I will read for the record a cautionary tale from the Tampa Bay area in Florida which has a population of 2.4 million people. It is a similar size to Auckland for example. In 1999 a 30-year contract for $129 million was let to a company to build operate and manage a water treatment plant. At the end of 2007 the project was 4 years behind schedule and nearly $80 million over the original budget. The local authority then sued the original engineering companies for faulty design. In 2004 it awarded a $29 million contract to another company to try to fix all the problems. The project was 5 years late 16 percent under capacity and 44 percent over budget when it was finally up and running. That is a cautionary tale and there are plenty more where that came from. 
When this sordid bill comes to the select committee I hope that New Zealanders will have the chance to scrutinise it properly and make submissions. People will be very interested to measure up the provisions in this bill against the international experience of water privatisation. 
The bill is obviously not all about water privatisation and I make it very clear to this House that Labour is not against streamlining the Local Government Act. We are not against the transparency provisions and we are not against achieving efficiencies. The provisions in this bill around core services community consultation being cut back integrating the community outcomes planning process inserting financial strategies and imposing a requirement on councils to issue a pre-election financial report are all worth considering on the face of it. I am sure they will be subject to adequate scrutiny at the select committee. But all of those points will raise questions in the minds of people who are concerned about the state of our democracy. On the question of core services for example there is a blatant omission of social development or community well-being and there is nothing about economic development. Rodney Hide was told time and time again last year that those matters are important to New Zealanders and important to our local government. 
The question that I have when looking at this bill is whether the bill would pass the test of the cost-benefit analysis provided for in the Minister’s own Regulatory Improvement Bill. We have had advice only in the last couple of days that this bill will result in a net increase in compliance costs for councils. I think it will be very interesting to see that issue teased out in the select committee. New Zealanders will be concerned about the proposals to cut back the requirement for community consultation. Perhaps there are too many requirements of that sort in the principal Act. But given the track record of this Government and this Minister in cutting back the democratic process and showing a disregard for people’s democratic rights in local government these proposals will ring alarm bells. 
Labour will vote against this bill. It is repugnant; the water privatisation provisions are repugnant. They are unwelcome and they are the latest piece in the jigsaw of this Government’s gutting of the public domain in relation to local government. This is the latest instalment. We have seen the corporatisation of Auckland local government the shutting down of Environment Canterbury and the scaling back of our democratic process. 
LOUISE UPSTON (National—Taupo) 
: 
 I am delighted to rise to speak in support of the Local Government Act 2002 Amendment Bill. As my very able chair of the Local Government and Environment Committee Mr Auchinvole said: “Good local government is essential for our communities our economy and our environment.” As Mr Auchinvole very ably led the Local Government and Environment Committee I am very proud to follow him in supporting this local government amendment bill. 
The bill of course amends the 2002 principal Act and the three principles that members will hear again in this speech will be “improving transparency” “accountability” and “financial management”. The previous Labour speaker Phil Twyford did say that Labour was supportive of those three principles so I am very pleased about that. 
The National Government values an honest and open working relationship with the local government sector. We recognise that there is not a one-size-fits-all approach to local government. We understand that communities up and down New Zealand are different; even within an electorate they are different. I will demonstrate this for a moment by talking about the Taupo electorate. 
When we look at the case of the Waipa District Council we see that this year it is hosting the World Rowing Championships at Lake Karapiro in November. This event will be the biggest sporting event in New Zealand since the 1990 Commonwealth Games. The council will be significantly involved. Last week the South Waikato District Council signed a $3.4 million contract for the New Zealand Cycle Trail project in respect of the Waikato River Trail. It will ensure that the last 41 kilometres of the cycleway is completed in time for the World Rowing Championships. 
The Taupo District Council—a very different council again—has recently been awarded accreditation as an International Safe Community. The World Health Organisation has examined Taupo and its commitment to safer communities. Taupo is known as a wonderful tourist destination and the accreditation will boost our image. The Government the Minister of Local Government Rodney Hide and the Associate Minister of Local Government John Carter understand that there cannot be a one-size-fits-all approach to local government. We keep the “local” in local government. 
I remind members that this bill is about transparency accountability and financial management. The Local Government and Environment Committee worked incredibly well together last year on simplifying and streamlining legislation in the reform of the Resource Management Act. It is fair to say that we work well together at simplifying and streamlining things and this bill is another example of that. I know that we will be working together to reduce costs and waste in local government. 
This bill works on two different levels. First on a strategic level the bill aims to change the way that local authorities set their direction and the way this can be influenced and assessed by their communities. There are several provisions in the bill. I will not cover all of them and I defiantly will not dedicate 90 percent of this speech to issues to do with water. Some members of the Opposition seem to have forgotten the main issue of strategic changes which this bill will reform. One change that I think is really important is the introduction of a pre-election report which will encourage and inform the debate during the elections. It means that voters will have better information on which they can base their decisions. It will introduce a financial strategy to the long-term council community plan and it will help local communities and authorities debate and resolve the key financial and service delivery trade-offs that they have to make. 
At the second level are the operational reforms. The bill aims to simplify decision-making processes. A couple of these changes include the removal of unnecessary auditing. If members talk to local councillors up and down the country they will find that that is an area of financial waste that they would rather do without. The bill will remove unnecessary auditing by taking a number of operational policies out of the long-term council community plan. It will also level the playing field to better enable the private sector to deliver local authority services. 
Local government is essential for our communities our economy and our environment. We on this side of the House recognise that there is not one size that will fit all. We recognise the differences in our councils up and down the country. I have given examples of three different councils in the Taupo electorate and things that are important to them. This bill is about improving transparency accountability and financial management. Ultimately it will make councils nationwide far more accountable for their actions. That is what ratepayers want what local politicians want and what the National Government wants. 
SU’A WILLIAM SIO (Labour—Mangere) 
: 
 I am grateful for the opportunity to speak on the Local Government Act 2002 Amendment Bill in its first reading. I want to reflect a little bit on where we have come from. 
Members will recall that on 17 November 2008 Martin Johnston of the  
New Zealand Herald 
 wrote an article—members may have read it I do not know—that said: “ACT has a radical agenda for local government but party leader Rodney Hide is keeping his lips sealed.” The article went on to say: “ACT wants councils to privatise their commercial activities and to supply water on a ‘fully commercial basis’ but Mr Hide would not identify yesterday which activities should be prioritised or discuss these policies at all.” Later in that same month Brian Rudman of the  
New Zealand Herald 
 wrote another article entitled: “Hide and local government a scary mix”. I quote: “There are many in local government scratching their heads after the appointment of Act leader Rodney Hide as Minister of Local Government and wondering what on earth they did to upset Prime Minister John Key so much.” The article continued: “Top of the scorched earth local government policy list Mr Hide was elected on was that ‘local government will be required to shed its commercial activity thereby eliminating the need to separate regulatory and commercial functions between local and regional councils’.” 
Members will also be aware that Mr Hide as the Minister of Local Government rammed through the implementation of the Auckland super-city. They will recall that the Government said that it would consult widely with the people of Auckland once the Royal Commission On Auckland Governance had released its report. That was never done. Members will also recall that earlier this year Mr Hide with the support of this Government removed the 14 elected councillors of Environment Canterbury. That regional council will not have the ability to replace those elected officials with new elected officials in this year’s local body elections. They are being replaced by commissioners who have been politically appointed by the Minister of Local Government and the Government. 
I thought it would be useful to give some background as to what is happening with regard to local government and what is yet to occur with the final Auckland super-city bill going through the House and now with this Local Government Act 2002 Amendment Bill. I support what my colleagues have said: we in Labour are opposing this bill. There are a variety of reasons why. 
Let me begin by saying that in quickly going through the bill I saw a range of areas of concern that I wanted to bring to the attention of the House. I am hopeful that the people of Auckland the people of the Canterbury area and everyone who is passionate about local government will take the time to make submissions on this bill. New section 11A in clause 5 makes reference to “core services”. The bill states: “a local authority must have particular regard to the contribution that the following core services make to its communities:” then lists “network infrastructure:” “public transport services:” “solid waste collection and disposal:” “the avoidance or mitigation of natural hazards:” and other community infrastructure. 
People who are working in business improvement districts will be asking—I know that those in Manukau will be asking—whether economic development is a core service of councils. Is the business of business improvement associations a core service? Will this bill specifically put a circle round or define the limitations of what is regarded as a core service? I am saying this because currently all local government bodies and communities are able to participate in identifying what local core services are through the annual plan process; that is when communities come forward to their councils and identify what their needs are and what is important to them. 
For example only last month many people throughout New Zealand—all of us I suspect—celebrated Anzac Day. The events on that day are generally organised by community boards and are funded by councils. Our local event in Mangere Bridge is organised by the good Rev. Les Dixon of the Anglican Church there. He estimates that the council puts in about $10000 to pay for that local event. People are now asking whether Anzac Day celebrations and other events that local government bodies currently support are core services. 
From talking with members of the local government fraternity I have a suspicion that we could see a situation where local government bodies use lawyers to try to define what a core service is. I do not believe that this bill will achieve what it is designed to do which is to reduce compliance costs and to reduce the rates burden on ratepayers if councillors need to consult and to seek the advice of legal advisers to identify what is a core service and what is not a core service and to determine which current community activities will be part of local government services in the future. 
I come to community consultation and to clause 8. Several amendments in this Government bill seem to me to take away the opportunity currently available to members of the public to provide input into the long-term council community plan. If on the one hand the Government is saying that it wants transparency and wants accountability why on earth is it removing the particular part providing for wider community participation and for communities to hold local government bodies to account? The removal of participation by communities is explicit in that particular part of the bill. I do not know why the Government is doing that. I hope people will be consulted and will be able to raise their concerns. The risk is that under clause 8 community considerations will not be given a full and fair hearing at key stages of the process. 
I come to the area that the Minister of Local Government did not spend a lot of time on. It must be considered the most significant part of the bill. It is about partnerships the private sector and making it easier for the private sector to take control of an asset and to take control of an income stream that comes from the water industry. The Minister spent little time on it yet it is probably the most significant part of the bill. 
My colleague George Hawkins said that if these contracts will last for 35 years ratepayers who are now aged 65 will not get a say in what happens to those contracts until they are 100. Ratepayers now aged 35 or 40 will not have a say for the next 35 years. They could be dead at 70 if they are Pacific or Maori. They will not have a say in how the private sector will run the water industry under that particular clause. 
It is a weird situation to have a bill that aims to reduce compliance costs but on the other hand adds other compliance costs. On the one hand the Government says it wants more transparency but on the other hand it tries to keep a lot of the decision making that will be made by the private sector away from the community so that the community is not participating and the community is not involved. There are major concerns about this bill and I hope the public of New Zealand listening to this debate will take the opportunity to make submissions on this bill. Thank you. 
NIKKI KAYE (National—Auckland Central) 
: 
 I rise to speak on the Local Government Act 2002 Amendment Bill. This bill is about delivering to New Zealanders greater transparency and accountability in local government. As MPs we often have constituents coming to us when they have issues in getting basic information from councils and when they think issues are very complex so I am very pleased to be able to speak on this bill because I think we will be able to do something in this Parliament to help those constituents get greater access to information. 
If I could sum up this bill I would say that this is about greater freedom of information for residents and ratepayers. Recent analysis by the Department of Internal Affairs shows that the cumulative increase in rates per head in the next 10 years will be 49 percent. We know that many ratepayers are concerned about increasing rates so more and more New Zealanders want to know how their hard-earned money is being spent. We on this side of the House stand up for the right of those New Zealanders to have access to that information. 
That is why I find it so difficult to understand members opposite and their position on this bill. They are opposed not only to New Zealanders having greater access to information and accountability on how their rates are being spent but also to giving communities more power over that information which could see better use of that money. So when members come to this House and talk about helping disadvantaged people and greater transparency it is really hard to believe them. When it comes to the crunch with a bill about transparency and delivering greater use of people’s rates what do they do? They vote against it. It is really difficult to believe those members of the House. 
As we sat through the select committee process on the legislation that changed Auckland governance so many people came and said they could not get even basic access to information about how their rates were being spent. It is really difficult to understand the position of members opposite on this legislation. 
The other point I will talk about is public debt. It is forecast to increase by 97 percent and expenses are forecast to rise by 91 percent. We on this side of the House think it is unacceptable to have a situation where local government cannot produce transparent information about how people’s rates are being spent. Let us talk about some of the mechanisms that are within this legislation to try to achieve this greater transparency and accountability for the New Zealand taxpayer. 
The first step in this bill is about a principle that says local government should operate within a fiscal envelope. As I have said before we all know of examples of local authorities that have racked up accumulated debt in a way that has not been transparent to the New Zealand taxpayer. The other key thing which came out during the select committee hearing of submissions on the Auckland governance legislation is that within long-term council community plans some of these documents are hundreds of pages long. Do we on this side of the House really expect people to wade through those documents to understand how their little local project is being dealt with? Actually that is not possible for a lot of New Zealanders. 
We on this side of the House support the fact that the Minister of Local Government the Hon Rodney Hide and this Government are interested in making these plans simpler and clearer for people to understand. What we are trying to do is give more individual power to New Zealanders through clear and simple information about how their money is being spent. The bill also includes provisions on financial disclosures which have to be in plain English. This ensures that simple information is available to members of our community be they local board members within Auckland or constituents who are able to decipher the gibberish that is being thrown up by some of these councils. I think it is important to acknowledge that this information could also be more available to some community newspapers. I have had some of them come to me and say they cannot get basic information about projects within their areas. 
The other key aspect of the bill which is very important and I find it very interesting that members opposite do not support it is the concept of pre-election reports. That is about saying to local body politicians that they must go into an election with greater transparent information about what the council’s financial position and commitments are. How can members opposite not support that basic level of transparency? No longer will I accept those members going around public meetings in Auckland talking about transparency and accountability when they are voting against this bill. Under this legislation the chief executive of a local authority will have to prepare a report before each triennial election providing information to promote public discussion on the issues facing that local authority. 
The next aspect of the bill that is very important is the concept of a financial strategy. The purpose of this document is to help facilitate local authorities’ proposals for funding and expenditure by making transparent the overall effects of funding and expenditure proposals on local authority services rates debts and investments. Again this was a core principle that came through a number of submissions from people within the community who said “Look we just want to know what our council is doing what the debt is and what the basic financial position is.” I find it very difficult to understand how members opposite cannot support those provisions. I also believe that the council consultation processes are unnecessarily onerous and complex so I am really pleased that the bill will help achieve less complex consultation processes. 
In conclusion I say that this National Government is delivering legislation that is about greater transparency and accountability for the New Zealand taxpayer. I am proud to support this bill. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 The speech made by Nikki Kaye the member who has just resumed her seat was a fascinating insight into the way she approaches issues. There are 53 clauses in this bill and Nikki Kaye chose to focus her speech on the elements that everybody agrees on—but in a strident tone of anger at members on the other side of the House; how dare we agree with the Government about those clauses—whilst proceeding to completely ignore the clauses that have the greatest degree of controversy which obviously are the clauses that deal with water privatisation. Nikki Kaye’s approach was quite extraordinary. 
I want to talk mainly about the water privatisation issue and to make absolutely clear that on this side of the House we of course support improved transparency and putting out good financial statements but we cannot support a further erosion of democratic rights in the local government sector. Time and time again in the 18 months I have been in this House we have seen National bring forward measures that diminish our democracy at a local level. 
Some of the first speeches I made in this House were about the early Auckland governance reforms which took away some fundamental elements of democracy from the royal commission’s recommendations. We have seen ongoing programmes in Auckland in relation to the council-controlled organisations where people’s ability to have a say has been removed. The ability of people to have a say at the most basic level of democracy has been removed and I think that is an appalling thing to do. 
Then there was the situation with Environment Canterbury. That was a remarkable move. Not only did the process get rid of an elected council but also it cancelled an election that would have enabled over 350000 Cantabrians to elect their regional council. Around the world there are names for countries that cancel elections. “Banana republic” is one of those names. Yet in this House the National Government blithely cancelled an election. It cancelled part of the democratic process in this country. Nick Smith actually told the  
Timaru Herald 
 that one of the reasons the National Government did that was that he was worried about the outcome of the election. He was worried about the outcome of the election so he cancelled it! He got rid of it. That is the kind of approach to local democracy that we have seen consistently from this National Government. 
Now today we have the Local Government Act 2002 Amendment Bill which despite Nikki Kaye’s protestations is not really about transparency. It is about freeing up the privatisation of water—the ability to let a 35-year contract for private water services. In 35 years Mr Hide will be 89. My good friend Phil Twyford whose birthday is today will be 82 in 35 years. It will be that long before they will be able to have a say and we know that Mr Twyford will be a very grumpy 82-year-old if he has not been able to have a say in respect of the way water services are changed in Auckland. But that is what this bill will do. It will push out the ability of people to have a say about the way in which a core part of our infrastructure is delivered for 35 years and that is privatisation no matter what language is put around it. 
We know what the ACT Party’s agenda is here. We know that Mr Hide would get rid of anything that would prevent the privatisation of water and National is now complicit in the de facto privatisation of water services for 35 years. I want to refer to a particular part of this bill that I think shows how this anti-democratic agenda is taking place at a local level. This bill repeals section 88 of the Local Government Act 2002. Currently when a local authority wants to change the delivery of a service it is required to use the special consultative provisions of the Act. That means that when a major change is in place the council is obliged to go out and talk to people but that provision is now gone. The 2002 Act recognised that the way a core service like water is delivered is pretty important and needed a special consultative process. That is gone with this bill. That important check and balance in the democratic process is gone with this bill. 
How much clearer can it be that the agenda of this bill is to reduce participation reduce democratic rights and put in place a process whereby privatisation can be bulldozed through for 35 years at a time? That is anti-democratic. It is against the core principles that New Zealanders hold dear. New Zealanders want to have a say in the way services are run and they want to know that if they want to stand up for publicly run services they can. That will go under this bill. 
As Mr Twyford said earlier Labour is not opposed to public-private partnerships in principle but we need to take a careful approach. Public-private partnerships lock Governments into all kinds of things. They are the “Hotel California” of Government arrangements—“You can check out any time you like but you can never leave.” If there is a debt it will be with ratepayers forever. Ratepayers will not be able to get away from that debt; it will be with them forever. The experience internationally is that when things go wrong ratepayers and taxpayers will have to pick up the debt. 
Public-private partnerships should be approached with caution but this bill goes in exactly the opposite direction. It opens the floodgates. It puts at risk assets that have been built up by ratepayers for years and years and it puts them in a basket so that they are up for grabs by the private sector and taken away from the democratic process. I think that is completely wrong. 
Some other aspects of this bill need to be analysed closely by the select committee. What are services and why are economic and social development not mentioned within core services? Those are important questions that the select committee needs to give its attention to. The bill also reduces community consultation processes. There is a useful debate to be had about where and when consultation best takes place but it should not be an exercise in simply throwing the baby out with the bathwater and saying that community consultation is not important. 
Of course members on this side of the House support the things that will make processes more streamlined and give more transparency in financial statements but we will not support the taking away of democratic rights and the further erosion of local government and keeping decisions close to local people. We oppose the privatisation of water and that is what this bill is designed to do. 
A party vote was called for on the question  
That the Local Government Act 2002 Amendment Bill be now read a first time. 
Ayes 64 
New Zealand National 58; ACT New Zealand 5; United Future 1. 
Noes 58 
New Zealand Labour 43; Green Party 9; Maori Party 5; Progressive 1. 
Bill read a first time. 
Bill referred to the Local Government and Environment Committee. 
Electoral (Finance Reform and Advance Voting) Amendment Bill 
First Reading 
Hon NATHAN GUY (Acting Minister of Justice) 
: 
 I move  
That the Electoral (Finance Reform and Advance Voting) Amendment Bill be now read a first time. 
 At the appropriate time I intend to move that the bill be referred to the Electoral Legislation Committee which has been established to consider this bill and the Electoral Referendum Bill. Electoral finance law is fundamental to New Zealand’s democratic system. The regime must be impartial fair and transparent so that the people of New Zealand have confidence in our elections. I also add that as far as possible electoral law should also be the product of cross-party consensus as this is the path most likely to lead to enduring solutions. 
As part of this Government’s pre-election platform the Electoral Finance Act 2007 was repealed within our first 100 days in office. An interim regime was put in place and we began a consultative process. It started with a scope paper published in April and this was followed by an issues paper released in May and a proposal document released in September. We also held public forums in Auckland Wellington and Christchurch. This bill is a result of that consultative process and it is the fourth bill in the Government’s electoral reform programme. 
As the title suggests the bill is divided into two primary areas: finance reform and advance voting. The primary purpose of this bill is to amend electoral finance law in areas where there is broad-based consensus for reform. This bill will provide certainty to electoral agencies political parties candidates and the public. 
It aims to improve the understanding and application of electoral law. To recognise the impact of new technology and media the bill updates the definition of “election advertisement” to cover advertising by all forms of media. 
The bill also sets up a regulatory regime for third-party promoters that emphasises transparency rather than restrictions on the freedom of expression. It requires third-party promoters to register with the Electoral Commission if they spend or intend to spend over $12000 on election advertising in the regulated campaign period. The bill does not include an expenditure limit for third-party promoters. The register of information on third-party promoters will ensure that the public know who is funding political campaigns. In addition to getting authorisation from candidates or political parties for positive advertising all promoters will have to disclose their name and their residential or physical address on all types of election advertisements. Campaign spending limits for candidates and parties were last changed in 1995. Under this bill they will be allowed to increase at the rate of inflation to ensure that they are not set at levels that have become unrealistic over time. 
This bill clarifies how expenses can be apportioned where advertisements serve a dual purpose such as advertisements for both a candidate and a political party. Although these expenses have historically been apportioned between the party and the candidate the decision in the  
Peters v Clarkson 
 case suggests that those expenses should count in whole against both the party and the candidate. This bill reinstates the historical position that advertising expenses are to be apportioned between candidates and parties based on each one’s coverage in the particular ad. 
Many aspects of the donations regime in the Electoral Finance Act have been retained. However this bill improves the transparency of donations to political parties by adding two features. It introduces a new requirement for political parties and candidates to disclose in bands their total income from donations. It also includes an associated entity test to stop companies closely associated with each other from making separate donations to get around the disclosure requirements. 
The bill also makes changes to the regulated campaign period. We propose that the regulated campaign period be no longer than 3 months rather than up to 11 months as under the Electoral Finance Act. The Minister of Justice signalled this change to the Speaker to ensure that amendments to the Parliamentary Service Act with regard to election advertising would be consistent with the Electoral Act. Following the Speaker’s consultation with parliamentary parties it was agreed that the regulated period should no longer apply retrospectively and is possible under the current law. This means that there needs to be a trigger for the regulated period where an election is called less than 3 months from polling date. Therefore this bill provides that the regulated campaign period will now start 3 months before the last possible date of an election where an election has not been announced before that date or 3 months prior to polling day where an election is announced more than 3 months prior to polling day or from the date that the election is announced where it is announced less than 3 months from polling date. 
The Government is also using this bill as an opportunity to implement one of the Justice and Electoral Committee’s recommendations from its inquiry into the 2008 general election with regard to advance voting. The committee asked the Government to consider removing the existing restrictions on advance voting and the requirement to complete a written declaration in advance. This bill amends the Electoral Act accordingly. I hope that this will remove a potential impediment to those who may consider casting their vote in advance. 
I thank the electoral agencies for their valuable advice parliamentary parties and the public for their input and submissions that were made during the development of this bill. Given the importance the Government has placed on consultation and consensus in the development of this bill it has proceeded with only those reforms that have broad-based support. However the select committee process is an opportunity for the public to persuade parties from across the House that there may be other areas where reform to our electoral finance laws is desirable and I think we should approach those submissions with a very open mind. I commend this bill to the House. 
Hon LIANNE DALZIEL (Labour—Christchurch East) 
: 
 Labour will support the Electoral (Finance Reform and Advance Voting) Amendment Bill going to the Electoral Legislation Committee. I begin by acknowledging the Government for following a comparatively good consultation process. First of all we had an issues paper which was open to public submissions. Then we had a proposal document which was open to public submissions. Throughout the process there was consultation with parliamentary parties. I have a slight problem with what happened after that although I think it was not as deliberate as perhaps the Acting Minister of Justice Nathan Guy may have suggested in his contribution. 
I might as well deal with this now because I think it is an issue that we will have to address at the select committee. I refer to the definition of “regulated period” because certainly no agreement was reached on the nature of how that would best be provided for in our law. We accept on our side of the House that National when it was in Opposition never agreed with taking the regulated period back to the beginning of the year. We accept that there was going to be change in that regard. We have stuck to a single-minded position on this in that we are willing to make changes in that regard. The alternative that we put to all the consultative processes that we were engaged in was 1 May. The usefulness of 1 May was that it was sufficiently far through the year to enable people to be undertaking activities as they would do in the normal course of events not knowing exactly the date of the election but it was a date that would by all means assure that any spending after that date would be caught within a regulated period regardless of when the election was called. 
I think that when we do not have a fixed date for a general election it is better to have a set date at which the regulated period will begin if there has been no earlier calling of an election. That has been the position the Labour Opposition has taken all the way through. We have pulled back from our original position that it had to be for the entire year and we put up 1 May as an alternative. That date sits very well with almost all of the elections that we have had certainly in the time that I have been in Parliament. Almost all would have been picked up apart from the one I think that was called in July 2002 which was called on a date that did not give a 3-month period of regulated activities. 
I find regulatory impact statements very useful and interesting documents. I will read from the regulatory impact statement of the bill: “The regulated campaign period during which political parties and constituency candidates are subject to campaign expenditure limits currently runs from the date three months before the election date until election day. The purpose of this period is to define the official campaign period during which the expenditure controls imposed under the Electoral Act 1993 are imposed. Because New Zealand does not have a fixed election date”—and I agree with this point—“the three month regulated campaign period can operate ‘retrospectively’. That is where the Prime Minister announces that an election will take place in less than three months time the regulated period effectively starts before the announcement took place. This creates compliance problems for constituency candidates political parties and the general public—who effectively can be required to comply with rules that were not in force at the time their actions took place.” 
The problem with this definition of the problem is that it sets up a solution that was not resolved for consideration in this bill by the process that I described before. That is the single issue I have with how this has been handled. It was referred to the Parliamentary Service Commission as part of resolving the issues about the conflict that can arise between an electoral expense and a legitimate parliamentary expense as applied by a member of Parliament. It was right and proper that that issue was referred to the Parliamentary Service Commission where the parties are fully engaged in the process; it really was a very good process. The trouble was that this issue got tied up with the broader issue and I think the Parliamentary Service Commission ended up unwittingly being part of the contribution to this bill when it thought it was no longer part of it. This bill leads the commission to the position where it has unwittingly ignored the consultative process that was going on. 
I thought it might be a good idea to explain exactly what has happened. I am being very sincere in the concern that I am raising here because I think the select committee can address this problem and resolve it. The statement that the Minister put out last week describing the bill that we are addressing tonight talked about several developments having occurred since the February announcement. The first statement that he made in that regard said: “The proposal to clarify the relationship between the Electoral Act 1993 and Parliamentary Service legislation will now be addressed in a stand-alone bill to amend the Parliamentary Service Act 2000.” I think everyone who was engaged in that process within the Parliamentary Service Commission thought that that is where things now lay. Little did they know that in fact their engagement in this process went on from there: “The proposal for a three-month regulated period for election advertising has also been amended. Following consultation by the Speaker with all parliamentary parties”—and that is a reference to the Parliamentary Service Commission; I checked with the Minister’s office today because I was not quite sure what it meant—“it was agreed that the regulated period could also be triggered where an election is called less 
than three months from polling day to avoid retrospective application to prior spending.” That may well be what people have taken from the discussion but I can assure the House that that is not how people who participated in that decision understood it would be translated into the bill before us today. 
I do not think there is any subterfuge or any attempt to pull the wool over anyone’s eyes. I honestly think that it is a genuine misunderstanding and certainly a misunderstanding of the policy position that our party has had throughout this process. I believe that during the select committee process we can resolve the problem. I want to work through the nature of the problem so that everyone fully understands it; I have no time to talk about parallel campaigners but I am sure my colleagues will pick up that serious matter. It is worth having this on record because it is something we will have to address. The bill talks about a default day meaning “the day that is 3 months before the last possible polling day for the general election” and therefore we read those words for the words “default day”. The bill states: “If before the close of the default day the Prime Minister gives public notice of the day that is to be polling day for the election the regulated period—(a) commences on the later of the following days: (i) the day after the date on which the Prime Minister gives that public notice: (ii) the day that is 3 months before polling day; and (b) ends with the close of the day before polling day.” 
The later date will always be 3 months before polling day unless 3 months’ notice of the general election is not given. Given that the Government decides the date of the general election it gives the Government an unfair advantage. It can spend for an entire month if not longer—perhaps if it gave only 6 weeks’ notice of the general election—in the knowledge that none of that spending will be counted as part of the regulated period. That is the Opposition’s issue with that provision. I know that this issue will be drawn on in our party submissions to the select committee. We have made it absolutely clear that we should avoid retrospectivity but we should also minimise the risk of unregulated election spending occurring less than 3 months before an election. That is the position we have always had and that is the position we wish to retain. 
AMY ADAMS (National—Selwyn) 
: 
 I am very pleased to have a chance to take a call in the first reading of this very important legislation the Electoral (Finance Reform and Advance Voting) Amendment Bill. I pick up on some of what the Acting Minister of Justice Nathan Guy discussed in his first reading speech specifically around the fact that this as electoral legislation is the sort of legislation that needs in my view and in the Minister’s view to proceed on the basis of a broad consensus. I talked a little bit about this in the debate around the MMP referendum. When we as a Parliament look at matters to do with the way we elect this very House we are dealing with matters that are of the most serious constitutional significance. Although these bills can be passed on the strength of numbers I think it is incumbent on us to make sure we tread carefully down this road and try to build cross-party consensus which is likely to make the laws we pass not only respected but also enduring. 
If there is any lesson that we can all learn from the Electoral Finance Act that was passed before the previous election it is that—that these are serious issues; they are not the sorts of issues on which we want to exploit a position of power and we need to go back to some sort of broad consensus as far as we possibly can. Certainly that has been the Government’s approach to introducing this bill today. The point to remember here is that very soon after coming into Government following the 2008 election National repealed the Electoral Finance Act. From memory I think that that repeal was broadly supported in this House. I remember the Labour Opposition agreeing that we needed to re-look at that Act and I think that it was wise of those members to concede their mistake on that point. Since that time we have reverted to electoral law as this country had known it for the many many years in building up to the passing of that Act. The discussion document and the issues paper that went out for public consultation which this bill is the result of started from electoral law before the Electoral Finance Act and we said: “Let us look to make changes to that only where there is a broad consensus of support for it.” When we are looking through the provisions of the bill in front of the House tonight it is important to look at it in that context—that of starting from a stable position of electoral law that has served this country very well for a long period of time and of saying that there are issues we need to look at but let us make changes only when we feel there is a broad consensus of support for them. 
I will start off on the smallest of the issues dealt with by the bill which is the one the Acting Minister finished on; that is the advance voting provision. I was lucky enough to be involved in the Justice and Electoral Committee when it had its inquiry into the previous election and considered this issue. It is an interesting one and perhaps one that the wider public has not taken on board as yet. The changes in this bill will enable a greater level of participation in our general elections and I think that is something we all strive for. Our elections work best when there is a high level of engagement. If the matter is as simple as allowing voters to vote on a different day to election day without having to go through a complex process of proving their entitlement and filling out declarations then that is a simple enough thing that we in this House can and should do to encourage participation. That is a simple enough change to make and it is an important one to do and I am certainly very pleased to support that. 
The biggest part of the bill relates to the running of campaigns campaign financing the question of who can advertise the matter of how much can be spent the time we measure from and those sorts of issues. Again when we start the debate on these things from my perspective the issues we have to look at are the sorts of issues that were brought sharply into focus during the 2008 election campaign. I think the biggest difficulty we all struggled with through that campaign was the lack of certainty and the lack of credibility of the very rules. There was a constant process of going to the Electoral Commission and to lawyers to try to find out what could be done who could do what what counted and what did not. It got to the point when even if the Electoral Commission would tell us: “Look candidate X has breached the rules.” it would also say “We can’t really do anything about it because the rules are so unclear that no one really knows what’s happening.” We have to take from that the importance of being very very clear of having very certain rules and of having a good workability between the rules we operate under as MPs—when we spend money in our capacity as members of Parliament—and the money we spend and the regulations we are under when we are campaigning. The waste of resources during that 2008 election campaign was a source of ongoing frustration to me because the time and effort that should have been spent being out talking to the public was spent in trying to get our heads around exactly what those rules all meant. 
The previous speaker Lianne Dalziel spoke at some length about the regulated period and I agree with her that that is an important issue. I go back to the opening comment I made which was that the 3-month regulated period is the period we had in this country for a long time leading up to the Electoral Finance Act. That is what we have gone back to as a starting point for these changes. On the issue of retrospectivity which Ms Dalziel spoke about I agree that that is a serious concern. By way of personal example I mention to this House that I was selected as a candidate in May of 2008 yet all my expenditure from 1 January 2008—a full 5 months before I was even chosen to be a candidate—was regulated. That is a nonsense. How on earth can candidates be responsible for expenditure that they might have spent in that period that may have served to encourage the public to vote for them? That was the sort of crazy system we had. We have reverted back to a 3-month period or to a period that is defined by the calling of the election to ensure that everybody knows once we are into the regulated period. I think that that is really key. 
Tied in with that—and it is important to tie it in—is looking at the campaign expenditure limits for candidates. Under new section 205B substituted in clause 8 we see that those expenditure limits which have been set at $20000 inclusive of GST since God played fullback for the Apostles as they say have now been changed to reflect a CPI adjustment. It goes back only as far as 2008 and the adjustment in the legislation as printed is not a big one. The important aspect of that is in new section 266A inserted by clause 26 which this bill seeks to impose. It is the provision for annual Orders in Council to update those CPI linkages. So that is a beginning. It does not mean a big step forward in the campaign expenditure limits initially but it finally puts in place some sort of mechanism to make sure that those limits keep pace with inflation over time. I think that that is important. 
In this bill we see addressed some important apportionment issues as the Minister discussed to make sure that there is clarity about how and where campaign expenditure is apportioned. We have kept from the current electoral finance regime the disclosure of donations and the regime around that. Added to it is the new requirement for political parties to disclose not only donations over a certain limit but also income they have received in bands below that limit. There will be a more complete picture of the funding of our political parties and I think that that increase in transparency and the clearing up of that can be only a good thing. I am sure that as this bill goes through the select committee we will see some interesting discussion on some of the issues within it. 
I will end where I began which is simply to say that I think it is dangerous to charge ahead unless we can find a broad consensus for some of these issues. That is why reverting back to the stable electoral law that we have worked under for so long is a good starting point. I look forward to a good enlightened and educated debate on these matters in the select committee because they are important. I am looking forward to the process and I commend the bill to the House. 
Hon DAVID PARKER (Labour) 
: 
 I endorse Amy Adams’ comments about the desirability of forging a consensus on these issues in relation to the Electoral (Finance Reform and Advance Voting) Amendment Bill but I add this note of caution: in order to reach a consensus we have to have compromise on all sides. It is all very well for the Government to say that it wants to reach a consensus but if it withholds its approval of reasonable suggestions on the part of other parties including the Labour Party then it will not reach a consensus. Consensus can only be reached if there is give and take by all parties in relation to these issues; otherwise one party can withhold consensus. We all know that realistically the prior status quo under electoral law had some failings but in some instances those failings could have been to the advantage of the National Party. If that party defines consensus as a requirement for its agreement on everything then it can prefer the status quo effectively even if the status quo is inadequate. I just caution a little against the pretence that that sort of consensus is the ultimate answer. Actually reasonable compromise leading to consensus is what this Parliament should be aiming for. 
I mention what I think are the three most important principles in electoral law. They are the principle of equity the principle of freedom of expression and the principle of transparency. They are the three most important principles. There are other principles like accountability legitimacy integrity viability clarity and cost-effectiveness which were referred to by the Royal Commission on the Electoral System in earlier years but the three most crucial principles are equity freedom of expression and transparency. Equity of course is crucial as the report of the royal commission said back then. It said that there was a particular importance in achieving fairness between political parties because at elections voters were primarily choosing between alternative party Governments. There had to be fairness between parties but that is not just fairness between sitting parties as represented in this Parliament. Election rules should not advantage one party over another; nor should they place inequitable barriers on the formation and entry of new parties into Parliament. That is one of the important principles. 
The next principle is freedom of expression and that principle requires that there should not be undue restrictions on the ability of citizens to freely express their views. Freedom of expression is very very important. We made proposals around freedom of expression that left the media completely unconstrained—and the media should be completely unconstrained—but there have always been some constraints on political parties and there should be. If we are to maintain a low-cost electoral system such as we have in New Zealand that implies there have to be some constraints on spending. Those constraints are a necessary restraint on freedom of expression. If we did not do that we would have an electoral system like those in the United States where people can essentially buy elections by outspending the other. We would get into a ratcheting-up of expenditure on both sides of the political debate. Increasingly the only people who can meaningfully participate in election processes in countries with unconstrained expenditure are those with very deep pockets and that is not democracy. A low-cost election system is appropriate and freedom of expression does not mean an unlimited right to spend in order to buy an election. That is why there are spending constraints on political parties. We have long had them in New Zealand and we should long continue to have them. 
The third principle is that of transparency. Transparency only works if there is transparency around donations and that is one of the areas where the Labour Party thought that we should go further than this bill does. We thought there should be even more transparency than is proposed in the bill. This is an area where we may be forced to compromise but we think this bill should have gone further. We accept that we may have to compromise on that but we cannot see why there should not be further transparency in respect of donations. At the last election from memory the Labour Party disclosed the source of about 15 percent of our donations and the National Party disclosed the source of less than 10 percent of its donations. Both parties spent over $2 million yet we disclosed only 10 percent of our donations. That is not good enough. 
Amy Adams 
: You wrote the law. 
Hon DAVID PARKER 
: This law does not improve it. The member says that Labour wrote the law. Well that law did not go far enough in respect of transparency. There is nothing wrong with donating to political parties. It is a good thing to do. But public confidence in the democratic process requires that there be transparency as to donations otherwise we can never escape the imputation that it is substantial donations that have caused the policy position and that undermines public confidence in democracy. What we are trying to do here is to protect public confidence in democracy because democracy is so important. The countries of the world that have the biggest problems do not have democracy or they do not have transparent-enough democracy. Transparency is a really important principle. There ought to be more transparency in respect of donations. 
This leads me to the issue of parallel campaigns. They are difficult. If we do not in some way have some regulation of parallel campaigns we might as well have no regulation of political parties. We have theoretical limits of spending and some transparency of donations for political parties. If we did not have similar rules for people who are advocating for political causes outside of political parties we might as well not have any rules for political parties because it makes a nonsense of them. Through the process the Government ran we proposed in our submission some transparency around third parties. We made it clear that the media should be absolutely unconstrained. Nothing in our submission affected the media. In respect of third parties we said that they should not just have to register as being a third party which is what this bill proposes but also have transparency around their donations. 
If people are out advocating for the Labour Party the National Party the Greens or ACT—whoever they are advocating for—in effect through their third-party campaign it should be clear as to who their funders are so that we have transparency as to our election process. We did not have any limit on what third parties could spend. Again that was a considerable compromise on the part of the Labour Party compared with our preferred position that there should be at least some limit. 
Hon Lianne Dalziel 
: It wasn’t a tiny limit. 
Hon DAVID PARKER 
: It was not a tiny limit but maybe it was too low. We moved away from any threshold but there should be disclosure. There should be transparency as to the source of the funding of campaigns if more than $100000 is spent. That is what we said. That is a perfectly reasonable proposition on the part of the Labour Party and for the National Government to say that it is doing this by consensus illustrates the fact that it can withhold a consensus and stick with the status quo where it thinks that is in its best interests. 
I hope that the National Government is willing to look at this issue at the select committee—I really hope so. I do not think we are doing a favour to New Zealand or a favour to democracy—[ 
Interruption 
] no they have not. We are not maintaining public confidence in our election process if we do not deal with this important issue which is the transparency of the campaigns run by third parties. The Royal Commission on the Electoral System concluded that limited spending by political parties but not by parallel campaigns was illogical. The royal commission found that; it is not the Labour Party being selfish in saying that. Labour is taking a principled approach which was found by the royal commission. We hope that this is properly addressed through the select committee and that the Government is willing to compromise on it as we have compromised and as we are compromising in so many other areas. If it does not then the talk about consensual electoral law will be shown to be hollow words. 
John Hayes 
: Nothing consensual at all about the way you did it. 
Hon DAVID PARKER 
: There is some fairness in that criticism. Labour has accepted that but the same accusation will be made against the National Government if it does not follow a consensual route in respect of some of the issues that we are fairly raising and that were raised by the royal commission. National cannot have it both ways. It cannot say on the one hand that we did not follow a consensual process. 
METIRIA TUREI (Co-Leader—Green) 
: 
 Aotearoa New Zealand prides itself on being a fair and equitable country. It is a country that we love and work very hard to protect. Our community often fails to engage with that protection for a myriad of reasons. None the less we continue as a country to strive for a better fairer and more prosperous nation where everybody gets a fair go. We continue to strive for honest and open politics and for good government that respects all people. The year 2007 saw a highly contentious and quite radical in some respects reform of New Zealand’s electoral finance laws the Electoral Finance Act. It was not—and I have heard this being talked about tonight—a process that was particularly well handled politically or in the debate that surrounded the reform. The Green Party supported the legislation then because it made a significant step towards fixing some of the glaring holes that the 2005 election campaign showed up. Those glaring holes were extremely serious. In my view they showed how easily the democratic process in Aotearoa could be manipulated and distorted. Those holes showed very clearly that politics in Aotearoa was and to some extent still is very vulnerable to the excessive influence of wealthy players in the political realm. 
I do not need to tell the story. We have books films and a wide variety of writing that sets out that story. But I need to restate the problems because the Electoral (Finance Reform and Advance Voting) Amendment Bill is designed to fix them yet it fails. Amongst the problems was an initially secret $1 million intervention in the campaign by the Exclusive Brethren church. It campaigned for the National Party and against the Greens and Labour without the spending falling within the National Party’s election cap. Some argue that the electoral process worked fine then because the scam was eventually exposed but it was not the electoral process that exposed the scam; it was the very hard work of Rod Donald and Jeanette Fitzsimons. It was only because of their skills and determination to get to the truth of the matter that the Exclusive Brethren’s secret was exposed. Only Rod Donald’s determination exposed the link between the Exclusive Brethren campaign and the National Party. The public have good cause to thank Jeanette Fitzsimons and Rod Donald for their efforts in shedding light on the ease with which our elections can be bought and sold. 
Other issues arose that showed glaring holes in our electoral law. In 2005 alone the National Party received over $1.7 million in unidentified donations from secret trusts and Labour received over $300000 in anonymous donations. National’s board was aware of the identities of the donors even though their identities were hidden from the public by the use of secretive trusts. And of course we had the $120000 illegal broadcasting overspend by the National Party. No prosecutions arose from any of those matters. Aotearoa does not have a sufficiently robust regime to protect the democratic process from the threat posed by secretive wealthy political players. The 1986 Royal Commission on the Electoral System stated that it is not fair if some in the community can use their relative wealth to exercise disproportionate influence in determining who is to govern and what policies are to be pursued. 
The Green Party will be opposing this legislation for this very important reason: there is no cap on the election spending by third parties in this bill. Under National’s legislation the Exclusive Brethren or anyone else for that matter can run an election campaign opposing a political party and can use an unlimited amount of money. Let us look at the political environment here in election campaigns to understand why this is so important. Political parties have a spending cap of around $2 million in an election campaign. Political parties have a broadcasting allocation for use on TV and radio and they cannot use any other money but that allocation for TV and radio advertising. These caps are designed to provide a kind of level playing field so that wealthy political parties cannot completely swamp smaller or less wealthy political parties. To an extent these rules even out access to airtime so that the public has more even access to the policies and programmes of the political parties campaigning in the election. That is a sound principle. Our elections should be a contest of ideas not of wallets. The Green Party supports having a level playing field for political parties in an election campaign. 
What happens if other non-political parties—third parties or parallel campaigners—can campaign without having an upper spending limit? First it opens the door very widely to corruption in New Zealand politics. Political parties that have access to wealthy donors—corporate or individual—can funnel those donations to a third party which can then spend as much money as it likes in negative campaigning. Thousands of dollars can be spent on pamphlets and letters delivered to every household in the country. Enormous commercial billboards can bought up in bulk to display adverts attacking a political party for months at a time. Whole armies of people can be employed to get out on to the street and campaign against a political party that happens to be out of favour with that wealthy group. Hundreds of thousands of dollars can be spent on a campaign to attack a party. That means that a political party can funnel its funds to a third party so that that political party can avoid its spending cap. If one has money then one can corrupt the system. 
What is the response of the political parties that are constrained? Well it depends. If it is the case that the wealthy interests are campaigning against one’s political opponents then one might think that that is fine. If not political parties especially the smaller ones struggle to contest misleading or false information and struggle to get their message out to the public. Whatever side one is on—whether one benefits from that corruption—one simply cannot argue that that is fair. Some would argue that people do not pay any attention to advertising. I have heard this argument before and it is clearly untrue. Otherwise we would not have an advertising industry in Aotearoa with an annual turnover of $2 billion. Advertising works; that is why it is done. In this bill there are no limits on how much advertising a third party can buy in order to influence the outcome of an election. 
There are some good things in this bill; it is not all bad. We are pleased that the parallel campaigners will have to register with the Electoral Commission if they expect to spend more than $12000. No New Zealander should ever be in the position of having to hunt down a third party identity because it like the Exclusive Brethren has actively hidden its identity from the public. As I explained transparency is necessary but is not sufficient to combat the opportunity for corruption that an unlimited spending cap provides. 
We are pleased about the retention of the donations regime that we argued for in 2007. It does not go as far as we would like it to but it is a step in the right direction. Political parties should be transparent about their donations. It is worth noting that in a donations disclosure to the Electoral Commission this week of donations over $10000 we saw that ACT got one the Progressive party got one the Maori Party got one Labour got one the Greens got nine and National got none. Is that not interesting? I am not convinced about that somehow. We would like to see the threshold of donations lowered so that there is considerably more transparency about who has donated to a political party. 
We are very pleased to see that the offence and penalty regime has not changed. It is critical that we have a strong offence and penalty regime in our electoral law because if the fines are too low that simply rewards the wealthy players who would rather pay the fine because a breach of the rules enables them to achieve their preferred electoral outcome which no doubt would be of considerable value to them. I will say this again because I believe it: Aotearoa prides itself on being a fair and equitable country. It is a country that we love and work hard to protect. Despite the occasional tripping up we continue to strive for a better fairer and more prosperous nation where everyone gets a fair go. We continue to strive for honest and open politics and for good government that hears all people and protects our environment. For decisions as critical as whom we elect as our most senior public decision makers the utmost fairness the most stringent rules and the clearest most transparent processes are necessary. I look forward to working for that in the select committee. Thank you. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 In May 2009 the Institute of Policy Studies in Wellington held a half-day workshop on electoral finance reform. One of the participants at that forum put forward the interesting challenge that there was very little evidence to demonstrate that big money had any impact on the overall outcome of an election. That participant suggested that it might be more appropriate for the emphasis to shift to politicians who should be bound by a code of conduct. However other participants were equally adamant that although there may be a lack of evidence to prove that money wins elections certainly a lack of money loses them. 
The Maori Party has never entered the competition over whether the most expensive campaign is likely to be the most successful. Our wealth has always been in the power of the people. Nevertheless we have been well aware of the strong views held about the impact of finances on an election campaign. A fundamental premise of our approach to electoral finance reform has been our commitment to transparency and accountability. We have supported the call of the public for greater transparency. We hope this will encourage political parties to desist from the practice of using trusts or lawyers’ accounts to obscure the identity of donors. In a post-recession conversation we believe that transparency is just as relevant to electoral finance as it is to any other aspect of our economy. At a time when banks have been able to accrue outrageous profits when shady loan sharks and the debt police are holding families to ransom and when the potential of far too many families is trapped in the stranglehold of poverty it is only right that we have clear rules in place to determine whose interests are served by covering up the use of wealth in a political party context. 
In this context then I have to say that the Maori Party has been impressed by the commitment of the Minister of Justice to encouraging wholesale support for the reforms to ensure greater certainty and transparency in the conduct of the electoral process. Anyone browsing the Ministry of Justice website can now come across all of the work that has occurred in developing options around electoral finance. They can come to the independent conclusion that a broad consensus has been achieved. The Minister has set a new benchmark in establishing transparency and accountability as hallmarks of the new electoral system—and it is a benchmark that we are pleased to support. We can now download within seconds the issues papers and proposals on electoral finance reform. We can browse the submissions. We can fast track to the slides of a presentation that Professor Andrew Geddis has delivered on the regulation of electoral finance. 
Importantly the reforms appear to be oriented in such a way as to actually encourage people to vote. One of the key turn-rounds in the policy has been with regard to advance voting. We think advance voting should be supported as a means of supporting greater uptake of the democratic right of all New Zealanders to vote. In the past anyone who elected to vote in advance was asked to make a written declaration explaining why such a step was necessary. Following the unanimous decision of the Justice and Electoral Committee in its inquiry into the 2008 general election the Electoral (Finance Reform and Advance Voting) Amendment Bill removes the requirement for advance voters to make a written declaration before election day. From an administrative point of view this is helpful in removing another layer of costs from the schedule. More important it removes a barrier to participation. 
We saw the appeal of advance voting really take hold of the American voting public during the 2008 campaign. Some experts predicted that one-third of the voting public had banked their vote early up from 20 percent in 2004. Advance voting was in fact a popular strategy employed by Barack Obama who held enormous “Early Vote for Change” rallies flooded the networks with “Vote Early” email messages and placed advance voting ads in more than a dozen popular video games. Whether the same phenomenon would occur here of course is anyone’s guess. But we certainly support the right for a person who is qualified to vote in a particular electorate to be a special voter if he or she applies in person to vote within that electorate before polling day. Importantly we endorse the right of such persons to not complete a written declaration establishing eligibility. 
The other big wave of reforms introduced in this bill is around electoral finance. We are delighted that a party donation made by a body corporate must now be accompanied by a written statement that is signed and dated by an officer of the body corporate setting out the names of all of the associated entities of the body corporate as at the date of the statement. If there is a failure to comply with this provision the secretary of the political party must within 20 working days give back to the donor the entire amount of the donation or its entire value. In another new development third-party promoters who spend or intend to spend more than $12000 on election advertising during the regulated campaign period must register with the Electoral Commission. The register will be publicly available to ensure openness and transparency concerning the identities of third-party promoters. 
We believe that both of those aspects—the signed statement of the body corporate and the public register of third-party promoters—are very useful means of ensuring everything spent on behalf of or towards political parties is above board and open. It is common knowledge that corporate donors expect a political return on their political investment so we are pleased that any political negotiations that may result from corporate donations will be well and truly evident through the donations regime. 
We support the proposed increase in the amount of money that parties and candidates can spend on election campaigning. We agree that it should be adjusted at the rate of inflation for each general election. However in the interests of greater transparency for the general public it would be useful to know why twice as much funding needs to be available for a by-election campaign as for a general election campaign. We also support the moves to introduce more certainty to what counts as electoral advertising by modernising the definition. 
We would like to see the issue of unethical advertising addressed in further development of the bill. I do not need to remind everyone in this House of the appalling way in which some parties and advertisers have used Maori as negative fodder during election campaigning. We must never again return to the era where politicians gamble on national identity and threaten the unity that has been so desperately sought by pitching campaigns to create unnatural divisions between iwi and Kiwi. 
We are disappointed that the bill does not provide for reform of the broadcasting regime that has existed since 1990. Although we can understand that there were widely held views on this issue we cannot forget the issues that have arisen in the past over varying interpretation of rules over the broadcasting spend. We throw into that same thought the general concerns about illegal use of parliamentary funding. We understand that the relationship between the Electoral Act 1993 and Parliamentary Service legislation will now be addressed in separate legislation and we support that. However we hope to see some time frames around this issue as we would not want to see this vital area of reform slip away under the radar. 
All things considered we support this bill at its first reading and certainly look forward to the ongoing debate. 
CHRIS TREMAIN (National—Napier) 
: 
 Elections are one of the most important—if not the most important—part of any democracy. They are supposed to be a testing of ideas and personalities a debate about the future and a testing of the mettle of our potential leaders both locally and nationally. I hark back to my first election in 2005 for the seat of Napier. 
Hon Darren Hughes 
: Hark back? 
CHRIS TREMAIN 
: It is certainly going back a few years. It was a testing of personalities if I recall the candidates I was up against. 
John Hayes 
: Well your opposition had no personality. 
CHRIS TREMAIN 
: Ha ha! I was up against Russell Fairbrother a debater of some merit. 
Hon Darren Hughes 
: Much like the member. 
CHRIS TREMAIN 
: Oh I could not put myself there. There were certainly different personalities in that test. Anyway it was a testing of personalities; that is the point I want to make. It was a testing of ideals and fortunately at that particular time I was lucky enough to win the seat. 
In any democracy an election needs to be a fair fight. The reality is somewhat different as many new candidates entering a political race quickly find out. There is no doubt that sitting MPs have the competitive advantage: 3 years of incumbency 3 years of school visits 3 years of constituency clinics 3 years of galas school prize-givings and assemblies 3 years of being in the newspaper and 3 years to build an awareness and a positive brand with their constituency. There is no doubt that the political tide comes and goes. However good constituency MPs have the advantage of incumbency which opposing candidates must battle against from day one. It is tough but that is the reality. 
No law will change that and this particular bill will not change it either. But the competitive advantage of incumbency has been somewhat reduced with MMP. In many instances list MPs are able to establish a pseudo-constituency office and make out that they are the local MP. That effectively means that the taxpayer is funding a 3-year campaign against the incumbent MP. I am not sure that the wider electorate is particularly happy about that but hey that is the way it is. Once again it will not change under this legislation. Those anomalies aside elections need to be regulated to be as fair as possible. It will be the job of the Electoral Legislation Committee of which I am a member to ensure that the final legislation is an equitable playing field. 
Throughout time immemorial human beings have sought ways to obtain competitive advantage within the rules that are in place. It is just part of the human spirit to try to push the boundaries—that Kiwi spirit. If we think about the America’s Cup campaign and the rules that were in place there we see that the amount of money that was spent—and the number of lawyers who were employed to bend the rules—was incredible. Many lawyers and accountants spend their entire professional lives trying to find ways around existing laws in order to gain advantage for their clients. And election law dare I say it is no different. 
I am sure that immediately this law is passed political boffins will be looking for ways to improve their lot to improve their competitive advantage and to get around the rules. It is therefore very important that the members of the committee obligate themselves to challenge this legislation to ensure that it is as robust as possible. Most of us on the committee have served a couple of elections—and Mr Hughes is one of those people. I think that that experience will be important as we steer the bill through the Committee stage. 
Let me give members an example of a situation that currently pushes the boundaries. I will be asking the committee to have a close look at the current position of MPs who own their own office through a trust. They are obliged to provide a market valuation for the rent—no problems there. All do that and most pay the amount of that valuation. However some do not charge the full cost of the rent to the Parliamentary Service. The MPs will say that they are saving the taxpayer money but will then go on to spend their entire taxpayer budget; the taxpayer saves not one cent. Effectively the MPs have gifted themselves a pecuniary interest from their trusts or companies which allows them a much better office location while they are still able to spend their full out-of-office budgets on advertising and other things to help lift their profiles. There is not much problem with this outside the election period although I still believe that this gift should be declared in an MP’s document of pecuniary interest. 
The real issue that we need to turn our thoughts to comes during the election period. Here is the question: if an MP has a high-profile corner office—effectively a billboard—for which the Parliamentary Service is not paying the full cost should the benefit of that additional spend be included as part of an MP’s electioneering cost for the regulated period? My argument would be that not to include that cost would create an unfair advantage. I refer members to the definition of “advertising expenses” which is amended in Part 1 of the bill when section 3(1)(a)(ii) is substituted in clause 4: “the reasonable market value of any material used or applied towards the advertisement that is provided free of charge or below reasonable market value;”. This definition brings the issue into question. It is something we will have to consider and we will have to make sure that the cost is being declared either within the election expenditure or within the document of pecuniary interests. 
In the extreme situation MPs could provide their high-profile offices at no cost to the Parliamentary Service then spend their entire parliamentary budget on self-promotion in the lead-up to the regulated period. If the office is not paid for by the Parliamentary Service then what is that office? I suggest that it is a campaign office. I am sure that there are other examples of situations like this and I am sure that committee members will be able to turn their minds to these examples and to provide what I believe should be a fair transparent and equitable playing field going into the next election. 
I look forward to sitting on the select committee and dealing with the issues that arise throughout the period of submissions. I encourage New Zealanders to submit to that committee to make their opinions heard so that we can listen to them and make sure that we deliver the very best legislation possible. It must be legislation that is agreed to as much as possible across the House so that we have a robust piece of legislation going forward. Thank you very much. 
Hon DARREN HUGHES (Labour) 
: 
 I rise to speak to the Electoral (Finance Reform and Advance Voting) Amendment Bill. It is not often that a senior whip goes slightly off message but I have to take up the opportunity of joining my opposite number Chris Tremain who may well have done the same thing. All I could think of as he complained about a high-profile street-corner office was that Stuart Nash must really be getting under his skin in Napier if he wants to change the entire system of the way electoral offices are run from Parliament on the basis that his own individual candidate opponent has a high-profile office. We could almost hear Government members who have such high-profile corner offices—and who were listening to this debate from their offices—lunging at their radios and saying that someone should shut Mr Tremain up before he rewrites all the rules based on a constituency race in Napier. 
Chester Borrows 
: Are you reading minds now? 
Hon DARREN HUGHES 
: Well no; that was the last legislation we debated the Local Government Act 2002 Amendment Bill I say to Mr Borrows. This particular bill does not. As that previous speaker freely admitted this legislation does not affect any of those issues whatsoever and the question of ownership of out-of-Parliament offices is best dealt with through other vehicles and not through this bill. 
Labour is supporting this bill’s referral to the Electoral Legislation Committee as the Hon Lianne Dalziel our spokesperson for electoral law made very clear when she spoke. The bill has a number of elements that we support but there are certainly some aspects that we want to continue working with the Government on. 
I pick up David Parker’s point—I strongly agreed with him—that where parties can come to a compromise position on these sorts of rules we are better off for it. Labour has tried to signal throughout this debate areas where we have moved away from our prior position in terms of the legislation that came immediately before this bill—the Electoral Finance Act. We have moved from that position. We have even moved from some of the positions we held in our submissions in order to meet some of the proposals from the Government. But we really looked throughout the whole process for the Government to move from some of its positions as well. The pixie dust of MMP where we all get up during debates on these kinds of legislation and give compulsory praise to Simon Power—which I will do shortly because it is in my notes; I want to be back on message as I mentioned before—cannot simply be because we all agree with National’s position. That is not compromise. The look of shock and horror on National members’ faces makes me realise that that is what they think it is. So I may have struck on a little point there. But I think the main point of course is that we want there to be a consensus. 
Mr Tremain made a very good point. He talked about the winds of political fortune changing. Indeed they have. In the period that we have had MMP Labour has polled as high as 41 percent and been the major party in this Parliament and we are now down at 34 percent and in the Opposition. 
John Hayes 
: And still dropping. 
Hon DARREN HUGHES 
: Well Mr Hayes thinks that with his prescient political predictions. I welcome them because I know the predictions he made about himself and what has happened so I hope he keeps on making predictions about the Opposition. He and I have a little bet on some of those matters and I look forward to collecting one Sunday in November 2011—or even August as some people say. National on the flip side of that has been at a high of 45 percent at the last poll. It leads the Government now but of course in 2002 it only got 20 percent of the vote. I know that was long before Mr Quinn was involved with the National Party. 
Paul Quinn 
: I wasn’t born! 
Hon DARREN HUGHES 
: In 2002? The member most certainly looks as though he was born by 2002. He looks as though he had enjoyed a very good 50th birthday celebration by the time 2002 rolled around. Political parties on both sides have been up and down. They have enjoyed electoral success and electoral defeat over that period. In 2002 when Mr English was its leader National relied very heavily on its Parliamentary Service funding for its campaign. That is a matter of public record. I am sure that National now enjoys much greater financial donations as its political fortunes have improved. 
Chester Borrows 
: We couldn’t say. 
Hon DARREN HUGHES 
: I say to Mr Borrows that it could not have got any worse. I think the National Party’s largest corporate donation in 2002 came from the Clutha RSA. I am sure that things have improved slightly since then and perhaps some of the city branches are now involved. The main point of this observation is simply that the laws have to work for parties whatever political situation they find themselves in. I believe that that is where the compromise must be reached. One of the reasons the Electoral Finance Act was not successful is that it had strong strong opposition from National. I think that National made a deliberate political decision to make that law unworkable by not cooperating with it and through ensuring— 
Hon Anne Tolley 
: So it’s our fault? 
Hon DARREN HUGHES 
: No no I am not ascribing blame; I am simply saying that any law can be picked apart. I am sure the Attorney-General would agree with that. Any law can be made as difficult as possible to implement. For a law to work effectively we need to have people accepting it. That is the point I am making. 
I recognise that National did not accept the previous legislation. Of course that was because some events had happened before that legislation was passed that I think a lot of National members would privately say they were not comfortable with. In the House they cannot say that. There were things that took place involving a third party. The activities of the Exclusive Brethren church have been mentioned before. They probably went beyond the pale of what most people who participate in politics would like to see. I think the fact that we do not know and that we saw them—[ 
Interruption 
] Mr Borrows interjects. Given how active the church was in the Whanganui electorate I would not be interjecting on that particular point if I was him. There are a lot of provincial and rural members who were great friends of that particular organisation and who have been much quieter since it came into play. Certainly we would not want to see a repeat of the 2005 events. The 2008 events with the major Opposition party not wanting to go along with the law because they disagreed with it so vehemently—and that is no attack; I just refer to the way National felt about it—means that for 2011 we have to have a law that Labour National and all the parties feel is fair for them. I think we are getting there but I want to emphasise Mr Parker’s point that there must be some agreement. 
I will touch on three other issues. I will finish talking about the third-party issue by saying that we agree with registration because we think that it is logical. There is transparency in people having to put their hands up and say that they are not a political party but they want to influence people and how they cast their party vote puts some sunlight on them. People will be mindful of the activities they are undertaking. That makes a lot of sense. 
We do not have agreement on the fact that the amount they can spend is uncapped. I think that that creates a bit of an illogical difference where in a campaign political parties’ behaviour that clearly seeks party votes in a certain direction is regulated and capped but behaviour by organisations that set themselves up to overtly influence people’s party votes is uncapped. The Royal Commission on the Electoral System said in 1986 that there would be problems with a two-pronged system like that. I think there are and I think that the committee should look at that. It should not be too hard to reach a compromise on because under the old Electoral Finance Act the cap was $120000 which is quite a lot of money. We have said that as part of a compromise we will look for a higher figure if that is what will get consensus. When we think about it that is a lot of money for an organisation that is not part of a political party to spend in order to get involved in an election campaign to support a particular party. When we think through the logistics of it we will be able to come to some level of agreement. 
Paul Quinn 
: It’s less than your salary. 
Hon DARREN HUGHES 
: Well I am sure that Mr Quinn has not put his entire salary into his election campaign. That would be a particularly bad investment in his case. It is almost like the finance companies writ large. Even funding his own deposit seems to be a bit of a waste of time for Mr Quinn. However this country is a democracy and people are free to do what they want with their money. I am sure that Mr Quinn will once again subject himself to democracy. 
The regulated period which Lianne Dalziel spent a lot of time discussing is something we have to get right. What we asked to discuss at the Parliamentary Service Commission was that if an election was called within 3 months members who had legitimately spent money from Vote Parliamentary Service on their parliamentary business work would not be caught in the defined period for the election and have that spending counted against their $20000 cap. An example of that is if Mr Anderton had as his slogan for his parliamentary business work “Working for Wigram” and that was approved by the Parliamentary Service—as is allowed for his advertisements in the newspaper—and we go into an election period and he happens to use that same phrase on his election billboards it would be possible to say that the Parliamentary Service - funded phrase was being used for an election purpose and all that money would be counted. At the Parliamentary Service Commission we wanted there to be a bright-line test so if things were approved for parliamentary business they would not be caught within a 3-month period. I think that we need to get that absolutely clear at the select committee because in reading the Minister’s release it now looks as though the Parliamentary Service Commission determines what the regulated period should be. I do not think that is what the Parliamentary Service Commission thought they would do at all. I look forward to participating in the select committee. 
HEKIA PARATA (National) 
: 
 Tena koe e Te Mana Whakawa huri noa i to tatou Whare i tenei po tena koutou katoa. I am very pleased to stand and take a short call in the first reading of the Electoral (Finance Reform and Advance Voting) Amendment Bill. As many speakers before me have said this evening this bill is part of a process of ensuring integrity and durability in a very important part of our constitutional infrastructure in New Zealand. Together with the Electoral (Administration) Amendment Bill which we are also in the process of debating it establishes the credibility and certainty of the institutions and processes that together instil confidence in New Zealanders in the constitution of our country. The process that has been followed to get us to this point was led by our very able Minister of Justice and it has been an inclusive one. 
It is important that electoral law reform enjoys the support confidence and understanding of the many and different participants in the process. Up to this point we have ensured that parliamentary parties as well as the public have felt fully engaged or that they have had the opportunity to engage in this process so that we have arrived at a bill that reflects a broad consensus. All of us in this House no matter which part of the political spectrum we are from are committed to ensuring that we have and can secure enduring law reform. 
This bill has six main provisions on which many speakers before me have commented. They are about identifying exactly who the players in this process are likely to be and the regulations that they need to abide by. Therefore the provisions cover the promoters of election advertisements the electoral advertising itself the regulation of the campaign period the campaign expenditure limits donations and of course the opportunity to provide and amend regulations in respect of advance voting. I am—and other members have indicated that they are too—really pleased that we are getting clarity on a range of these issues. Having participated at the 2008 election I found that much of my time was spent in trying to establish clarity and certainty about what I and my campaign team were allowed to do and not allowed to do. As my colleague Amy Adams has indicated often the answers were not very clear at all and we were left in a kind of limbo which made us susceptible to doing the wrong thing even while trying very mightily to do the right thing. The provisions in this bill will give us all greater certainty not only for those of us who will be very active participants in the process but also for the most important players in this process: the voters of New Zealand. 
This bill marks an important step in New Zealand’s constitutional evolution. The necessity for such an evolution to occur can be seen not only here in New Zealand but also in the United Kingdom where elections are currently taking place. Those of us who have had the opportunity to look at the analysis of how the voting trends would go under the current first-past-the-post system that Britain continues to use can see that it is really important for voters to understand the system that they are engaged in what their votes will mean and whom they will get as MPs after election day. The evolution of our constitutional framework here in New Zealand is highlighted by comparing where we are in New Zealand with what is happening in the UK from which we have inherited all of our Westminster system of parliamentary governance. New Zealand has adopted changes to that system as we have seen the necessity of becoming more attuned with what is required within the polity of New Zealand and this bill will continue to contribute to that constitutional evolution. 
I look forward to participating as a member in the Electoral Legislation Committee under the able chairpersonship of Amy Adams and to hearing submissions on the bill from as wide a variety of people as possible. It is important that New Zealanders take the opportunity that the select committee process offers them to make submissions because what we end up with will be a reflection of all their contributions and of our select committee’s consideration of them. I very much look forward to hearing those submissions and debating the provisions of this bill in the select committee and I thank the House for the opportunity to speak on this bill at this time. Kia ora. 
CHARLES CHAUVEL (Labour) 
: 
 The Electoral (Finance Reform and Advance Voting) Amendment Bill will— 
John Hayes 
: Are you some kind of horse? 
Hon Member 
: It’s his list ranking. 
CHARLES CHAUVEL 
: —amend the Electoral Act 1993 to provide a package of reforms to ensure greater certainty and transparency in the conduct of elections according to the explanatory note of the bill. 
I can see that my tie is causing great amusement on the other side of the House. I will advise members opposite because it is a good time to give this advice to them that 350 is the name of a campaign by a group of young people who mobilised on the climate change issue last year. It is a bit of a shame that there is not instant familiarity with the issue among members opposite as there is by members on this side of the House. Three hundred and fifty parts per million is the level at which carbon levels in the atmosphere have to be stabilised in order to keep global temperature increases below 2 degrees Celsius which the Intergovernmental Panel on Climate Change says is the key goal for us. These young people—and I know this is a slight digression Mr Deputy Speaker but I hope you will indulge me—came to see our caucus this morning to talk to us about our policies in this area. They were incredibly engaging young people and it was great to see them. I have worn this tie in their honour and it is good to be able to explain that to members opposite. Hopefully that will end the levity on this serious issue. 
Chris Tremain 
: I’m sure you just made that up. 
CHARLES CHAUVEL 
: I can assure Mr Tremain that I never make things up. That is a monopoly that is enjoyed by members on the other side of the House. 
As other speakers on this side of the House have said Labour will support the referral of the new electoral legislation to the Electoral Legislation Committee but there are some real concerns about this bill. The concerns that I want to speak about are very similar to those that I mentioned in respect of the electoral referendum legislation that parallels this bill and was dealt with in the House a week or two ago. 
One major problem is the lack of any spending limit on parallel campaigners. No one in his or her right mind would want to see any election that is conducted at a local or national level in New Zealand be overrun by cash. On this side of the House we do not want to see that. We do not want to grant to parallel campaigners the ability to campaign on the two issues before voters without any financial limits thereby overwhelming other voices in the election campaign. 
It is clear from the debate around the Electoral Finance Act that there was widespread concern about limiting parallel campaigner spending to $120000. Obviously if there is to be a cap in the area of parallel campaigning—and Labour says there should be—we would consider a higher spending cap than that but not unlimited third-party spending. Hopefully the Electoral Legislation Committee under the chairpersonship of Amy Adams will hear a lot of evidence on and address that matter. As I said in my speech on the earlier companion legislation no one wants to see a rerun of what occurred at the 2005 election. The Government has not properly considered the effects of a lack of proper limits allowing wealthy individuals or groups to overwhelm other voices in the election campaign. If the Government has considered that and none the less has produced the bill in its current shape then I say shame on it for actually allowing that to occur. That cannot be allowed to stand after the select committee process if we are to try as a House to produce decent electoral law. 
It is a good thing that under the bill parallel campaigners will have to register with the Electoral Commission. Clearly that will increase the sort of transparency that anyone who thinks about this sort of law will want to see. It is an improvement on the current law which requires parallel campaigners only to state their name and address on an advertisement and to get permission before advertising in support of a political party or candidate so it should be supported. But clearly that greater transparency will have a beneficial effect only if forcing parallel campaigners to register reveals the person or entity responsible for the advertising. Under this bill’s regime it would be possible to use a front organisation to register as a promoter. A lawyer or another professional person could simply be used as an agent and that would prevent the public from knowing who really was behind the group’s spending. There is no requirement to disclose where a promoter’s money comes from. That is not a satisfactory element of the bill and the select committee will have to address that matter. 
The Royal Commission on the Electoral System concluded way back in 1986 that limiting the spending by political parties but not that by parallel campaigners lacked any sort of logic because political parties can simply give money to a lobbyist to run a negative campaign for them. Nothing in this legislation will address that evil; in fact it will be exacerbated. 
This very problem is also faced in the US at the moment. In January the Supreme Court struck down the “soft” money prohibitions in the McCain-Feingold Act the Bipartisan Campaign Reform Act of I think 2002. Eighty percent of Americans think that is a bad thing notwithstanding that it was a restriction on absolute freedom of speech. There was a widespread acceptance even in that bastion of freedom of expression that in the area of electoral law we cannot allow money to buy votes. So now in the US there is a vacuum as to what to do with “soft” money. Everybody knows that in the November mid-term elections if that striking down of the law is not remedied then there will simply be a deluge of “soft” money from corporates in favour of conservative candidates. The electorate will be awash with cash from the cash-rich part of the political spectrum. People who support democracy know that that is not a good thing. It is not good to see us replicating in our own legislation the vacuum that exists through the result of a court decision in the United States. 
Because political parties do face strict spending limits— 
John Hayes 
: I raise a point of order Mr Speaker. I draw your attention to the  
Standing Orders 
 at page 17— 
Shane Ardern 
: Speakers’ rulings. 
John Hayes 
: I am sorry; it is Speaker’s ruling 17/1. Although the first sentence of that ruling refers to the wearing of a hat the second sentence talks about the wearing of attire with advertising or a message written on it being unacceptable. I wonder whether you would like to rule on that. 
Mr DEPUTY SPEAKER 
: I will rule. In my view the member is just interrupting the speaker who is on his feet. There is nothing untoward in what the member is wearing and I ask the member to continue. 
CHARLES CHAUVEL 
: Thank you Mr Deputy Speaker. I know that the 350 group will appreciate my wearing its tie and will not mind the fact that the member who has resumed his seat notwithstanding his credentials as a climate change denier is present in the Chamber. 
Political parties face strict spending limits and as I said the fact that both National and Labour spent close to their statutory limit in 2008 is important here. There will be an incentive in this bill if we do not address the parallel campaign issue and the campaign spending limits issue for parties to work with parallel campaigners who are not subject to the limits in an attempt to get round the rules. 
I hope that the chair of the select committee is paying close attention to these issues. She is nodding. That is good to see because if a credible result is to occur from this process—which will be to the benefit of her career—then it would be really good to see these loopholes being closed. [ 
Interruption 
] It is good that she says she appreciates the advice. I am not always the best person to give career-enhancing advice but if we care about the quality of the outcome the matter ought to be addressed. 
As initially proposed the new electoral finance provisions would have required parallel campaigners to register only when they were spending more than $20000 but this bill contains a lower threshold of $12000. It seems to us that it would be far better to go back to at least the original proposal. It is useful that the Minister has engaged in consultation prior to the introduction of the legislation and I think it is appropriate to pay some tribute to him for that exercise because the experience of the House has been that in producing sustainable and durable electoral law it is appropriate to have widespread consultation on its provisions and if possible to achieve a consensus across the House on those provisions. I hope that will be the outcome of this process but if it is to be the outcome then the issues that I have sought to address in my speech do need to be sorted out in the select committee process. 
CHESTER BORROWS (National—Whanganui) 
: 
 It is good to be able to take a very short call in respect of the Electoral (Finance Reform and Advance Voting) Amendment Bill. It is great to hear members from the Opposition side of the House talk about things like consensus and understanding bearing in mind the atrocity we had regarding the legislation enacted when the previous Labour Government was in office. I commend this bill to the House. 
Debate interrupted. 
The House adjourned at 10 p.m.