King Annette: Subordinate Legislation (Confirmation and Validation) Bill — Second Reading In Committee Third ReadingText is incorporated into the Bound VolumeKing Annette: Subordinate Legislation (Confirmation and Validation) Bill — Second Reading In Committee Third Reading[Sitting date: 04 December 2012. Volume:686;Page:7107. Text is incorporated into the Bound Volume.]Hon ANNETTE KING (Labour—Rongotai): I rise to support the Subordinate Legislation (Confirmation and Validation) Bill but I suspect that there are a number of people out there listening today who are wondering what on earth a Subordinate Legislation (Confirmation and Validation) Bill is.Grant Robertson: Thousands of them.Hon ANNETTE KING: Thousands of people are probably wondering what it is. It is a very grand title indeed. So I thought perhaps I would give just a little explanation so that they could follow what this debate is. Subordinate legislation bills are introduced every year to confirm and/or to validate what is called subordinate legislation. What is subordinate legislation? Well in fact it is regulations and orders that are made by this Parliament. The purpose of this bill is to confirm that subordinate legislation—in this case regulations and orders—is able to continue so that it does not lapse. If it has sunset clauses we confirm that it can continue to carry on and continue in force. This is something that we do each year and we bring in a bill. Parliament is the one thatdecides on this because this is an area where Parliament has already decided that it does not just allow Cabinet to make decisions in terms of the executive making regulations.This particular bill is covering seven Acts confirming regulations in them. What are they? The Animal Products Act 1999 the Commodities Levies Act 1990 the Customs and Excise Act 1996 our New Zealand Superannuation and Retirement Income Act 2001 and Social Security Act 1964 the Road User Charges Act 2012 and the War Pensions Act 1954. This bill actually covers those six main areas.You might wonder what sorts of issues are covered in those particular Acts. Well if you take the Commodities Levies Act 1990 it makes orders about commodity levies on things like navel oranges kiwifruitnashi pears arable crops cereal silage maize asparagus and so on.Then if you look at what happens under the orders being made under the Customs and Excise Act you will see that orders are being made on tobacco products and the indexation of tobacco products. The indexation of excise duty is brought about by confirmation of these orders. This is an area that I have particular interest in because we know that if we do have an increased price for tobacco we also have a corresponding reduction in the consumption of tobacco. Of course there are those out there who think that the earth is still flat and that tobacco has absolutely nothing to do with cancer. There are others who have proven over many years that tobacco cigarettes—no matter how many you smoke—are going to be bad for you. The first one is bad for you and so are the 60 you smoke every day. And so we do know that increasing the excise on tobacco is likely to lead to people stopping smoking.It has been asked of me over the years why we would want to penalise the poor by putting up the price of tobacco. My answer is: why would we let tobacco companies kill poor people? That is what this product does. It is one of the only products that if you take it is likely to lead to your death. So I totally support raising the excise duty on tobacco and I would imagine that there are very few people who would be opposed to that. It also deals with the excise duty on alcoholic beverages but amongst that we also have motor spirits and toothfish so it is quite a broad-ranging order indeed.The other one I wanted to talk about is the road-user charges of 2012. This increases road-user charges through an order. This really came out of an experience I had as Minister of Transport. I see Mr Colin King smiling over there; he probably remembers the event very well. You see when I was Minister of Transport I decided that I would increase road-user charges because there had been one increase in road-user charges on vehicles over 3.5 tonnes since 1989. As you know road-user charges are the way we ensure that those who drive heavy vehicles help to pay for their share of the roads. I am sure the member for Invercargill will be very aware of the damage that big vehicles do to roads and particularly local roads down in an area where you have a lot of farming and you have big vehicles on the road and the damage they do in cutting out those roads—Phil Twyford: Especially in Southland.Hon ANNETTE KING: —particularly in Southland. In fact there is a major problem in Southland because the funding that goes into the maintenance of local roads in our rural areas has been cut by this Government. You will see the results of that in the years to come because if you do not maintain your roads and you do not have enough money coming in through your road-user charges and other avenues you will pay for it in the future when it costs you much more to go back to square one to repair your infrastructure. So road-user charges are the way that we get heavy vehicles to contribute to their cost. In fact it is my view that they do not completely pay for the damage that they actually do on the roads.When I was Minister I decided to increase the road-user charges and it was actually quite a modest increase in road-user charges—for example a typical 5-tonne truck would pay an additional $53 every 10000 kilometres while a 23-tonne four-axle truck was expected to pay around an additional $198 for 10000 kilometres. It made up about 10 percent of a truck’s total operating costs. So you can see that the impact it would have had on freight was quite small. What happened because I increased it—one increase since 1989? We had the truckies go on strike. They blocked the roads around New Zealand in big convoys of trucks. They did not like to have an increase in road-user charges.So I then said OK we would undertake a review in the way we set road-user charges in terms of the notification and what notice is given that the road-user charges will go up. One of the reasons that there was not notification on the particular occasion when I was Minister was that the year before I had increased it very marginally and had given notice. Within 3 days there was something like $21 million of forward buying of road-user charges certificates to try to avoid the increase. It is sort of like going out and filling up your car with petrol if you think the excise duty is going to be put up on Budget night and hoping that you have got a windfall because you have avoided having to pay the extra cost. Of course there was a famous occasion in this Parliament when one of the Opposition members of the National Party when we were in Government in the 1980s decided—Grant Robertson: Who was it?Hon ANNETTE KING: —I will not name him—that petrol excise was bound to go up that night in the Budget. He rushed out and he filled up his car rubbing his hands with glee only to find the excise duty was put down and in fact he made a loss.But what came out of my experience in road-user charges is giving notice of setting. This is what came out of that review and under this order it is set at a particular time and there is enough notice for people to know that it is going to be set but also mechanisms are in place so there cannot be a whole lot of forward buying to avoid having to pay what is a legitimate cost of vehicles on the road.This is a standard bill that we have before the House. It validates orders and regulations that are made by this Parliament and Labour supports the bill.