Draft transcript - Wednesday 15 June 2016First draft - subject to correction.Draft transcript - Wednesday 15 June 2016United Nations Committee on the Rights of Persons with Disabilities— Election of Robert MartinMr Speaker took the Chair at 2 p.m.Prayers.Hon ANNE TOLLEY (Minister for Social Development): I seek leave to move a motion without notice or debate that this House congratulate Robert Martin on being elected to the United Nations Committee on the Rights of Persons with Disabilities—Mr SPEAKER: Order! I just need to put the leave first. Leave is sought for that course of action. Is there any objection to that action being followed? There is none.Hon ANNE TOLLEY: I move That this House congratulate Robert Martin on being elected to the United Nations Committee on the Rights of Persons with Disabilities and recognise that being the first person with a learning disability to be elected to any United Nations committee Robert has made a historically significant achievement.[Continuation line: ORAL QUESTIONS]Points of OrderImmigration (Refugee Quota) Amendment Bill— Leave to IntroduceDENISE ROCHE (Green): I raise a point of order Mr Speaker. I seek leave to introduce the Immigration (Refugee Quota) Amendment Bill in my name and for the bill to be set down for the first reading next members’ day.Points of OrderImmigration (Refugee Quota) Amendment Bill— Leave to IntroduceMr SPEAKER: Leave is sought for that course of action. Is there any objection? There is.[Continuation line: GENERAL DEBATE]General DebateHon HEKIA PARATA (Minister of Education): I move That the House take note of miscellaneous business. I would like to take the opportunity to congratulate the teachers the principals and the kids and their families who have contributed to the highest National Certificate of Educational Achievement results we have ever had. Up and down the country we have hard-working Kiwi families who have contributed to the increasing strength in our economy. That in turn has allowed this Government with a very strong investment focus to put the money that we have prudently husbanded into places where it will make the most difference both in short-term investments but also in the medium to long term. Everybody in this House knows that a good education gives more choices. Those choices properly executed will mean that we will see greater strength in our economy and the ability to grow well and to invest in the options that people want that characterise their quality of life and by that I mean to be able to travel to be able to purchase the houses they wish to purchase and to be able to have their children educated in the way they wish to have them educated. Under this Government we have seen growth under very difficult times. This Government has not resiled from that. We have seen more jobs created we have seen the average income go up we have seen unemployment go down and we are seeing skills and qualifications growing through the very targeted investment we are making in education. For the first time Vote Education is over $11 billion—$11 billion. That is a ship-load of money that this Government considers—[Interruption] Oh a ship-load—please. Please it is a little pun—do not get all upset about it. That is going into education and we are seeing the results of that. We are seeing more young people participating in early childhood education. We are seeing more do better with national standards. We know how well kids are doing each year. We do not have to wait as the previous administration did till they get to year 12 to find that kids are not literate or numerate. Every year under national standards—in fact every week or every month—teachers are able to see how well kids are doing and to make the next learning step or investment. This Government using its social investment approach for the first time in Budget 2016 has said rather than have a universal operations grant across the education sector it will target those kids who it knows from data are most at risk of not achieving. That means that although the overwhelming majority of schools will get some investment they will get different levels according to the intensity of risk that is in their schools. This approach reflects our Government’s approach to using data and investing taxpayers’ money where it will make the most difference. It reflects our respect for taxpayers who are the ones who grow the economy which this Government understands. It is not the Government—we are just the middle people.Hon Member: You’re saying taxpayers.Hon HEKIA PARATA: I said taxpayers—that is right. We respect those people. We want to make sure that the investments we put into education or science—this Budget also provided for a $761 million dollar investment into the space of technology science and engineering because we know that that is part of a 21st century modern economy. Last week I was out in “Technology Valley”—otherwise known to some people as the Hutt Valley. Chris Bishop the energetic list MP based in the Hutt ensured that I attended the Technology Valley Awards. There was a celebration from the youngest learners there to the entrepreneurs and the innovators in recognition that knowledge and new knowledge is important for New Zealand’s place in the world. New Zealand understands its role as an international player.Hon Trevor Mallard: The same day you fired 14 scientists in the Hutt.Hon HEKIA PARATA: Not only are we concerned to ensure that New Zealand citizens get the best education possible but we are also prepared to give that opportunity as part of our international role to those who cannot get it elsewhere. That member can shout away over there—Hon Annette King: You’re shouting. Ssh!Hon HEKIA PARATA: —but the people in the Hutt know he does nothing but shout. I am matching the shouting from your colleague Mrs King. I am excited about “Technology Valley”. I am excited about the investments made there by the Hutt City Council. I am excited by the energetic Chris Bishop who is the first time they have seen energy in the Hutt Valley. It is the investing in education—yes Mr Speaker—that will make the difference for more young New Zealanders. Thank you.[Continuation: O’ROURKE]Points of OrderContinued Speech - Hon HEKIA PARATADENIS O'ROURKE (NZ First): The National Government’s mismanagement of housing in New Zealand is now chronic. It is not just a housing bubble in Auckland; it is a housing crisis nationwide. It is causing a firestorm of economic health and social issues throughout the country that will drag New Zealand down for decades to come. If you look at the results in Auckland alone you can see the magnitude of the problem. First of all ordinary people simply cannot find a house within their price range to buy and too few are being built. We need at least 13000 houses a year in Auckland alone but what we find is fewer than half of that are still being built per year in New Zealand. The National Government has known that for years and has done little or nothing about it. First-home buyers even if they can find a house to buy cannot afford to purchase it. They are forced into long-term rentals. That is why the term Generation Rent has been applied to them—applied for the first time in New Zealand. The problem is of course that they cannot afford to rent those properties either because of the huge rent increases that are actually driven by the increase in house prices. So they have to move down market and down market trying to find lower and lower rents so that they can afford it and to make things even worse immigration being at net 70000 a year most of whom actually go to Auckland greatly exacerbates the problem. The root cause of this is that successive Governments have failed to plan for housing needs over decades. They have never developed a genuine long-term strategy they have let the so-called market rein and most people know that in New Zealand the market will never cope alone. The Government has penny-pinched wherever possible fobbing off housing issues—especially social housing issues—on to other organisations most of which cannot cope either. The Government has always failed to integrate housing provision with resource management immigration transport and social security policy. New Zealand First says that we should be taking a long-term view and that there should be direct Government investment in the housing market not the zero-investment policy that this Government has taken. That is contrary to the approach that needs to be taken in New Zealand. So New Zealand First calls upon the Government and all parties to support the establishment of a housing commission so that we get a non-political approach to solving New Zealand’s long-term housing problems. We need to revamp New Zealand’s housing market with a number of objectives and the first is residential and land homeownership affordability. That is the fundamental problem. Also social housing supply security and affordability planned Government investment in land development and low-cost first-home purchase finance which is also something that is desperately needed in New Zealand at the present time. In addition sustainable housing objectives including energy sustainability and efficiency are also required as well as housing quality generally. We also need integration of new housing developments with sustainable transport systems. That is something that really does not happen in New Zealand anywhere and should do so—that is what is happening overseas. New Zealand First also believes that it is very important that overseas purchasers should not be able to buy residential property in New Zealand. We believe that they should be ineligible and that they should have to apply to the commission of which I spoke for a permit to buy a house in New Zealand and that should be granted only if they can demonstrate a genuine need. That should be difficult to do. We would also reduce immigration to sensible and sustainable levels which is not what we have got in New Zealand at the present time. Immigration needs to be aimed at meeting genuine skill shortages in New Zealand instead of the open slather we have now.[Continuation line: WOODHOUSE]General DebateContinued Speech - Hon HEKIA PARATAHon MICHAEL WOODHOUSE (Minister of Immigration): You can say one thing about New Zealand First: they are nothing if not predictable. Yesterday we heard speeches in the motion of support for the people of Orlando in the wake of that tragedy. I want to touch on a couple of them. The first was from Kevin Hague one of the most compelling interventions I think I have heard in my time here expressing condemnation at the act and aroha and support for the LGBTI community and for the Muslim community. Then we heard another speech without doubt the most vile spiteful hateful and ignorant intervention I have heard in my time in this Parliament from the leader of the New Zealand First Party Winston Peters. I reckon it plumbed a new low even by that member’s standards by drawing a nexus between a United States citizen born in that country and this country’s immigration policy. Frankly his call for some kind of Anglo-Saxon values statement to be signed by new migrants absolutely epitomises how ignorant and out of touch that party is. Today I hosted the annual World Refugee Day function here at Parliament. I challenge Mr Peters to go along to functions like that and listen to the speeches that we heard today from a 16-year-old Syrian and from an 18-year-old Rwandan or to go to the Māngere Refugee Resettlement Centre and go to a pōwhiri and see the energy and support for the values that we hold dear the values of freedom and peaceful coexistence of harmony and diversity and then stand and tell this House that we need some kind of values statement. Pauline Hanson has got nothing on Winston Peters. I wonder actually whether he is Ms Hanson’s older brother because they certainly sound very much the same. At the World Refugee Day function was a fellow by the name of Yahya. Yahya has the distinction of being the first Syrian refugee to arrive into New Zealand under the emergency places response this Government put in place a couple of years ago. He spoke at the World Refugee Day event last year and rather cheekily put his hand up and said: “I am good at what I do I have worked in a warehouse in logistics I speak pretty good English—does anybody have a job for me?” And actually there was an approach that day by a very large organisation in New Zealand that was trying to see if it could help. Sadly that did not come about and I met Yahya again today a year later and he tells me that he is still looking for paid employment. I was very sad to hear that but not that surprised because that is a typical story we hear around the country. Oh were it the case that every refugee we take could tell the same story as the speeches that we heard today. That would be great but unfortunately that is not the case. Despite being held up as one of the world’s best at settling refugees we still have fewer than 40 percent of those refugees in paid employment 10 years after they arrived. Their children do not do as well as school as ours. Immunisation and other health services are not taken up at the same rate. We need to do better which is why the New Zealand Refugee Resettlement Strategy was put in place 3½ years ago. It is working. Progress is being made but it is slow and we need to do more which is why I am really pleased this week in addition to the announcement of a significant increase in the quota—Dr David Clark: Double the quota.Hon MICHAEL WOODHOUSE: —of one third. That member says: “Double the quota”. Well he can go and ask his colleagues who were in Parliament from 1999 to 2008 why they did nothing. Not a thing. Why would they say that? Yes we have 60 million displaced people in the world. When the Labour Government was in power there were 42 million people displaced and it did nothing. There was no strategy no increase in the quota—more lion in Opposition but pussycats when in Government—no money and a decaying facility which the Prime Minister will open on Saturday. So I am very proud of the response and the announcement that was made this week to raise the refugee quota by a third and we will re-double our efforts to make sure that every single one of those refugees settles well thrives is independent from the State but more important is free of the vile disgusting rhetoric that we heard from Winston Peters and the New Zealand First Party. It is a speech and rhetoric that we have heard long enough going to a smaller and smaller cohort of New Zealanders—and I think that is a good thing.[Continuation line: CLARK]General DebateContinued Speech - Hon HEKIA PARATADr DAVID CLARK (Labour—Dunedin North): I challenge Minister Woodhouse to double the quota. I was out on the parliamentary forecourt this afternoon where people made the point that that Minister and his Prime Minister have not visited a refugee camp themselves. The last Labour Government took refugees when there was a crisis. When I was a child growing up there were Cambodian refugees taken in by New Zealand. The people want to have these people in the country—the churches and the community groups pledge that they will help. They are doing it in Dunedin; we can do it across New Zealand. New Zealanders are big enough people to do more than we are currently doing and I think that the Minister knows that. I want to speak a little bit about the way that the odds are stacked against middle New Zealand under this Government. Because we have a Government sitting there opposite that has just put through a Budget that has absolutely nothing in it to solve the housing crisis; an education budget that has frozen the operations grants for schools and is going to see parents fork out more in voluntary donations; and a health budget that does nothing to address the $1.7 billion of underfunding that that Government has brought in over the last 6 years. It is busy working in the interests of the ultra-wealthy and not in the interests of most New Zealanders. You can see it clearly every time an issue comes up. In the Panama Papers the Prime Minister’s first response was: “That’s going to be $24 million that the industry misses out on.” A short-term monetary response—not looking at New Zealand’s international reputation and not showing any values that New Zealanders could identify with. We see it with the Skycity deal—done behind closed doors with big corporates. We see it with the housing speculators. This Government has done nothing to curb housing speculation. That is because it is more interested in the interests of the ultra-wealthy than the interests of middle New Zealand. When an issue does arise that hits middle New Zealand in the pocket it runs a mile. I am going to talk now about the great salary stuff-up: the issue of payroll in New Zealand—the great salary stuff-up. It is not the cock-up that catches out a Government Minister; it is the cover-up. That is what I want to say to the Minister today because this Government has covered up something that has been going on since 2009 unchecked in this country. It did a review of the Holidays Act back then it found that there some inadequacies in the Act and it changed the law—and it has only made it worse. Then it buried the issue. Since that time the Government’s estimate says that up to $2.2 billion in debt has accrued to employers because this Government has failed to address this payroll issue. That is not just a matter of that big figure; this is an issue affecting middle New Zealand. The Government says that up to 763000 New Zealanders—up to 763000 New Zealanders may have been underpaid for the last 6 years. That is 1:3 working people in New Zealand who may not have been paid correctly. People do not know it yet—people do not know it—because they themselves have not checked whether they have had the right pay cheque. The Minister is not making it easy for them. He is not releasing the list of payroll providers who are carrying people on their books who have not been paid correctly. Most employers do not know that they have done it. Employers in my experience act in good faith. They want a clear set of rules and they want to do what is right by their employees. They do not want to short-change them. They are doing what their payroll suggests—they are following the automatic settings. They are doing what they think is right and this Government has failed in its oversight of payroll in New Zealand and allowed that liability to grow. It has been covering up this issue for the last 6 years and allowing those New Zealanders to be underpaid for all of this time. The Ministry of Business Innovation and Employment estimates that most people affected are missing out by between $250 and $500 a year. That adds up over time. Over 6 years that means that some people will have been underpaid by $3000 and they do not know it yet. The Government’s low-end estimate actually is nearly that 200000 people have been underpaid. People out there watching this today will not yet know that they have been underpaid. The Government should release the list of those companies who are carrying people who have been underpaid and if it is not going to do that we will release the list on this side of the House in due course because we cannot let this continue. This Government’s cover-up is going to cost it. When an issue comes up that affects middle New Zealand it does not stand up and make sure that middle New Zealand is looked out for it has not looked to correct this issue; it has put employers in a different position—they are underpaying employees in New Zealand and this is to the tune of billions of dollars. The Minister needs to take some accountability. This issue is going to affect so many New Zealanders. Check your pay cheques out there and watch this space because there will be a lot more to come on this one.[Continuation line: McCLAY]General DebateContinued Speech - Hon HEKIA PARATAHon TODD McCLAY (National—Rotorua): That was the best speech from that member in 50 years. In fact it was not—it was not even the worst speech in 50 years; it is just another speech that he has been making for 8 years. For 8 years that member and his colleagues have been coming to this House and trying to tell New Zealanders that this is the worst country in the world. New Zealanders get it. They know that is not the case. Take education which he passed over very lightly. What a fantastic speech by a passionate Minister of Education. The only people more passionate about education in this country than Hekia Parata are our teachers. This week we actually can turn round and say thank you to our teachers and to the people in our schools who have worked so hard to increase outcomes in all of those schools and in our high schools. They have done it with the absolute support of this Government over 8 years. We are spending more money than ever before in education. They have done it with the absolute support of two hardworking Ministers of Education in this Government over the last 8 years who have backed teachers and recognised that students can get ahead when teachers have the tools that they require. This year $11 billion has been committed in the Budget to education. So what did we hear from the education Minister? Well statistics—and they are very important. The highest level of achievement in National Certificate of Educational Achievement (NCEA) level 1 2 and 3 than ever before. In NCEA level 2 a 16.6 percent increase in achievement of pass rates over the last 8 years since we came to Government. It is a fantastic outcome. It is actually not about the Government doing a great job it is about 16.6 percent more young people in New Zealand who sit NCEA Level 2 achieving doing well and having a brighter future under the support that we are giving them. NCEA Level 1—74 percent of young people who sit NCEA Level 1 are passing. It is an amazing achievement on the part of those young people with the hard work of our teachers and the great work of our schools and they know that they are supported by this Minister and by this Government. I want to take just a moment to recognise Rotorua Boys’ High School in my electorate who this week received a Prime Minister’s Education Excellence Award for leading: an amazing school a great principal and very hard working students who are supported by their parents. That school recognised that there were groups of students who were not achieving well enough; they actually worked extra hard to raise those levels of achievement. That school is as good as any school in this country with the support of this Government and the hard work of those teachers. I want to thank the teachers of that schools and every other school in the Rotorua electorate for the work that they do. Just briefly that $11 billion sounds like a lot of money—well it is. But it is going to go into better and more school buildings where they are needed supporting at-risk students special education and just driving up achievement and success throughout the education system. Do you know what this means? Hard working young New Zealanders have a better education better outcomes and they get to go and trade that education for high paying jobs in a global economy. This week we have 500 delegates and 500 negotiators from 16 countries representing the ASEAN Regional Comprehensive Economic Partnership agreement; a trade negotiation that New Zealand is at the heart of. This week as host we are driving hard to make sure a high quality outcome can be delivered for the 3 billion citizens of those 16 countries that represent half the world’s population that are almost 35 percent of the world’s economy and that spend $23 trillion on GDP every year. We want a higher achievement for them so that all New Zealanders and all New Zealand companies can benefit. I would say to those listening the Trans-Pacific Partnership agreement (TPP) is a high quality agreement that will deliver significantly for New Zealand but the ASEAN Regional Comprehensive Economic Partnership agreement has the opportunity to be significantly larger because these economies are closer to us they are growing economies they are developing economies and we have agreements already in place with 14 of them. One we do not is India and India will be a big prize. Our negotiators are pushing hard so that New Zealanders can have a very very good outcome. It will take some time because we will not settle for less than we should that was a case with the TPP but those 500 delegates are welcome to New Zealand and I am glad that we can play our part to drive for greater liberalisation of trade openness so those hard working students who are achieving so well under Hekia Parata in this Government can use this great New Zealand education and exchange it for a higher paying job in a global economy that wants Kiwis to do well fo0r them. Thank you.[Continuation line: SHEARER]General DebateContinued Speech - Hon HEKIA PARATADAVID SHEARER (Labour—Mt Albert): There is a housing crisis. There is a housing crisis. There is a housing crisis. I say it three times because this Government says there is no housing crisis yet it has allocated three Ministers to this housing crisis and the way it is going they will need to allocate another three. Because it is going badly it is going really badly. Today we had the really embarrassing spectacle of Paula Bennett having to apologise about a smear campaign out of her office against Hurimoana Dennis in Te Puea Marae—a man who has lead the charge on homelessness that Paula Bennett after 3 weeks of this Marae functioning fled through the other day fled through went through barely stopping to meet anybody. She should be thanking Te Puea Marae not trying to put them in their place and smear them. That was a long list of problems. Yesterday as well Paula Bennett gets asked about the housing problem and some of the temporary mobile housing that is coming up the prefabs. She says she knows nothing about it. They said: “But Mr Key just talked about it.” “Oh” she said “Oh yes yes that is right—they will be ready in April.” This Government is all over the place—all over the place. It is sending people down to the provinces with $5000 in their pockets because it cannot put them into houses in Auckland. It is putting people in motels and then asking them for the money for it. These are beneficiaries who have done nothing wrong except failed under this Government’s policy and they are being put in motels and asked to pay that money back. It is a disgrace. That is only one housing Minister. The second housing Minister is Nick Smith and do you believe him—do you believe him? Homelessness he says is a figment of people’s imaginations. Do you believe this? He tells us about consents but everybody knows that consents do not keep out the rain—you cannot shelter under a consent—you want a home. He also says that houses are more affordable under National. The average house has gone up by $500000 under Nick Smith—$500000 and Auckland is heading towards a million dollar average. Who can get into a million dollar house—who can get into a million dollar house? It has decimated the dream of young New Zealanders wanting to buy a house. It is disgraceful. He is a mistake of a Minister. It is an appalling legacy that this Minister is leaving for the people of New Zealand. HousingMinister No. 3—Bill English is the economic so-called guru of New Zealand. His credentials are taking a dive. He is saying that speculators are no problem yet we know that 46 percent of all houses bought and sold in Auckland are done through speculators. We have now racked up a level of half a trillion—half a trillion—of debt in New Zealand; half a trillion dollars. That is beyond anything we have ever seen before. Fifty years under Muldoon my God! This is nothing compared to that. We have got $90 billion of debt under this Government and we are now being fuelled by credit. Just to tell you how out of touch this Government is we have the banks finally saying: “No. We’re not going to lend to foreigners.” This is Labour Party policy I hope you know. We should not be lending to foreigners. But that Government has never had the intestinal fortitude to even be able to stop foreigners from treating our housing market like they do the New York Stock Exchange. Selling pork bellies on the New York Stock Exchange is exactly what they are doing here in New Zealand with our housing market. It is a disgrace. This Government has had three housing Ministers to do the job and none of them—none of them—have been able to do anything that can give us any hope.[Continuation line: YOUNG]General DebateContinued Speech - Hon HEKIA PARATAJONATHAN YOUNG (National—New Plymouth): Under this John Key - led Government children are starting school better prepared to learn and are leaving school better qualified to earn. We are getting it right. We are seeing the results of young people getting higher levels of attainment and achievement and we are seeing results that are the best ever achieved by our students. As the Hon Hekia Parata said congratulations not only to the students but to the teachers the principals and the parents. There will be parents right throughout this country right now who are absolutely stoked absolutely thrilled and absolutely feeling as if this Government is making something work for them and their families. That is a very very important thing. This is great for New Zealand. We need an emerging workforce that understands what it is to face challenges to work hard to persevere and to succeed. Passing National Certificate of Educational Achievement (NCEA) level 1 level 2 and level 3 is all of that. It is not just about the content and having a fact file. It is about developing personal tools of discipline and perseverance personal tools of learning and being able to become educated and engaged in the bigger world that is outside the doors of the school. The OECD Policy Forum on the Future of Work which I know members opposite highly revere says that the world is in flux as a result of digitisation and the development of the digital economy. We all understand that but the future of work is today—it is today. It is people who today are leaving places of training needing to find employment. What we can say from this side of the House is that we have been focused on that. We have wanted to build a great foundation for companies to prosper and succeed. We are wanting to have very high-quality international agreements where we can have greater opportunities for export and those export companies can flourish and also they can employ more New Zealanders. Two hundred and eighty jobs a day—that is what is happening in our country today; they are being created. These are graduates from tertiary institutions and from high schools who are leaving their training going out there and seeking employment. We want to have a workforce that is highly skilled and earns a good wage. We are seeing this happen here in this country. We have got this trend happening. Here in New Zealand we cannot swim against the trend against the current. We have to continue as a modern economy to adapt and change and be adaptable. One of the things that we have done in this last number of years is make sure that we are able to engage digitally—not only across our nation but across the world with our ultra-fast broadband. Right now 1.2 million New Zealanders have the opportunity to connect and many of them are doing studies and transacting business across this amazing network. We have made sure that our schools and hospitals have been online first. It is a great thing to do and a great thing to see. The proportion of 18-year-olds achieving NCEA level 2 qualifications has increased. Four years ago it was 74 percent; today it is 84 percent. That is a phenomenal increase. That is phenomenal. You would not find anybody in the country saying that that is not a good thing. Even across the House their muted silence is an agreement that this is a good thing—84 percent. They will not stand up. [Interruption] So you are going to say that is a bad thing—84 percent. Since this Government took office in 2008 level 2 achievement rates have risen as Todd McClay said nearly 17 percent. That is phenomenal. What we have seen is 200000 jobs being created and another 170000 in the next 3 years. We know that Treasury is forecasting 3.2 percent 2.8 percent increases in terms of economic growth in this country. This place is in a really good shape. It is great that in the midst of all of this we are even seeing crime rates come down. Is it not amazing that we are seeing youth crime come down nearly 40 percent? That is a great indication that young people are finding a future that is positive that is engaging that is bringing them into employment and bringing them into a future. I think that is a marvellous thing. When you look at this Government at what we have done—around 100000 families with children are financially better off for the first time with a real increase in benefit rates since 1972. That is a great thing.[Continuation line: HENARE]General DebateContinued Speech - Hon HEKIA PARATAPEENI HENARE (Labour—Tāmaki Makaurau): Once upon a time the world looked towards New Zealand as a leading light—a shining hope and a country where prosperity was found everywhere where kids played and families were able to raise their tamariki and their mokopuna in what was essentially a utopian society. What we can see at the moment in fact is that Rome is burning. I say Rome is burning because not only is there a housing bubble but inside that bubble is this Government. It is oblivious to the decisions that it is making and the impact they are having on our reputation around the world. I say that in light of a very recent topic—250 extra refugees coming to New Zealand. Well whoopee! That is just not enough. There has been pressure from the international community on all Governments across the world to take this issue seriously. And what does this Government do? It increases the quota by only 250. And now the world is looking at us and saying: “By crikey. Maybe New Zealand isn’t the leading light of the world. Maybe in fact this Government is living inside the housing bubble that they’ve created oblivious to the fact that the decisions they’ve made have had a huge impact on our reputation around the world.” I am reminded of one of my favourite songs from the 1990s by C+C Music Factory called “Things That Make You Go Hmmmm”—things that make you go hmmmm. The reason for that is that once upon a time Te Puea Marae were doing what the Government failed to do and all of a sudden the Government comes up with a smear campaign—things that make you go hmmmm. We ask questions of the Minister and this Government about exactly what the cause of that was; no answer—things that make you go hmmmm. And I can tell you for a fact that Te Puea marae are doing a fantastic job. In fact I want to share some of those numbers if I can. Over 60 assessments have been completed within 2½ weeks. They have housed within Te Puea Marae 91 people—over 10 families and over 50 children. And while this Government talks about these great achievements for education I can tell the House that of the 50 children inside Te Puea Marae nearly 30 percent have gone to only their first day of school this year in the week just gone. What does that tell you about the ignorance of this Government and the failure of this system to actually take education seriously and to make sure that the children and the children that are finding themselves not by choice—because children do not choose to live in cars. Children do not choose in garages. Children do not choose to not go to school. Sadly what we are seeing at Te Puea Marae is over 30 percent of the kids who have gone into Te Puea Marae have attended school for the first time in the week just gone. That speaks to a failure of this system. There has been 8 long years of this Government—8 long years. Kids born while this Government has been in power have fallen through the gaps. They have fallen through the gaps. Sadly what this Government cannot do—it has appointed all of these Ministers to look after these issues but what it has failed to do in fact is actually connect all the dots. What a housing crisis is a part of what a poor education system is a part of—all of these things speak to poverty. It speaks to poverty. This Government is not taking poverty seriously. I challenge any of the members on that side to come to Tāmaki Makaurau. Come along with me and I will take you to Te Puea Marae but leave your grubby politics out of it. Leave the grubby politics out of it and let the marae do what they have done—Hon Anne Tolley: People need to take responsibility for their kids.PEENI HENARE: —in the past 2 weeks filling the holes found in this Government’s policies. I listen to the Minister over there and I say this: she thinks she forced her staff members to help Te Puea Marae. She is in fact wrong; it was I who called those staff to make sure they got to Te Puea Marae. I challenge her to show her phone records—I will show mine—to see who made the phone call first. So I finish by once again congratulating Te Puea Marae for the great job that they have done in filling the holes found in this Government’s policies moving forward. I want to say to Hurimoana Dennis and to the board kia kaha.[Continuation line: WILLIAMSON]General DebateContinued Speech - PEENI HENAREHon MAURICE WILLIAMSON (National—Pakuranga): Thank you for that. Can I first of all give a huge thankyou to the whips for allowing me once again to speak in Auckland’s drive time. I said to the senior whip that it used to be when he let me speak around 4 or 4.30 it was Auckland’s drive time. In Auckland right now it does not matter what time in the House you speak it is Auckland’s peak drive time where you are stuck in traffic. But I do thank the whip for that. I want to entitle my speech today—because I think every good speech should have a title. The title of my speech today is going to be “Peace for Our Time version 2”. I reminded of “Peace for Our Time” version 1—that was a man called Neville Chamberlain coming back from Germany arriving in England and he said that he had in his hand a piece of paper—just one piece of paper—and that it was going to give an agreement. It was a sort of memorandum of understanding with the other side where they could work together cooperatively. I have never ever been more reminded of that than last week or the week before when I saw Andrew Little out in the foyer of this building with a piece of paper in his hand saying “We have got an agreement.” I have never seen a piece of paper worth less than that piece of paper—including the one Neville Chamberlain had—because it did not say anything. It did not say anything. It said they were going to work together Labour and the Greens. I actually thought they had been doing that for a decade or more. They had to put it down on a piece of paper a memorandum of understanding. They said they would cooperate more and be nice to each other—I thought they already were. I already thought they were. God knows what they were doing beforehand if they needed to get a memorandum of understanding for it. But when any two organisations merge—and before I came to this place I saw a number of airlines merge. They had to get agreement on what was this part of the service that they would drop and what part would another one pick up and when they went to the public with their offering the public knew what they were getting. The public knew exactly what they were getting and said “This is quite good.” But we do not have a clue what this two-headed—and it has to have more than two heads we have already been told. Andrew Little told us—he told us—it is not monogamous. It is not monogamous. I know that some members over that side of the House think monogamy is something you make a dining-room table out of but I know what monogamy is and this arrangement is not monogamous. It is going to require some others in the relationship. I first of all had a think about the colours because when you are merging two things you should look at the merger. Does anybody know the chromatic scale of what happens when you mix red with green?Tim Macindoe: Brown.Hon MAURICE WILLIAMSON: No wrong. It is not brown.Tim Macindoe: Dark brown.Hon MAURICE WILLIAMSON: Well it is close. It is yellow if you have a look at the chromatic scale but it is at the Karitane-yellow end of yellow. Any of you who have changed nappies over the years will know what the Karitane-end of yellow can look like. That Karitane yellow only heads towards the brown scale if you tip a bit of black in it. And that is what will probably have to be added to it in order for it to be of any value .So when I see the policies that are so divergent between them—and I ask for the poor old voter of New Zealand to think what is it they would get. What is it they would get if they voted for this memorandum of understanding? Would they get those who are supportive of free-trade agreements like David Shearer and Phil Goff and that who think free-trade agreements are great? Or would they get the lunatic-end of the Greens who think free-trade agreements are evil and disgraceful and wrong? Which one would they get? Or would they get a free-trade agreement that was only for one year and then for another year it would not be and then it would be an on-and-off agreement so that both parties could get it? How would the voter ever know what they were going to get? I have to say that Neville Chamberlain’s piece of paper had a lot more value to it for his “Peace for Our Time” than this memorandum of understanding had. What I also want to say to Labour is that you cannot come to this House all the time criticising policies—Hon Annette King: You used to. You did for 9 years.Hon MAURICE WILLIAMSON: —like the refugee numbers increase that we have gone from 750 to 1000. And yet for listen to this 12 years in office—now I have my colleague saying “no it was only 9.” No no. They made the change in 1987 so from 1987 to 1990 and then from 1999 to 2008—that is 12 years. They did not change it. I have to say and the public in New Zealand say what crocodile tears. What a shipload of rubbish that is to—General DebateContinued Speech - PEENI HENAREMr SPEAKER: The member’s time—[Interruption] Order! The member’s time has expired.[Continuation line: DELAHUNTY]General DebateContinued Speech - PEENI HENARECATHERINE DELAHUNTY (Green): Tēnā koe Mr Speaker. Tēnā koutou e Te Whare. The previous speech was that voice of jealousy and fear that comes when something happens that the National Government cannot control and that it knows is welcomed by the country. So I am glad that the previous speaker felt he had to devote his speech to us but actually we are here for other reasons and we have got things to talk about that are not based on jealousy and fear. What we want to talk about is clean water. Imagine if a child was born 10 years ago next to a river and in that child’s life over the last 10 years that child has never been able to swim in that river. I am talking about the Waikirikiri-Selwyn River where a child has grown up in a beautiful area with an amazing coastal lake and an incredibly significant river to find that that child can never swim in it. Every summer there is a sign saying that it is temporary but you cannot swim in this river. Ten years of a child’s life and 8 years of a Government that has completely failed to fix the problem. That is the legacy for that child at the Waikirikiri-Selwyn River. Imagine being a person in their 60s—a man in his 60s at the Wairua River in Te Tai Tokerau who gets up every day gets into his inflatable boat and goes up and down the Wairua River taking photographs of the cows destroying the banks polluting the water and the industry that has impact so heavily that he as a volunteer has to devote his life to cleaning up that river. All his photographs get sent to the regional council and yet it is not listening. Neither the regional council nor the Government is listening. Imagine if you were living next to a creek in the middle of the city that was once full of kayaks and annual swimming events that the Minister for the Environment says no one wants to swim in and you belong to a community group that has been fighting for that creek and you hear the Government say: “Oh no one wants so swim in Lucas Creek.” Imagine being a member of those groups that are still fighting because they believe our children have a birth right to swim in those rivers. Imagine if you come from the Waikato and you are a farmer in the lower Waikato planting fencing and desperately trying to clean up water quality while the Government and the regional council refuses to turn the tap off at the top of the catchment and dairy conversions across the volcanic plateau are pouring diffused nitrogen into your river as you try to fix it. The tap has to be turned off. The Government and the regional council do not have the political will to do so. Imagine if you are the young people from my rohe a young group called Te Mātauranga Tira which is a passionate group of young people who came to me and said “We want one thing for our river”—this one is the Waihou. “And what is that?” I said to them. They said “We want to be able to swim in it. We cannot swim in our river. Our whakapapa tell us this is our river; we cannot swim it.” The Waihou goes into the Hauraki Gulf Tīkapa Moana and is full of dairy effluent day after day after day. Imagine if every time a person got up on their marae to do their pepeha to talk about their mountain and then their river and their river was the “Black Drain”— Tarawera the most polluted river in the Bay of Plenty where the pulp mills have had free run at putting their contamination into the river. When they improved the colour they added to the toxicity. So although the river looks cleaner it is just as toxic in recent years as it has been for quite some time. Those of us who fought for the clean-up know what it means to those people whose whakapapa is still the “Black Drain”. Imagine if you came from Waitara and you stood up against sewage and back flow up with Waitara River and you were sued by your regional council. I am talking about Rob and Fiona and Pikikore who are being sued individually for standing up for clean water. That is the legacy of the last 8 years. A person can be sued for standing up for clean water in Taranaki. The Manawatū the Ruamāhanga the Mataura and more—we have so many rivers that need to be swimmable that can be swimmable and that the Green Party will fight for alongside community groups. We believe in fresh water. It is not a choice; it is a necessity. We believe in swimmable rivers. The Minister believes there are too many birds and too much volcanic ash. That is a joke. That is just completely out of touch. We can have swimmable rivers and with us and our leadership we will.[Continuation line: PARMAR]General DebateContinued Speech - PEENI HENAREDr PARMJEET PARMAR (National): We are just 5½ months into this year and we can see this National Government is working hard for New Zealand. We are building on the big work we did in 2015. For example we made GP visits for our young people under the age of 13 free. That was to see that our young people are able to achieve 100 percent 100 percent of the time. Look at the National Certificate of Educational Achievement (NCEA) results. Are they not great? Since this National Government came into office in 2008 NCEA level 2 achievement has gone up by 16.6 percent. Here we are talking about thousands of children. So these thousands of children are now able to get into higher education they are able to enter into the workforce. We want to see more and more children achieving better results. That is why we are investing in Communities of Learning. I am really delighted to see a number of schools in Mount Roskill are now part of Communities of Learning. We want to see that the system revolves around students not students revolving around the system. In Mount Roskill I have been working with a number of schools that provide for children with special needs. So I am really delighted to see $15 million for teacher-aides for schools that provide for special needs. I believe disabled students also deserve to have the opportunity to do well in their life. For our economy to be more productive we want more and more people contributing to our economy and that is why we are investing hugely in our social services to meet the needs of our growing population. Our population is growing because our economy is doing so well and as a result there are a number of people from all around the world coming to New Zealand. At the same time we are providing direct support to New Zealanders in need. Domestically we are doing really well and at the international level we are doing well as well. As the Prime Minister and the Minister of Immigration announced we are increasing the refugee quota from 750 to 1000 from 2018. This is the first increase since 1987. Yes the first increase since 1987 and it is this National Government that is increasing the refugee quota. It is not just 750 refugees who come to New Zealand because there are hundreds of others who come under family reunification then there are hundreds who come as asylum seekers and we have already committed to take 500 Syrian refugees over the period of 2 years. Taking refugees is not a simple process because these people come with some expectations. They are coming to their new home and we should have resources to meet their expectations. I have been to the Māngere Refugee Resettlement Centre and I have seen the orientation programme and how that is implemented when these refugees come to New Zealand. They are shown a New Zealand way of life and they also go through series of health checks because these refugees go through rough circumstances so we want to make sure their mental health and physical health is good as well. It is a long-term thing. The number—1000—is the appropriate number and I applaud the Minister and the Prime Minister for increasing it to 1000. I can go on and on listing the achievements of this National Government but if I look at the Opposition and I look at the Labour Party the Labour Party is struggling. If I look at the Green Party the Green Party is struggling. These parties are struggling because they have no ambition for New Zealand. They have no ambition for New Zealand and their leaders lack direction and goals for their respective parties. These parties have realised they are not worthy Opposition parties against this third-term National Government. That is why they have come together. There are three leaders—two co-leaders from the Green Party and one from the Labour Party with 4.5 percent popularity against one leader on this side the Rt Hon John Key. The leader the Rt Hon John Key is on the side of New Zealand voters on the side of New Zealand families and businesses. He is the leader who is working hard for New Zealand. This National Government is working hard for New Zealand and the Opposition is busy running their own parties into the ground. There is no direction there is not stability just desperation moves. Thank you.[Continuation line: WILLIAMS]General DebateContinued Speech - PEENI HENAREPOTO WILLIAMS (Labour—Christchurch East): I want to change the tone of the debate this afternoon. I want to celebrate the men and the women who work in the NGO sector who work for not-for-profits who work for community organisations in the third sector—civil society organisations. Many of them are volunteers but each and every one of them is dedicated to the people and the causes they care about and they support. So I celebrate the work they do. They support people with disabilities to live fulfilling lives they help parents to parent well they support individuals and families to live violence-free lives they teach kids how to play sport they support mothers to breastfeed and they house the homeless. And speaking of people who should be housing the homeless has not the Minister for Social Housing had a dreadful few weeks? She has had a dreadful few weeks. First her response to the ever-increasing homelessness issue was to offer people $5000 to leave Auckland because there are no houses in Auckland.Hon Annette King: How much to come back?POTO WILLIAMS: And then when they get to these places and they find there is no work she offers them $3000 to come back. So we have got this amazing homelessness loop of people leaving Auckland coming back to Auckland leaving Auckland coming back to Auckland. So what is her next response to homelessness? Well she is going to pre-book some motels at the princely sum of $190 a night which the homeless will have to actually repay. But let us face it—when the Government does not do its job who picks up the pieces? Who then has to take up the reins? The community sector and the NGOs do. And why does the Government not rate the NGO sector higher—why does it not? I turned on the news the other day to find out that 750 NGO groups are due to have their contracts cut in 2 weeks—in 2 weeks’ time. Andrea Vance’s report on One News the other night said 750 NGOs are due to have their contracts expire. The Ministry of Social Development (MSD) —Hon Anne Tolley: That is rubbish.POTO WILLIAMS: It is rubbish. It is complete rubbish that you would treat the NGO sector in this way. Smokefree Coalition Minister—Hon Anne Tolley: That’s not MSD funded.POTO WILLIAMS: I did not say MSD; I said 750 NGOs—[Interruption] Listen Minister it might pay you to learn some things. The Ministry of Health and MSD are cutting 750 NGOs; in 2 weeks’ time they will lose their contracts. Smokefree Coalition has worked in the smoke-free area for 20 years and has a strong commitment to New Zealand becoming smoke-free in 2025—which is a Government responsibility. That is 20 years down the drain because the Ministry of Health will not continue to find it. And why does this Government disregard the expertise of the sector? Why? Let us look at what happened to the Problem Gambling Foundation. The Problem Gambling Foundation had the audacity to stick its head up and say: “We have the right to advocate on behalf of the people we serve and the Government policy isn’t matching the needs in the community.” And what happened to the Problem Gambling Foundation? It had its contract cut. Let us look at how the Government uses the NGO sector to actually legitimise its own policies. The Minister for Social Housing used the name of the Salvation Army to legitimise the work that the Government was doing. Thank goodness the Salvation Army actually came out and said that it was not true. I just want to end on one note. I want to send huge congratulations to Te Puea Marae and Manurewa Marae in South Auckland for doing what this Government should do. They are the New Zealanders who care for each other. They are the ones who have the least who give the most. They are not motivated by profit but they are motivated by the aroha they have for other New Zealanders unlike this Government.[Continuation line: TAXATION (ANNUAL RATES FOR 2016–17 CLOSELY HELD COMPANIES AND REMEDIAL MATTERS) BILL 1R]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillFirst ReadingDebate resumed from 14 June.Mr SPEAKER: When this debate was last before the House Grant Robertson was speaking and he has 9 minutes 20 seconds remaining if he wishes to take it.[Continuation line: ROBERTSON]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillFirst ReadingGRANT ROBERTSON (Labour—Wellington Central): I do Mr Speaker. When I was rudely interrupted last night we were discussing what had been the best thing to come out of Hamilton and never go back and the people of Hamilton had voted—[Interruption]—no it was not Mr Macindoe that is true. Mr Bennett was the export that Hamilton did not want back and unfortunately I cannot go on any more about that for reasons I am not allowed to refer to. What I am here today to discuss is the Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) Bill and again we have in front of us a taxation bill that is ad hoc at best. I long for the day that a taxation bill would come to this House that gave us an idea of the overall goals that the Government had for the tax system—what it was trying to achieve; the balance that it wanted between taxing wealth and taxing income; where it saw the future of taxation and planning for that. But no—every single time it is a bill that is ad hoc and the danger in that is that we come back time and time again to correct the ad hoc mistakes or to add a little bit more in and it becomes a system that is very difficult to understand. When we did the last bill in select committee our expert adviser made this very point: that the piecemeal changes that the Government keeps making are confusing for the sector that uses them and for the tax accountants that use them let alone the individual taxpayers; the people whom the Inland Revenue Department (IRD) actually mainly works with and for. They are confused because there is no coherent framework. So we stand here once again that is—as described sometimes by the IRD—about making sure that the original intent of tax legislation can be clarified. That is the problem; if we are spending all our time doing that let us go back and work out what should be in this legislation. But again it is not. We have a set of ad hoc remedial piecemeal measures that are frankly mostly useful as far as we can tell but do not constitute an overall picture of where taxation should be going in New Zealand. One thing we do know for sure is that this bill will set the annual rates for taxation for 2016-17. Again here would have been an opportunity for the Government to say: “It’s time for some fairness. It’s time to have another look and make sure that we’ve got the rates set in a way that’s fair not just automatically roll them over.” Prior to the Budget we heard a lot from the Government about their concerns about what is known as bracket creep fiscal drag or whatever you want to call it—the idea that some people are being “captured” by the fact that their incomes have risen but the tax brackets have changed. When this bill came out I thought: “There you go the Government will be true to its word. They will have addressed that issue. They are the ones who raised it in the run up to the Budget.” Nothing. Not a word—not a single word. So it is crocodile tears when it comes to the people who might over time have seen the fact that their incomes had increased but the tax rates had not changed. Not a word in here—the annual rates have been set for 2016-17 and they go on regardless. The public of New Zealand might want to reflect on the real commitment of the National Government in addressing that. It is all very well to wave around the idea of tax cuts saying that they are going to come in the never-never and rely on outrageous forecasts in the Budget but then Bill English stands up says: “No there’s no room for tax cuts.” He puts on his best dour Dipton face and he says “There’s no room for tax cuts.” and then John Key comes along “floating from one cloud to cloud” as Minister English once said and says “Oh no we can do them—$3.5 billion I reckon.” That was the phrase. That will go down in history; when he was asked how much would be required for tax cuts: “About $3 billion I reckon.” That is how they are making tax policy nowadays in the National Government on John Key’s reckonings. We can do a whole lot better than that. This would have been the opportunity for the Government to do that when it set the annual rates for 2016-17 and it completely failed to address any of those issues. What else the bill does is a range of measures. The one that I want to focus a bit of time on today is the changes that are being made around look-through companies. The whole issue of the place and role of look-through companies in our tax legislation has been in the spotlight in recent times. They popped up during the Panama Papers in one of the more unfortunate references to New Zealand which was the desire of Mossack Fonseca to sell what it was calling combo packs to interested investors. So here we were as the McDonald’s of tax havens with Mossack Fonseca deciding you could get a decent combo pack. It was not fries that came with your foreign trust; it was a look-through company. That was exactly what was being put on the table: that for particular a type of investment you could find yourself the look-through company vehicle. The example that was given in the Panama Papers was of a French investor who had previously had his money in a Swiss arrangement but changed that to a New Zealand look-through company arrangement on the basis that that could be zero-rated for tax purposes. If all of the income was foreign income the New Zealand look-through company could be zero-rated for tax purposes and then when the person repatriated their income back into France they were able to say that they had paid tax. They had paid tax at a rate of zero so they had not but they actually were able to tell the French authorities that they had paid tax at that rate. That is what our look-through companies are being used for today. That is what is in the Panama Papers. So when we come to discuss the changes on look-through companies that are proposed in this legislation members on this side of the House will be looking very closely to see what is being done. I think on my first reading I will give this to the Inland Revenue Department officials. They are tightening up a little around how look-through companies are being used.Chris Bishop: Oh how generous of you.GRANT ROBERTSON: Well I trust them Mr. Bishop to do that. I am not so sure about the Government members but I think the officials who brought this bill to the House are actually looking to try to tighten up around how look-through companies are run. My colleague Stuart Nash when he was speaking in the House last night was running through the ways in which there was an effectively free untaxed capital gain that was being realised by New Zealand owners of look-through companies. That is certainly an issue to look at. We also want to look at the treatment and use of look-through companies by foreign investors and those who hold foreign trusts because clearly from our point of view that misuse of a look-through company is significantly damaging for New Zealand. It needs to be noted again in the context of my earlier remarks about the piecemeal nature of these kinds of tax bills that it was a 2010 piece of legislation put through by this Government that actually enabled the arrangements for look-through companies as we see them today and the exploitation of them by those with foreign trusts seeking to shelter income from offshore. It was Chapman Tripp that in writing about the changes that were made noted that New Zealand funds were now an attractive alternative to funds resident in Luxemburg Ireland or the Caymans. So that is the league that the 2010 changes put us into and that quite clearly have now been used and we have seen the enormous explosion of foreign trusts as part of the aforementioned combo packs that are being sold around the world. It is on those issues—the look-through company issues—that we will be focusing most of our attention. The remaining remedial matters including issues to do with non-resident withholding tax appear to us to be sensible and are in part a response to the Government’s work in relation to the base erosion and profit shifting work being done at the OECD. Again a failure to come to this House with a comprehensive package to deal with that and we heard today from the Minister of Revenue at the select committee that his point of view is that New Zealand cannot really do much—we are just going to have to wait and see what the OECD comes up with. He does not think we need a diverted profits tax in New Zealand like his comrades in Australia and the UK have put in place. He is just prepared to do a few little tiny piecemeal acts in this area; we should be a lot more ambitious than that. The Labour Party will support this bill but it is an ad-hoc piecemeal response to a series of issues that require a strategic and coherent plan sadly lacking from this Government.[Continuing line: BISHOP]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONCHRIS BISHOP (National): Well that was not a bad effort from Mr Robertson. Mr Robertson’s speeches on tax bills and I have heard a few of them in the House now since I have been a member of Parliament generally follow a fairly strict formula. There is the generic abuse of David Bennett in the first 2 minutes of the speech and actually to be fair to Mr Robertson that can be reasonably amusing because David Bennett is a unique character in the Parliament. He is a superb chair of the Finance and Expenditure Committee which I have the privilege to be on shows real leadership and actually the defamation that he has to suffer from Mr Robertson is uncalled for. So there are 2 minutes of generic abuse—Hon Clayton Cosgrove: I raise a point of order Mr Speaker.The ASSISTANT SPEAKER (Hon Trevor Mallard): A point of order Clayton Cosgrove. I hope it is one.Hon Clayton Cosgrove: It is. I just wonder whether it would be worth reminding the member speaking about misleading the House.The ASSISTANT SPEAKER (Hon Trevor Mallard): Mr Cosgrove I think you are aware of the fact that that is not an appropriate point of order and therefore you will stand withdraw and apologise for making it.Hon Clayton Cosgrove: I withdraw and apologise.CHRIS BISHOP: So we start with the 2 minutes from Mr Robertson about Mr Bennett and then we get on to the generic complaints about Government tax policy. The reason that Mr Robertson does this is that the Labour Party does not have a tax policy. So he will spend about 3 minutes of a 10-minute speech with complaints about how there is no plan. It is like 2009 redux all over again when Labour used to say “The Government has no plan.” “Where’s the plan?” says Mr Robertson. “There’s no comprehensive statement of principle. We don’t know where they are going with tax policy. We need more fairness in things like that.” So there are about 3 minutes of very repetitious behaviour about that. And then we get from Mr Robertson in the last quarter of his speech the cursory references to what is actually in the bill. To be fair to him that was not a bad effort because he spent about half the speech talking about look-through companies and various other things that the bill does. Actually the Government does have a comprehensive tax programme that we are implementing. This is part of it. This is the May tax bill. There are two tax bills per year. This is what is known as the May tax bill and if Mr Robertson bothered to do his reading he would know that the Inland Revenue Department (IRD) runs a very comprehensive process called the generic tax policy process which is extremely transparent and extremely consultative. They publish tax policy discussion documents. They publish material online. They consult with the various stakeholders with the companies with the various interest groups in the area that are affected by tax law. It is extremely transparent. Actually the bill that we are debating in the House which is going to go to the Finance and Expenditure Committee for further consideration is actually a fair way along a very consultative process to make sure that our tax law is fit for purpose and make sure that it is refined every year as we need to do. We have a very large body of tax legislation the bulk of which is contained in the Income Tax Act 2007 of course. But we are far better off than many other countries that have extremely bulky pieces of tax legislation tax codes. I think if you put the Income Tax Act and the various other pieces of legislation—if you printed them off and stacked them up I think they get up to about my height or perhaps to the height of one of my colleagues who is a bit shorter than me. If you did that to the United States I suspect you would be hitting the top of the New Zealand Parliament here with its high-stud ceilings and perhaps going a bit further. We have a very very good tax system in New Zealand and the aim of it is to have a comprehensive system that is broad based and low rates. That is exactly what this bill does. I want to make only another couple of points. The first is to just highlight for the House that this bill adds 14 organisations to schedule 2 of the Income Tax Act 2007 which makes these organisations exempt from income tax because they are charities. That is fair enough. It adds things like the Cambodia Trust (Aotearoa-New Zealand) First Steps Himalaya Hornsby Pacific Education Trust and the Siphala Foundation. Fair enough. But you do have to wonder why it is that we have to pass a piece of legislation through the Parliament and send it to a select committee in order to add organisations to a schedule to make them exempt from income tax under the Act. Surely this must happen a lot. I seem to recall about a year ago debating a similar piece of legislation—debating the May tax bill a year ago basically probably around about the same time soon after the Budget—in which we did various things to the schedule as well. I have got to wonder surely there is a better way. Surely there is some regulatory process that would take this mechanism outside of the legislature and put it in the hands of Ministers acting on behalf of advice or organisations. I think that would be a better process. So we will wait and see. I for one am looking forward to exploring why that is the case with officials in the select committee. There is one organisation that ceased operations which is Bicycles for Humanity which I know Mr Assistant Speaker that you will be interested in as a charity. I am also interested in it as well. It ceased operations sadly. I do not know the organisation but why is it that we have to turn up in Parliament and pass a piece of legislation to remove them from the schedule to remove them from the charitable status exemption? It just seems a little bit strange. So I am looking forward to examining that at the select committee. The second remark that I want to make about the substantive policy of the bill is that actually this bill does do some of the things that Mr Robertson said it was not doing. It does actually make some useful contributions to the law around trusts and around multinational tax behaviour. This bill brings into place rules designed to stop multinational corporations sidestepping withholding taxes and levies that are imposed on interest paid on borrowings by New Zealand operations. If Mr Robertson had bothered to read the KPMG commentary on the bill he would have found that out. I expect that KPMG along with the other organisations in this space will be submitting to the select committee and I am looking forward to hearing what they have to say. I am looking forward to hearing further from the IRD about what exactly we are doing in this piece of legislation and how that fits into the Government’s overall tax policy process. This is a good bill. I think it is going to receive unanimous support in the select committee. I look forward to serving on that redoubtable Finance and Expenditure Committee with my colleagues Mr Cosgrove Mr Bennett and others and examining it in more detail.[Continuation line: SHAW]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONJAMES SHAW (Co-Leader—Green): The Green Party will also be supporting this bill’s referral to a select committee but as with the Labour Party we have got a number of reservations more about what the bill does not contain than what it does contain. The previous speaker Mr Bishop referred to some of the things that the bill does do—in particular in relation to starting the moves towards tightening up around multinational tax avoidance—and of course we know from the last 8 weeks or so that multinational tax avoidance is one of two very big public events in relation to the tax sphere. The other one of course is around foreign trusts. This bill is the bill that would have addressed the laxity around New Zealand’s foreign trust regulatory regime and our transparency regime had the Government not 2 years ago killed off the Inland Revenue Department’s proposed review into how we regulate foreign trusts in New Zealand. So I just wanted to take a moment to talk about some of the context that has led up to this bill being introduced into the House and some of the things that we would like to see in the bill as a result of that time line. Back on 15 August 2013—oh dear he has got his green book out—the department warned the Government about the high risks from New Zealand trusts. Mr Assistant Speaker I am just going to quote here. It said in that report that our foreign trust rules were being perceived as a tax haven and were damaging to our international reputation. It said that foreign trusts were being used by people to avoid paying tax not just in New Zealand but in fact anywhere in the world. It said that New Zealand’s current regulation was not good enough and that the regulation made it difficult to enforce compliance with the rules and the department questioned the adequacy of our disclosure and record-keeping requirements and its ability to realistically reform the industry and to make it comply. So there were a number of concerns there. On 2 December 2014 of that same year Ken Whitney of the Antipodes Trust Group wrote to Minister McClay on behalf of the foreign trust industry concerned about the Inland Revenue Department’s view of the industry—Dr David Clark: Who was that?JAMES SHAW: That was Ken Whitney of the Antipodes Trust Group on 2 December 2014. In that email he claimed that he had spoken to the Prime Minister and that the Prime Minister had assured him that there were no plans to change the status quo but that he should speak to then Minister of Revenue Todd McClay. The very next day the Minister Mr McClay expressed concern to Inland Revenue Department officials that their report might include removal of the foreign trust regime and an official from the department responded saying that “They will bear this in mind when they write the report.” Then on 12 December of that same year the Inland Revenue Department produced another report on foreign trust rules and it was sticking to its guns Mr Assistant Speaker. It said that New Zealand’s foreign trust rules—you are looking at me a bit funny Mr Assistant Speaker.The ASSISTANT SPEAKER (Hon Trevor Mallard): No you said “Mr Assistant Speaker” so I was just making sure that you had my very undivided as opposed to divided attention.JAMES SHAW: Feel free to divide your attention Mr Assistant Speaker. It said that New Zealand’s foreign trust rules were damaging to New Zealand’s international reputation so the department had a second report saying that in fact their recommendations for reform were even stronger than they had been in the previous August. A few days after that Todd McClay met with representatives of the foreign trusts industry unaccompanied by Inland Revenue Department officials in Auckland at the offices of the Antipodes Trust Group company. So that group sought from Minister McClay “a commitment from the Government as soon as possible that it will not conduct a public review of foreign trust tax laws but that it could keep on with its BEPS work” which has actually made it into this bill. So in other words it specifically said “Please don’t proceed with the review of the foreign trust industry but feel free to continue with your base erosion work.” which is exactly what the Government has done as a result of that meeting. So in this tax bill it has included some measures around multinational tax avoidance and has started to tighten up that regime and has not included anything around the foreign trust review that it was planning. That group said that its view was “it would severely damage the industry” if that work was to proceed. Then on 22 January 2015 there was another letter sent to the Minister proposing another meeting and expressing how pleased the group was that the foreign trust industry was yet again meeting with the Minister who then promptly met with OliverShaw  one of the other companies involved in this. In May 2015 the Minister of Revenue wrote to the foreign trust lobby group that he had been meeting and conversing with reinforcing the earlier promise that the Government had no plans to review the foreign trust tax rules and I just want to point out again that that is in stark contrast with both of those reports from the Inland Revenue Department expressing real concern about foreign trust regulation and about how actually it ought to be included in the review and thus some of those reviews would have made it into the tax bill that we are debating tonight. So Mr McClay concluded: “I trust that this provides you and your industry with the certainty needed to continue to do business in New Zealand.” Then on 19 May 2015 the same Inland Revenue Department official informed her staff that there would be no review of foreign trust regulation in New Zealand. The Panama Papers which Mr Robertson referred to have changed all of that of course so they have started to shine a light into a dark place.The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I am now going to interrupt the member after the member I think worked out that I have been thinking about it for some time. In a first reading members can make passing reference—it is quite a broad debate but members can make passing reference—to what is not in the bill. I have let the member run for some time because members previously including the member immediately before him spent quite a lot of time on what was not in Mr Robertson’s speech rather than focusing on the bill. But I am now going to ask the member to move from making passing reference to the bill to making only passing reference to what is not in the bill.JAMES SHAW: Certainly Mr Assistant Speaker. Well the conclusion of my passing reference to what is not in the bill is that we are 2 years behind on foreign trust law reform and that ought to be in this bill. In 2013 the Green Party introduced a piece of non-controversial legislation that would have imposed a more rigorous registration and disclosure regime and we are hoping that we will be able to introduce that into this bill in later stages of the bill’s passage through the House. Those measures would help to restore international confidence in New Zealand’s international reputation as a well-regulated and transparent place to invest and trade. So I will explain given all of the absence of proper reform around foreign trusts why we are supporting the bill through the House and certainly to its next stage. It is because it does go some way as I said earlier to closing down some of the look-through company abuses that have been occurring and some of the profit sharing from multinationals which has been recommended by the Inland Revenue Department. It is compromised of course because the National Government is not prepared to go as far as the department wanted nor as fast but it does move us in the right direction. The Government has of course known about multinational tax avoidance for many years but has been dragging its feet so it is good to see in this bill some progress around that. Budgets in 2016 in the UK Canada the United States and Australia all saw new measures to close some of the biggest loopholes in multinational tax avoidance around the world but Budget 2016 in New Zealand saw no new measures at all to deal with that trend in New Zealand and in fact there is a wall of funding—a cliff top—that we are about to go over in a year unless the Government addresses this in terms of the Inland Revenue Department’s ability to investigate and enforce. The Australian Government expects nearly A$4 billion in taxes from multinationals. We could be doing the same thing if this bill was tighter than it is and we will be looking for ways to tighten it up even further. The bill is highly complex and it will require thorough scrutiny by the select committee but it is promoting some changes that we believe will have a positive impact on tax avoidance by multinational companies and tax abuse through look-through companies as well. So it is a step in the right direction. It does not go as far or as wide as we would like to make a meaningful difference to the billion dollars or more of lost tax revenue through multinational tax avoidance in New Zealand but it is a step in the right direction and for those reasons the Green Party will be supporting this bill through the House. Thank you.[Continuation line: TABUTEAU]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONFLETCHER TABUTEAU (NZ First): I rise on behalf of New Zealand First in support—only at this stage—of this large omnibus bill entitled Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) Bill.Hon Clayton Cosgrove: What a title.FLETCHER TABUTEAU: I know—it is a beautiful title but it does speak to the frustration some of us have on this side of the House when we keep having these remedial bills put in front of us. [Interruption] I say to Mr Macindoe and the New Zealand public that these remedial pieces of legislation should cause the New Zealand public some great concern—some great concern—especially under that National Government. Here the Government will be making as far as I have had the chance to count—I have had some amazing frustration at the pace. This bill has been presented to the Opposition parties and then suddenly it is in the House frustrating my genuine endeavours to make a thorough and full analysis of the material before us. From what I have been able to count here the Government will be making over 50 changes to amendments across seven pieces of legislation ranging from the Income Tax Act 2007 to the Stamp and Cheque Duties Act 1971. I want to add to the words of my colleague from the Labour Party who spoke quite eloquently about the ad hoc nature of this piece of legislation and in fact I suppose echo the words of the co-leader of the Green Party James Shaw when we ask where the direction is. Where is the understanding that the New Zealand public is supposed to take from pieces of legislation like this especially with regard to hugely important issues that are defining the world around us and certainly defining the nature of the National Government and its lack of action thus far around tax issues and avoidance? This for me has come onto the Order Paper and I just noted that it took just a couple of weeks to get into the House which is unusual. It sat at the very end. I do want to acknowledge that although I may not have had the time to do my normal consultation with friends in the accounting field and lawyers I do acknowledge some of the words of Mr Bishop who gave one of his better contributions of late—Hon Ruth Dyson: Not a very high bar though.FLETCHER TABUTEAU:—no it is not a high mark—on the generic tax policy process used. In reading the impact statements you do get an understanding of the consultation that the officials have undertaken in coming to the House with the legislation as it sits thus far. There was comprehensive consultation. I say that with reservations because for example there is tax legislation in here that relates to councils but only the Auckland Council was consulted. So you have to wonder how robust the feedback was in terms of what the nature of those changes will mean for council-run State-held entities. It is complicated. I think everyone in the House has acknowledged that. I do acknowledge that the consultation with the community thus far has been to a degree comprehensive. That is why New Zealand First is offering its provisional support—at this stage of the debate anyway. From here we are able to go to the select committee and have not only officials but also our public and our experts out there come to the select committee and give us feedback. I know without any doubt whatsoever there will be a large large array of issues that will need tidying up. The last piece of tax legislation that came before the House included components of the brightline legislation. New Zealand First opposed that right from the start because we knew that it was a waste of time marketing spin but this one at least in our readings does move us in the right direction. So I agree with the Minister’s contribution. I do agree with Mr Bishop which is unusual that the tax system does need to be defined and made such that it is broadly fair and that the New Zealand public can have a good and kind of transparent understanding of their tax obligations. The Inland Revenue Department and the Minister of Revenue themselves talk about the issues around compliance becoming lesser if members of the public understand what their obligations are and we fully concur. Unlike the last piece of legislation which did the exact opposite we believe at this stage that we are moving in the right direction. I do not think any amount of fast talking from the Minister on the ICT spend which in my understanding is from $1.2 to $1.6 billion on the Inland Revenue Department (IRD) upgrade can justify those numbers just yet. That is an abhorrent number. That is frightening. I do not know why the New Zealand public has not rallied against $1.6 billion—or $1.5 billion if you concede the Government numbers—on an ICT upgrade. But you know we do want a transparent tax system. The Minister will have a lot to answer for and he will have to answer to the Opposition constantly for that spend so we will move from there. You will note the theme from the contributors this afternoon. We managed to dig into some depth on at least one of the over 50 changes. I looked into the double tax agreements and the anti-avoidance rules which I think Mr Shaw talked to. I think I unlike Mr Shaw will acknowledge that the Government is actually looking at the trust structures here and the companies in terms of their avoidance procedures. I think what the Government is acknowledging with this legislation as I read it thus far is that the DTAs—the double tax agreements—“do not prevent … anti-avoidance” at this stage. That is a quote from the regulatory impact statement analysis itself. What I will say is it has taken way too long to get to this point to have this conversation about legislation around tax avoidance for these large multinational corporates. It has taken way too long for the Government to get here. To be fair I am not even satisfied at this point that the legislation as it stands will actually solve the problem. At this stage it is a matter of degrees. The double taxation agreement will take precedence. There has been no case law to examine the issues around this at the moment but I think we may still have some issues as we move forward unless the legislation there has changed. New Zealand First has said that the tax settings need to be changed and we look to Canada and Australia for example as early adopters those who act quickly in acknowledging the issues with tax non-compliance with large multinationals. I can see that there is work being done by the OECD and New Zealand does need to work in parallel with those efforts but we have examples from around the world of Governments acting unilaterally and not compromising those efforts holding these big multinationals to account with regard to their tax compliance. That is what is fair and what is reasonable in undertaking business in our jurisdictions. I do look forward to a comprehensive select committee process. I look forward to the Committee of the whole House. We here in New Zealand First have no doubt there will be much to debate. I just want to say again for the record so it is clear that it is only at this stage that we support this piece of legislation so that we can get it through to the select committee so that we can have meaningful broad and robust debate on tax legislation that must—must—go through that process. Thank you.[Continuation: ROSS]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONJAMI-LEE ROSS (National—Botany): I do not intend to talk for as long as Mr Tabuteau did on this bill. I congratulate him on that very well-drawn-out effort on this bill. This bill contains a range of very well-meaning changes to tax law—none that are overly earth-shattering though. As a number of speakers have pointed out already it does contain a range of matters that improve the tax legislation in this country particularly with regard to ensuring that we continue to level the playing field between New Zealand companies and overseas companies. This bill also contains that wonderful clause—that wonderful “yes” clause— “Annual rates of income tax for 2016–17 tax year”. Of course this bill continues with the Government’s approach to taxation which is to ensure that we maintain important public services and fund those through taxation but not tax people through the teeth like we see other parties in this House have been proposing. I am sure that if we were discussing this bill and Grant Robertson had written this bill—long may that not be the case—we would probably be discussing annual rates that would be far higher than what we are discussing today with all of the huge multibillion-dollar promises that they have been making so far without counting of course the Green Party promises that they will have to include once their marriage goes a bit further. The annual rates that we would be looking at in a bill like this would be much scarier. As members have commented quite collegially already today it is going to be a good opportunity at the select committee to look at the many measures in this bill and hear from tax experts about how we can refine those further. I always find that tax bills like this that go through the Finance and Expenditure Committee attract very high-quality and very technical submissions which aid the committee well and the committee always does work very well together in trying to find changes to the bill that improve it and ensure that we are passing good-quality tax legislation. It is a long bill with well-meaning changes and I am happy to look forward to the select committee process later on.[Continuation line: LOGIE]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONJAN LOGIE (Green): I am pleased to take a short call for the Green Party on the Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) Bill. As has been well covered by previous speakers this is a very detailed piece of legislation covering a lot of ground. The unifying thread of the legislation is tax and beyond that it is a little bit hard to make out what the unifying concept is as so much is covered in this piece of legislation. I will list the pieces of legislation that are covered by this. It may be slightly painful but I think that if anybody is listening or reading the transcripts it may be an easy way to work out whether this covers an area that you are concerned with. It will look at the annual rates of income tax for 2016 making changes relating to closely held companies look-through companies and qualifying companies non-resident withholding tax for “Related party and branch lending” the Goods and Services Tax “Related parties debt remission” “Loss grouping and imputation “Remission income insolvency and bankruptcy” “Aircraft overhaul reserves” New Zealand double tax agreements “Schedule 32 donee status” for charities “Land tainting and council controlled organisations” “Loss offsets by mineral miners” “Working for Families Tax Credits” information sharing the application of the time bar to ancillary taxes and other remedial amendments. For all of those with a very keen interest in our taxation system I hope that was helpful. For me what characterises this legislation in what I can see in it at this stage is a sense of lost opportunity really more than anything in the detail as I have not truth be known had the chance to go into it in its full depth yet. But we are aware as my colleague James has spoken to quite significantly already about the disappointment around the fact that it does not cover or provide any protections for us around foreign trusts to make sure that New Zealand’s reputation is secured internationally and that we are keeping up with the movements in the world to protect the tax bases of each country and make it as difficult as possible for those with resources to be able to hide their wealth in other countries and avoid supporting the countries that have supported them so well. So this is a lost opportunity on that basis. I would also suggest that this bill is a lost opportunity in terms of addressing child poverty because although it is making minor changes to the Working for Families tax credit whenever we look at the Working for Families tax credit we have the opportunity to make an absolute difference in reduction to child poverty in this country. We know that we have over 305000 children living in relative poverty in this country and massive material hardship which means kids who do not have their own bed who have never had a birthday in their life because their families do not have the money to be able to buy presents or put on a special dinner and kids who are getting sick and being hospitalised because their families cannot afford to heat their houses. This bill could make those changes to Working for Families of bringing the in-work tax credit in line with the family tax credit giving those poorest families who are not able to be in the workforce the $72.50 that other families who are able to work that 20 hours get. It would reduce inequality in our country and protect our most vulnerable children. It would also be an opportunity to reset the abatement rate for Working for Families which the Government has very sneakily been increasing clawing back money from not particularly well-off people in this country—people who are still struggling and needing the support of Working for Families—to be able to give it to some of the poorest New Zealanders rather than taking it from the wealthiest. I hope that we use this bill as an opportunity to promote transparency to be a good international citizen and to tackle child poverty. To me that would make this bill interesting.[Continuation line: HENARE]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONPEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe Mr Assistant Speaker. Thank you for this opportunity. I rise to make a short contribution on the Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) Bill. When your normal New Zealander is out there and they look into this House and they look at the pieces of legislation that we are currently debating they want to see several things. They want to see several things particularly with regard to taxation and taxes. They want to see that (1) it is transparent—all of the processes are transparent. They want to see that (2) it is robust (3) that it is fair and finally they want to see that (4) it is user-friendly. I can tell you that as I have read through much of the material here I have thought: robust? Yes. Transparent? Questionable. Fair? I think it is pretty fairly well weighted in favour of the businesses and in favour of the taxpayer. Is it user-friendly? That is a big question that I will leave on the floor this evening. Members across the House have already spoken about how you fall into dangerous territory when you start making a series of rules around taxation without any clear policy framework a clear policy framework that provides for all of the attributes we look at when we consider taxation law. We find then that when you start making these ad-hoc rules along the way it often becomes problematic. I have already mentioned how when you have got a clear framework around taxation when you set the annual rates—as this particular bill will be doing for 2016-17—there is a clear direction with your taxation. There is a clear policy direction that allows for the public out there to have a look at this particular bill and say: “OK if we are going to pay these taxes that are set by this particular bill we expect these types of things to come from them. We expect infrastructure spend and we expect spend on the essential services to our communities.” I get back to my point about how if you are making ad-hoc changes to taxation law you fall into a trap of that lack of policy framework and that lack of policy direction. This particular bill in setting the annual rates for 2016-17 is supported on this side of the House to make sure that it does get to select committee. There are far smarter people out there who are able to provide fantastic advice that I am sure the Finance and Expenditure Committee will look forward to hearing. We support it at this particular point in time. At select committee you can expect continual challenges from this side of the House to make sure that when large omnibus bills such as this one are passed in this House that the detail is not simple swept under the carpet and that the transparency for our public can be found in the debate and in the processes that this bill will go through from here on out. I do not want to go on too much further but to say that we will be supporting the bill at this point in time. We send it off to the Finance and Expenditure Committee and we look forward to hearing from the submitters—the experts like the Inland Revenue Department and those business owners tax specialists and accountants from across the country who will have an opportunity to have their say on this particular bill moving forward. On this side of the House we will be supporting it. Thank you.[Continuation line: BAYLY]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONANDREW BAYLY (National—Hunua): It is pleasure to be talking on the Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) Bill. In the Finance and Expenditure Committee—and some of its members are actually in the House tonight which is good to see—we have considered a number of different tax matters during the course of the year all seeking to continue to improve our tax system to make it simpler and to maintain its integrity. It is a continual evolution of what we are trying to do with our tax system. I would have to say that most people around the world look at our tax system and regard us with a sense of envy because we have a very simple clear tax structure. At a personal tax level we only have four different tax levels. Company tax is very simple to understand and partnerships and all those types of arrangements are very very simple. That has been an ongoing process of this Government to make sure that what we have in place is something that people can understand easily can engage with and can pay their due taxes. I would hasten to note that the Inland Revenue Department is undertaking one of its big transformation projects at the moment—a billion-dollar project—and the first roll-out of that will be changes to the GST regime next year which is going to make it a lot easier for companies and smaller companies in particular to make their commitments around GST. Ultimately we also want to see smaller businesses paying their taxes as they go. This pay-as-you-go system is moving away from a provisional tax system and I think it is a very good measure that was introduced in the recent Budget. This particular bill deals with a few changes. First of all it mends the Income Tax Act 2007 the Tax Administration Act the Goods and Services Tax Act the Stamp and Cheque Duties Act the Student Loans Scheme Act the Income Tax Act 2004 and also the Goods and Services Tax (Grants and Subsidies) Order 1992. There are particular things that I just want to focus on. At a high level the bill is first of all about constraining reducing or correcting issues relating to land tainting. Secondly it is about ensuring that the Working for Families tax package is maintained. We know how important that is to most New Zealand families. We want to make sure that the package continues to operate in the way that it should to support our lower-income families. Thirdly it introduces allows or permits 14 new charities. As you are probably aware charities are reviewed every year. I think from memory there are about 2500 that are reviewed to make sure that they are of a charitable status and are meeting their commitments. As a result of that there are 14 new charities being introduced this year. The bill also seeks to set the income tax levels for 2016-17 financial year which of course is essential for the Government if we are to continue to remain in business and do all the good things that we are trying to do. I just want to focus on a couple of little issues. One is that we are changing the rules relating to look-through companies. As many of you are probably aware they are similar to partnership arrangements and we are making some specific changes around them to make sure that people are taxed at their personal level and the complexity around those look-through companies is reduced. The second thing is we are specifically targeting where non-residents have provided debt to a New Zealand entity—it might be a branch or some structure here in New Zealand—to make sure that appropriate interest is being paid on that. I am sure that the Opposition will be very pleased to hear about that measure. We want to make sure that non-resident withholding tax is paid for related party debt where it involves non-residents. We are also making changes around deducting GST on capital-raising. For most companies going out capital-raising—and for this they would normally get professional advice. They need to be able to get that advice and normally it comes at a cost with GST. We are making sure that is standard and that companies actually have the ability to deduct that GST because at the moment they cannot deduct the GST portion. Then we are making some changes and technical amendments around aircraft maintenance. Those are the key aspects of this bill. I look forward to working with the committee and the House as we work through this process.[Continuation line: COSGROVE]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - GRANT ROBERTSONHon CLAYTON COSGROVE (Labour): As other colleagues on this side of the House have said we will be supporting the bill at least to the select committee. I acknowledge a number of the points that have been made in respect of it. Yes this bill does make some positive changes to address abuses in the tax system. It is true that it makes changes relating as the member Andrew Bayly said to closely-held companies non-resident withholding tax related parties branch lending GST and the list goes and on. But I do make the point that although there are number of positive changes in this bill this is yet another opportunity where the Government could have made a big hit or a big statement in respect of overall tax planning and tax policy. What you do have in this—which as the name reads is like a sort of motion picture—is a mishmash of issues dealt with by yet another sort of clean-up bill where a whole series of issues are thrown into a piece of legislation we are here and it will then go to a select committee and we will you know sort of spend a lot of time cleaning it up. But if you look at some of the big issues—Alastair Scott: Ha ha!Hon CLAYTON COSGROVE: The member laughs but I have to say that if you look at the cleaning up that committee has done a lot of wet work in terms of cleaning up National Party tax bills. If you go right back—I am glad he had a bit of a giggle about it—to the brightline test and to the 2-year hold issue they were an absolute mess when they got to the select committee. I am not talking about the Chair sir—not you—but the committee it had to be cleaned up by the Finance and Expenditure Committee and the member knows it. If you go back a couple of steps members will recall the tax on car parks and the tax on computers—an utter mess that went to the Finance and Expenditure Committee and was trumpeted by the then-Minister Peter Dunne and it ended up on the cutting room floor. So I do not have a lot of faith in terms of the quality that will come out of this piece of legislation. I do know with a high degree of certainty—having sat on that committee for many years and chaired it once—that this piece of legislation will need a lot of work. No disrespect but I do have concerns about how it is when you lose people out of the department like Robin Oliver who was the former deputy commissioner of the Inland Revenue Department that many of those examples I have given today—particularly the computer and car-park tax debacle—would have never hit the Minister’s desks would never have been given a 5 minutes’ notice and if they had got that far they would have been cauterised at that point and the deficiencies in that legislation that were identified would not have made it into this House. It does worry me—no disrespect to officials—that that degree of knowledge and that degree of lineage within the department is not there and that we are dealing with these sort of mishmash bills. I will pick up on one thing that Mr Bishop said that I think is worth consideration—but again I lament the fact that I suspect that the Government will not do anything about it. I think it is quite strange and bizarre and a waste of time energy and money that every time that we want to alter the charitable list—those who are entering the charitable list; there are 14 contained within this bill—we have to convene the Parliament we have to write up a piece of legislation and we have to go right through the whole palaver every time this is done. I would have thought the great minds at the Inland Revenue Department (IRD) the Minister of Revenue and the great minds on the Government’s side of the select committee could have turned their intellectual capacity to coming up with some sort of formula that would allow us to circumvent that process. Because after all what you are attempting to do in respect to charities is to ascertain in effect if they are the full quid. Are they genuine do their aims and objectives in raising money in the variety of ways they do and the utilisation and the distribution of that money meet charitable purpose and does it fit within the legislation and the law? I would have thought you would not need to convene the Parliament and have a 2-hour debate to deal with that particular issue if you will. I would have thought that when we talk about tax simplification and we talk about the great benefits to business that the Government trumpets—what about doing something for the charitable sector and making it more efficient if we want to promote philanthropic behaviour charitable giving charitable purpose—so that they do not have to jump through a whole series of hoops a whole series you know a legislative framework and the convening of this Parliament to actually get on with what they do best. But that might be a test or a barrier or a height bar that is just a wee bit too high for some of the Government members to address. I also want to address something that Mr Robertson said in his speech. It relates again to what could have been put in this bill apart from a whole lot of tinkering measures positive though they may be in terms of dealing with the big issues. It was very instructive this morning at the select committee when Mr Robertson asked the Minister; “Is any work being done by the IRD on a land tax?” and the Minister—to be fair to him he is a new Minister in the role—he looked sort of “possum in the headlights” and asked Mr Robertson to define what he meant by land tax. Well I am not an accountant but I would say it is a tax on land. I would have thought so that is a reasonable definition of what a land tax—Phil Twyford: A bit of a leap of faith.Hon CLAYTON COSGROVE: Bit of a leap of faith—a tax on land. Mr Robertson then tried a third go which was to say why did he not define it in the same way the Prime Minister defined it—would that help the Minister? And the Minister’s reply and I summarise it was basically “Well you know I don’t quite know what the Prime Minister’s definition of it is.” Then we got to the guts of it and the IRD Commissioner looked at the Minister and the Minister looked at the IRD Commissioner both looked rather nervous. We got a sort of answer that he had not had any advice and the work plan of the IRD had not yet been produced. That was the answer. So I think if translate all that sort of gobbledegook out I would say if I was a betting man that you could probably put the house on some sort of land tax being worked on or appearing probably with a different name—bit of camouflage bit of shellac—in the IRD work programme whence it comes. But there is an issue of course that and international foreign trusts those are two big issues of moment of huge concerns to the communities which have massive economic and fiscal implications for this country that could have been addressed in this bill. So whilst I say that the Opposition supports it the Opposition is sort of girding its loins for the Finance and Expenditure committee process under the chairmanship of Mr Bennett because we know that we will have to take the scrubber to this piece of legislation. There will be some massive holes in it as there always are when this sort of mishmash is presented to the House. We lament the fact that we are not sitting down trying to grapple with a piece of legislation that deals with big issues that affect this country. The big issues around New Zealand’s perception as a possible tax haven the big issues around housing and in respect of tax options around that and the big issues of moment to those people who tonight will again sleep in cars under bridges and under bushes and trees and other places because they cannot afford the rent for a home let alone the prospect of ever buying a home. I know the member is waving his arms and legs around—you need flags to do semaphore actually I am told not just your hands—but thanks for waving. I do not know whether that was with two fingers or five. Those are the big issues that could have been dealt with in this piece of legislation not just the shopping list valid though it is—goods and services tax related party debt remission loss grouping and imputation. The member Mr Bayly said in his speech that people would be hanging on every word they will understand every aspect of this bill. Well the man who has become the “ Bear Grylls” of the Parliament with his very worthy I should say exploits and expeditions should know that I suspect most people will not be concentrating on the aspects and minutiae of this bill or even the headline issues. What they may well be looking for in a tax bill are the big issues—land issues housing issues—and how they are dealt with. Perhaps they might be looking at how the Government might propose to deal with foreign trusts. They are the sort of headline issues that they are reading in the paper and watching on the news every night and they are the things that the communities are talking about. So I just say to Mr Bayly he may want to reengage with his community have the odd clinic on a Friday or a Monday morning and maybe ask a few people what their priorities are in terms of tax frame work tax planning and tax legislation. That being said we await with bated breath the officials’ report at the select committee.[Continuation line: SCOTT]Taxation (Annual Rates for 2016-17 Closely Held Companies and Remedial Matters) BillContinued Speech - Hon CLAYTON COSGROVEALASTAIR SCOTT (National—Wairarapa): I would like to focus on the bill for a minute and specifically some of the ideas that Stuart Nash was talking about earlier when he was trying to suggest that this tainted capital gains portion of the bill somehow enabled capital gains to be distributed that would otherwise be taxable. In fact the opposite is true. That piece of the bill enables gains of a capital nature to be distributed as capital sums rather than as is the case today as taxable distributions. I just thought I would clear that up for Mr Nash at the outset. Other members have quite correctly said there is a lot going on in this bill. Jan Logie listed the whole gambit of affected legislation and I am not planning to do that but what I will do is help Mr Robertson out when he was confused about what the I think his words were “Overall goals of the Government regarding taxation”. The overall goals are to make sure that taxpayers—one of the things is to make sure that taxpayers have more money that they earn remain in their pocket. That comes in relation to this bill to the rates that are set by way of this legislation. That is important. I have not heard anyone in the Opposition talk about the taxpayer. They are the people who we are taking money from and spending on their behalf to help those who are most in need. The philosophy of this side as I say is to either keep rates the same or reduce them and that is only going to happen if we have good public accounts accounts that are managed prudently and effectively and making sure that we hit surpluses. As the House knows projected surpluses in the foreseeable are positive rising to between $6 billion and $7 billion in the next few years. That enables us to think about options whether it is to pay down debt or coming back to the bill reduce income tax rates. The alternative course from the Opposition is to talk about universal basic income (UBI) as being a core policy of the Opposition. I just thought I would note that there is an article actually in the Wall Street Journal of 4 and 5 June this year which specifically discusses a guaranteed income for all. It is written by Charles Murray who first talked about a UBI in 2006 for the House’s interest. If you read the article a UBI is a scary thought because everyone gets paid a certain amount no matter what their circumstances are. There is no consideration for those who need it most—Mr DEPUTY SPEAKER: Order! I am going to ask the member to come back to the bill.ALASTAIR SCOTT: What I am saying is the Opposition’s policies in general—Mr DEPUTY SPEAKER: No no—the member will come back to the bill.ALASTAIR SCOTT: OK the tax rates that are in this bill would not be the same if it were an Opposition made up of Greens and Labour because we know that their policies are only about spending taxpayers’ money inefficiently and ineffectively.The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I probably should have got to my feet earlier to warn the member. He actually started his speech quite well. He stayed about a minute and a half on the bill. But since that time he has diverted a long way from it. What is not in it from the Government perspective he has gone through and now he is going through what is not in it from the Opposition perspective. Neither of those parts are relevant as I have made clear to members earlier.ALASTAIR SCOTT: Thank you Mr Assistant Speaker. This bill does a number of things. It is going to be an interesting select committee process. There is going to be a lot of discussion. It is a collegial select committee and I look forward to that debate.[Continuation line: CHILDREN YOUNG PERSONS AND THEIR FAMILIES (ADVOCACY WORKFORCE AND AGE SETTINGS) AMENDMENT BILL 1R]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingHon ANNE TOLLEY (Minister for Social Development): I move That the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill be now read a first time. I nominate the Social Services Committee to consider the bill. At the appropriate time I intend to move that the bill be reported back to the House by 17 October 2016. This bill represents the first phase of major and far-reaching changes to the legislative framework for the care protection and youth justice systems necessary to make positive changes to the lives of our most vulnerable children and young people. The bill includes a package of amendments to the Children Young Persons and Their Families Act 1989—the CYF Act—as well as some consequential amendments to other legislation. Later in the year I expect to introduce a further set of legislative changes to the House. These legislative changes are part of the wider programme to transform the care protection and youth justice systems in New Zealand. We know that children and young people who come into contact with these systems are some of New Zealand’s most vulnerable people and we know that this can be a complex and challenging system for them to deal with. Children and young people who have been in care are far more likely to die at a young age leave school with few qualifications receive a benefit be convicted for criminal offending and have children who also need care and protection support. Young people who have had experience in care before the age of 17 are 22 times more likely to spend time in prison by the age of 21 than young people who have had no contact with Child Youth and Family. In April 2016 I released the Government’s response to the final report of the expert panel I appointed to lead a complete overhaul of the system. The report found a number of fundamental issues with the operating model for Child Youth and Family. The current system does not place children at its centre. It does not meet the needs of vulnerable young people as they move into adulthood. It is fragmented lacks clear accountability and is not organised around a common purpose. In order to address these issues this Government has committed to developing an operating model that is child-centred and responsive to children’s and young people’s views and needs. This bill is the first step to make this happen. The bill has three main objectives: first it extends the statutory age of care and protection to under 18 instead of under 17; second it provides vulnerable children and young people with the support needed to express their views and have them heard both at the individual and at the system level; and finally it enables a broader range of professionals to identify and meet the needs of vulnerable children and young people. This bill amends the definition of young person in the CYF Act to include young people who are 17 years old for care and protection purposes. It also consequentially amends the Vulnerable Children Act 2014 which refers to the definition given in the CYF Act. Including 17-year-olds within the scope of the youth justice system is being investigated. Leaving the care and protection system at the age of 17 can seriously impact a young person’s life. Young people who have spent time in care have spoken of their pronounced sense of vulnerability as they moved into adulthood. For these young people the transition out of care often comes too early too abruptly and with little in the way of a safety net. International evidence has shown that allowing young people to stay in care for longer has a range of benefits. A study in the United States found that an increased upper age for care and protection meant that young people who had been in care had better educational outcomes had children later in life and were less likely to become homeless. Young women who had been in care for longer were less likely to commit crime. Young people have told me that they are rarely given a chance to be involved in the decisions being made about them. We need to do more to ensure that children and young people are able to participate in these decisions. To support the establishment of the Independent Advocacy Service this bill places a duty on the chief executive to ensure that services are available for children and young people who are subject to an action or are receiving a service under the CYF Act. The services will support them to express their views about matters in relation to those actions or services that affect them and more generally on improving processes and services delivered under the Act. The duty requires that particular consideration be given to the needs of children and young people in care. The bill also specifies that advocacy services should operate independently from other services provided under the Act. I want to note that work on the design of the Independent Advocacy Service is currently being carried out in partnership with the philanthropic sector. Any further changes to the legislation needed to underpin the advocacy service will therefore be included as part of the second stage of reforms. This bill also includes duties to ensure that children and young people are encouraged and assisted to participate in any actions and decisions under the Act that may significantly affect them. These duties specify that any views expressed by the child or young person must be taken into account. The duties include that the child or young person be supported to express their views freely where they face any barriers such as those relating to age language or disability. These duties will fall on the person responsible for the relevant proceeding or process under the Act to either perform them or ensure another person has performed them. The bill also includes a new duty on the chief executive to ensure that wherever possible children’s and young people’s views are considered as part of departmental policies and services. This includes views received through the advocacy services. The future operating model for the department will take a far more multidisciplinary approach to child protection work and decision making and will include a number of broadened functions. The bill amends the CYF Act to vest functions and powers that currently sit with social workers in the chief executive. The chief executive will be able to delegate these functions and powers to employees in the department and elsewhere in the Public Service and also to persons outside the Public Service with the appropriate Minister’s prior written approval. This amendment will provide the chief executive with a greater ability to delegate core roles to other professionals where they are equally or better placed to perform them. This change helps to ensure that a broader range of professionals are available to identify and meet the needs of children and young people. I want to acknowledge that social workers will still be the main professionals responsible for carrying out many of the functions specified under the CYF Act. Therefore where functions or powers are being delegated to anyone other than a social worker the chief executive must be satisfied that the person is appropriately qualified to exercise those powers or functions. The bill includes additional controls to make sure these functions and powers are exercised competently and transparently. These will cover the delegation of any of the chief executive’s existing powers under the Act. First all delegations must be publicly notified on the department’s website while those delegations are current. Second if delegating outside the State services the chief executive must be satisfied that appropriate contractual arrangements are in place. In summary this bill represents the first stage of a broad and far-reaching set of changes to how Government works with our most vulnerable children and young people. These changes will help to ensure that our care protection and youth justice systems are child-centred and responsive to children and young people’s views and needs. These changes set a foundation for further legislative changes that I expect to introduce later this year. I commend this bill to the House.[Continuation line: ARDERN]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingJACINDA ARDERN (Labour): I am pleased to rise in support of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill. As a party Labour has generally given cautious support to the process that the Minister undertook when she introduced the expert advisory panel that carried out both an interim and final report setting out the reforms that it believed were needed for our child protection and child welfare system in New Zealand. We came into that process with an open mind because we ourselves had pushed for so long for changes that were needed in order to improve the outcomes for children. It was our view however that it was never fair to blame social workers for the situation that we had in New Zealand given that we have not been properly resourcing and supporting those social workers for some time now. In fact in the select committee today that was confirmed when we questioned the Minister over funding for Child Youth and Family and she admitted that over the past few years $52 million has been taken out of Child Youth and Family in what has been called efficiency savings. But what do those efficiency savings actually represent? It included the holding of vacancies—when social workers left jobs they certainly were not replaced—the way that holiday pay was paid out and whether or not programmes were indeed delivered. Fifty-two million dollars taken out of a department that could not afford it and what is proof that it could not afford it? The Minister this Budget put $36 million back in in one year alone because she has acknowledged that that was needed just to tread water. I make those comments because although this bill is welcomed and we are pleased about it we do need to acknowledge that in the here and now we do have a department that continues to be under considerable strain. How can we truly say it has failed when we never resource it to do the job properly in the first place? On the specific provisions in this bill though there is one element in particular that I am really pleased to stand up in support of and that is the raising of the age of care and protection. When we lost the last election to stay sane as an Opposition member for another 3 years—Jono Naylor: Stay?JACINDA ARDERN: I will defend my sanity—having already served 6 years I wrote a bucket list. An Opposition bucket list—things that despite not being in power I wanted to see happen in my term in Opposition. At the top of the list was an increase in the age of care and protection. It never ever seemed fair to me when I first came into Parliament that once a young person who is under the care of the chief executive in foster care in residence in kinship care—that once they turn 17 once they had their 17th birthday no one had responsibility for them not one person. A parent would never do that to their child. A parent would never say on the 17th birthday of their child: “Pack your bags leave the house I have no responsibility for you any longer—no financial responsibility no emotional responsibility nothing.” Yet that is what we do to our young people who you could argue need more support than anyone else. So we as a Labour Government—when we were in Government we were set to change this. We had a bill on the Order Paper an amendment to the Children Young Persons and Their Families Act to change the age of care and protection but we lost. So when I came in I remember when I was the youth affairs spokesperson every time a bill came up where I could make an amendment that might lift the age I did—every time. Not only that we ran a petition and tried to get public sympathy for this issue as well. ActionStation came on board and the petition grew. It seemed to have got some momentum but none of it would have happened—and I want to acknowledge the work of Dingwall Trust which works with these young people every single day. It was one of the first organisations that put a young person in front of me and had them tell me their story. Lifewise another organisation with the homeless sees the other side the repercussions of this policy. Those are just some of the organisations that did awesome work championing this issue and I believe got it here today. So I am pleased that we are ticking off an item that just so happens to be on my Opposition bucket list. But it would be remiss of me not to add that on the flip side of that unfortunately we are now going to have a separate age for care and protection than we will for youth justice and that is a lost opportunity. There is a reason that our care and protection age and our youth justice age are linked. It is because if you have a young person committing crime then you will often find that there are care and protection issues. In fact this was confirmed by Judge Andrew Becroft who in a speech not too long ago said that of the 1982 offenders in the Youth Court last year Child Youth and Family had prior involvement in 67 percent of cases—in 67 percent of cases. There is a reason that our Children Young Persons and Their Families Act includes the youth justice provisions in it. So why are we only raising one element? It makes sense to have young people in the Youth Court for as long as possible not only because of our United Nations Convention on the Rights of the Child responsibilities which we get whacked with every time because we have not raised the age but because the Youth Court is a highly successful interventionist confrontational personalised process. I have heard much come from the community of late that the Youth Court does not hold young people to account. I have two challenges to that. I have never seen a process more confrontational than what I have seen for instance by the Youth and Rangatahi Courts—the young person is at the centre of the process. They cannot sit back and not take responsibility in the way that you see our adult system work where they can almost be a bystander to the process. They are at the middle. The Youth Court has tools that enable it to cater the sentence to that young person. It could include a long stint in a residential facility but it also can include wraparound services for the family that young person has come from and will go back to. It understands that their environment has played a role. The other important point is that if the case is severe enough the Youth Court can send it on to the adult court—the provision is there. The Youth Court is a gem in our justice system and we should be sending more young people to it. I really implore the Government in the work that it is doing to assess whether or not that age should go up to consider that positively. I want to come to the two other provisions in this bill around advocacy—the ability of a young person to personally have their views heard and also the establishment of an advocacy service for young people in care. Absolutely. In Australia they have something similar particularly for children in foster care. We have needed that for some time. One point of caution though: we must resource that properly. Currently the Children’s Commissioner has that responsibility to be a voice for young people but he has already said that that is one of the thing that he has had to step back from because he has not been properly resourced and his funding has remained static for the last 8 years. Whatever we do we have to make sure we support it properly. The involvement of the philanthropic sector in designing this—my only question will be: is that a sustainable way to create what is going to be a piece of core service in legislation. If we design something with the philanthropic sector are we then reliant on it to make sure it continues to be delivered? No young person should rely on their advocacy being funded out of goodwill. It needs to be more sure than that. Although I welcome the fact that people have an interest in this area and want to contribute we must give it a stable footing. The last point—and this where our most significant reservations sit—is around enabling a wider role of professionals to have core responsibilities in discharging functions under the Children Young Persons and Their Families Act. There is a reason that we train our social workers comprehensively. There is a reason we are advocating that social workers must be registered. This is a professionalised sector that performs a very critical role. They make the decision to remove children from their families. It does not get much more serious than that outside of incarcerating someone. It is a specific role that requires expertise. The delegation that we are talking here—we do not really have specificity around what is going to be delegated to other professionals but the idea that the chief executive—not this Parliament but the chief executive—can make that decision simply by putting a notice on a website does not sound like a robust check and balance to me. It does not sound robust enough. We will be questioning that at the select committee.[Continuation line: NGARO]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingALFRED NGARO (National): I rise and take a call in this first reading of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill. I look forward to this coming to the Social Services Committee and the work we will do. I see this bill is quite critically important for the roles and responsibilities the Government has and in particular this morning at our select committee we had our Minister for Social Development present. One of the questions that was asked and was responded to by the officials was about the reviews that had taken place. In fact one of the officials said that since 2000 there had been 14 reviews and in each review there had been a layer of complexity and also too more sort of bureaucracy that had been added on to the department which made it inefficient in being able to fulfil its role. I think that is quite critically important to this piece of legislation. This piece of legislation is a direct response to some of those critical issues and I will talk about them in a moment. The bill has three main objectives. The first objective inside the bill is to extend the statutory age of care and protection to those under 18 which was previously those under 17. As the previous member Jacinda Ardern spoke about that is something that has been talked about by this Government. It is something we are actually enacting and initiating very clearly. One of the things I think is important is that I was present when we actually in the 50th Parliament had a presentation from the Dingwall Trust and a number of young people who were in care. They talked about the importance for them to have the age of entitlement and eligibility extended. A number of them talked about the challenges the difficulty they had in order to transition at the age of 17 to be able to get into some training or some employment. So for them this is critically important. I hope those young people will hear that this Government is now actually taking on that responsibility and is extending the age to 18. The other thing I want to say also to give comfort to others who may be listening is to say that although other people say 18 is maybe not enough and it could be higher up to 19 20 21—well it is clear there is a provision and it has always been there that if the chief executive deems that actually there are critical issues of concern and vulnerability then the chief executive can extend that. It can even currently be extended up to the age of 25. That provision is currently there. That has not changed. What has changed and will change under this bill is the extension of that age of statutory care to the age of 18. The second part that I think is really important inside the bill is around the voice of vulnerable children being included. In August 2015 we had a report from the Children’s Commissioner which was a pretty damning report if we want to be honest about it. Part of the statutory role of the Children’s Commissioner is to monitor the roles of responsibility for children young persons and their families. In the Children’s Commissioner’s report in August called State of Care 2015: What we learnt from Child Youth and Family Dr Russell Wills wrote a number of things. One of the things inside of the report that was critical was the lack of ability for the voice of children and young people to be in the decision-making of the department in all the decisions that actually reflect on the children themselves. That was quite clear. In fact what that said was this: give them a choice in decisions about their care and crucially allow those voices to be a part of the implementation which is quite critically important as well. I think that is quite critically important. The second provision in this is to ensure the voice of children is included inside of that and I think that is quite critically important. Also if one reads inside the expert panel report it says on average there are about 60000 children who are notified to Child Youth and Family. Four thousand nine hundred of those children are actually in State care. Out of that what has actually come out is that the Minister has in her wisdom ensured we have those key stakeholders involved with the expert panel. What I just want to read which goes to the second part of the objectives of the bill is what a young person wrote to the Minister in a particular letter as part of those key stakeholders and they said this: “Dear Hon Anne Tolley When you read the final report over Christmas I would most like you to think about the importance of advocacy for children in State care.” It goes on to talk about their own experience being one in which they did not have the role of advocacy inside of that. The second part of the bill ensures and provides vulnerable children and young people with the support to express their views to have them heard both at the individual and system level. The last part and the third part of the objectives of this bill is to ensure we enable a broader range of professionals who will also identify and meet the needs of vulnerable children. We know the previous speaker talked about the roles of the social worker. But also too what did come out of the Children’s Commissioner’s report is the fact that there was an issue around the capacity and capability of social workers and the roles they play as well. We are not criticising that. I think there are issues for us to be able to ensure the burden of responsibility is not just put on the role of the social worker. The third portion of this bill ensures that there may be a broader range of specialists who have an ability to be able to meet some of those needs. That could be in the area of for instance mental health areas of need that could be counselling and other forms of specialist support that could be offered as well and that is the third component of the objectives of this bill as well. I look forward to this bill coming to our select committee and to the submissions that will be made. This is again the initiative of the Government to ensure that as part of the overhaul we look at the system to ensure it does respond. It is fully inclusive of all the key stakeholders and I think that is critically important. I think what we have done in this bill and what the Minister has done is critically important. The last thing I want to say is around what comes from the expert panel in their consultation right across and it is that this part of the recommendations which have now been factored into the bill has factored all of those key stakeholders who are involved. None have been left behind—the voice of families the voice of children the voice of young people also too the professional perspectives that have come from the social workers and counsellors and those who are also policy makers. I think the approach the bill is taking is thorough and I think it is well considered. I look forward this coming to the committee. I commend this bill to the House.[Continuation line: SEPULONI]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingCARMEL SEPULONI (Labour—Kelston): There are four key changes in this bill. It is extending the age of care and protection to a young person’s 18th birthday ensuring the views of children and young people are taken into account as part of decision making at an individual level and in the development of services and policy supporting the establishment of an independent youth advocacy service and enabling a broader range of professionals with specialist skills who will widen the expertise within the new model to perform some functions under the Children Young Persons and Their Families Act. Social workers will still be the main professionals responsible for carrying out these functions. I want to speak to those four key changes individually. Firstly around raising the age of care—we on this side of the House and I know other political parties as well have fought long and hard for the age of care to be raised. So it is good that in this bill we will be considering that. Before we left the Government we had a bill on the Order Paper that would have seen the age of care increased. That was the Children Young Persons and Their Families Amendment Bill (No 6). That was unfortunately dumped by the Government. We are now at that point when we are reconsidering the age but there was a time some years back when the Government could have done the right thing. We have then tried to use bills before Parliament to raise the age. These too have been defeated. Last year we instigated a petition alongside the likes of Lifewise and the Dingwall Trust to raise the age so we are pleased the Government has finally acted on these calls. It just took a little bit of time. Currently the law sets out that a young person remains under the care of the chief executive only until they turn 17. This creates a significant gap in support services. Young people at this age are ineligible for a Housing New Zealand house for instance and accessing a benefit at this age is incredibly difficult. Our disappointment with this bill is that the bill only raises the age for care and protection purposes which will now mean we have a different age for care and protection than we have for youth justice. Youth justice provisions are set out in the Child Young Persons and Their Families Act. It makes sense to keep these ages linked especially given that offending at a young age is often an indication of wider care and protection issues. Of the 1982 offenders in the Youth Court last year Child Youth and Family had prior involvement in about 67 percent of all the cases. The UN has repeatedly raised our failure to meet our United Nations Convention on the Rights of the Child obligations because we try 17-year-olds in our adult justice system. This was an opportunity to remedy that. Unfortunately the Government has not taken that opportunity. The Youth Court is not a light touch. It has the ability to apply tough parameters around a young person or to escalate a case to the adult system if need be. It is often a much more confrontational environment for a young person who is placed at the centre of the process and directly held to account rather than being a bystander as often the case in the adult justice system. The Government is currently considering a lift in the jurisdiction of the Youth Court to include 18-year-olds; we would support this move. Just on considering the lift from 17 to 18—because there has been much discussion over whether it should be higher—my concern if it is left at 18 is that actually year 13 students are often in the middle of their year 13 year when they turn 18. So we still could have that dilemma where we have students who are in the middle of their compulsory schooling in year 13 who all of a sudden are not eligible for care. We have heard from those who have made submissions including the young people who came as part of the Dingwall Trust submission that that just creates so much trauma for them when here they are trying to complete their secondary schooling and all of a sudden they have to find their own accommodation and they are no longer eligible to be considered as part of the care. So we will need to have conversations about that at select committee. On to the advocacy service we support a change in legislation to embed the voice of young people in care into decision making. We support the independent operation of advocacy services but will explore at select committee what the responsibilities of the Ministry of Social Development and Child Youth and Family’s (CYF) will be in ensuring that the service is properly resourced. We are concerned that the advocacy and child voice role that the Children’s Commissioner has had has been weakened in recent years due to a lack of funding. The bill’s introductory note also states that the design of the independent advocacy service is being undertaken in partnership with the philanthropic sector and we want to ensure that this is a suitable and sustainable model. If we move to enabling a wider roll of professionals to have core roles in discharging functions under the Department of Child Youth and Family Services Act we have some concerns about this section of the bill and will explore them in greater detail in the select committee. This amendment will also create greater flexibility in the delegation to other professionals to play a role in identifying the needs of vulnerable children. We are concerned that this is a significant step and that Parliament will not retain oversight over how this delegation is managed. The bill sets out that the chief executive can essentially make the decision and the delegation can extend beyond those outside of State services and they will simply need to ensure that there are contractual arrangements in place and that each delegation is notified on an internet site. Going to the costs pressures within CYF Labour has concerns regarding the overall ability of CYF to currently operate even before these changes will be implemented. In 2016-17 CYF is forecasting a deficit of up to $38 million due to demand-driven costs. The new funding of $35 million allocated for CYF next year only barely covers its deficit which includes the discontinuation of funding from a previous year. The Minister has also not been funding CYF to increase the number of social workers as required to by the Government. In fact we know there is a shortage of social workers—there is a shortage of qualified and registered social workers. We see that with CYF but we also see that in the Social Workers in Schools (SWIS) programme where we have 183 decile 1 to 3 schools that should be—and are actually—eligible for Social Workers in Schools but cannot get them for a range of reasons. Mostly it is the underfunding of the SWIS programme but also the shortage of qualified and registered social workers. CYF had a deficit of $7.7 million in 2014-15 which is underwritten by the Ministry of Social Development and has an expected deficit for the current year 2015-16 of $11.2 million which includes approximately $18.8 million in cost pressures offset by $7.6 million of mostly one-off savings from within CYF budgets. CYF is currently forecasting a deficit in its budget for 2016-17 of between $28 million and $38 million. This is driven by the continuation of funding pressures from previous years cessation of one-off funding in 2015-16 and additional wage and other cost pressures in 2016-17. The range reflects uncertainty about the offsetting savings that might be achieved both within CYF budgets and the Ministry of Social Development. Overall the projected deficit of $38 million is driven by current demand pressure from client-related costs accumulated remuneration pressures unfunded past agreements to increase social worker resources continued costs of the implementation of changes to other pressures. This also currently excludes any estimate of future client-related demand increases or decreases which are still being considered. So there is a lot there for the Minister to consider. I will raise that the Minister brought up earlier and has actually brought up time and time again that she thinks that children need to be the focus of policy in relation to CYF. I just want to say to the Minister that actually children should be at the centre of all policy including within her jurisdiction Work and Income . We did raise today with the Minister that if she means that then in the rewrite of the Social Security Act she should be considering a change to the principles to ensure that we include in there a principle that says children should be at the centre of policy making. She said in the select committee that that will not be the case because not all social security legislation is about children but can I just say that there is a principle in the Social Security Act around work and not all social security is about work particularly when we take into consideration superannuation which makes up half the spend in Vote Social Development. I am hopeful that the Minister will actually take seriously her vow to ensure that children are put at the centre of policy.[Continuation line: DOOCEY]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingMATT DOOCEY (National—Waimakariri): It is an honour and pleasure to rise in support of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill. I think that last speaker said it all—9 years in Opposition and all they have got to say is: “Spend more money.” Spend more money—an Opposition that has got a litany of failed social policies. In 2008 those members’ last year in Government Salvation Army came out and said that with all their extra expenditure—they blew the budget—they did not even get social progress to increase by 1 percent. Nine years in the Opposition benches and all they can say is: “Spend more money.” That says it all. On this side of the House what we are looking to do is bring in reforms that will support vulnerable children and vulnerable young adults. We know with the feedback from the final report of the expert panel what it identified is that what we should be doing is ensuring all vulnerable children and young people that go through the care system come out with the opportunities that the average New Zealand child has. It is clear by the state of care that we are not providing that and it is amazing to think that we could be taking vulnerable children and young people into a care system and not knowing if we are harming them or doing them any better. What this bill is based on is a very vulnerable cohort of young children and young people. We know from the regulatory impact statement when you look at the statistics that roughly 1 percent of young people who spend more than 3 months in Child Youth and Family (CYF) at the age of 15 or 16—seven out of 10 of these will leave school with no qualifications. Eight in 10 will leave without National Certificate of Educational Achievement level 2 or equivalent; that is two times higher than the general population. Ninety percent will have been on a benefit before the age of 21; that is 2½ times higher than the general population. Four in 10 of the young women are on a benefit with a child by the age of 21; four times higher than the general female population. Six in 10 of the young men have a corrections sentence by the age of 21—5½ times higher than the general male population—and 21 percent have received a custodial sentence a rate shockingly 11½ times higher than the general male population. It is clear that over decades the care system has let young people down and that is why this reform is much needed. That is why this Government is taking a social investment approach. It is not only about social funding; it is social investment it is allocative efficiency—people on the street will know that—and it is how we spend money wisely how we get it to where it needs to go and how we get good bang for the buck. What we know is that for these vulnerable young children and young people who have been in care at the age of 15 and 16 future liability by the age of 35 will be around half a million dollars for the Government. So we know actually that if we look at that future liability and we invest upfront then we can support these young children and young people to not only go on and be aspirational but to expect what the average New Zealand Kiwi kid expects in life opportunities. That is what this bill is supporting. When we look at some of the outcomes of this bill I am very much looking forward to being part of the Social Services Committee ably led by the chair Alfred Ngaro. We are going to kick the bill around no doubt with a range of submissions and really think about whether it is going to be fit for purpose for protecting our young children and young adults. We will be raising the age up to the 18th birthday. At the moment it is just before the 17th birthday. I have some sympathy with Opposition members who are talking about it needing to be higher. I agree. The next stage of reform will look at that. You could easily imagine some transitional service up to 21 and even for complex young people up to 25. What adolescence and being young people is about is transition. It is about moving from being a young person into adulthood and we should be looking to support them so that they become productive members of New Zealand society. That is why I commend this bill to the House.[Continuation line: LOGIE]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingJAN LOGIE (Green): There are some bills that are more important than others in this House and this should be one of those bills. I just want to start by acknowledging that I am sure—and I assume that everyone in this House cares deeply for the children of this country and that we all want to end child abuse and in the meantime we want to ensure that the children who are in our shared care are safe and have every opportunity in life. The Green Party certainly believes that and wants that for our children. The Green Party supports albeit with caveats three provisions in this bill. But the fourth point and the Government’s strategy is of such concern to us at this point that we will be opposing this bill at this reading. We know that there are the numbers for it to go to the select committee and we look forward to engaging with the community on the bill but we believe it is important in our vote to reflect the concerns that have been raised with us. I hope that through the select committee process our concerns and the concerns of people in the community are abated to the point that we can support the bill. Let me start by outlining the things that we do support. We do support extending the provisions of statutory care and protection to young people aged 17 at the very least. We advocated for this along with other parties and many many people in the community when this House was considering the Vulnerable Children Bill about 3 years ago now. We heard during that process compelling and I have to be honest completely tear-jerking evidence from young people about their experiences of being aged out of care at 16 and becoming homeless and ending up in trouble with the police and having addiction problems that would never have happened if they had had support from the State until they no longer needed it. We listened to them then and wanted to make the change. It was so sad that the Government chose not to actually acknowledge their needs at that point. However 3 years on here is the Government with this provision and we will support it. The Green Party also supports calls to have this bill cover youth justice as well. Very often these are the same young people so it really is a nonsense to have 18 for care and protection and 17 for justice when often they are the same young people. Including care and protection and youth justice is important to ensure that our legislation is consistent with UN Convention on the Rights of the Child. It would be a really good move I think ahead of the UN committee examining New Zealand in September for us to get consistency on this minimal level. The Green Party also supports the establishment of an independent advocacy service with a particular focus on children. I understand that this idea came from a hui of young people advocates in the philanthropic sector some time ago. It is wonderful in this instance to see the Government actually picking up on the innovation that is happening in our community and putting some legislative support behind that innovation. We do have concerns as some others have expressed that although often the philanthropic funding can go into seeding and developing ideas it is often not the best model of funding for the long-term sustainability and assurance of something that is part of a legislative system. So we will be interrogating that aspect of it in the select committee process. This will be an advocacy service and it will be very important to enable us to hear the voices of young people and to look at ways that we as a society can include these young people more. However that advocacy service will not have a monitoring role to ensure the safety of young people and it is really important that we get that those things are distinct that that monitoring safety role still fits with the Office of the Commissioner for Children. I do want to register again our deep deep disappointment that the Government has failed to increase the funding for the Commissioner for Children to fulfil that monitoring role when he has clearly told the country and this Parliament that he is unable to fulfil that duty properly because of a lack of resource. Although there are significant changes as heralded by this Government coming into force over the next period that actually increases the risk for those young people. As change happens people can fall between the cracks. So actually that monitoring role is critical at this very point. The fact that that Government has chosen not to increase the funding to enable the commissioner that critical role actually sends a message that the Government’s priorities are wrong. Its priorities are not with ensuring the safety of our children as the first priority. That worries me deeply. We also support the embedding of the views of children and young people at an individual and system level. That was clearly an intent of the 1989 legislation. The paramountcy of the child was there in that Act and through cost pressures and political ministerial risk aversion we lost it in practice. It is good to see that now that will be built back into the system. I would like to flag here though as well that children exist in families. Actually we heard from members on the other side that they had listened to service providers and social workers and children; we have not heard once a mention of families. The expert advisory group was very clear about telling stories and every single member in this House will have heard harrowing stories from families who feel as if their children have been taken off them where they have not been given support where it was not in the best interests of their children. We hear this particularly from Māori and we see this reflected in terms of the statistics. Almost 60 percent of children in Child Youth and Family care and protection are Māori. That I think means that this system should be building in advocacy and support for the voice of parents. There are some amazing examples from overseas actually of that parental involvement coming in and advocacy sitting alongside the youth involvement changing the whole system and the reduction in the need for children to come into care as a result. The lesson out of that is actually that if you involve the parents the children are better off and we get sustained change. Sadly we have not got that yet. I do also want to raise some points now to get to our primary concern and what we cannot support in this bill—the single point of accountability being held with chief executive of the Ministry of Social Development and the delegated authorities. The reason to explain this is the single point of accountability takes accountability away from the social workers where it is held at the moment. There is some confusion and I do get that there are some tensions we need to work out in this but having the accountability sitting with the social worker means that it is based on their judgment of analysing all the different variables in every family situation and what we have seen over time with Child Youth and Family—and nobody I think denies this—is that political risk aversion has resulted in really negative impacts on the practice of the social workers within Child Youth and Family. So if we put the single point of accountability to the chief executive of the Ministry of Social Development who is directly responsible to the Minister there is an absolute danger that we are going to increase that result and have very perverse outcomes. When we delegate out into the community the responsibilities and have other people participating in the system rather than Child Youth and Family social workers that delegation and authority and accountability from the chief executive will apply to them. When the Minister talks about Māori being keen on this—if Māori are picking this up they will still be under the chief executive of the ministry’s delegation. That is not tino rangatiratanga; that is colonisation. That will not represent the needs of Māori in their community and their ability to actually practise in the way that they believe in. It will have them under the direction in effect of the Minister which is of deep concern to us.[Continuation line: BOND]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillFirst ReadingRIA BOND (NZ First): I am privileged this evening to rise on behalf of New Zealand First and my colleague Darroch Ball to speak to the first reading of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill. The bill’s objective as stated is “to help achieve a child-centred system by—extending State responsibility for the care and protection of vulnerable young persons; ensuring that vulnerable children and young persons are able to express their views and have them considered as part of decision making in individual cases and in the departmental services and policy; enabling enhanced access to appropriate specialist skills and expertise to respond to the needs of vulnerable children and young persons.” New Zealand First supports the idea of children’s voices being heard—absolutely—but what we are nervous about is how this is going to happen within a framework of philanthropic funding. We support the idea of including other professionals. However New Zealand First insists that professionals no matter who they are are given additional skills to deal with vulnerable children in care and protection. What New Zealand First is worried about is whether this bill is going to open the door to inviting outside—perhaps international—entities to come into New Zealand and provide contractual services to our vulnerable children and young persons. This we will not accept hence our position to send this bill to a robust select committee process so that those concerns can be alleviated or diminished such is the risk that this will open a door for the privatisation of our social services for our vulnerable children and young persons. Just this morning I sat before Minister Tolley in the Social Services Committee . I listened to the justifications and rationale that sit behind where this National Government has spent taxpayer money tackling the poor record of how the State has parented our most vulnerable children. The Minister says that we must have a cultural shift in our thinking throughout society if we are to ever get it right. When we look at which model will best service the needs of our most vulnerable children and young persons the Minister states that a suite of bills including this bill and many others to follow will let the voice of a child come first. To put children at the forefront to let the child tell us what they need is for adults and Governments past and beyond to understand what our vulnerable children need under State services. I am going to break this bill down into three main areas: age settings advocacy and workplace settings. Regarding age settings this bill proposes to extend the provisions of the statutory care and protection system to persons aged 17 to 25 years. Currently it is 17 and then you are out. I have actually seen how detrimental this is to children. Just recently I was privileged to attend the L’Oréal foster care programme workshop and what it did was it gave these children the opportunity to dare to believe—to actually believe—that they can bust out of the stigma that society and people have placed them under. What these children learnt over the course of the weekend was that they can stand up and that they can be given a certain strategy and support to help them achieve and to be the best that they can be in their future. I was really quite astounded by the concern from some of the children. Once their State service care ended at their age they were actually quite anxious about what and where they would go to next because still—still—in some cases their families were not appropriate to go back to and often these children are left to fend for themselves. So New Zealand First agrees that this extension of care to include the up to 25-year-olds is paramount to helping these individuals journey into society with a more successful platform that includes the security of knowing as they move from high school to tertiary education and then on to the workforce that they will receive the real and actual support services needed for them to belong and move within our society a society that does not take away the aspirations and dreams that every individual in this country deserves to have. It is a tragedy and a blight on this and previous Governments that at the age of 17 children with such complex needs were simply dumped out on the street. This lack of engagement and understanding right down to key care arrangements has been occurring for over years and it must stop. We are pleased to note the extension of care from 17 years to 25 years. With regard to advocacy the bill proposes to embed “the views of children and young persons at an individual and a systemic level by strengthening obligations in the Children Young Persons and Their Families Act 1989 (the CYPF Act) to support the participation of children and young persons:”. This bill supports “the establishment of independent advocacy services with a particular focus on children and young persons in care through a new duty imposed on the chief executive of the department administering the Act:”. The Minister explained today that a chief executive will be put in charge who will set up multi-professional advice services and that that individual chief executive will then choose those service providers. This will include social workers district health boards the police psychiatrists psychologists educators and many more who will get the chance to design this foolproof system that is meant to last a lifetime and where the voice of children will again be heard. So in other words after today’s select committee discussion it has been fleshed out that this Government may pour millions of tax dollars into all sorts of pilot programmes and hope like heck that by some miracle the various pilot programmes work and it will then roll them out nationally. This is based on blind faith if I may say so and if we think that is OK then that is wrong. How can the Minister effectively ensure that the change made is a change made for good for the betterment of children and young persons in this country? New Zealand First absolutely supports putting the voice of the child at the forefront of these decisions and for once we are grateful for Paula Rebstock for educating the National Government on this very basic premise which should have always been there. Finally with regard to work settings this bill aims to enable “a broader range of professionals to perform a wider set of functions under the CYPF Act to help identify and meet the needs of vulnerable children and young persons.” From reading the regulatory impact statement we have been provided with an analysis of options for new workforce settings that enables professionals to perform a broader set of functions within the new operating model. It also considers the related objectives of providing appropriate flexibility for the agency to deliver services via strategic partners and of supporting the chief executive of the children’s agency as the single point of accountability for vulnerable children and young people. If this Government truly believed in putting the voice of vulnerable children first then this Government would also recognise the potential of the Children’s Commissioner to play an absolutely vital role working inside the advocacy space. Yet despite the rhetoric and despite what we call the lip service this Government has dished out to Dr Russell Wills and his team of two and a half staff at the Office of the Children’s Commissioner this Government has failed miserably to adequately resource what should have been the jewel in the crown. It is noted that “The preferred option [by the Ministry of Social Development] is to amend the CYPF Act to vest the functions currently residing with social workers instead in the Chief Executive.” Here is where the legislation becomes unstuck: “that the Chief Executive would only be able to delegate functions to people who have the interpersonal skills training and experience to suitably qualify to perform those functions; that if delegating outside the State sector the Chief Executive be required by the legislation to have contractual requirements in place to support the appropriate exercise of the delegation and to enable the person with delegated authority to be held to account; that the legislation require those exercising delegated authority to have regard to any guidance issued by the Chief Executive; that the Chief Executive be required to maintain a publicly accessible register of delegations to assure transparency and clarity for the sector and for the public.”Sitting suspended from 6 p.m. to 7.30 p.m.RIA BOND: I was actually nearly to my conclusion before the dinner break so I would like to finish on a summary of the fact that New Zealand First supports this bill to the select committee where I know my colleague Darroch Ball will work very hard to ensure this bill is scrutinised in its whole entirety and brought back to the House to carry the voice of children as it is intended to do. New Zealand First will however review our position upon the findings of the select committee process. Thank you.[Continuation line: NAYLOR]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDJONO NAYLOR (National): I would like to start my contribution by quoting a piece of work on this topic done by a guy by the name of George Benson who said “I believe the children are the future teach them well and let them lead the way. Show them all the beauty they possess inside. Give them a sense of pride” etc. In all seriousness this piece of legislation is about children. It is fundamentally about them. Before I go any further I want to just ensure that the wonderful workforce that we have working on the frontlines of Child Youth and Family across New Zealand who are doing the best they can day in day out trying to do the best they can with the tools that they have got are recognised. Because when we change legislation it is very easy to poke the borax at individual people and the work that they are doing but we have got some good people out there who are working hard and I just want to acknowledge the work that they are doing. I also want to acknowledge Minister Anne Tolley who since taking on this portfolio has worked tirelessly looking at the outcomes that we are achieving through our care and protection legislation and recognising as has been outlined by a number of the speakers already that the statistics and the outcomes for our young people in care by and large are simply not acceptable. We are not helping them to achieve what they should be achieving and so we need to take a long hard look. Because of the 14-odd reviews that have been done since the Children Young Persons and Their Families Act was first passed in 1989 another review was not going to cut it. So the Minister has taken the bull by the horns has actually really gone to some great lengths to put in place something that will be lasting and hopefully something that will actually be enduring and ensure that we get good outcomes. Can I acknowledge two other groups of people as well the expert panel who have put together I think a really comprehensive report outlining some of the issues that we have in our current care and protection arrangements but also outlining some ways forward that we might be able to do better. Also the panel of young people who helped contribute to what has been going on. I think it has been incredibly brave of them to tell their own stories. Again as other speakers have said this evening sitting on the select committee and hearing from some of those young people from the Dingwall Trust was incredibly moving and I think just strengthened our resolve to make sure that we do better for young people who are at risk in New Zealand and those who require the care of the State. The original 1989 Act did have a clause in it that talked about the paramountcy of the child’s needs but it appears that somewhere along the line the importance of that has been somewhat lost. We were heralded throughout the world to be honest on our Act in 1989. The introduction of youth justice family group conferences had the global social work field really talking about this innovative new way that New Zealanders were working with children and families at risk. But we will need to make sure that we do not sit on our laurels and actually we have discovered now that that system is not necessarily delivering all that it could. So this legislation goes further than simply having a paramountcy principle within the Act but actually ensures that young people will have a voice not just in their own outcomes but will have a voice in the actual guiding principles legislation and policies that will oversee their lives and the type of interventions that will take place. We have also talked about the importance of shifting the age upwards. Again I just want to reiterate the importance of us lifting this age. To be a 17-year-old and suddenly being faced with having to renegotiate your own board arrangements or otherwise simply is not good enough. This is a step in the right direction. I think over time we will be able to explore how those transitions actually occur as well when children reach the age of 18 if they have been in care as to how they transition into adult life. It is what most of us as parents would do for our own children and I think it is beholden on the State to make sure that we do at least as good a job as regular parents would like to do for their own children. I am encouraged by the support that this bill is receiving from right around the House. I think we are going to have a really robust time in the select committee looking over the finer points of it. I hope that we will get some good support as we seek to bring this through but that we will actually get some good comment from submitters. There are a lot of people out there who have had interactions with Child Youth and Family over the years who perhaps have not had an ideal experience who will be able to offer us some further insights into how we can improve. As I said at the beginning of this contribution children are our future. Children do need our support and we need to continue to do everything that we can as the legislators of this country as those people who provide the rules and the regulations about how we intervene when things are not going well for children to do the very best that we can. I see this bill as a very positive step forward for those children and for our country. Thank you.Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDMr DEPUTY SPEAKER: Marama Davidson—5-minute call.[Continuation line: DAVIDSON]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDMARAMA DAVIDSON (Green): Tēnā koutou e Te Whare. Thank you Mr Speaker. I rise to take a call on this bill the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill 2016. My colleague Jan Logie previously mentioned that we are not supporting this bill at this stage the first reading. She highlighted some reasons. In my contribution to the House I want to focus specifically in my role as Māori affairs spokesperson and mention that Māori children make up 25 percent of our population but are 60 percent of the children in Child Youth and Family care. That reason alone surely should have mandated and demanded robust involvement consultation and consideration of Māori voices Māori experiences and Māori expertise at all levels of this review and from the get go it did not. It was only until some political pressure was placed on the Minister that some involvement of a Māori perspective was included in this review. That cannot be acceptable. That cannot be acceptable in the way that we run and govern a country. It cannot be acceptable when we are trying to overhaul a system and a department that is responsible for dealing with so many of our Māori children. The other reason why that low level of involvement and engagement in proper partnership with Māori expertise is because this very overhaul is so relevant to the care of whakapapa of Māori whānau hapū and iwi. So we have two things here we have a department that is fully involved influences and holds power over a large proportion of Māori children and we have a piece of legislation that holds incredible influence over whakapapa over Māori well-being whānau hapū and iwi. So I do want to remind this House that over colonisation over generations we know that one of the biggest impacts on and fallouts of the harm to well-being for Māori families has been the disruption in whakapapa and the disruption of well-being in whakapapa. So here we have a piece of legislation that is fully fully involved in that. I also want to say in this first reading I want to make a general point that this is a bill that deals with the fallout. We need a review of the whole-of-Government systems that actually looks at the structures that contribute to all of our people falling into hardship falling into poverty and having it tough in the first place. To be clear for example Māori unemployment saw the biggest increase across all of the groups in unemployment. It rose by 2.2 percent recently and is now up to 12.8 percent. I want to be clear that we have to keep in mind through all of this review any legislation that has a huge impact on Māori families. We cannot do that in isolation. We have to be mindful of all the other systems and all the other social economic justice and cultural problems that need looking at as we are reviewing our legislation. That is called responsible and sustainable governance. Just in closing I want to again indicate that I cannot support such a low level of Māori expertise in this review of the Act. I want to see how we can improve this but this legislation is only dealing with the outfalls and we need to look at the structures. Thank you.[Continuation line: WILLIAMS]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDPOTO WILLIAMS (Labour—Christchurch East): Kia orana and thank you. I want to in my short contribution come from the perspective of having been a member of a community panel called the Community Child Protection Review Panel which is a panel that is put together from community members who have some expertise in the sector who look at the notifications that come to Child Youth and Family where the duty social worker has closed off the case. It is the community’s response to ensure that no child gets left behind or that there are no issues that have not been addressed by the social worker in the passage of that notification through the Child Youth and Family site. So in that regard I want to refer to a public statement that the Minister for Social Development made on 1 June with regard to this particular bill because I think that statement and the subsequent notes that I have read have caused me to ask more questions than I have answers to. I think this is the appropriate forum as this bill goes to the select committee to put on record those questions that I think need to be addressed. Firstly I want to say that the Minister makes the statement that it will be a new child-centred operating model with a single point of accountability that will be place by the end of March 2017 focused on prevention intensive intervention care support services transition support and preventing youth offending and reoffending. The single point of accountability is the first point I want to ask a question about because does that not currently occur when a child who is notified to Child Youth and Family for example has a social worker—a social worker who is no doubt part of a team but a single person who is charged with the care and protection issues of that particular child. How is this issue of a single point of accountability different from current practice and what resources what model is going to be in place? The other issue that I am concerned about is the fact that in the Minister’s statement she talks about prevention and care support services in the same sentence that she talks about preventing youth offending and reoffending. We all know that the current model of Child Youth and Family is under review and that we have care and protection services and we have youth offending services. Some of the discussion tonight has been about the age of eligibility being raised to 18 for care and protection being out of line with youth offending. It might be a little bit of a stretch but one of the questions that I want to ask is: why is youth offending and reoffending included in the same sentence as care support services and does this mean that we are looking at a model of service that covers both streams of work? That would seem to be out of line with what is best practice and it is a question I would like the select committee to examine. The role of the Community Child Protection Review Panel which is a community panel set up of local experts is one that I am hoping that in the overall review of Child Youth and Family they keep because its specific role is to ensure that outside experts are brought in to scrutinise the notifications that come through to Child Youth and Family. I say that because the Minister says in her statement that one of the four main aspects of this particular piece of legislation one of the key aspects is that a broader range of professionals with specialist skills will widen the expertise within the new model to perform some functions under the Act that social workers will still be the main professionals responsible but that this is actually looking at bringing other people in. I say again: how is that different to what is currently in place and what of the model that is currently in place will remain? I am really hopeful and I would want the select committee to examine that community involvement through these Community Child Protection Review Panels which were set up out of an environment where there were children being harmed and also losing their lives while in the care of Child Youth and Family remains. There are aspects of this bill that we are really encouraged to see including increasing the age of care to 18. As Jacinda Ardern said in her earlier contribution she has been lobbying for that for a long time. I just want to echo what other members have said about the contribution from the Dingwall Trust: it would be great if we could extend that to 25 in certain cases where it is warranted. Thank you for the call.[Continuation line: PARMAR]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDDr PARMJEET PARMAR (National): Thank you for the opportunity to take this call on the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill in its first reading. I am taking a short call to support this bill. This is a huge step in the positive direction to improve the lives of children and young people who come into State care. It is not acceptable for it to continue the way it is because the outcomes that we are getting for children and young people who come into State care are terrible. We are bringing these children into State care from their families because their families are unable to look after them but there are some statistics that made my heart sink. The first is that the average age of children who come into contact with Child Youth and Family is 7 to 8 years and by this age some of these children have already gone through a number of placements. I believe that children of that age should just be thinking about studying or playing not thinking about the next family they will be placed into. There is no certainty for them there is no stability for them and there is no family to bond with. The second statistic is that 64 percent of 61000 notifications to Child Youth and Family are repeat notifications. So we are not able to get the results that we want for these children and that is why they keep coming back to Child Youth and Family. There was a study done on children born in the 12 months to 1991 and this study was done when they were 21 years old. This study found that 90 percent of these people were on a benefit—we are talking about children who were put into placement care—and out of this 25 percent of them were on a benefit with a child. The same study found that almost 80 percent of them did not have a National Certificate of Educational Achievement level 2 qualification 30 percent of them had a youth justice referral by the age of 18 and 40 percent of them had gone through a community sentence. We are taking these children from their families and into State care and what we end up doing for them is putting them on a benefit getting a low education outcome for them and referring them to the youth justice or the corrections system. So I am really happy to see that the Minister is taking charge of this situation. This bill is to reform the current system so that we can have that long-term view and the kind of support that we need for getting the desired outcomes for children who come into State care. There is no quick fix but we cannot continue the way we are doing it at the moment because we cannot get better results by just continuing the way we are. I am looking forward to working on this bill in the select committee process. I support and commend this bill.[Continuation line: WALL]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDLOUISA WALL (Labour—Manurewa): Kia ora e Te Māngai o Te Whare. Thank you very much for the opportunity to contribute in this the first reading of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill 2016. I am not a member of the Social Services Committee but I am Labour’s youth affairs spokesperson so I take particular interest in this piece of legislation. I immediately want to focus on one of the main features of the bill which is about extending the age of State care and protection to a young person’s 18th birthday. There are some questions that I have already. It seems that in increasing the age to 18 there has been a lot of discussion about what that age should be. Some people think it should be 21; some people think it should be 25. I found a piece of research that is associated with ActionStation and its petition that is currently wanting to increase the age of foster care to 21 years. It is interesting to note that one of the key findings was actually “Why 21?” because actually when we look at young people today on average they stay at home until they are 23. Young people today actually need the continued support of their parents and so it is one of the rationale from ActionStation and its campaign partners—and I want to list them all: it is the Dingwall Trust Lifewise Youthline Child Poverty Action Group and the Wesley Community Action the Christchurch Methodist Mission—for why they are currently engaging in a public process to say that the age should be 21. So I do want to say to the Government that moving the age up to their 18th birthday is a step in the right direction which I guess technically is when a person stops being a child and becomes an adult. So I can kind of understand some of the rationale for that particular age but actually when we look at the specific cohort of young people I think that we should already seriously start looking at that age. From the perspective of a lot of organisations involved in the care and protection of our children they think that that age should be 21. One of the other questions I have in relation to that first point is: why is it only children in care and protection? Why does that particular statutory responsibility on the State not extend to young people in the youth justice sector? It has been really baffling to try to determine why the Government has chosen to do this. The bill states that its purpose is: “reforming the system of services for responding to the needs of vulnerable children and young persons.”. So what do you do when you get a purpose like that—do you actually look at definitions? Well I do. The definition of “vulnerable” is “People who are in need of special care support or protection because of risk of abuse and neglect.” So you kind of start working through a process about why the Government would have excluded young people in our youth justice system when they are going to be providing for young people in our care and protection system. Then you actually look at the Final Report of the Moderising Child Youth and Family Expert Panel. Its vision for New Zealand children is: “that New Zealand values the well-being of our children above all else.” When it states the role of the State in caring for children it says: “The purpose of the care protection and youth justice system is to ensure children and young people are in loving families and communities where they can (a) be safe (b) become strong and (c) flourish.” When you look at the principles that drove the Government’s expert panel they said that: “The place of the child or young person has to be at the centre of everything that we do.” This piece of legislative reform is supposed to meet the needs of the most vulnerable young people who are in our Child Youth and Family Services (CYFS) system. They are either in our care and protection system or they are encapsulated within our youth justice system. So it is interesting or baffling as to why children in the youth justice sector are not included—and explicitly—in this piece of legislation. One can only assume that there is some political issue about including young people in the youth justice system that possibly means that the Government is going to be soft on crime. Who knows? But we are hoping that some of that motivation for excluding young people actually comes to the fore and that we can actually understand what this Government is trying to do. On the face of it it is contradicting recommendations from its expert panel. For somebody who is incredibly interested in this piece of legislation I will be trying to determine like the rest of the country why that is the case. The other two points that I want to make are around the Government’s rationale for the bill being: “to ensure that the views of children and young people are taken into account as part of decision making at an individual level and in the development of services and polices.”. What I want to note is that actually in the Children Young Persons and Their Families Act 1989 section 21 it states that it must: “give effect to the wishes of the child’s or young person’s family whānau”. Already engrained in the current Act is a commitment to listening to children and ensuring that the voices of the whānau are incorporated in any care planning so I find it again interesting that we have chosen to ensure that the views of children and young people are taken into account because they already should have been. The fact they have not been beggars the question about how the new processes and the new systems are going to ensure that not only the young person’s voice is going to be heard and be paramount but also the communities’ voices. Those communities are actually the communities of interest associated with the child who is in care and protection and I contend in youth justice facilities. Specifically any formation of advocacy groups or any input has to at the core of it ensure that Māori voices are front and centre because the appalling statistic that we all have to face is that 57 percent of the 3844 children in care are tangata whenua. That is not a random phenomenon—it has happened because over consecutive years the system has failed to meet the needs of Māori. The intergenerational transmission of children in care is actually something that we should all be—what is the word?—committed to addressing. The only way we can address it is if we have Māori around the table—and many Māori not one Māori. In fact if we look at the beginning of this process there were no Māori and so I question the integrity of this whole process given Māori have not had many more seats around the table when trying to look at the system that has continued to create and generate a situation where Māori children have been encapsulated in our CYFS youth justice and care and protection system. I cannot not mention the wonderful Judge Mick Brown in my contribution. It was Judge Mick Brown through his work as the first Principal Youth Court Judge who actually brought in family group conferences. He ensured that whānau were intimately involved in trying to deal with youth offending. As a second principle they did make a concerted effort to not charge our youth offenders unless there was a public interest required. I think if you look at the legacy of Judge Mick Brown what he tried to introduce was actually about recidivism—to nip it at the bud—so that we could actually assist those whānau to assist the young people and ensure that they got all the services that they required to address the actual context of some of the behaviour from our young people. I think that is where we have failed actually. We have failed to give our young people and our families the support that they need to provide them with different opportunities in life different pathways different visions different I guess life outcomes. So when we look at this piece of legislation I will be scrutinising how involved Māori will be in this process how involved our young people will be because if we end up again like last night creating a prescriptive system that is going to tell our young people and families what to do then we already know that that will fail. I hope that on this side of the House we will think of some amendments to this particular piece of legislation that will make it work for all of our young people. Kia ora.[Continuation line: PUGH]Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment BillContinued Speech - RIA BONDMAUREEN PUGH (National): What a pleasure to stand and speak in support of the Children Young Persons and Their Families (Advocacy Workforce and Age Settings) Amendment Bill 2016. What a great privilege it is to be a member of the National Party and to be here to witness this historic and radical change to the way we respond to the needs of our most vulnerable young people and their families. This bill will amend the Children Young Persons and Their Families Act 1989 and enables the first step in the overhaul of the current system. The main objective of this bill is to make the system child-centred. It ensures that young people’s views are taken into account when decisions are being made about their care. No longer will State care be done to them it will be done with them. This Government is absolutely committed to the new operating study. We understand and accept the findings of the expert panel’s report that was appointed to lead this overhaul of the care and protection system and we welcome the reforms ahead of us. I have great pleasure in commending this bill to the House. Thank you sir.[Continuation line: VOTE]Local Government Act 2002 Amendment Bill (No 2)First ReadingHon Peseta SAM LOTU-IIGA (Minister of Local Government): I move That the Local Government Act 2002 Amendment Bill (No 2) be now read a first time. At the appropriate time I intend to move that the bill be considered by the Local Government and Environment Committee with instruction that the committee report to the House on or before 28 October 2016. This timing will allow councils to make submissions on the bill before the break for local body elections. The intention is to pass legislation in time for the newly elected councils and the Local Government Commission to use these improvements early in the new council term. Local government touches everyone’s lives. Councils help to build our roads supply our water and collect our rubbish. They manage our libraries our community halls and our swimming pools. They make decisions that affect the lives of all New Zealanders in their local communities every day. Councils provide essential infrastructure and services to support regional growth jobs and community development. They have a challenging task and their world is changing. The cost of providing local services and managing council infrastructure are rising faster than council revenues. Councils need new ways to manage finances improve efficiencies and create better value for ratepayers. There are currently 78 councils and 66 ward authorities across New Zealand. Some regions in New Zealand are facing rapid growth while others have to deal with declining populations. As a result some councils are struggling to provide services to their communities at optimal levels. This is because individually their rating base is small and they are unable to attract the necessary levels of expertise within their ranks. The current legislation focuses on amalgamation to gain scale for shared services. Communities in Northland Hawke’s Bay and Wellington have told us that they do not want full scale amalgamation. But this bill provides a middle ground. Communities will retain their elected councils; the councils in turn will be able to work more collaboratively to manage infrastructure and services across our regions. This will deliver more joined-up cost effective services and better value for our ratepayers. I have engaged with councils iwi and local government sector groups around the country over recent weeks and have received their feedback on the better local services reform package. This bill as tabled takes on this feedback and implements this package. First this bill will allow two or more councils across a region to create more effective council-controlled organisations (CCOs). CCOs are a proven way to deliver cost effective services and infrastructure to communities. The current legislation restricts the kinds of CCOs that can be created. Through multiply-owned CCOs councils across regions will be better able to achieve cost saving and improved service delivery of water transport and other council services. Multiply-owned CCOs can have the size and scale to enable them to have much greater capability and capacity than can be achieved by individual councils. For example this bill will allow a water CCO owned by multiple councils in the Waikato area. I know that councils are already exploring options for shared series to run a Waikato water network and I know Mr Macindoe will be happy about that too. A multiply-owned CCO could own the infrastructure do the planning and manage the network for its shareholding councils. This bill will also remove some of the barriers to possible transport CCOs. Two models for regional transport multiply-owned CCOs will be specifically provided for in the legislation and if councils prefer there is a provision to create a bespoke model which will require the approval of the Minister of Transport and I know in the Canterbury region that will be welcomed. The bill also enables region-wide planning with joint council committees able to prepare combined plans under the Resource Management Act. This would make life easier for communities and developers as they would have only one set of planning rules to deal with across a region. The bill also introduces much stronger accountability arrangements for CCOs. Councils can appoint a joint committee to oversee the management of their CCO interests. CCO planning and delivery documents will be closely aligned with council plans to ensure that ratepayers get the services and the sustainable infrastructure that they need. Secondly the Local Government Commission will be empowered to work with councils and communities to deliver local solutions. This bill will expand the processes available to the Local Government Commission. Current processes mean the commission is limited to reacting to reorganisation applications that it receives. The bill will enable the commission to be much more proactive in setting its work programme. Ratepayersand residents will see a commission that is much more responsive to local circumstances working with local communities and councils as well as with iwi to find local solutions. To balance these enhanced powers the bill will also place greater transparency and accountability arrangements on the commission. Any reorganisations will need to protect the integrity of any council—iwi arrangements. The commission and councils will need to consult with their local communities as well as with iwi on any proposed reorganisation. The commission will be required to provide annual statements of intent and agree the commission’s work programme with the Minister of Local Government at that time. The commission will also be subject to the Official Information Act upon the completion of its investigations dispute resolutions and determinations of appeals. They will also be subject to the Ombudsmen Act. It is expected that the commission will have an increased workload as it works with communities on shared arrangements. For this reason I am proposing the number of permanent commissioners be increased from three to a maximum of five. This bill will make a number of changes to the Local Government Act. It will enable council-led reorganisations for the first time. Councils will be able to develop and implement reorganisation proposals in consultation with their communities and their neighbouring councils. The Local Government Commission will have enhanced powers to work with councils and Government to support reorganisation proposals. But most importantly these changes will enable more effective delivery of quality local services that will support regional growth jobs and local communities. I urge members to support this bill and I commend this bill to the House.Mr DEPUTY SPEAKER: The Minister indicated that he intended to nominate a committee but he has not done that so he should.Hon Peseta SAM LOTU-IIGA: I move that the bill be considered by the Local Government and Environment Committee with an instruction that the committee report to the House—Hon Michael Woodhouse: He doesn’t have to do that.Hon Peseta SAM LOTU-IIGA: I can do that at the end of the bill.Local Government Act 2002 Amendment Bill (No 2)First ReadingMr DEPUTY SPEAKER: Thank you.[Continuation line: WHAITIRI]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAMEKA WHAITIRI (Labour—Ikaroa-Rāwhiti): Tēnā koe Mr Deputy Speaker. Otirā e ngā mema o Te Whare nei tēnā tātou katoa. Labour has serious reservations about this bill which I will outline in my contribution this evening. But it is important that those reservations and concerns be tested in a very public manner. So it is for that reason and that reason alone that Labour will support this bill to the select committee. Our support however is not guaranteed beyond that point. Tonight we will look at the package of amendments that the Minister mentioned. In my contribution I would like to go through the six main amendments methodically and then raise the concerns or reservations that I mentioned in my opening statement. Amendment No. 1 talks about increased powers for the Local Government Commission to unilaterally initiate an investigation into any aspect of local government reform such as the establishment of multiple-owned council-controlled organisations—commonly known as CCOs—joint governance arrangements transfer of powers boundary changes and amalgamations. The point labours on around the unelected Local Government Commission and the ability to unilaterally initiate investigations. That is a concern for Labour. It is also important to draw the House’s attention to the Government’s track record when it comes to local government reform. The last time the Government tried this in 2012 the reforms led to failed amalgamation proposals in Wellington Northland and my very own Hawke’s Bay and the current situation with Auckland Council and the North Rodney and Waiheke proposals where those two particular communities want to opt out of the super-city. The Minister of Local Government has not even provided the Local Government Commission with a letter of expectation or the public with any assurances around how these increased powers will help councils or improve local democracy. A Government committed to improving the performance and administration of its agencies should be setting out expectations. This can include outlining broader Government policy frameworks strategic direction managing risk and ensuring that the commission acts in accordance with best practice. Amendment No. 2—the introduction of council-led reorganisations with the objective of securing the support of all affected local authorities and communities and endorsement by the commission. No problem with council-led organisations. In fact this bill should be all about council-led reorganisation. No problem with support of all affected local authorities and communities. The endorsement by the commission though begs the question: why? Amendment No. 3—greater use of CCOs particularly for water and transport services. That raises three issues for me—one is about accountability. I acknowledge the Minister’s contribution about improving the accountabilities of the Local Government Commission but accountabilities in relation to the role and expectations of CCOs. We have had examples of what happens when CCOs go unchecked. I have got a very local example of that called the Hawke’s Bay Regional Investment Company over the Ruataniwha Dam debacle. When you look at the case of the Hawke’s Bay Regional Investment Company a CCO that has been allowed to push back the deadline for financial close on the Ruataniwha Dam not once not twice not three times but seven times and it has operated in a secretive manner and with an air of contempt for Hawke’s Bay ratepayers the perils of vesting too much authority in a CCO are plain to see. Amendment No. 3—the greater use of CCOs for water and transport services also raises the issue for me around the ownership of assets. Who will own these assets? Will they stay in public ownership or will they be privatised? We hope we can get clarity from the Minister through the select committee process. The third issue I have around CCOs is the elected officials on the board. The Minister in his briefing to us mentioned that no elected officials will sit on the CCO boards and gave as one of the reasons managing conflicts of interest. But these will be major major CCOs. If I just draw the House’s attention to this year’s Auditor-General’s report on the Governance and accountability of council-controlled organisations it is mentioned in this report that councils need to be clear about the purposes of CCOs. They need to appoint the right people to govern CCOs and they need to meet the requirements of monitoring the accountability. There is a clause in the bill that talks around having no elected bodies on the CCO board. That is making a decision on behalf of elected councils. Amendments Nos 4 5 and 6 all refer to the removal of the ability of local ratepayers to petition their local authorities for a poll on any amalgamation or reorganisation changes. It also mentions the removal of the poll of electors for any council-led proposals on reorganisation and where all affected local authorities agree. It also mentions in one of its main amendments restricting the mandatory holding of a poll of electors to Local Government Commission - led amalgamations and where a major transfer of water transport and/or Resource Management Act functions from one local authority to another is proposed. It is important that the Minister assures ratepayers that this bill does not remove the requirement for a public poll on council-led amalgamations. We look forward to this bill coming to the select committee to be examined. It is important that I highlight the risk to ratepayers that we ensure that they are not left carrying the can for changes without them having a say. We also want to make sure that crucial utilities remain in public ownership. The better local services packages must not be used by the Government to force amalgamation and privatise council assets. We have concerns about the additional powers as I have mentioned conferred on the Local Government Commission an unelected body and how this will benefit local democracy. Enhancing the powers and scope of the unelected Local Government Commission (LGC) is also risky and at odds with the stated aims of promoting council-led reorganisations. It is unclear where the justification is for the Local Government Act 2002 Amendment Bill (No 2) or how it will lead to any real community benefits. I have attempted like I said in my introduction to identify the reservations I have with this bill and the concerns I have. I stand by the fact that we will test those concerns and reservations through a public process. On behalf of the Labour Party we support it to the select committee. We encourage people to have their say so we can help either shape this bill to what I think the Minister is trying to do and to allay any fears ratepayers may have with it. Thank you very much.[Continuation line: SIMPSON]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGASCOTT SIMPSON (National—Coromandel): I am rising to take a brief call on this Local Government Act 2002 Amendment Bill (No 2) in the name of my friend and colleague Hon Peseta Sam Lotu-Iiga. I am delighted to hear that the Labour Party will at least support this bill on first reading to select committee. As chair of the Local Government and Environment Committee I want to assure that member who has just resumed her seat that the committee will give this bill very thorough and due consideration as we do with every piece of legislation that comes before the committee. This is on the face of it a very good piece of legislation. I want to just spend a minute or two explaining a little bit about why it will have an impact once it is passed in an electorate like mine of the Coromandel. In the Coromandel I represent about 60000 people in the electorate—as do most constituency MPs about that sort of number. We have in the Coromandel—I have to deal with five district councils and two regional councils for 60000 people. That is an awful lot of local government for a relatively small percentage of New Zealand’s 4.5 million people. So across the country we have 78 councils—district and regional—and 66 water authorities. That is by any measure surely not the most efficient allocation or distribution of intelligent resource at a local government level. This bill is all about trying to create an environment where local government the Local Government Commission local communities and local interests can ensure better supply of service to ratepayers in a way that gives real meaningful value to those ratepayers and also to the councils that operate at a local government level. There are three main objectives of this bill. Firstly this bill will give more options for councils to create jointly-owned council-controlled organisations. The council-controlled organisations that we know of today were essentially established for the Auckland super-city and that was what we know as a forced amalgamation. There is nothing in this bill that in any way will provide for further forced amalgamations. That is not a model that this Government wants to pursue. It may be something that the Labour Opposition and its memorandum of understanding partners do want to pursue but it is not something that this Government wants to pursue. The second objective of this bill is to give the Local Government Commission greater powers to support councils when they are in fact creating those council-controlled organisations and when councils want to look at options for reorganisation across regions such as mine in the Coromandel. The third and important objective of this legislation is that the bill will ensure that there is greater and more statutory oversight for the guidance of the Local Government Commission. I was delighted to hear the Minister make the point that he is intending to increase the membership of the commission to a maximum of five members. I think that is a very good move and something that will be welcomed not only by the hard-working current members of the commission but also by anyone who has dealings with them. This is a bill that is about lifting local government performance for all New Zealanders and ensuring that ratepayers get good value for their hard-earned ratepayer dollars. I know that there will be many councils many individuals and many stakeholder organisations that want to make submissions to the Local Government and Environment Committee and I want to assure all of those organisations and individuals that they will get a good hearing from the committee. We are interested in hearing what their thoughts view and opinions are. I know that as we work through the select committee process this bill will come out of the legislative process that is the way we do things in this Parliament as a good bill one that is suitable and fit for purpose. I thoroughly commend it to the House.[Continuation line: PARKER]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAHon DAVID PARKER (Labour): It is my pleasure to take a call in the first reading of the Local Government Act 2002 Amendment Bill (No 2). For me one of the most significant parts of this legislation relates to the possibility of using council-controlled organisations (CCO) for shared services across different district or regional councils. I am personally glad that we seem to be passing the point where we are going to force amalgamations of councils down the throats of populations that do not want them. I have always thought that local government should be local and the more local it can be the better. Indeed if I think back to some of the local government reorganisations that we have had over recent decades down the in the region that I come from originally which is Otago I am not sure that we have actually got the balance right by going for ever-larger geographic conglomerations of formerly small councils into one bigger council. Councils used to be organised effectively relative to geographic barriers—hill ranges—and they were small enough so that the job of running a council was normally taken on by the most capable people or some of the most capable people from within those societies who were willing to pay back their debts to the community by doing some civic service effectively working part-time for close to free as mayors or councillors. Once those jobs became larger because those councils were forced to amalgamate into larger bodies I think in some ways we actually ended up with a subset of people who were willing to put in that longer period of time because some of those who were willing to do something part-time for civil service were not willing to take on the bigger job that just about turned into a medium-paid full-time job but not a particularly well-paid full-time job relative to the skillsets that those people had to bring to bear. So I am quite pleased that we might as a country be ending this phase where bring to an end the amalgamation of councils in large geographic areas. I think it is a different case when it comes to amalgamation of councils within a conurbation a large metropolitan area. I can see why it was wise to bring together the councils of Auckland which the prior Labour Government started a royal commission on and the current Government finished off. In respect of rural areas I do not think we need to have more amalgamations. Having said that there are also efficiencies that can sometimes be attained if there is the sharing of services between more than one council. That is already starting to happen in some areas. In some areas of the North Island we are already starting to see the sharing of some services be those waste disposal services or waste collection services sometimes other services in the future I think like water reticulation maybe sewage treatment will maybe have more cooperation between councils. So if in order to facilitate that we need some changes to the Local Government Act—in order to have councils cooperating across boundaries—I think that is a good thing. So I am interested to support this to select committee and hear submissions from councils to that effect. I would say that we need to be careful we do not force councils to use CCOs because one of the disadvantages of CCOs is that there is less political accountability for their decisions. Given that through local democracy we are voting for councillors to on behalf of their voting population and their ratepayers exercise democratic power for the benefit of those areas I do not think we should be so paternalistic to tell those councils that they must use CCOs because on occasions they might want to have services delivered by the council themselves rather than a corporate that is running a purely commercial model which the council may not as directly control because there is a board of directors who sit between the council-controlled organisation and the council. I can see why if things are not going well sometimes councils will want to say “I’m sick of this. I want to take control of this as the local elected politician.” and in those situations if that is what the mayor and councillors decide—that it would be better if it actually for a while came back within the council organisation rather than being in a council-controlled corporate organisation a little bit further out of the council—I think councils should be able to do that too. I will be interested to check in the Local Government and Environment Committee that with this legislation we are not imposing through a codified approach the obligation or the ability of a Minister by regulation to impose council-controlled organisations. Of course that is what the current Government did in regard to the Auckland Council. It did legislate that some services had to be delivered through CCOs rather than that they just could be. I think that was a step too far. For me that is the most important issue that is raised by this bill. I look forward to hearing submissions from the many stakeholders be they councils be they infrastructure providers be they ratepayers be they environmental groups or be they business groups. I think they will all have valid perspectives that will aid the select committee in its deliberations. I do not think I have much to add to that. I look forward to the progression of this through the House.[Continuation line: KORAKO]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGANUK KORAKO (National): Ā mauri ora e Te Mana Whakawā. It gives me pleasure to stand in support of the Local Government Act 2002 Amendment Bill (No 2). Just briefly just to cover off again which was done quite admirably by our chair of the Local Government and Environment Committee this particular bill gives a lot more options for councils to create a better delivery of core services. It also gives the Local Government Commission more support around councils and it gives the Local Government Commission more oversight and statutory guidance. One thing that I thought was interesting particularly from the honourable Minister who introduced the bill Sam Lotu-Iiga is that there has been quite a lot of consultation already around this new legislation and particularly with local authorities across New Zealand; iwi which to me is really important; Local Government New Zealand; the New Zealand Society of Local Government Managers; the New Zealand Council for Infrastructure Development; chambers of commerce; and also Business New Zealand. This particular piece of legislation is another very very sort of typical piece of legislation that has been introduced by this Government. It is very much common sense it is down to earth it is logical it is practical and it is realistic. I commend this bill to the House. Kia ora.[Continuation line: LOGIE]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAJAN LOGIE (Green): After such a comprehensive contribution from the Government member Nuk Korako I am not sure how to follow that act; I will do my best to try to live up to it. I am pleased to be able to take a call on the Local Government Act 2002 Amendment Bill (No 2) which has been presented to this House. The Green Party at this stage shares actually a lot of the reservations that were raised by the Labour spokesperson on local government. But those reservations or concerns have led us not to be able to support the bill at this stage. I do recognise the Minister of Local Government is presenting this as empowering legislation to address the funding constraints ultimately that are limiting we hear from councils their ability sometimes to provide core infrastructure and maintain it and actually ensure their systems are resilient. In the discussions though with the Minister and in the reading of the documents we are yet to be convinced that the solution is not a funding-based situation rather than an amalgamation-focused solution. There is no doubting that councils are in a very difficult position at the moment in terms of the limitations on their funding base and their ability to be able to secure the infrastructure into the future. We are concerned that although we are being told this is empowering legislation and it is not about forcing amalgamations the context of this is that this is the first piece of legislation after the failure of three amalgamation attempts. We have increasingly been hearing some quite strident comments from this Government in relation to local government. There has been I would almost go so far as to suggest threats being made to Auckland Council that if it does not free up more land then the Government may step in which you know I think is clearly the Government trying to distract from its own failure and that actually the housing issues in Auckland are not a result of Auckland Council but can be clearly sheeted home to this Government. But actually that kind of rhetoric of coming in and suggesting that central government will take over—I have heard the same comments being made approaching Wellington City Council in terms of the Wellington community’s resistance to the flyover. So we are in a context in which this Government is not giving local government the respect the Green Party believes it deserves. For us appropriate decision-making which is decision making that is made at the level closest to the people affected by the decisions is one of our charter principles. It is one of the absolute fundamental beliefs that guide all of our decision making. We are very concerned in particular at the increased powers for the Local Government Commission that are contained within this legislation. The Local Government Commission with this legislation will be able to initiate investigations around transfer of functions between local authorities joint governance arrangements areas of common shared interest and greater use of jointly council-controlled organisations. I think it is worth remembering the Local Government Commission is appointed by central government. This bill will provide for an increase in members on that commission. Although we are told to balance the increased powers that are being given to the commission there will be increased checks and balances some of those checks and balances are that it will be required to detailed accountability documents such as annual plans and reports and consult the Minister of Local Government when establishing its priorities. That is an accountability that goes back to central government. When our concern is a possibility of increased central government imposition on local government an accountability back to central government does not allay our concerns. We are being told that another check and balance is that the commission will be guided by criteria that are being set again by central government. Also there is a concern for us that this is also echoed in the council-controlled organisation (CCO) models in the provisions that are being provided in the bill. So CCOs which are a step away from democratic control are set up as companies and the Government’s rationale for promoting and privileging the CCO model over other shared-service models is that it is efficient and it will save money. That is not universally true and that needs to be put on the table in the first place. But even if it was that it saved money then we still have to acknowledge that there is a removal of local democracy in that model and that this bill will restrict and prevent any local councillors from sitting on the boards of those CCOs as is very common practice at the moment. The argument given for that is that it is potential conflict of interest. But we do have concerns that this is another quite significant step in removing local democracy. This will also provide for the CCOs to be able to comment on local authority long-term plans before a local authority starts the consultation process. So that is actually giving these company structures an additional point of influence in the democratic process. So while removing democratic involvement in their model it gives them extra control and input into the democratic process. You know it has been a long-standing concern about the public actually communicates with the CCOs and actually makes sure—we have seen examples in Auckland recently with Auckland Transport and the Ports of Auckland clearly getting it wrong in terms of the will of the people. This is one of the problems with the model and it is very hard for the council to then turn that round. The Minister has said: “Well that can be sorted out by giving clear enough directions to the CCOs when you’re setting them up.” But we are yet to be convinced that that is going to do the trick. Further the bill provides that the constitution of a CCO must not preclude the organisation from using any particular form of charging or source of revenue. So that is central government dictating the conditions around the establishment of a CCO. Take the example of charging for water—a deeply deeply political issue. In the community I was living in when they were talking about putting in water meters the local response was “You put them in; we’ll smash them.” It is a very political issue and there needs to be political accountability to it. This legislation says that a council cannot set up a CCO with the provision that it will not charge for water. That is off the table according to central government. Further it provides that shareholders of the CCO may impose additional accountabilities including the requirement to describe in their statement of intent how the organisation will contribute to the objectives and priorities of the shareholders and the Government. So in the structure of them they will be accountable back to central government and the Minister has said clearly that he sees that this is about getting the economic agenda of this Government moving more quickly. Well I believe that that should happen bottom up—that the councils and communities negotiate their economic agenda and plans and that they should be making the decisions about what form and structure are best going to be able to deliver on their local aspirations and that central government should be listening to them and supporting that. The Minister has said that Local Government New Zealand is very supportive. It told us it was told about the changes rather than being involved in any significant way. Again—another concern.[Continuation line: MARK]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGARON MARK (Deputy Leader—NZ First): Well I rise on behalf of New Zealand First to take a call and in doing so I need to acknowledge a wonderful contribution from the member across the other side of the House—a man whom Matt Doocey said this evening should be on only half his wages because he was a list MP. So Nuk Korako I think you need to talk to your man over there and maybe explain to him that you are just as hard-working as he is. I want to say that speaking of hard-working the piece of this legislation that annoys some of us more than anything is what I would describe as the “PNS”—something that the National Government seems to suffer from which is patronising nanny State syndrome. That is all over this bill. If I look at the legislation—let us go to paragraph 2 of the explanatory note: “New Zealand’s local authorities need to adapt their governance arrangements and structures to lift performance and respond to emerging challenges.” Really—is that true? Where is the evidence of that? It continues: “Councils need more options to co-ordinate and combine networks and scarce resources across regions and towns especially for large-scale infrastructure.” Really? Is every council—and I have attended quite a few Local Government New Zealand conferences over the years and I do not hear and I have never heard Local Government—[Interruption] I raise a point of order Mr Speaker.The ASSISTANT SPEAKER (Lindsay Tisch): Point of order Ron Mark.RON MARK: I think you know what I am referring to. It is just a little distracting.The ASSISTANT SPEAKER (Lindsay Tisch): Well I am not sure what you are referring to but I certainly know what I am—there is too much noise over here because I cannot hear the speaker. So I would ask members to quieten down. Your point of order Ron Mark?RON MARK: That was exactly it Mr Assistant Speaker. Thank you very much. I do not recall Local Government New Zealand standing up and chorusing these words. What worries New Zealand First is that this piece of legislation which supposedly has all been put together for the benefit of local government to enhance local government has not actually been put together by local government. This is another attempt by the National Government which simply hates local government. I do not understand why its members have this syndrome. They have had MPs like Mark Blumsky here they have got three former mayors sitting in their ranks but they seem to have this view that Local Government New Zealand for ever needs to be told what to do and how to do it. So if we want to talk about council-controlled organisations (CCOs) and providing the capability for councils to come together and work together maybe this Government should have taken time out itself to read the combined Wairarapa councils’ report and their own proposal for amalgamating the three councils in the Wairarapa—something that they and their local government commission rejection. The funny thing about certain councils around the country is that they are already doing this. Wairarapa—Masterton south Wairarapa Carterton—is still the only region in New Zealand where you have a combined district plan. Do we need new legislation to make it possible to have a combined plan? No in fact Wairarapa district councils—Masterton Carterton and south Wairarapa—were given an award for their innovative approach to producing a combined district plan. Do we need new legislation? No because it has already happened. It has been done. Do we need to be interfering at central government level on shared services arrangements? Well actually—and it is interesting that we have got so many National Party MPs sitting here blabbering and chattering away to themselves and not listening. If they listened they might learn something. There are right now a number of shared service contracts in the Wairarapa. If the Government members would care to get off their lazy backsides drive across the Rimutaka hill and sit down with Mayor Booth Mayor Patterson Mayor Staples they would learn that already the three councils in the Wairarapa are doing this. One they do not need to be told and two they do not need to be told they are useless and that they should be doing this sort of thing. They have already done it. If one listens to Local Government New Zealand carefully—a skill that this National Government seems to have lost; a skill it seems to have abandoned—one will find out that local governments are already working together in shared services. The Watercare contract here in Wellington—did it need this legislation? No. Did they manage to put together a joint venture involving all of the councils under the regional councils? Did the regional councils managed to do this without giving away the asset to a CCO that subsequently then denies the ratepayers the opportunity to have a say in how that asset should be managed? No they did not. So what is this piece of legislation? This piece of legislation appears to New Zealand First to be just another underhand dirty way of trying to force through the corporatisation of local government. It is about removing the word “local” out of local government removing out of local government taking away decision making from duly-elected people who are given a mandate by their ratepayers to get on and do the job—giving it to a bunch of appointed corporate suits who then run their asset like a business and dare I say if they choose to do so decide to sell it off. The thing that stands out as glaringly obvious—and you do not have to look too far. I mean look at Ports of Auckland and the controversy that has arose as a result of their decisions to ignore the ratepayers wishes in Auckland and set about on their plan to change the way in which the Auckland ports are run the way in which that real estate is managed. Well if we go back to—when was that? 2015? March 2015? Have we ever seen a situation where corporates highly respected yachtsmen sports people and ordinary ratepayers came together as one to protest about the way that that council-controlled organisation was managing that asset? No we had never seen anything like that before. New Zealand First is highly suspicious of this piece of legislation. We have not seen any sign of sincerity in the Government in the way in which it has handled local government up until now. In fact we have seen derision and scorn heaped upon local government year after year after year Minister after Minister. We might accept that there needs to be some changes in the way that the Local Government Commission (LGC) operates because over in the Wairarapa we were frustrated by the fact that the LGC would not listen to our proposal. We have heard countless times how supposedly the Auckland super-city model was going to deliver lower rates reduce rates increases and better performance and thus far none of the evidence suggests that at all. This piece of legislation worries New Zealand First. We see it as the thin edge in a drive towards the corporatisation of local governance. We see the removal of local democracy the removal of the ratepayers to have a say in how their assets will be held and managed and we will not be supporting this legislation to the select committee. We know that it will go to a select committee but at that point we are simply saying to the Government: “Prove it. Prove that this legislation is required. Prove that it is going to achieve what you say it is going to achieve and prove to us that this is not just another underhand way of “nanny Stating” and taking over and directing local government.” which actually should be left as the duly elected people to determine its own future. If there is a need for any more changes to the Local Government Act 2002 they should be the people who should be writing that legislation because quite frankly if we applied the same standards that this Government is applying to local government to this Government itself this Government would get a fail at every turn.[Continuation line: HAYES]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAJOANNE HAYES (National): I stand to take a short call on the Local Government Act 2002 Amendment Bill (No 2) in the name of the Hon Sam Lotu-Iiga in its first reading. It is common knowledge that councils currently face a number of challenges due to the demographic changes economic shifts and the environmental pressures that they face. Technology is changing and so too must councils change. This is what this bill is all about. It is not about building up shared services; it is about the provision and the ability to have a number of council-controlled organisations to help them all. We have heard from the member across the way there Ron Mark about the councils in the Wairarapa and what they are doing but not all councils not all small councils do that and this bill will help enable them to do that. It will allow them to take responsibility for developing refining and consulting on the reorganisation of the council on the proposals that are coming through that they will receive. And it will equip them with a number of tools without them losing sight of the local preferences. This is a good start. It is a good bill. I welcome it to the select committee. I want to also support the words that were spoken here tonight by the Minister in his opening kōrero and I also want to support the words that came from the chair of our select committee. I think it is a good way forward and I commend the bill to the House. Thank you.Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAThe ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. I call Eugenie Sage—5 minutes.[Continuation line: SAGE]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAEUGENIE SAGE (Green): Tēnā koe Mr Chair thank you. I am pleased to take a call on the Local Government Act 2002 Amendment Bill (No 2). Local government has got a critical role in ensuring a democratic society. It provides a check and a balance on the power of central government and the Green Party supports effective democratic processes at that local level and governance arrangements. But we do not think that this Government trusts local government and we see that in this bill. It continues the centralisation of executive power at the expense of local democracy and at the expense of the public having a say in decisions that affect them. Although I would like to be as confident as a previous Labour speaker that we have seen an end to forced amalgamations the powers that this bill gives the Minister to direct the Local Government Commission are quite significant and that is one of the reasons that the Green Party is opposing it. We have got the Local Government Commission as my colleague Jan Logie noted being appointed by Ministers and in clause 16 we have got the commission getting a notice from the Minister that sets out the Minister’s expectations as to how the commission will perform its functions and exercise its powers. The commission then has to take account of the Minister’s expectations in developing its statement of intent and its work programme. It has got to report to the Minister on the extent to which it has met his or her expectations and the Minister can write to the Local Government Commission and direct that it have regard to any relevant government policy. It can review the commission how it is operating and how it is performing when in our view it would be better if Parliament did that and the commission has got to report annually to the Minister. So what we are getting with this power now for the Local Government Commission to initiate reorganisation proposals and for the commission to be under the thumb of the Minister is effectively central government promoting its amalgamation agenda and using the Local Government Commission to do that. I think we saw that in Scott Simpson’s speech when he talked essentially about New Zealand having too much local government. National obviously wants big centralised councils where there are fewer people making the decisions so it is not an end to amalgamation. It is giving the commission significantly more powers to do that through initiating proposals. One of our other major concerns is the reduction in public participation because the public is not going to have the certainty of there being a poll on reorganisation proposals because if those proposals are initiated by councils and the councils agree there is no need for a poll and the previous provision for 10 percent of electors in a district to be able to request a poll is being removed. So certainly polls have to occur if the Local Government Commission is doing the amalgamation or reorganisation but not if councils are doing it. We agree with the Mayor of Wellington that encouraging councils to do this while circumventing a poll is wrong and is not in the public interest. The Minister is also wrong in claiming that there are checks and balances on the powers of the Local Government Commission. The bill through removing much of the work of the commission from the Official Information Act is actually making its work much more opaque. It prevents the Local Government Official Information and Meetings Act from applying to any documents that are being created or received by the commission in the course of an investigation a resolution of a dispute the termination of an appeal or an amalgamation proposal. So that is actually reducing transparency and reducing a significant check. The other major area where we have got a lot of concern is around council-controlled organisations (CCOs) and the corporatisation agenda that is potentially behind this bill. The Local Government and Environment Committee recently considered a petition raising significant concerns about the accountability or lack of accountability of CCOs in Auckland and that is despite the fact that there are more requirements on those CCOs in terms of being accountable and the Auckland Council being able to sit additional accountability requirements than those that apply elsewhere in the country. We have major concerns about this bill and we oppose it.Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAThe ASSISTANT SPEAKER (Lindsay Tisch): I call Su’a William Sio—5 minutes.[Continuation line: SIO]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGASu'a WILLIAMSu'a WILLIAM SIO (Labour—Māngere): It is a sign of a Government that has become so arrogant and out of touch with our communities when we have a national housing crisis that ought to be fixed and instead what we have got is legislation that I do not believe local government asked for. I would have thought that a Government that had a heart and that cared about the community would spend our energy in this House finding the right solutions to fix the housing problem so that we do not have families sleeping in cars in this cold winter. This Government introduced this legislation arguing the efficiency argument and whenever it uses that word “efficiency” and argues efficiency we are supposed to believe that something better will come of this and that there will be savings. It has used the argument of efficiency to remove trade union workers’ rights and to enable flexibility—actually it is to shift the balance of power from the people on to a few. Tonight it does the same. It uses the argument of efficiency to take away the balance of power from the general public and into the hands of a few so my colleague Meka Whaitiri is correct. We have serious concerns about this bill and although the Minister has said that he has consulted with a range of organisational stakeholders my belief is that he has simply gone around and said: “This is what I intend to do. That’s it.” There has been no request for input and there has been no participation by these groups on how this bill has been written. When the Government uses the efficiency argument I cannot help but remember that it also did this when it imposed the super-city amalgamation and it imposed it suggesting that somehow the amalgamation of Auckland would provide some savings. Today there have been no savings. Ratepayers continue to receive increased rates every year. It also used the efficiency argument for the reason why we should develop more council-controlled organisations (CCOs). Auckland has a phrase for CCOs. It is “corporate-captured organisations” because you are taking away the power of elected representatives of our community and instead appointing certain people who no longer are accountable to the general public but who are accountable to the masters who appoint those people on those CCOs. I believe what the member from New Zealand First said which is that already many local government bodies share and collaborate. There is no need to impose legislation that forces them to set up a new structure that then imposes additional costs on the ratepayers because not only do you have to—let us say for example Watercare Services . Once upon a time in the former councils of Auckland we used to get a water bill every 6 months. Today we receive a water bill every month. Those costs have gone up because when this Government uses the efficiency argument we are supposed to think that something better will come of it. People in Auckland know through the super-city experiment that big is not going to be cheap and the argument that my colleagues from the Green Party said about the polls—that is crucial. We have not yet had a proper debate in this country since this Government has come into power about how important the role is that local government bodies play in our communities. They are genuine partners with central government in terms of delivering well-being—social cultural and economic well-being—to our communities. Since this Government has come into power it has been focused squarely on controlling local government and the amalgamation I have to say smells suspicious. This Government has had its chance at Auckland—imposing amalgamation there. It attempted to do it in Auckland and it failed and now it is doing it again in a roundabout way. So I would be looking towards our general public to make strong submissions on this bill in the select committee process.[Continuation line: DOOCEY]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAMATT DOOCEY (National—Waimakariri): It is a pleasure to rise and speak in support of the Local Government Act 2002 Amendment Bill (No 2) in its first reading. After those contributions from the Opposition I would just like to return to planet Earth. I feel like every time we talk about local government  the conspiracy theories come out the tinfoil hats get put on and we hear very much about the “Roswell Area 51 Coalition”—hearing about what is happening out there in the wide universe. But back on planet Earth—Tracey Martin: How much are you paid?MATT DOOCEY: Thank you Tracey Martin for being my main fan club and who still thinks we are on Back Benches. But I would just like to say what a fantastic bill and what a great initiative from our Minister.MATT DOOCEY: As a very hard-working electorate MP—Tracey Martin: Ha ha!MATT DOOCEY: —as Ms Martin will know one of the biggest issues that comes through the office is that constituents are very concerned you know? They want to get the economy right from their rates with local councils and they want to ensure councils are taking every step to improve their efficiency and to get good outcomes with their services. This legislation will give them a vehicle for councils to work smarter more economically and more effectively. Look in Canterbury there is a range of territorial authorities. I do not think anyone is looking for amalgamation. We are all pretty parochial and proud of our patches. But what we can do around economies of scale—especially in my area which is quite rural. We look at Hurunui and “Waimak” joining together to deliver better services and pretty much this is what this bill is about. We have got some great learnings post-earthquake in Greater Christchurch and we have had some really strange outcomes when we are looking at implementing new roading infrastructure for Greater Christchurch. You have one council investing heavily into a new motorway and then you have another council that is voting down the motorway’s extension into the city and it is just not good for all the people within those jurisdictions. They expect better from their councils and that is why these council-controlled organisations will allow more integration. They will allow more economies of scale and overall I think they will provide efficiency and effectiveness for ratepayers. I commend the bill to the House.[Continuation line: TWYFORD]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAPHIL TWYFORD (Labour—Te Atatū): It is a pleasure to speak on this bill and to support the comments by my colleagues Meka Whaitiri and David Parker and Su’a William Sio. Local government is always an issue that we like to talk about in this House because it is very interesting to think about what a troubled—troubled—relationship this National Government has had with local government in the last 8 years. I think it is important to consider the backdrop to this bill which is the very vexed history of policy that this Government has had in regard to local government starting with the forced amalgamation of Auckland. It took a good idea and made a hash of it legislating away the right of Aucklanders to have a say and to exercise their democratic rights that are enshrined in the law for all citizens in regard to local government amalgamations. It was not very long that it had been office before it basically closed down democracy for Environment Canterbury  for the Canterbury Regional Council  so that its corporate dairy farmer mates could basically pillage the water resources in Canterbury. National was quite happy to shut down democracy in Canterbury and it still has not restored it properly. The next thing this Government did was it stripped the four well-beings out of the Local Government Act 2002  basically and narrowed the focus of local government considerably against the wishes I think of most communities around New Zealand. It made it easier for councils to privatise municipal water utilities and then really over the last 2 or 3 years we saw this kind of comedy of errors as successive local government Ministers pursued this policy of forced amalgamations. Well what a resounding success that was! It was given short shrift in Northland in Wellington and in Hawke’s Bay. It was a total disaster. So to hear Scott Simpson the chair of the Local Government and Environment Committee  stand up and say that this Government’s policy is not to have forced amalgamations he seems completely oblivious to the fact that that has been those members’ policy for the last 3 years. This bill that comes to the House today aims to facilitate the development of shared council-controlled organisations (CCO) shared arrangements between councils and makes a few relatively subtle tweaks to the processes and the rules around amalgamations and the powers of the Local Government Commission. This bill and the so-called Better Local Government services policy package is a direct response to the abject failure of the National Party’s local government policy which was all about forced amalgamations and it was comprehensively rejected. So it has been a very troubled relationship that National has had with local government. The other thing that characterises their policy has been the persistent scape-goating of local government for every imagined ill. The one that we have heard most about in recent times is the Auckland housing crisis. If you listened to what the National Party says about the housing crisis the main thing that they like to do is to blame the Resource Management Act RMA and blame Auckland Council for the failure of their own policy. The rather pathetic whimper that we were greeted with a couple of weeks ago when they released their national policy statement that they promised 8 years ago in a campaign manifesto it has taken them 8 years to deliver on that promise. They came up with a national policy statement that I know Paul Goldsmith who fancies himself as some kind of libertarian must be cringingly embarrassed to be associated with. A national policy statement that does nothing to improve or to fix the restrictive land use rules that are a significant factor in driving up land prices and house prices in Auckland. So that is the rather desperate and parlous state of the National Party’s local government policy. What they have done with this bill that we are debating tonight in the first reading is bring together a package of measures that are designed to encourage councils. If we are not going to go down the force amalgamation route perhaps we can encourage councils to set up some shared assets. So what this bill wants to do is to facilitate and make it easier for the establishment of multiply-owned CCO for example for setting up a jointly owned transport organisation or a jointly owned water authority. We have direct experience of this already and as David Parker pointed out the National Government imposed on Auckland a legislated transport CCO. It is in legislation Auckland Council if it wants to bring the transport agency in house it cannot because it is legislated in the Auckland super-city founding legislation and it also set up Watercare Services. I think on the face of it you would have to say that there is some logic to the idea of regionally- or multiply-owned CCOs for these purposes. There is a proposal that is circulating that is being discussed in the Waikato. The Council for Infrastructure Development released a report recently that projected that if the Waipā Waikato and Hamilton councils created a joint water utility they could save half a billion dollars over the next 30 years and $107 million over the next decade. Well if that is true those are pretty impressive savings. You would have to look at the experience of Watercare Services in Auckland and although many Aucklanders will complain that their water rates have not gone down and in some cases have gone up the establishment of a publicly-owned non-profit water utility has probably delivered some significant efficiencies in Auckland and allowed the creation of an organisation that has the balance sheet the professional skills and specialisation to properly manage the asset management of billions of dollars’ worth of wastewater and drinking water infrastructure for one-third of the country’s population. There is no doubt that many of the smaller and dispersed local authorities around the country have really struggled to meet the clean water standards and to invest in the plant and the technology that is necessary to deliver the environmental protection and the water quality standards that everybody in this country deserves. Probably the textbook case of a small rural council that failed in this duty was the Kaipara District Council who got into a terrible mess in borrowing a whole lot of money for a water treatment plant at Mangawhai. I think we all do not want to see that sort of stuff continue. Previous speakers have pointed out that in many areas around the country local councils are already doing a very good job of cooperating. I want to pay tribute to the councils in the Bay of Plenty. The Bay of Plenty local government futures project who have a track record both through that initiative but also through Smart Growth which has been going on for the best part of a decade including Tauranga and Western Bay of Plenty councils and others are doing some really fantastic work in that area managing land supply infrastructure and land for both business and residential. It is a very very impressive example of regional cooperation by local territorial authorities. So this bill has not invented the idea of shared services and shared assets but it is something that is worth considering. I want to spend the rest of my time talking about the proposed proposals to reorganisation procedures and register our concern that what this bill does is removes the ability of local ratepayers to petition their local authority for a poll on any amalgamation or reorganisation changes. We do not support that and we will be arguing very strongly at the select committee and scrutinising those proposals. We do not support the removal of a poll of electors for any so-called council-lead proposals on reorganisation even where all of the affected local authorities agree because local people and local ratepayers deserve and demand a say in the structures of representation and decision making in their communities. That is fundamental. So we have real concerns that this bill should not be used as a backdoor attempt to pursue the same old National Party agenda of forced amalgamation. We support this bill going to a select committee but we will be very closely scrutinising it.[Continuation line: FOSTER-BELL]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGAPAUL FOSTER-BELL (National): Tēnā koe e Te Mana Whakawā. In taking a brief call on the Local Government Act 2002 Amendment Bill (No 2) in the name of my hard-working and I think very pragmatic colleague Hon Peseta Sam Lotu-Iiga I just want to say that this is a very sensible measure. It was a bit rich to be lectured from the member who resumed his seat in such supercilious tones about scape-goating local government. I do not think we need to be lectured on this side about scape-goating from that particular member. There are examples of these measures in place. You can look to the Wellington region where you can see the efficacy of leveraging off regional-wide cooperation in utilities in water for instance. But also you can see massive room for improvement for instance our regional council have a woeful track record on transport within our region. Unfortunately the leadership of our city council here in Wellington has not been ideal. We have not moved ahead as a city. There is an opportunity to correct that in the local body elections at the end of the year but this bill also goes a very long way and is very positive. I for those reasons commend it to the House.[Continuation line: VOTE]Trade (Anti-dumping and Countervailing Duties) Amendment BillFirst ReadingHon PAUL GOLDSMITH (Minister of Commerce and Consumer Affairs): I move That the Trade (Anti-dumping and Countervailing Duties) Amendment Bill be now read a first time. I nominate the Commerce Committee to consider the bill. The bill puts in place new arrangements for the Government to consider the wider impact of imposing anti-dumping or countervailing duties. In 2013 the Government completed the Residential Construction Sector Market Study in response to a Productivity Commission report into the cost of residential construction. The study found that residential building materials were considerably more expensive in New Zealand than in Australia and recommended steps that the Government should take to reduce their cost and help improve housing affordability. One recommendation was to remove tariffs on residential building products which the Government did by putting in place a tariff concession in 2014. Another was to introduce a public interest test into the dumping and countervailing duties regime. The study highlighted that anti-dumping and countervailing duties can impose costs that are disproportionate to their benefits. The current system protects New Zealand industry from material injury caused by the dumping and subsidisation of goods from abroad but it does not take into account the wider public interest when duties are imposed. So the point of this bill is that it will allow the Government to have a fuller consideration of the effect of duties through the introduction of a bounded public interest test also known as a consumer test. The test will consider the benefits that a duty will have for the domestic industry against the cost of that duty on downstream industries and customers. This change modernises the anti-dumping and countervailing duties regime by weighing up those who will pay for the duty through higher prices and those who will benefit. The test will have a materiality threshold built into it—that is a presumption in favour of imposing duties. The bill requires that duties are imposed unless the cost to downstream industries and consumers is likely to materially outweigh the benefits to the domestic industry. The materiality threshold is designed to strike a balance between maintaining a regime that provides an appropriate degree of assurance to domestic industries that they have remedies available to them when confronted by dumped or subsidised goods and the wider public interest in determining whether duties should be imposed. Dumping and countervailing duties are legitimate trade instruments that are part of an international set of rules necessary to facilitate fair and honest trade between World Trade Organisation members. The dumping and countervailing duties agreements provide member States with legitimate trade instruments to level the playing field and to provide remedies against dumped or subsidised goods. It is important that New Zealand maintains an effective trade remedies regime so that our domestic industries have confidence in the international trading system. However the current Act does not allow the Government to consider the effect that duties can have on consumers and other industries. The bill prescribes specific factors that the public interest test must consider. They relate to competition prices alternate supply sources choice and availability quality employment levels and the financial viability of the domestic industry. The public interest test reflects similar credible trade remedy regimes such as those found in Canada and the European Union and was developed with consideration of specific features of the New Zealand economy. The test is necessarily bounded within parameters and factors prescribed in the legislation. This ensures that the Government maintains a consistent approach over time. The test will be automatically conducted immediately after investigations or reviews. The current Act gives specific deadlines before which investigations have to be completed. This bill continues those deadlines and imposes additional time frames within which the public interest test must be completed. The Minister will make a determination on whether or not to impose duties based on officials’ findings that dumped or subsidised goods have caused or threatened to cause material injury to a domestic industry and whether or not those duties are in the public interest. Officials will collect information from parties that are likely to be affected by the duties being imposed or not imposed. They will also draw on advice from external expert parties such as the Commerce Commission and use information gathered in the initial investigation on dumping or subsidisation causing injury. The bill requires officials to release a draft findings report prior to making the final recommendation. Interested parties will be invited to comment on draft findings. The bill will allow the Government to complete a public interest test on ongoing investigations and on duties that have been determined within 3 months before the date of commencement. The bill also clarifies various processes in the Act that are undertaken in conformance with the World Trade Organisation rules. For instance the bill clarifies the decision-making powers and reviews of existing duties and explicitly allows for the imposition of a separate rate of duty for named exporters and a residual rate of duty for all other exporters and allows for those rates to be reassessed if circumstances change. I am sure the members are very pleased to hear that. The Government considered and consulted on an automatic termination period—this is where duties would automatically expire after a set number of years. I spoke extensively to relevant industry representatives and decided that introducing a public interest test but not an automatic termination period would strike the right balance between improving competition and maintaining an effective dumping and countervailing duties regime. The bill also creates a power for the Government to suspend or terminate current duties or to defer or not impose new duties on products where the users have been affected by a natural disaster. This power is a stand-alone provision in the bill so it is not tied to the public interest test nor any review provision. This provision will strengthen the Government’s ability to respond to natural disasters. The bill ties the natural disaster powers to the Civil Defence and Emergency Management Act to ensure a consistent approach to emergency management across legislation. I do nominate the Commerce Committee to consider this bill because it will improve competition in the New Zealand economy. Under the current legislation anti-dumping and countervailing duties can impose costs that are disproportionate to their benefits. This bill takes the necessary steps to modernise the legislation. The new consumer test will help promote competition in New Zealand by requiring the Government to consider the interests of consumers and downstream industries before imposing duties. So I do look forward to progressing the bill through the House. I move that the bill be now referred to the Commerce Committee for consideration. Thank you.[Continuation line: COSGROVE]Trade (Anti-dumping and Countervailing Duties) Amendment BillFirst ReadingHon CLAYTON COSGROVE (Labour): Can I state from the outset that the Labour Party will support this bill to first reading and can I say that as a basic principle we welcome the Minister of Commerce and Consumer Affairs’ innovative attitude in respect of New Zealand business. What we seek is that in any trade agreement the rules of a trade agreement are enforced on all borders—likewise on our own borders. We understand the anti-dumping regulations we understand the importance of New Zealand business and we understand the enforcement of those rules around our domestic borders. We welcome the public interest test. There has been a lot of conjecture in respect of trade agreements per se. There has been lot of debate I think in recent times in respect of the positive nature or otherwise of trade agreements and what a number of manufacturers have sought over a long period of time despite Governments is that we enforce the rules of the day as our Australian and other counterparts do. So in essence we support this legislation. We want to scrutinise it appropriately in terms of its balance between the New Zealand interest and those of our economic partners. We welcome the fact that it will go to the Commerce Committee and to be fair I do pay tribute to the chair of the select committee. I am not a member of the Commerce Committee but in fairness and to be fair in this great Chamber Melissa Lee does preside a balanced approach to select committee hearings and does give all parties a fair go. This has not always been the case Mr Assistant Chair as you may as a learned and long-serving member of the Parliament acknowledge in respect of the Commerce Committee. We think that the public interest test is imperative in terms of if it is appropriate to enact these provisions then there needs to be a public interest test. I acknowledge the Minister of Commerce and Consumer Affairs who was grappling with a whole series of issues—whether they be ports or whether they be patents there are a whole series of interwoven issues that he is dealing with. What we seek and what we would support is a commerce Minister who would support the public interest. I take the Minister at this word that in introducing this bill he is determined to support New Zealand industry to support the New Zealand public interest and to ensure that we are internationally competitive with our trading partners. I would be a dark day if New Zealand industry was somehow hampered and somehow hobbled behind other industries in foreign competitive markets and hampered in respect of their export earnings. In the brief commentary that I wish to give—because I do not think there is a major conjecture about this issue and about this bill—I wish to say that we will support the bill to select committee. We want to ensure that the committee gives the appropriate scrutiny and that the appropriate tests are put in place. It does introduce a public interest test. We know that in terms of construction products for instance if we look at those in respect of the housing issue that there is a lot of conjecture in respect of the competitive nature of those products. I am told that you can land a container of GIB for instance out of the United States for about two-thirds of the cost that you can produce it locally. One could make an anti-dumping or dumping argument in respect of that.Dr David Clark: You are not going to argue that there is a consumer benefit?Hon CLAYTON COSGROVE: No I would always argue that there is a consumer benefit. My colleague the Labour trade spokesperson makes an interesting point. But what New Zealanders want to know is that there is a level playing field if you are in business and if you are producing goods and services and you are in the international trading market that there is a level playing field under World Trade Organisation (WTO) rules. So I welcome the Minister’s comments. In respect of the select committee I look forward to scrutinising those comments in the bill because what we want and what New Zealand manufacturers want is not a free lunch; they want to be competitive and they want to be out there on the international stage. They do not want Government provision; they simply want to compete with their international markets and they want to compete within the rules of the WTO. If the intent of this bill is positive—we want to see the detail—but that being the case we support the bill. We want to see it progress but we want to give it due scrutiny and we also want to of course scrutinise the Minister’s intent. Over patents legislation ports legislation—all these issues—we acknowledge that the Minister of course has New Zealand’s interests at heart. We want to ensure that that is communicated and is legislated through this bill so we support this bill to the select committee.[Continuation line: LEE]Trade (Anti-dumping and Countervailing Duties) Amendment BillContinued Speech - Hon CLAYTON COSGROVEMELISSA LEE (National): Thank you for the opportunity to take a short call on this important bill introduced by the Minister of Commerce and Consumer Affairs the Hon Paul Goldsmith. Before I get on with my speech I would like to make the comment that the Hon Mr Goldsmith actually works incredibly hard supporting the commerce and consumer needs of New Zealand and I would like to take a moment to say thank you—but he is sitting right next to me so some people might actually mistake that I have to say that because he is sitting next to me. I would like to commend the speaker who just took his seat the Hon Clayton Cosgrove. I would like to thank him for his compliments on my chairmanship of the Commerce Committee. I have to say that I have also enjoyed his attendance at the Commerce Committee from time to time on bills that he has specific interest in.Hon Clayton Cosgrove: How much?MELISSA LEE: Very much—very much sir. I look forward to your attendance tomorrow Mr Cosgrove. The Trade (Anti-dumping and Countervailing Duties) Amendment Bill seeks to introduce public interest—as the Minister has attested—into the current anti-dumping and countervailing duties regime which the Minister and the Hon Mr Cosgrove have also just spoken about. Here in New Zealand goods are considered to have been dumped if the export price into our country is in fact less than the price that the goods are sold for in the domestic market of the exporting country. I mean for example New Zealanders love whiteware that has been imported because we can get some brands at a much cheaper price. I might actually quote that sometimes Korean-manufactured products like Samsung fridges and whiteware could potentially come in cheaper. In fact if the Korean Government was for example providing Samsung—I am not saying that it is—a subsidy to export to New Zealand at a much much lower rate then the manufacturers in New Zealand should be worried that we have a situation where we cannot compete with those products that are actually being dumped or are getting subsidies from those countries. We want a marketplace that is actually fair where our manufacturers exporters and producers can in fact compete with those overseas manufacturers and exporters. I think this bill is actually very important. The Government of course has been making excellent inroads into the growth of better business and trade supporting more New Zealand companies to be able to engage in international businesses to buy more goods cheaper goods and better quality goods from different parts of the globe at competitive prices. All of the free-trade agreement negotiations and the agreements that we have actually signed go towards that promotion. We also have the obligations and responsibilities to the World Trade Organisation where it is reflected that these law changes that we are making are actually important due to our standing as a good-faith trading partner to so many other countries around the world. New Zealand of course was one of the founding members of the World Trade Organisation and former Prime Minister and ambassador the Right Hon Mike Moore served as its director-general from 1999 to 2002. Such links are important to New Zealand trade and to New Zealand consumers who want assurances that we are giving them the best possible deal in regulation and also in consumer awareness and I guess consumer prices—we want cheaper prices but we want to make sure that whatever is actually coming into the country is not putting our own producers at risk either. But if in fact those products that we may import are in the best interests of the consumers—this bill might actually consider best public interest issues and I think it will actually deal with those worries. A customers-first Government as my colleague Brett Hudson says. National’s plan is to help businesses thrive while protecting consumers an admirable plan we took into the 2014 election and that we have consistently delivered on and will continue to deliver on going into the 2017 year. Small businesses are in fact the backbone of our economy and make up about 97 percent of businesses in New Zealand and they too are consumers. In this public interest test that we will be implementing they too are in fact the public interest that we should actually consider as well. I think this is a great bill and I look forward to the submissions in the Commerce Committee and having serious discussions with my Opposition members as well as the Government members. I commend this bill to the House.[Continuation line: CLARK]Local Government Act 2002 Amendment Bill (No 2)Continued Speech - Hon Peseta SAM LOTU-IIGADr DAVID CLARK (Labour—Dunedin North): It is a pleasure to rise to speak to this bill and as my colleague Clayton Cosgrove has indicated the Labour Party will be supporting this bill to select committee where Melissa Lee is the chair. We will very much look forward to the debate around what this bill has to offer and how New Zealanders can benefit from it and if necessary make recommendations for tweaking or amending the bill should it prove after submissions from interested parties that it can be improved upon or if there are fishhooks in it that we have not yet spotted. On the surface of course what it does is it makes the regime more responsive to consumers and that has to be a good thing. On this side of the House we recognise the importance of trade for this country. New Zealand is a trading nation it is the way we make our way in the world and so the Labour Party with the exception of the Trans-Pacific Partnership agreement with which we have had some challenges has supported trade right since the beginning. In fact the first Labour Government was the party that made a real impact in Europe by looking for new trade avenues there long before the National Party was even formed. Before the National Party was even a perverse idea in someone’s mind the Labour Party was out there beating the drum on trade. They will of course have a difference of opinion on some matters of trade but generally there has been a bipartisan consensus across this House that trade is an important thing. We will of course continue notwithstanding this bill to challenge the Government. It has set itself the test of getting exports up to 40 percent of GDP since it came to office. It has in fact gone backwards during its time and it now sits below 30 percent of GDP. We recognise that if we are going to pay our way in the world as a country we do need to trade and we do need to trade increasingly. Unfortunately this Government seems to be taking us in the opposite direction. But when we see a bill come along that seems a sensible trade measure that clarifies the rules and that is in favour of consumer benefit we want to support that bill. That is our natural instinct on this side of the House. This bill allows for natural disasters and a different course of action when natural disasters happen and essentially a relaxing of the regime that is in place because it might be in fact to the country’s benefit to take goods in a situation that is different from the ordinary situation despite it technically being a case of dumping. I have had a chance to flick through some of the background papers gathered under the Official Information Act and can see that the ministry itself has provided analysis of a range of options and assessed in a handy matrix form for the Minister the range of options and whether they achieve the goals that a country might set out for itself in terms of assessing the change against the status quo. Preserving the good sides of anti-dumping legislation is one of the goals it has set itself but also providing discretion in situations that are different and giving that discretion so that the public might benefit. They have done it in a simple tick-box form that pretty much anyone could understand. I encourage people at home who are interested in this kind of thing to apply for such papers under the Official Information Act. It is something I was discussing with a constituent just yesterday how few people do use the Official Information Act. It is a favourite of course of journalists and politicians to get the background information to make sure that the Minister has made the right decisions is across his or her paperwork and is acting in the best interests of the country given the advice that they have received. But ordinary members of the public out there people in middle New Zealand can of course request information under the Official Information Act too. They will receive by and large copies of the paperwork that a Minister will receive in their decision-making process and can see how decisions have been made. Often that aids in the process of select committees and it can aid generally in the making of good law and the understanding of how we come to be in the situations we are as a country. The first speaker for Labour the Hon Clayton Cosgrove touched on the fact that businesses want clear rules. They want a level playing field for trade. They want to be sure that there is not dumping going on that is going to affect domestic industries in a negative way because of unfair behaviours—behaviours that are outside the norms of international trade and the expectations set up by trade rules. That is fair enough. With clear rules some certainty and expectations that is when businesses prosper. When the rules are clear when the playing field is laid out and everyone is playing by the same rules we back our New Zealand industries to be innovative to put their best foot forward and to compete on the international scene. Of course on this side of the House we feel that there is more that could be done. We see some distortions in our economy. We see money going into the speculative sector in the housing market that could be going into the productive sector and supporting businesses. We see a lack of investment available for hard-working New Zealand business people. It is very hard to get the capital that people need and of course one of the consequences of that is that we have seen fewer businesses created per annum under the current Government than we saw under the previous Labour Government. That in part is because I would contend the party opposite is more interested in big established businesses and less interested in new businesses coming through. They are less interested in the ordinary middle New Zealander who risks their shirt every day. They are more interested in backing vested interests in the ultra-wealthy. That is something we have seen time and time again in the nature of legislation that is brought to this House. However today we are not criticising that. We are supporting this bill for the fact that it seems like common-sense policy. It is not the big idea that is going to change things. It is not the big game-changer in New Zealand. It is not the big idea that will get us to exports—reaching the Government’s goal of 40 percent of GDP rather than going backwards. It is not the big idea that will turn the corner for us and see us earning more per capita. Unfortunately wages in New Zealand have been static under the Government as expenses have gone up and funding in the health sector has dropped and so on. Things are getting tougher for New Zealanders. This is not the thing that will change that overnight but it does seem to be a sensible measure that we would want to support to the select committee to have a full examination. We do support sensible measures albeit they are small steps in the right direction. So just to remind ourselves—what we are talking about here is goods that are dumped. They are considered to be dumped if their export price to New Zealand is less than the price the goods are sold for in the exporting country. So you can see the pattern of behaviour that is being described. Also goods that are subsidised by foreign Governments can be considered to be dumped as well. Where there is a distortion in trade practices we have legislation in place that stops dumping practices because they are and can be injurious to New Zealand industries. Where there is no New Zealand industry present where it is unlikely that goods coming cheaply into the country are going to be injurious to an existing industry in fact may be of benefit to consumers in New Zealand. We would support this change and that is in fact as I read the legislation what it is designed to achieve. We only hope that this can get through in a good form. We recognise that with the Commerce (Cartels and Other Matters) Amendment Bill which Minister Goldsmith brought to the House before there was some backtracking and a curious path taken. We hope that this one has a safer journey through the select committee. We ourselves will be putting our shoulder to that cause to make sure that this legislation is debated fully thoroughly and comes back to the House hopefully in an improved form because there are always good suggestions that come forward from the public and interested parties. We will bring the bill back to this House and debate it fully and see a better regime as a result. Thank you.[Continuation line: HUDSON]Trade (Anti-dumping and Countervailing Duties) Amendment BillFirst ReadingBRETT HUDSON (National): It is a pleasure to rise in support of the Trade (Anti-dumping and Countervailing Duties) Amendment Bill in its first reading not least of all because it is—any way you care to describe it—a very sound and pragmatic way of dealing with the interests of consumers and the fair and reasonable protection of our own industries. As a small trading nation we understand how important it is for us not only to sell to the world but as some members opposite in recent times in other trade discussions seem to have failed to comprehend it is important—trade is a bilateral thing in that we are purchasing. We are importing from other nations. It is important that we meet our responsibilities under the World Trade Organization agreements that we are party to. Actually in the anti-dumping measures it is very important that we take a broader consideration. Historically what we have looked at is the protection of local industry. So the idea is that we are a small country of 4½ million people and that larger economies at a very tactical level can take measures because of their own oversupply that have little impact on them but that have a great distortionary impact on our local economy. In the short term if we allow that to happen what happens in those instances is that those companies are able to dump to offload the excess supply they have. It comes at very very good prices to our consumers but it is very tactical. It is a short-lived temporary measure and once they have finished with their particular wants our consumers are left—particularly in some cases they are locked in to certain product supplies that are then only available to them under a different pricing and supply regime. So dumping is about the suppliers; it never has been about the consumers. So the measures that we have had in place are reasonable in the context of not only protecting mainly our own industry but also our own consumers while living up to our responsibilities under the World Trade Organization. There is always an instance or a regime. We might consider that the anti-dumping rules we have had in place do not meet the prevailing conditions in New Zealand. The example that I think both sides of the House have used—certainly the Minister did in his speech—was around housing. It has been the position and remains the position of this Government that the issue with the housing challenge is one of supply. It can be dealt with mainly in the primary areas of freeing up land of reducing time and cost for consents to create new developments making sure that we have the skills available to build those houses to deliver the supply and in ensuring that the materials available for those developments are affordable. One of the things the Government took a decision in in 2014 was to provide some relief against the anti-dumping measures because it created a means to address some of the housing supply issues by taking away some of the duties that would otherwise be imposed on goods that were considered to be dumped. What this bill does is to take that very sound approach and work out how we can pragmatically employ it on an ongoing basis in this country where we can make sure that we take the right steps to protect our consumer industries and the right steps in the case of housing to ensure that we can support the sort of supply that we want to see but still have the ability to protect our own local interests. That is precisely what this bill will do if it is enacted. It gives us the ability to consider what is in consumers’ interests and also what is in the interests of industry. If you take the balance between those two then we can create an almost perfect storm particularly in housing where we are ensuring that the materials are available freely and at a good price while not destroying our own local industry and seeking to deliver the objectives we have which particularly in housing is to make sure that we have the right supply to meet the growing demands in New Zealand. This is a very pragmatic and sensible bill and I commend it to the House.[Continuation line: MATHERS]AdjournmentMOJO MATHERS (Green): I rise to take a call on this bill. As it stands the Green Party is not supporting the bill and I want to take the opportunity to outline some of our concerns. So from our perspective what we see this bill as doing is weakening current protection for local New Zealand producers and manufacturers under the guise of public interest. What we have here is a bill that as it stands provides some protection so that when goods are imported that are way cheaper than locally produced goods because they are heavily subsidised by Governments overseas in their country of origin or because they are being dumped here at a price that is well below what they are selling for in the country of origin. Both of these situations do not create a level playing field for New Zealand businesses and it is recognised as such by the World Trade Organization. It thought that the existing Act and the existing duties that are in place under this Act are compliant with the World Trade Organization rule. So the question would be why we would want to allow it to be possible for heavily subsidised goods or for goods to be dumped here in New Zealand. Why would we do that? We know from international experience that the practice of dumping very low priced goods on to local markets can have far-reaching and highly damaging long-term consequences for local economies and sometimes they can take time to eventuate. This is because there are very few industries that are able to withstand the impact of dumped products flooding the market. In the long term it is not in the public or national strategic interest to allow local industries to be undermined in this way. It is actually anti-competitive practice these kinds of things. Once we have lost manufacturing expertise in a particular area it can be very difficult to re-establish that back at a later date when that particular product that had been dumped is no longer available at rock-bottom prices. So for example the Hawke’s Bay Fruitgrowers Association have warned that peach growers in Hawke’s Bay are likely to have to pull out their trees and get out of the business if extremely cheap canned peaches from Greece and Spain are allowed to be here. At the moment there is a duty on them; they cannot be dumped here. But if they are allowed in the consumer interest of allowing people to have extremely cheap peaches then what that could mean is that we undermine the peach growing industry in Hawke’s Bay. If they have to pull out their trees they are very likely to reinvest and plant the trees and wait 5 years for them to start producing fruit again at a cost to the economy. At the moment the peach industry in the Hawke’s Bay region contributes $15 million to Hawke’s Bay and employs thousands of people. We could put all of that at risk for short-term consumer interest. But in the long term when the peach trees are wiped out and gone and then suddenly maybe there are no longer rock-bottom priced peaches available all the way from Greece and Spain we could have a shortage. It is not in our national long-term interest to allow these sorts of situations to happen. Why would we risk sabotaging a viable industry that contributes so much to the region for the sake of short-term consumer interest? We will be looking very carefully at the select committee at what this public interest test is and how this will be implemented and we will be asking if there is any question of things like the peach industry being put at risk by changing the Dumping and Countervailing Duties Act in this way. As we push out these alternative manufacturers and producers what we end up doing is concentrating all our economic eggs in one basket more and more into dairying. We already have an economy that dangerously relies on and is vulnerable to the ups and downs of dairying. The last thing we need to do is to undermine other viable industries that are currently viable. We also need to remind ourselves that cheaper is not always better especially when it comes to raw building construction materials. Poor-quality materials can threaten people’s safety and homes. That was all too evident recently when 16000 tonnes of steel from China was found to be too weak for the bridges in the Huntly bypass project. It was interesting to see the legal commentary from Chapman Tripp that pointed out there is no reason in principal why anti-dumping duties could not continue for as long as injurious dumping or a subsidisation is occurring. If that is occurring overseas then let us keep the playing field as level as we can. I think it was interesting noting that officers have already acknowledged that adding a new public-interest test will make the Act more complicated to enforce reduce the overall effectiveness of the New Zealand anti-dumping regime and make things much more uncertain in the long term about how it is going to be and the process that is going to play out. So I actually really want to know exactly what the problem that this bill is trying to fix is. A couple of speakers have mentioned the maximum time to justify allowing inputted building materials to be dumped in the New Zealand as a mechanism for somehow making building houses cheaper. But we only have to look at either the Huntly expressway or the leaky-building fiasco to see where a race to the bottom can lead us. We do not want that scenario to be repeated. Opening our market to dirt-cheap imported goods is supposed to be a solution to the housing crisis. In our view it is an inadequate solution that risks creating more problems than it solves and shows a lack of ideas for how to make sure that New Zealanders have a roof over their heads and is a grasping at other mechanisms. What the Green Party would do—AdjournmentThe ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair.Debate interrupted.The House adjourned at 10 p.m.